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SummaryThe guru’s firm purchased 1,647 shares.

Royce Investment Partners announced a fresh investment in Bassett Furniture Industries Inc. earlier this week (BSET, Financial).
Chuck Royce (Trades, Portfolio) created the New York-based firm in 1972, and it specializes in small-cap companies. The portfolio management team selects equities using a bottom-up, active, risk-aware, and fundamental methodology. They also look for value in companies that are trading at a discount to their enterprise value.
Royce Investment Partners is no stranger to Bassett, having previously owned up to 1.5 million shares. After previously selling out of a position in the Virginia-based furniture company in the third quarter of 2019, GuruFocus Real-Time Picks, a Premium GuruFocus feature, disclosed on June 30 via a 13-G filing with the Securities and Exchange Commission that the firm had entered a new 1,647-share holding. On the day of the transaction, the stock was trading at an average price of $24.35 a share.

The history of Chuck Royce’s Bassett Furniture holdings.
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The company, which manufactures, imports, and sells home furnishings in the United States, was founded in 1902 and has a market capitalization of $240.65 million. Its shares were trading around $25.26 on Friday, with a price-earnings ratio of 13.13, a price-book ratio of 1.52, and a price-sales ratio of 0.56.
ADDITIONAL INFORMATION FOR YOU
The GF Value Line suggests that the stock is currently considerably overvalued based on its historical ratios, previous performance, and future earnings estimates.

According to the GF Value Line, the stock is considerably overvalued.
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The 8 out of 10 valuation rank, on the other hand, leans toward undervaluation.
The firm released its second-quarter earnings on July 1. Bassett reported earnings of 60 cents per share for the three months ended May 29, up from a loss of $2.04 cents per share a year ago due to headwinds associated to the Covid-19 outbreak. Similarly, revenue increased by 94 percent to $124.1 million from the previous quarter, owing to a considerable increase in demand in the company’s wholesale division.
Chairman and CEO Robert Spilman Jr. commented on the company’s prognosis for the rest of the year in a news release.
“Many cost pressures exist, and raw material lead times continue to be lengthy,” he stated. “However, we have a considerable backlog, and our most recent big sales event, which took place around Memorial Day, was a huge success. Considering all of the advantages and negatives, we remain optimistic about our chances for the balance of 2021.”

Over the last few quarters, here’s a look at Basset’s sales and net income.
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Bassett’s financial strength was rated 4 out of 10 by GuruFocus. In addition to having poor debt ratios, the company’s Altman Z-Score of 2.35 suggests that it is under financial stress, since revenue per share has been dropping for the previous five years. The weighted average cost of capital has also surpassed the return on invested capital, showing that the company is struggling to create value as it expands.
The company’s profitability didn’t fair much better, receiving a 5 out of 10 rating since its margins lagged behind competitors. However, it outperforms more than half of its industry counterparts in terms of returns on assets, equity, and capital. Bassett also has a high Piotroski F-Score of 7, showing that operations are in good health, as well as a one-star predictability rank. Over a 10-year period, organizations with this rank have returned an average of 1.1 percent yearly, according to GuruFocus.
Mario Gabelli (Trades, Portfolio) has the greatest holding of the gurus currently invested in Bassett Furniture, with 6.73 percent of outstanding shares. Renaissance Technologies, which is owned by Jim Simons (Trades, Portfolio), and Jeremy Grantham (Trades, Portfolio) also hold the stock.
The composition and performance of your portfolio
The industrials and technology sectors accounted for about half of Royce Investment Partners’ $14.88 billion equity portfolio, which had 1,012 stocks at the end of the first quarter. The financial services and consumer cyclical sectors had lesser holdings.

The following is a breakdown of Royce’s equities portfolio by sector.
GuruFocus.com
Purple Innovation Inc. (PRPL, Financial), Herman Miller Inc. (MLHR, Financial), La-Z-Boy Inc. (LZB, Financial), Leggett & Platt Inc. (LEG, Financial), Flexsteel Industries Inc. (FLXS, Financial), Hooker Furniture Corp. (HOFT, Financial), The Lovesac Co. (LOVE, Financial), Kimball International Inc. (KBAL, Financial), Kimball International Inc. (KBAL, Financial),
The Royce Premier Fund, according to the firm’s website, returned 11.5 percent in 2020, below both the S&P 500 Index’s 18.4 percent and the Russell 2000’s 20% return.
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Disclosures
I/we have no positions in any of the stocks mentioned, and have no plans to open any in the next 72 hours./nRead More

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