Investing

Hoak & Co. Urges NGS Board to Halt CEO Search and Explore Strategic Alternatives

Fintel reports that Hoak Public Equities, LP, has filed a 13D/A form with the SEC disclosing ownership of 1,150,000 shares of Natural Gas Services Group, Inc. (NGS). This represents 9.2563% of the company.

In the last filing, dated Dec. 9, 2022, they reported owning 9.26% of the company, indicating no change in their holdings.

On Dec. 29, 2022, J. Hale Hoak, acting on behalf of the Reporting Persons, sent a letter to the Board of Directors of the Issuer. In the letter, Hoak calls on the Board to halt any search process for a new CEO and instead begin a review of strategic alternatives.

“From our vantage point as your largest shareholder, it is hard to know who is in charge and, frankly, the Board dynamics appear somewhat chaotic. We imagine our concern is also shared by some of your employees, customers, vendors, and other stakeholders,” Hoak wrote.

He added that “in the absence of a sale of the company, we believe that NGS needs to identify a near-term plan that would put the company on a path to at least $75-100 million of EBITDA (our estimation of the minimum required to justify remaining a stand-alone public company), utilize a prudent level of debt to generate better equity returns and implement an industry-standard dividend policy. As we have discussed, NGS would efficiently achieve all the goals above by transacting with Nova Compression, another company in which Hoak & Co. is invested. However, we happily support any alternative that maximizes value for all NGS shareholders.”

NGS is a provider of gas compression services and equipment to the energy industry. The company manufactures, fabricates, rents sells and maintains natural gas compressors and flare systems for oil and natural gas production and plant facilities. NGS is headquartered in Midland, Texas, with fabrication facilities located in Tulsa, Oklahoma and Midland, Texas, and service facilities located in major oil and natural gas-producing regions in the U.S.

What are other large shareholders doing?

 

AWM Investment Company, Inc. holds 769,233 shares representing 6.19% ownership of the company. In its prior filing, the firm reported owning 685,508 shares, representing an increase of 10.88%. The firm decreased its portfolio allocation in NGS by 1.15% over the last quarter.

Franklin Resources Inc holds 751,046 shares representing 6.05% ownership of the company. No change in the last quarter.

Mill Road Capital Management LLC holds 705,859 shares representing 5.68% ownership of the company. In its prior filing, the firm reported owning 713,785 shares, representing a decrease of 1.12%. The firm increased its portfolio allocation in NGS by 3.05% over the last quarter.

Ameriprise Financial Inc holds 578,444 shares representing 4.66% ownership of the company. The firm reported owning 575,416 shares in its prior filing, representing an increase of 0.52%. The firm decreased its portfolio allocation in NGS by 82.16% over the last quarter.

Pacific Ridge Capital Partners, LLC holds 572,892 shares representing 4.61% ownership of the company. In its prior filing, the firm reported owning 590,580 shares, representing a decrease of 3.09%. The firm decreased its portfolio allocation in NGS by 2.72% over the last quarter.

What is the overall Fund Sentiment?

There are 118 funds or institutions reporting positions in Natural Gas Services Group, Inc. This is an increase of 1 owner(s) or 0.85%.

Average portfolio weight of all funds dedicated to Natural Gas Services Group, Inc. is 0.1688%, an increase of 2.1454%. Total shares owned by institutions decreased in the last three months by 2.67% to 12,315,523 shares.

Fintel’s Fund Sentiment Score is a quantitative model that ranks companies from zero to 100 based on Fund Sentiment. Fund Sentiment is important because it tells you if funds are buying or selling – and particularly how the company ranks compared to other companies in the investing universe.

Click to see the Fintel Fund Sentiment Score for NGS / Natural Gas Services Group, Inc.

This article originally appeared on Fintel

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