Bronte Capital, an investment management company, released its “Amalthea Fund” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund was down 3.72% for the quarter vs. +2.54% for the MSCI ACWI (in $A). It was down 5.59% in September vs. -0.35% for the index. The market rose in the third quarter, reaching new peaks, with a minor dip in late August and early September. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Amalthea Fund highlighted stocks like Discover Financial Services (NYSE:DFS) in the third quarter 2024 investor letter. Discover Financial Services (NYSE:DFS) offers digital banking products and services, and payment services in the United States. The one-month return of Discover Financial Services (NYSE:DFS) was 18.60%, and its shares gained 100.72% of their value over the last 52 weeks. On November 19, 2024, Discover Financial Services (NYSE:DFS) stock closed at $172.50 per share with a market capitalization of $43.31 billion.
Amalthea Fund stated the following regarding Discover Financial Services (NYSE:DFS) in its Q3 2024 investor letter:
“US Credit cards have become a concentrated business. The leading players in order are Chase, a part of JPMorgan, American Express, Citi, Capital One, Bank of America and Discover Financial Services (NYSE:DFS). A combination of Capital One and Discover will become the number two player.
A book of old and stable credit cards is a good business. You almost certainly have a card in your wallet (or embedded in your phone) and you transact on it a lot. The bank makes good coin from that card – and given your financial circumstances and long history of paying – your bank can be reasonably assured that you will never default on that card.
Many Americans however have two cards. The number two card in the wallet is a problematic business. If you have two cards in your wallet there will typically be one on which you do most transactions on and which earns most the revenue…” (Click here to read the full text)
A business professional in a suit swiping their credit card at the store.
Discover Financial Services (NYSE:DFS) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 69 hedge fund portfolios held Discover Financial Services (NYSE:DFS) at the end of the third quarter which was 68 in the previous quarter. In the third quarter, Discover Financial Services (NYSE:DFS) reported $965 million in net income, a 41% increase from Q3 2023. While we acknowledge the potential of Discover Financial Services (NYSE:DFS) 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 Discover Financial Services (NYSE:DFS) and shared Middle Coast Investing’s views on the company. 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.