Brennan Asset Management, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. Approximately half of the US was thrilled with the election result, and the equilibrium felt catatonic. At first, the markets surged, mostly due to expectations of tax extensions and maybe regulatory relief. The largest winners were some of the more speculative segments of the market, including Tesla stock, investments with an artificial intelligence theme, “normal” cryptocurrency, Dogecoin and other weird/”less normal” cryptocurrencies. This relief rally stalled following the Federal Reserve’s December meeting, which indicated fewer rate cuts in 2025. Meanwhile, markets outside the US continue to trade at extreme discounts, as do value equities to their growth counterparts. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2024.
In its fourth quarter 2024 investor letter, Brennan Asset Management emphasized stocks such as Millicom International Cellular S.A. (NASDAQ:TIGO). Millicom International Cellular S.A. (NASDAQ:TIGO) offers cable and mobile services. One-month return of Millicom International Cellular S.A. (NASDAQ:TIGO) was -0.48%, and its shares gained 70.48% of their value over the last 52 weeks. On February 12, 2025, Millicom International Cellular S.A. (NASDAQ:TIGO) stock closed at $27.14 per share with a market capitalization of $4.596 billion.
Brennan Asset Management stated the following regarding Millicom International Cellular S.A. (NASDAQ:TIGO) in its Q4 2024 investor letter:
“In many ways, Millicom International Cellular S.A. (NASDAQ:TIGO) has felt like a mirror image of LILAK the past couple of years from an execution perspective. As we described in previous letters, TIGO materially hiked its free cash flow guidance multiple times during 2024, substantially reduced leverage, monetized its tower portfolio via a sale/leaseback transaction and started a buyback/dividend program. Earlier this month, TIGO announced a change to its shareholder return policy, increasing its dividend to $3.00 annually. Even with the recent jump following the announcement, TIGO currently trades at ~7.7x/6.6x 2024/2025 free cash flow and now yields over 11 percent on a forward basis. None of those trading metrics seem remotely reasonable. Part of the disconnect could stem from forced selling from Swedish shareholders as TIGO consolidated its dual Sweden/US listing (the Swedish listing will be canceled at the end of February). Given this setup, share repurchases versus dividends would appear to be a no-brainer, but this calculus is more complicated since activist Xavier Niel owns over 40 percent of the company, and the company has restrictions on buying at prices above Niel’s low-ball $25.75 bid. As we have discussed, we are mindful of total LATAM exposure and will monitor total position size. That said, TIGO shares continue to look materially undervalued.”
A telecom tower in a city skyline indicating the companys expansive reach.
Millicom International Cellular S.A. (NASDAQ:TIGO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 10 hedge fund portfolios held Millicom International Cellular S.A. (NASDAQ:TIGO) at the end of the third quarter which was 8 in the previous quarter. While we acknowledge the potential of Millicom International Cellular S.A. (NASDAQ:TIGO) 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 Millicom International Cellular S.A. (NASDAQ:TIGO) and shared Bonhoeffer Capital Management’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q3 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.