This Fund Dumped a $16 Million Waystar Stake as Shares Lagged the Market by Nearly 30 Points
Key Points
New Mexico-based Westwind Capital exited 420,897 shares of Waystar worth an estimated $15.96 million.
The fund reported holding no Waystar shares at the end of the fourth quarter.
The position had represented 3.3% of fund AUM in the prior quarter, marking a complete exit from a previously significant holding.
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On Friday, New Mexico-based Westwind Capital sold out its entire position in Waystar (NASDAQ:WAY) for an estimated $15.96 million based on quarterly average pricing.
What Happened
In an SEC filing released Friday, Westwind Capital disclosed a sale of 420,897 shares of Waystar. The estimated value of the transaction was $15.96 million. This liquidation reduced the fund’s stake in Waystar to zero shares at quarter-end.
What Else to Know
Westwind Capital's Waystar stake had represented 3.3% of AUM in the prior quarter.
Top holdings after the filing:
- NYSE:V: $39.51 million (8.1% of AUM)
- NYSE:MA: $38.89 million (8.0% of AUM)
- NASDAQ:GOOGL: $37.89 million (7.7% of AUM)
- NASDAQ:AMZN: $32.10 million (6.6% of AUM)
- NASDAQ:ISRG: $30.95 million (6.3% of AUM)
As of Thursday, shares of Waystar were priced at $33.08; the stock declined 11.81% over the past year and underperformed the S&P 500 by nearly 30 percentage points.
Company Overview
| Metric | Value |
|---|---|
| Price (as of Thursday) | $33.08 |
| Market Capitalization | $6 billion |
| Revenue (TTM) | $1.04 billion |
| Net Income (TTM) | $111.18 million |
Company Snapshot
- Waystar provides a cloud-based software platform focused on healthcare payments, including financial clearance, patient financial care, claims and payment management, denial prevention, revenue capture, and analytics solutions.
- Its business model centers on offering software-as-a-service (SaaS) solutions to healthcare providers, generating revenue through subscription and transaction-based fees.
- The company primarily serves hospitals, physician groups, and other healthcare organizations seeking to streamline and optimize payment workflows.
Waystar specializes in cloud-based payment solutions for the healthcare industry, enabling healthcare organizations to improve operational efficiency and revenue cycle management through automation and analytics.
What this transaction means for investors
Portfolio exits are most compelling when they cut against improving fundamentals, and that tension is exactly what stands out here. Waystar recently delivered another quarter of double-digit growth, posting third-quarter revenue of $268.7 million, up 12% year over year, alongside an adjusted EBITDA margin of 42% and net revenue retention of 113%. Management also raised full-year guidance and pointed to confidence in both demand and execution.
Yet Westwind Capital chose to fully liquidate its position amid Waystar’s underperformance, with shares down nearly 12% over the past year. That gap versus the broader market likely matters more than the income statement. Westwind’s remaining portfolio is now dominated by mega-cap compounders like Visa, Mastercard, Alphabet, Amazon, and Intuitive Surgical, a mix that emphasizes durability, liquidity, and consistent free cash flow over emerging platform risk.
For long-term investors, this looks less like a thesis break and more like a portfolio-level decision. Waystar is still scaling profitably, generating $82 million in operating cash flow in the quarter and benefiting from structural tailwinds in healthcare payments automation. But it also carries leverage and integration risk following recent acquisitions, which can test patience during uneven stock performance.
Glossary
13F reportable AUM: Assets under management that must be disclosed in quarterly SEC Form 13F filings by institutional investment managers.
Quarterly average pricing: The average price of a security over a specific quarter, used to estimate transaction values.
Liquidation: The process of selling all holdings in a particular investment, reducing the position to zero.
Stake: The ownership interest or amount of shares held by an investor or fund in a company.
Allocation: The percentage of a portfolio's total assets invested in a particular security or asset class.
Denial prevention: Strategies or tools used to reduce the likelihood of insurance claim rejections in healthcare payments.
Revenue capture: The process of ensuring all earned income, especially in healthcare, is accurately billed and collected.
Cloud-based software platform: Technology services delivered over the internet, allowing users to access applications and data remotely.
TTM: The 12-month period ending with the most recent quarterly report.
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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Intuitive Surgical, Mastercard, and Visa. The Motley Fool has a disclosure policy.
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