Ariel Investments, an investment management company, released its “Ariel Global Fund” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the first quarter, the Ariel Global fund appreciated +7.35% lagging behind the +8.20% gain of its primary benchmark, the MSCI ACWI Index, but ahead of the +6.85% return of its secondary benchmark, the MSCI ACWI Value Index. The upward rally of developed markets continued in the first quarter of 2024. The rally was driven by investors’ excitement over artificial intelligence (AI), a rebound in bank lending growth, decreased energy costs, a rise in global manufacturing activity, recent structural reforms in Japan, and the near-term possibility of a rate-cutting cycle in the U.S. and Europe. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Ariel Global Fund highlighted stocks like DaVita Inc. (NYSE:DVA), in the first quarter 2024 investor letter. DaVita Inc. (NYSE:DVA) offers kidney dialysis services. The one-month return of DaVita Inc. (NYSE:DVA) was 4.16%, and its shares gained 46.13% of their value over the last 52 weeks. On June 13, 2024, DaVita Inc. (NYSE:DVA) stock closed at $142.16 per share with a market capitalization of $12.468 billion.
Ariel Global Fund stated the following regarding DaVita Inc. (NYSE:DVA) in its first quarter 2024 investor letter:
“Leading provider of dialysis services, DaVita Inc. (NYSE:DVA) outperformed during the period following a top- and bottom-line earnings beat. DaVita is benefitting from cost saving initiatives, early signs of a normalization in patient growth trends on par with pre-pandemic levels, improved leverage and an aggressive share buyback program. The company also recently announced an expansion of its international operations in Latin America, presenting an attractive long-term growth opportunity. Furthermore, management provided a 2024 financial outlook which is well above consensus and anticipates favorable growth. In our view, we believe the market misunderstands the long-term clinical impact of glucagon-like-peptide-1 (GLP-1s) on dialysis and as such, DaVita currently trades at a significant discount relative to our estimate of its intrinsic value.”
A patient at home using a compact console for on-demand dialysate production.
DaVita Inc. (NYSE:DVA) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held DaVita Inc. (NYSE:DVA) at the end of the first quarter which was 39 in the previous quarter. While we acknowledge the potential of DaVita Inc. (NYSE:DVA) 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 DaVita Inc. (NYSE:DVA) and shared top 7 stock picks of Warren Buffett. In addition, please check out our hedge fund investor letters Q1 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.
