The London Company, an investment management company, released “The London Company Small Cap Strategy” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. In the fourth quarter, US equities traded higher, with most indices posting positive returns. The fund appreciated 2.5% (2.3%, net) outperforming the 0.3% increase of the Russell 2000 Index. The positive impact of both stock selection and sector allocation contributed to the relative performance of the strategy in the quarter. For more information on the fund’s top picks in 2024, please check its top five holdings.
In its fourth quarter 2024 investor letter, The London Company Small Cap Strategy emphasized stocks such as EPlus inc. (NASDAQ:PLUS). Headquartered in Herndon, Virginia, ePlus inc. (NASDAQ:PLUS) provides information technology (IT) solutions to optimize IT environment and supply chain processes for companies. The one-month return of EPlus inc. (NASDAQ:PLUS) was -15.39%, and its shares lost 16.59% of their value over the last 52 weeks. On February 24, 2025, EPlus inc. (NASDAQ:PLUS) stock closed at $66.89 per share with a market capitalization of $1.78 billion.
The London Company Small Cap Strategy stated the following regarding EPlus inc. (NASDAQ:PLUS) in its Q4 2024 investor letter:
“EPlus inc. (NASDAQ:PLUS) – PLUS was one of the weaker holdings during 4Q after reporting results below expectations, reflecting weak networking hardware sales and lowered FY25 guidance. Despite the softer hardware demand, PLUS is delivering on the growth of its services businesses, which is positive for margin and stability. PLUS has an under-levered balance sheet and attractive opportunities to deploy cash into accretive tuck-ins or share repurchases.”
A close-up of a technician’s hands assembling a hardware component of an IT solution.
EPlus inc. (NASDAQ:PLUS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held EPlus inc. (NASDAQ:PLUS) at the end of the fourth quarter compared to 11 in the third quarter. In the third quarter of fiscal 2025, EPlus inc. (NASDAQ:PLUS) recorded consolidated net sales of $511 million, slightly exceeding the $509.1 million reported in the same quarter of the previous year. While we acknowledge the potential of EPlus inc. (NASDAQ:PLUS) 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 EPlus inc. (NASDAQ:PLUS) and shared AI news and ratings you should not miss. EPlus inc. (NASDAQ:PLUS) boosted The London Company Small Cap Strategy’s performance last quarter by reporting strong results and maintaining its annual guidance. In addition, please check out our hedge fund investor letters Q4 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.