Polen Capital, an investment management company, released its “Polen Focus Growth Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund returned -0.11% (gross) and -0.31% (net) compared to 8.33% for the Russell 1000 Growth Index and 4.28% for the S&P 500 Index. Generative AI (GenAI) remains the dominant market narrative in the second quarter. The portfolio does not own NVIDIA or other Semiconductor companies that are presently benefitting from the demand for AI hardware. However, with the portfolio’s extensive investment in software and IT services, the firm anticipates that GenAI’s long-term economic gains will go to these industries. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Polen Focus Growth Strategy highlighted stocks like Amazon.com, Inc. (NASDAQ:AMZN) in its Q2 2024 investor letter. Amazon.com, Inc. (NASDAQ:AMZN) provides consumer products, advertising, and subscription services through online and physical stores. The one-month return of Amazon.com, Inc. (NASDAQ:AMZN) was 1.31%, and its shares gained 42.18% of their value over the last 52 weeks. On July 19, 2024, Amazon.com, Inc. (NASDAQ:AMZN) stock closed at $183.13 per share with a market capitalization of $1.906 trillion.
Polen Focus Growth Strategy stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q2 2024 investor letter:
“Amazon.com, Inc. (NASDAQ:AMZN) reported better-than-expected results in the quarter, notably showing a re-acceleration in revenue growth in its Amazon Web Services (AWS) segment for the first time in several quarters. Equally impressive, the AWS segment saw margins increase significantly compared to the prior quarter and year, as it’s growing into a more structurally profitable business. In addition, Amazon’s profit margin is expanding rapidly as its e-commerce business has been re-aligned to produce real profits. Meanwhile, the ongoing mix shift to faster-growing and higher-margin businesses, like AWS and Advertising, are contributing more to the company’s bottom line.
We trimmed our position in Amazon purely as a function of risk management, limiting the position size from growing beyond a 15% weighting. Our ongoing analysis underpins our optimism for the business, its competitive advantages, growth runway, management team, and valuation relative to its long-term growth prospects, hence why it remains our largest position.”
A customer entering an internet retail store, illustrating the convenience of online shopping.
Amazon.com, Inc. (NASDAQ:AMZN) is in first position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 302 hedge fund portfolios held Amazon.com, Inc. (NASDAQ:AMZN) at the end of the first quarter which was 293 in the previous quarter. Amazon.com, Inc. (NASDAQ:AMZN) reported strong results in the first quarter and delivered $143.3 billion in revenue, up 13% year-over-year. While we acknowledge the potential of Amazon.com, Inc. (NASDAQ:AMZN) 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.
In another article, we discussed Amazon.com, Inc. (NASDAQ:AMZN) and shared the list of most profitable stocks of the last 20 years. ClearBridge Sustainability Leaders Strategy added Amazon.com, Inc. (NASDAQ:AMZN) to its portfolio in the second quarter 2024. In addition, please check out our hedge fund investor letters Q2 2024 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.
