Investment management company Vulcan Value Partners recently released its second quarter 2024 investor letter. A copy of the letter can be downloaded here. The quarterly results were mixed. The firm faced stock price volatility with some of the companies in its portfolios but managed this by adhering to discipline and capitalizing on the volatility to invest in companies with improved price-to-value ratios. In the quarter, the fund’s Large Cap Composite returned -2.9% net of fees and expenses, the Small Cap Composite returned -0.1 % net, the Focus Composite returned -0.4% net, the Focus Plus composite returned -0.8% and the All-Cap Composite returned 1.1% net. For more information on the fund’s best picks in 2024, please check its top five holdings.
Vulcan Value Partners highlighted stocks like NICE Ltd. (NASDAQ:NICE), in the second quarter 2024 investor letter. NICE Ltd. (NASDAQ:NICE) is a cloud platform provider for AI-driven digital business solutions. The one-month return of NICE Ltd. (NASDAQ:NICE) was 5.25%, and its shares lost 16.21% of their value over the last 52 weeks. On July 26, 2024, NICE Ltd. (NASDAQ:NICE) stock closed at $180.99 per share with a market capitalization of $11.591 billion.
Vulcan Value Partners stated the following regarding NICE Ltd. (NASDAQ:NICE) in its Q2 2024 investor letter:
“There was one material detractor: NICE Ltd. (NASDAQ:NICE). NICE is a global enterprise software company that provides mission-critical contact center software. NICE was a material contributor last quarter. As we said last quarter, the company continues to perform well, and fundamentals are strong. Cloud revenue has grown in line with our expectations. We believe that generative AI will continue to drive cloud adoption and that AI is an opportunity rather than a threat to NICE’s business. As the leading platform in the space, the company has many competitive advantages that position them well to win. Cloud penetration is in the low 20% range today and AI will likely accelerate cloud adoption, which should benefit NICE. We believe that this growth will more than offset any seat count attrition due to automation. Furthermore, data and customer examples show AI is driving higher levels of revenue per customer and that AI specific product adoption is increasing rapidly. We followed our discipline and added to our position during the quarter.”
A data scientist sitting in front of a monitor to review the performance of AI-driven digital business solutions.
NICE Ltd. (NASDAQ:NICE) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held NICE Ltd. (NASDAQ:NICE) at the end of the first quarter which was 26 in the previous quarter. In the first quarter of 2024, NICE Ltd. (NASDAQ:NICE) reported $659 million in total revenues, which reflects the high end of the guidance range and represents a 15% increase from Q1 2023. While we acknowledge the potential of NICE Ltd. (NASDAQ:NICE) 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 NICE Ltd. (NASDAQ:NICE) and shared Parnassus Value Equity Fund’s views on the company. In Q1 2024, NICE Ltd. (NASDAQ:NICE) was a significant contributor to Vulcan Value Partners. 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.
