Diamond Hill Capital, an investment management company, released its “Mid Cap Strategy” fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. Q4 witnessed an uneven increase in markets, capping off yet another positive year for the markets. In general, equities rose after the US election, but some gave up most or all of those gains by the end of the year. The portfolio trailed the Russell Midcap Index in Q4 and for the full year. The strategy returned -2.18% (gross) and -2.35% (net) in the quarter compared to 0.62% for the index. For the full year, the strategy returned 11.39% (gross) and 10.61% (net) compared to 15.34% return for the index. In addition, you can check the top 5 holdings of the strategy to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Diamond Hill Mid Cap Strategy emphasized stocks such as LPL Financial Holdings Inc. (NASDAQ:LPLA). Based in San Diego, California, LPL Financial Holdings Inc. (NASDAQ:LPLA) is an integrated platform provider of brokerage and investment advisory services. The one-month return of LPL Financial Holdings Inc. (NASDAQ:LPLA) was -13.61%, and its shares gained 21.72% of their value over the last 52 weeks. On March 17, 2025, LPL Financial Holdings Inc. (NASDAQ:LPLA) stock closed at $328.29 per share with a market capitalization of $24.517 billion.
Diamond Hill Mid Cap Strategy stated the following regarding LPL Financial Holdings Inc. (NASDAQ:LPLA) in its Q4 2024 investor letter:
“As valuations have continued rising and the economic cycle has gotten relatively long in the tooth, we’ve thought carefully about where and how we are exposed to more cyclical stocks. As such, we initiated a number of new positions in Q4, including ICON, Informatica, Teledyne Technologies, LPL Financial Holdings Inc. (NASDAQ:LPLA), Teleflex Incorporated and Solventum Corporation.
LPL Financial provides an integrated platform of brokerage and investment advisory services to financial advisors. Shares have been pressured amid concerns about cash flows and regulatory scrutiny on cash sweep rates — but we believe these fears are overblown. We expect the company can continue generating double-digit revenue and earnings growth as it continues taking market share and expense growth slows as investments in new capabilities are completed. We capitalized on the relatively low valuation to initiate a position in the quarter.”
An experienced financial advisor discussing investment options with a client.
LPL Financial Holdings Inc. (NASDAQ:LPLA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 65 hedge fund portfolios held LPL Financial Holdings Inc. (NASDAQ:LPLA) at the end of the fourth quarter which was 51 in the previous quarter. While we acknowledge the potential of LPL Financial Holdings Inc. (NASDAQ:LPLA) 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 LPL Financial Holdings Inc. (NASDAQ:LPLA) and shared the list of stocks to buy according to Lone Pine Capital. Baron FinTech Fund increased its position in LPL Financial Holdings Inc. (NASDAQ:LPLA) during Q4 2024. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.