What to Know as One Fund Cuts a $7.9 Million Position in This Defense Equipment Stock

On May 11, 2026, Catawba River Capital disclosed in a Securities and Exchange Commission (SEC) filing that it sold 199,018 shares of Cadre Holdings (NYSE:CDRE) in the first quarter, an estimated $7.95 million transaction based on quarterly average pricing.

What happened

According to a filing published by the SEC on May 11, 2026, Catawba River Capital sold 199,018 shares of Cadre Holdings during the first quarter. The estimated transaction value was $7.95 million, calculated using the average closing price for the period. The fund’s remaining stake at the end of the quarter stood at 260,318 shares, valued at $8.37 million. The net position value change, including price movement, was a decrease of $10.38 million.

What else to know

• Catawba River Capital’s sale reduced Cadre Holdings to 4.03% of its reportable AUM, down from 8.3% the prior quarter.
• Top holdings after the filing:
  • NYSEMKT:FBND: $22.94 million (11.0% of AUM)
  • NYSE:QXO: $22.04 million (10.6% of AUM)
  • NYSEMKT:GLD: $18.69 million (9.0% of AUM)
  • NASDAQ:ROAD: $15.62 million (7.5% of AUM)
  • NYSE:PRM: $15.51 million (7.5% of AUM)
• As of May 8, 2026, Cadre Holdings shares were priced at $29.85, down 17.3% over one year and underperforming the S&P 500 by 47.90 percentage points.

Company overview

Company snapshot

• Cadre manufactures and distributes safety and survivability equipment, including body armor, bomb suits, duty gear, and law enforcement accessories under brands such as Safariland and Protech Tactical.
• The firm operates through Products and Distribution segments, generating revenue from both proprietary protective equipment and third-party products such as uniforms, optics, boots, firearms, and ammunition.
• It serves a diverse customer base comprising state and local law enforcement, first responders, federal agencies, and international government clients.

Cadre Holdings is a leading provider of protective equipment for law enforcement and first responders, leveraging a broad product portfolio and established brands to address critical safety needs. The company’s dual-segment model supports diversified revenue streams and positions it as a key supplier to both domestic and international government agencies. Scale, specialized expertise, and a strong reputation for reliability underpin its competitive advantage in the safety and defense industry.

What this transaction means for investors

It’s worth noting here that while Catawba River Capital still kept a sizable Cadre position, cutting the stake from 8% of assets to roughly 4% suggests the firm may be tempering expectations around near-term defense and law enforcement spending growth.

That said, Cadre’s underlying business still appears to be moving in the right direction, albeit perhaps not as quickly as investors might be hoping for. The company generated record adjusted EBITDA for a third consecutive year in 2025, while annual net sales climbed to $610.3 million from $567.6 million a year earlier. Gross margin also expanded to 42.5% from 41.1%, helped by pricing strength and acquisitions. Still, shares fell after earnings due to softer-than-expected revenue and earnings.

For long-term investors, Cadre still looks like a differentiated niche defense supplier with sticky government relationships. The question now is whether acquisitions and margin gains can reignite the stock after a year of sharp underperformance.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Construction Partners and QXO. The Motley Fool has a disclosure policy.