Ace River Capital, an investment management company, released its second-quarter 2024 investor letter. A copy of the letter can be
Ace River Capital highlighted stocks like RCI Hospitality Holdings, Inc. (NASDAQ:RICK) in the second quarter 2024 investor letter. Headquartered in Houston, Texas, RCI Hospitality Holdings, Inc. (NASDAQ:RICK) owns and operates clubs and restaurants. The one-month return of RCI Hospitality Holdings, Inc. (NASDAQ:RICK) was 11.16%, and its shares lost 36.65% of their value over the last 52 weeks. On August 5, 2024, RCI Hospitality Holdings, Inc. (NASDAQ:RICK) stock closed at $43.61 per share with a market capitalization of $397.148 million.
Ace River Capital stated the following regarding RCI Hospitality Holdings, Inc. (NASDAQ:RICK) in its Q2 2024 investor letter:
“The fund’s top position is RCI Hospitality Holdings, Inc. (NASDAQ:RICK). RICK is the only publicly traded owner of adult nightclubs in the US. Currently they own 56 clubs across 13 states and an additional 13 sports-bar restaurants with the “Bombshells” concept that has recently begun franchising. With few municipalities issuing new adult entertainment licenses these businesses function as local monopolies with excellent unit economics. Management has recently announced the withdrawal of applications to operate casinos in Colorado and plans to sell those properties. I do not believe the company has a competitive advantage in the casino space and it seems most investors agree as this news was followed by a strong run up in the stock price. The stock price has taken a hit this year with the drop in same store sales figures. With the recent earnings update showing the first quarterly increase in nightclub same-store sales since 2Q23 along with the $25MM increase in buyback authorization from the board of directors, I am happy to see the company prepare to take care of undervalued share price and also shed the casino division to put that capital into more club acquisitions in the future. I still believe the OnlyFans type site “AdmireMe” to have extremely strong potential and am excited to see the launch.”
A bustling nightclub filled with energy, illuminated by mesmerizing lights and the thumping beat of the dance music.
RCI Hospitality Holdings, Inc. (NASDAQ:RICK) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 6 hedge fund portfolios held RCI Hospitality Holdings, Inc. (NASDAQ:RICK) at the end of the first…