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Is Red Violet (RDVT) Going to Stay Flat Forever?

Immersion Investment Partners, an investment management company, released its third quarter 2023 investor letter. A copy of the same can be downloaded here. The fund fell 8.62% in the third quarter compared to the 5.12% decline for the Russell 2000 Index. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.

Immersion Investment Partners highlighted stocks like Red Violet, Inc. (NASDAQ:RDVT) in the third quarter 2023 investor letter. Headquartered in Boca Raton, Florida, Red Violet, Inc. (NASDAQ:RDVT) is a software and services company. On November 24, 2023, Red Violet, Inc. (NASDAQ:RDVT) stock closed at $21.28 per share. One-month return of Red Violet, Inc. (NASDAQ:RDVT) was 5.50%, and its shares lost 2.88% of their value over the last 52 weeks. Red Violet, Inc. (NASDAQ:RDVT) has a market capitalization of $296.63 million.

Immersion Investment Partners made the following comment about Red Violet, Inc. (NASDAQ:RDVT) in its Q3 2023 investor letter:

"The beauty of what we do revolves around finding companies that have structural changes happening within them that are being overlooked by the market. Often the market ignores a company that is performing extraordinarily well because it is not showing up in a metric that can be easily discerned using screens or traditional financial ratios and metrics. The efficient market hypothesis would have you believe that all information is priced into a stock. We are here to tell you this is not the case but to find those outliers takes a lot of work. Most investment firms consider 3% a large position so a generous reading would be that analysts ignore our sandbox because it is extremely time-consuming and cost inefficient for what they are trying to accomplish; however, we would not rule out that they are lazy. It takes energy and time to find companies that offer well above average returns, and is a deeply involved process, rather than a simple screening of hundreds of stocks at a time. It is easy to overlook a company that is showing signs of future success. We applaud them for their laziness…errr, tools for efficiency…because it lays before us a terrific opportunity set. Where we become annoyed is when our companies do prove that they are doing well and the market still does not react, or it reacts positively for a short period of time instead of giving the names the credit they deserve. We have also resigned ourselves to the fact that Red Violet, Inc. (NASDAQ:RDVT) is just going to stay flat forever, regardless of the 20-30-40% earnings growth it will likely deliver over the next five years."

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Red Violet, Inc. (NASDAQ:RDVT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held Red Violet, Inc. (NASDAQ:RDVT) at the end of third quarter which was 6 in the previous quarter. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.

 

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Disclosure: None. This article is originally published at Insider Monkey.