Here's What Happened to DallasNews Corporation (DALN) in Q1

Middle Coast Investing, an investment advisor firm, released its first-quarter investor letter. A copy of the letter can be downloaded here. Middle Coast Investing had a difficult but manageable first quarter, but everyone has suffered since the Liberation Day crash at the beginning of the second quarter. To manage the volatility, the firm decided to increase cash goal levels by roughly 5% for each portfolio. In the quarter, the firm sold 3% more than it bought. In Q1 2025, the US Portfolios returned -3.7% compared to -4.6% for the S&P 500. It’s Core U.S. portfolios returned -0.7% while Russell 2000 returned -9.8%, S&P 600 returned -9.3% and Nasdaq generated -10.4% for the same period. However, its European Portfolios appreciated by 9.2%. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first quarter 2025 investor letter, Middle Coast Investing emphasized stocks such as DallasNews Corporation (NASDAQ:DALN). DallasNews Corporation (NASDAQ:DALN) publishes and sells newspapers in Texas. The one-month return of DallasNews Corporation (NASDAQ:DALN) was -25.49%, and its shares gained 10.88% of their value over the last 52 weeks. On April 15, 2025, DallasNews Corporation (NASDAQ:DALN) stock closed at $4.18 per share with a market capitalization of $22.373 million.

Middle Coast Investing stated the following regarding DallasNews Corporation (NASDAQ:DALN) in its Q1 2025 investor letter:

"We added a fair deal to our position of DallasNews Corporation (NASDAQ:DALN). At its quarter closing price, it traded for at most negative $6.1M when you factor in the most recent sale of its building according to my math.

Dallas News has resolved its pension obligations and reduced its operating expenses another $5M per year. The company is not far from profitability, Dallas is a growing part of the country, and if there is any revenue stabilization or growth, this will be worth a lot more even after the company issues a lot of its cash to a share buyback or dividend, which seems likely. An advertising recession is of course a risk, and while I’m at it, the Mavericks trading away Luka Doncic is not great for sports interest in the area.

If all else fails, an important Texas media outlet would seem to have trophy asset potential, especially with a pristine balance sheet. Given who the likely buyers would be, and how big money buyouts of news outlets have gone, this is not my preferred outcome as a citizen. But still.

I think there’s some impatience in the market, and disappointment the company hasn’t yet told us what they’ll do with all their cash."

DallasNews Corporation (NASDAQ:DALN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 2 hedge fund portfolios held DallasNews Corporation (NASDAQ:DALN) at the end of the fourth quarter which was 3 in the previous quarter. While we acknowledge the potential of DallasNews Corporation (NASDAQ:DALN) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

We covered DallasNews Corporation (NASDAQ:DALN) in another article, where we shared Middle Coast Investing's views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.