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Basch Report
Jax Daily Record Thursday, Jul. 7, 202205:00 AM EST

Cadre Holdings defies market downturn

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Barron’s sees more gains for the law enforcement products firm.
by: Mark Basch Contributing Writer

Cadre Holdings Inc. has defied the stock market, trading above its November 2021 initial public offering price despite the bear market.

According to one major financial newspaper, the Jacksonville-based maker of safety and survivability products for law enforcement and first responders is poised for more gains.

“Defund the Police Has Become Re-Fund the Police,” said the headline on a Barron’s story posted June 24 on its website.

“Buy This Stock to Profit From the Trend,” it said as it touted Cadre.

The story said President Biden proposed an 11% increase in law enforcement spending in his 2023 federal budget request, indicative of the political sentiment that will benefit Cadre.

Cadre sold 6.9 million shares at $13 each in its November IPO and was trading at twice that level in early June, before the stock fell after a secondary sale of 4 million shares.

The stock finished the first half of 2022 at $19.67, still a 51% gain from its IPO price.

By comparison, the S&P 500 index was down 19% since Cadre’s initial sale and other IPO stocks performed even worse.

The Renaissance U.S. IPO Index of newly public stocks dropped 56% in that time frame.

Despite the overall bear market, Barron’s said investors who missed out on Cadre’s initial gains could get a “second swing” at the company as it benefits from strong demand for its products.

Jacksonville stocks drop with market

Cadre Holdings rose quickly in its early days of trading in late 2021, but the stock actually has lost ground in 2022 along with the rest of the market.

Of the 20 publicly traded companies headquartered in Northeast Florida, 19 of the stocks fell in the first six months of this year and 12 had bigger losses than the 20.6% drop in the S&P 500.

Cadre fell 23% but the three other companies that went public in 2021 fell even more.

Space technology company Redwire Corp., which became public by merging with a shell company in September 2021, had the biggest drop of all Jacksonville companies trading above $1, falling 55%.

Dream Finders Homes Inc., which more than tripled in price following its January 2021 IPO, fell below its initial price of $13 in June and was down 45% since the beginning of this year.

Treace Medical Concepts Inc. fell 23% in the first six months of 2022 and has been trading mostly below its April 2021 IPO price of $17 for the last two months.

The only Jacksonville-based company to register a gain in the first half of this year was commercial real estate developer FRP Holdings Inc.

FRP has not had any major news developments to push the stock but it finished June up 4% since the beginning of 2022.

Report: 8 private Jacksonville firms top $1B in revenue

 In addition to 10 public companies that reported 2021 revenue of more than $1 billion, Florida Trend magazine’s annual list of the state’s largest private companies includes eight Jacksonville-based companies with revenue above $1 billion.

At the top is health insurer Florida Blue, which ranked seventh in the list in the magazine’s July issue with $11.5 billion in 2021 revenue.

However, Florida Blue actually is a subsidiary of a bigger Jacksonville-based company, GuideWell Mutual Holding Corp., which has more than $20 billion in annual revenue.

GuideWell was not included in the list but would have been the fifth-largest private company in Florida.

Southeastern Grocers Inc., parent of Winn-Dixie, ranked ninth with $7.2 billion in revenue.

Jacksonville had two other companies in the top 20: Fanatics Inc. at 17th with $4 billion and Crowley Maritime at 18th with $3.9 billion.

The other billion-dollar companies were Acosta with $1.7 billion in revenue, Main Street America Group and Haskell with $1.5 billion each and Gate Petroleum Co. with $1.3 billion.

Florida Trend determines the list based on company-supplied data and estimates for private companies that do not supply the data.

Cannae repurchases Fidelity shares

Cannae Holdings Inc., the investment company spun off from Jacksonville-based Fidelity National Financial Inc., announced June 28 it repurchased all 5.78 million of its shares owned by Fidelity.

Fidelity had owned the shares, representing about 6.8% of Cannae’s stock, since the title insurance company spun off Cannae in November 2017. 

Cannae said Fidelity was required to sell those shares by November 2022.

The sale ends Fidelity’s investment in Cannae, but Bill Foley remains chairman of both companies.

When Cannae was formed, its headquarters office was established in Las Vegas, where Foley lives.

“Buying our shares from FNF further demonstrates our commitment to our shareholders by aggressively repurchasing our shares while also removing an overhang that existed given FNF’s requirement to sell these shares,” Foley said in a news release.

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