White Brook Capital Partners, an investment management firm, released its second-quarter 2023 investor letter. The same can be downloaded here. In the second quarter, the fund returned 16.09% compared to the Midcap 400 Index’s 4.85% and the S&P 500 Index’s 8.74% returns. Year-to-date, the fund’s NAV increased by 13.37% (net) compared to an 8.85% and 16.89% increase for the benchmarks, respectively. Year-to-date, the top contributing sectors of the portfolio were industrials and financial services while materials and consumer discretionary detracted. In addition, please check the fund’s top five holdings to know its best picks in 2023.
White Brook Capital Partners highlighted stocks like Unity Software Inc. (NYSE:U) in the second quarter 2023 investor letter. Headquartered in San Francisco, California, Unity Software Inc. (NYSE:U) is a platform that provides real-time 3D development tools and services. On July 20, 2023, Unity Software Inc. (NYSE:U) stock closed at $44.44 per share. One-month return of Unity Software Inc. (NYSE:U) was 18.60%, and its shares gained 21.85% of their value over the last 52 weeks. Unity Software Inc. (NYSE:U) has a market capitalization of $16.828 billion.
White Brook Capital Partners made the following comment about Unity Software Inc. (NYSE:U) in its second quarter 2023 investor letter:
“Unity Software Inc. (NYSE:U): We took a trading position in Unity Software during the quarter. A trading position is one where I expect the duration of the investment to be relatively short at the time of investment. During the first quarter, I completed much of the work and viewed Unity as attractive based on valuation, but decided to pass. Behind that decision were fundamental questions around corporate governance and the probability that Apple, at the unveiling of their headset, would either go alone in providing tools for developers to produce content for their new augmented and virtual reality efforts or also announce a wide settlement with Unity’s primary competitor, Epic Games, of all outstanding legal matters and a new partnership. Instead, Unity is being relied upon to help developers. Due to continuing concerns around their incentive plan and the strength of the board, it is unlikely that the position will prove to be a multiyear holding, but they are very likely beneficiaries of growth in artificial intelligence and virtual reality in the short term.
Unity theoretically benefits from several trends coming together at once.
1.Augmented and virtual reality were unveiled too early, they’re not permanent busts. Artificial Intelligence advances should improve automation efforts that make it easier for developers to produce more intricate and complex environments and games in three-dimensional space. Improvements in chip development, notably Apple Silicon, but also by competitive chip manufacturers like NVidia and AMD, should also improve playback and interaction of three-dimensional worlds…” (Click here to read the full text)
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Unity Software Inc. (NYSE:U) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held Unity Software Inc. (NYSE:U) at the end of first quarter which was 23 in the previous quarter.
We discussed Unity Software Inc. (NYSE:U) in another article and shared Artisan Developing World Fund’s views on the company. In addition, please check out our hedge fund investor letters Q2 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.