NCR Corporation (NCR, Financial):
NCR was the Fund's best performer for the quarter. The company sells ATM, POS (point-of-sale) and self-checkout hardware, software and services. It is in the process of shifting further away from its historical hardware focus to higher margin recurring software-as-a-service products. We believe the company's stock declined disproportionately during the pandemic partly due to relatively elevated leverage and the impact of the pandemic on its customer base. We believe the leverage is sustainable due to an increasing level of recurring revenues. While some of its customers experienced greater impact from COVID-19, the pandemic created opportunities with other customers.
From the FPA Capital Fund (Trades, Portfolio)'s third-quarter 2020 shareholder letter.
