Hedge fund Menta Capital LLC, disclosed an equity portfolio valued at some $775.4 million as of the end of the first quarter of 2015. The equity portfolio is mainly invested in Finance (26%), Consumer Discretionary (23%) and Technology (18%) stocks. Menta Capital’s last 13F filing showed that the fund raised its exposure towards financials and consumer staples stocks, but reduced its holdings in the materials and energy sector.
In this article we will look into the top three picks held at the end of Q1. Among 10 largest holdings from Menta Capital’s equity portfolio (which amass 5.75% of the total portfolio value), the three top are: TravelCenters of America LLC (TA, Financial), Allegiant Travel Company (ALGT, Financial) and Skechers USA Inc. (SKX, Financial).
In TravelCenters of America LLC (TA, Financial), Menta Capital holds 291,654 shares, down by 20% on the quarter; the value of the stake amounts to $5.1 million. It is important to mention that the stock gained about 38.2% during the quarter.
The firm is a leading travel center business in more than 40 states and Canada operating under the TA and Petro Stopping Centers brands. The company had good results in the past quarter. Net income for the first quarter of 2015 was $15.7 million, or $0.41 per share. The increase over the year-ago quarter was immense. In that quarter, net income reached $0.2 million, or $0.01 per share. According to TA’s CEO, the tremendous increase can be explained by favorable fuel gross margins, initiatives that contribute to internal growth or the acquisition program.
The largest shareholder of the company is Acadian Asset Management LLC, which upped its stake by 192% on the quarter to 1.33 million shares held as of the end of the Q1 2015. David Dreman (Trades, Portfolio) has initiated a new position on the stock with 149,803 shares in the fourth quarter of 2014.
Allegiant Travel Company (ALGT, Financial), a leisure travel company, represents the second most valuable investment in the fund’s portfolio. After an 1113% increase in the company’s stake during the first quarter, the fund amounted to about 25,480 shares valued at $4.9 million. The stock has surged by 27.91% in the first quarter. The Las Vegas-based company recently announced an increase in its quarterly cash dividend in the amount of $0.25 per share. With a closing price of $167.3, we obtained a dividend yield of 0.6%, which we consider a bit low. Despite this, we always consider a good signal to increase dividends. Timessquare Capital Management, LLC held the highest number of Allegiant Travel shares, its stake containing 581,115 shares valued at about $111.74 million.
Next in line is Skechers USA Inc. (SKX, Financial). The fund held about 62,322 shares valued at $4.5 million at the end of the first quarter of 2015. With a market cap of $5.2 billion, the stock is up by 142.4% during the last 52 weeks, and gained 80.3% year to date. After reporting Q1 results at the end of April, shares continue with the upward trend. The stock’s total returns are at 26.3% month-to-date, compared to 1.9% for Nike (NKE, Financial) or the negative performance of Lululemon Athletica (LULU, Financial). Apex Capital Management, held a stake of 117,188 shares of Skechers valued at $12.74 million.
Disclosure: As of this writing, Omar Venerio did not hold a position in any of the aforementioned stocks
