Tuesday was a nightmare for SelectQuote (SLQT) , a member of my 2022 Tax Loss Selling Recovery Portfolio. SelectQuote shares were nearly cut in half (down 47%) after the company badly missed second-quarter consensus estimates. SLQT reported a loss of 84 cent a share, infinitely below the consensus estimate of a profit of 59 cents a share. Revenue of $195 million was less than half of the $457 million consensus.
SelectQuote blamed "greater parity in plan benefits for 2022," hiring delays and falloff in approved policies, among other culprits. This is one of the worst misses I've seen in quite some time, and it's even more surprising considering the amount of coverage the company garners; nine analysts currently cover the company. In the aftermath, Citi downgraded SLQT to "neutral" from "buy" and cut the price target from $14 to $4.
SelectQuote is now the worst performer (down 61%) in the 2022 Tax Loss Selling Recovery Portfolio. Despite SLQT's impact, the portfolio is still up about 4%, currently beating the S&P 500 by 400 basis points and the Russell 2000 by 1000 basis points. However, the portfolio is stuck with the name. By nature, there are no mid-season replacements, and we'll see if SelectQuote can regain any ground throughout the year.
Elsewhere, it is fascinating to see what has been happening with CF Acquisition Corp. VI (CFVI) . CF may not sound like a familiar name, but it is the special purpose acquisition company (SPAC) that will be taking YouTube competitor Rumble public.
CF shares have been jumping lately on Rumble's purported $100 million offer to Joe Rogan. I took a position in the warrants (CFVIW) in early December ($11.50 strike price, expire Feb. 17, 2026) as a way to play Rumble. CFVI is up about 50% since late January, while CFVIW has jumped 90% in the same timeframe. Where she stops (in either direction) nobody knows, but this value investor has an itchy trigger finger in these situations, in which I am rarely involved.