Is it Still Worthy to Invest in Cross Country Healthcare (CCRN)?

Rhizome Partners, an investment management firm, published its second-quarter 2022 investor letter – a copy of which can be downloaded here. For the second quarter of 2022, Rhizome Partners generated a net loss of 9.1% versus a 16.1% loss for the Standard & Poor’s 500 Index and a 14.7% loss for the National Association of Real Estate Investment Trusts (NAREIT) Index. During the quarter, the fund’s hedging efforts generated about 5.5% of gains. The hedging gains were the primary contributor to Rhizome’s outperformance in the S&P 500 and the NAREIT.  Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.

In its Q2 2022 investor letter, Rhizome Partners mentioned Cross Country Healthcare, Inc. (NASDAQ:CCRN) and explained its insights for the company. Founded in 1986, Cross Country Healthcare, Inc. (NASDAQ:CCRN) is a Boca Raton, Florida-based employment agency company with a $971.8 million market capitalization. Cross Country Healthcare, Inc. (NASDAQ:CCRN) delivered a -8.43% return since the beginning of the year, while its 12-month returns are up by 16.87%. The stock closed at $25.42 per share on August 30, 2022.

Here is what Rhizome Partners has to say about Cross Country Healthcare, Inc. (NASDAQ:CCRN) in its Q2 2022 investor letter:

“Our smaller positions in both HireQuest and Cross Country Healthcare are trading around 10 times normalized P/FCF multiples. Both companies have long growth runways and are led by talented CEOs. The ongoing maintenance capital expenditures of both companies are minimal. We keep looking for ways to disprove both investment theses and have a hard time coming up with valid reasons. Investors are concerned that Cross Country Healthcare is a Covid beneficiary and will eventually revert to its pre-Covid performances. But the bulk of the operational improvements that increased EBITDA margin from low single digits to high single digits during Covid is structural and permanent. Both companies are ideal candidates to add to if they continue to sell off.”

Our calculations show that Cross Country Healthcare, Inc. (NASDAQ:CCRN) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Cross Country Healthcare, Inc. (NASDAQ:CCRN) was in 15 hedge fund portfolios at the end of the second quarter of 2022, compared to 22 funds in the previous quarter. Cross Country Healthcare, Inc. (NASDAQ:CCRN) delivered a 44.02% return in the past 3 months.

In June 2022, we also shared another hedge fund’s views on Cross Country Healthcare, Inc. (NASDAQ:CCRN) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

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

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