Venor Capital Management LP reveals Q2 vs. Q3 2022 13F holdings shifts, increasing stake in Constellation Energy Corp. and decreasing position in ATI Physical Therapy Inc. and Option Care Health Inc.

Venor Capital Management LP Q2 2022 vs. Q3 2022 13F Holdings Comparison

Venor Capital Management LP is a registered investment adviser based out of New York, managing over $1.7 billion in assets, with a focus on event-driven and special situations investments. They recently released their Q2 2022 vs. Q3 2022 13F Holdings comparison, which provides insight into their portfolio changes during this time frame.

The 13F is a quarterly report filed with the Securities and Exchange Commission (SEC) that discloses the fund's holdings. These reports are mandated for investment managers who manage over $100 million in assets, including both long and short positions in equities, options, and other securities. Let's take a closer look at the major changes Venor Capital Management LP made to its portfolio during Q2 2022 vs. Q3 2022, according to the recently published 13F report.

Holdings that Increased

The following are some of the major equity holdings that Venor Capital increased in Q3 2022 compared to Q2 2022:

1. CEG ("Constellation Energy Corp")

Venor Capital increased its holdings in Constellation Energy Corp by 30,000 shares, from 201,958 shares in Q2 2022 to 171,958 shares in Q3 2022. The value of its holdings increased from $11.56 million in Q2 2022 to $14.31 million in Q3 2022. This represents a 23.7% increase in the value of CEG holdings for Venor Capital.

2. ATIP ("ATI Physical Therapy Inc.")

Venor Capital retained its holdings of 3,985 shares of ATI Physical Therapy Inc. in Q3 2022 while reducing the value of its holdings from $5.62 million to $3.99 million. This translated to a 29.1% decrease in the value of ATIP holdings for Venor Capital between Q2 2022 and Q3 2022.

Holdings that Decreased

The following are some of the major equity holdings that Venor Capital decreased in Q3 2022 compared to Q2 2022:

1. OPCH ("Option Care Health Inc.")

Venor Capital Management reduced it's holdings of Option Care Health Inc. by 46.8%, from 1,754,475 in Q2 2022 to 1,291,309 in Q3 2022. The value of its holdings decreased from $48.75 million in Q2 2022 to $40.64 million in Q3 2022, representing a 16.7% decrease.

2. ATIP ("ATI Physical Therapy Inc.")

As we discussed earlier, Venor Capital reduced its holdings of ATI Physical Therapy by $1.62 million, from $5.62 million in Q2 2022 to $3.99 million in Q3 2022. It's vital to note that Venor Capital still holds its previous number of shares in ATI Physical Therapy Inc.

What Do These Changes Mean for Venor Capital LP?

Venor Capital Management is a hedge fund specializing in Special Situations, Merger Arbitrage, Distressed Debt, and Activism. The Q2 2022 and Q3 2022 13F filings reveal that the fund management has been selling off shares of ATIP and OPCH, while increasing its holdings in Constellation Energy Corp. Some analysts believe that these portfolio moves signal that the hedge fund is anticipating a decline in ATI Physical Therapy Inc.'s fortunes and moves to mitigate that risk by investing more in Constellation Energy.

Furthermore, we can infer that Venor Capital believes that Constellation Energy will outperform ATI Physical Therapy going forward. In the case of ATI Physical Therapy, which has been struggling in the market - Venor Capital's trimming of its position might signal some bearishness on its long-term prospects.

Conclusion

Venor Capital Management's Q2 2022 vs. Q3 2022 13F Holdings comparison reveals some interesting changes that help us gain insight on its investment strategy. The hedge fund has sold shares of ATIP and OPCH while increasing its stake in CEG. From our analysis, we deduce that Venor Capital may be expecting a decline in the performance of ATI Physical Therapy and is therefore trying to hedge the risk by investing more in Constellation Energy. It will be interesting to see how these investments pay off for Venor Capital in the coming quarters.