On December 31, 2024, Chuck Royce (Trades, Portfolio), a renowned figure in the investment world, made a significant move by acquiring 273,760 additional shares of Orion Group Holdings Inc (ORN, Financial) at a transaction price of $7.33 per share. This acquisition increased the firm's total holdings in Orion Group Holdings to 2,023,545 shares. The transaction reflects a strategic addition to the firm's portfolio, which now represents 0.13% of the total portfolio. This move is indicative of the firm's continued interest in small-cap companies with potential for growth and profitability.
Profile of Chuck Royce (Trades, Portfolio)
Chuck Royce (Trades, Portfolio) is a pioneer in small-cap investing and has been the portfolio manager for the Royce Pennsylvania Mutual Fund since 1972. With a Bachelor’s degree from Brown University and an MBA from Columbia University, the firm has built a reputation for focusing on smaller companies with strong balance sheets and successful business records. The investment philosophy centers on identifying stocks trading below their estimated enterprise value, aiming for companies with a promising future. The firm's top holdings include SEI Investments Co (SEIC, Financial), Air Lease Corp (AL, Financial), and Enovis Corp (ENOV, Financial), among others.
Overview of Orion Group Holdings Inc
Orion Group Holdings Inc is a specialty construction company operating in the infrastructure, industrial, and building sectors. The company is divided into two main segments: Marine and Concrete. With a market capitalization of $284.76 million, Orion Group Holdings provides a range of services, including marine transportation facility construction and turnkey concrete construction services. As of the latest data, the stock is priced at $7.32, slightly below the transaction price. The company is currently considered significantly overvalued with a Price to GF Value ratio of 1.85.
Analysis of the Transaction's Impact
The acquisition of additional shares in Orion Group Holdings has increased the firm's position in the stock to 0.13% of the portfolio, marking a 0.02% increase. This strategic move aligns with the firm's investment philosophy of targeting small-cap companies with potential for growth. Despite the stock's current valuation challenges, the firm appears to be betting on Orion Group Holdings' long-term potential. The total shares held by the firm now stand at 2,023,545, reflecting a significant commitment to the company's future prospects.
Financial Metrics and Valuation
Orion Group Holdings presents a mixed financial picture. The company's GF Score is 62/100, indicating poor future performance potential. The Balance Sheet Rank is 6/10, while the Profitability Rank and Growth Rank are both 4/10. The company's financial strength is further challenged by a negative Return on Equity (ROE) of -10.35% and a Return on Assets (ROA) of -3.18%. Revenue growth over the past three years has been negative at -2.30%, with EBITDA growth declining by -27.40%.
Performance and Market Indicators
Year-to-date, Orion Group Holdings has experienced a price change of -1.21%. The company's Operating Margin growth remains stagnant, and the Piotroski F-Score is 6, indicating moderate financial health. The Altman Z score of 2.38 suggests some financial distress, while the Momentum Rank is high at 10/10, reflecting recent positive price movements.
Other Gurus Involved
Brandes Investment holds the largest position in Orion Group Holdings among gurus, while First Eagle Investment (Trades, Portfolio) is also involved. These investments by prominent firms highlight the interest in Orion Group Holdings despite its current valuation challenges.
Conclusion
Chuck Royce (Trades, Portfolio)'s strategic addition of shares in Orion Group Holdings Inc underscores a calculated bet on the company's potential despite its current financial challenges. For value investors, this move may signal an opportunity to consider the stock, keeping in mind its current valuation and financial health. The firm's focus on small-cap companies with strong fundamentals aligns with the potential long-term growth prospects of Orion Group Holdings.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
