Wasatch Global Investors, an asset management company, released its “Wasatch Micro Cap Value Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. During the first quarter, the strategy outperformed the benchmark Russell Microcap Index which rose 4.68%. Most of the portfolio holdings of the strategy met or exceeded earnings and revenue expectations in the quarter. Investor sentiments gradually improved as the quarter went on. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Wasatch Micro Cap Value Strategy highlighted stocks like HCI Group, Inc. (NYSE:HCI), in the first quarter 2024 investor letter. HCI Group, Inc. (NYSE:HCI) engages in the business of property and casualty insurance, reinsurance, real estate, and information technology. The one-month return of HCI Group, Inc. (NYSE:HCI) was -7.63%, and its shares gained 63.89% of their value over the last 52 weeks. On June 7, 2024, HCI Group, Inc. (NYSE:HCI) stock closed at $95.86 per share with a market capitalization of $1.004 billion.
Wasatch Micro Cap Value Strategy stated the following regarding HCI Group, Inc. (NYSE:HCI) in its first quarter 2024 investor letter:
“HCI Group, Inc. (NYSE:HCI) was the top contributor to strategy performance during the first quarter. The company issues property and casualty insurance and reinsurance primarily in Florida. The stock was up as a result of a very strong earnings report and a positive outlook. Because many insurers have left Florida due to increased storm frequency and intensity, HCI has been able to raise premiums as compensation for greater risks. Moreover, Florida recently enacted legislation intended to curtail fraudulent claims. We believe the combination of higher premiums and fewer claims should boost revenues and earnings in the years ahead. From a shorter-term perspective, however, we trimmed our position as a risk-control measure due to the higher valuation and uncertainty regarding the upcoming hurricane season.”
A homeowner happily smiling while holding a copy of their new insurance policy.
HCI Group, Inc. (NYSE:HCI) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 22 hedge fund portfolios held HCI Group, Inc. (NYSE:HCI) at the end of the first quarter which was 20 in the previous quarter. HCI Group, Inc. (NYSE:HCI) reported just over $77 million in pretax income and $3.81 in diluted earnings per share. Premium growth, increased investment income, improved loss patterns, and decreasing expense ratios are the main drivers of these results. While we acknowledge the potential of HCI Group, Inc. (NYSE:HCI) 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 HCI Group, Inc. (NYSE:HCI) and shared Bernzott Capital Advisors US Small Cap Value Fund’s views on the company. In the previous quarter, HCI Group, Inc. (NYSE:HCI) significantly contributed to Wasatch Micro Cap Value Strategy’s portfolio. 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.
