Andvari Associates, an investment management firm, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. Andvari achieved a full-year performance of 13.3%, significantly surpassing the long-term market average, on an absolute basis. However, on a relative scale, the fund fell short of the market, which is disappointing. This underperformance can largely be attributed to the weaker performance of equity allocation. Additionally, the firm increased the overall allocation to fixed income for clients who are approaching or are at retirement age, which has also played a role. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
Andvari Associates highlighted stocks like CoStar Group, Inc. (NASDAQ:CSGP) in the fourth quarter 2024 investor letter. CoStar Group, Inc. (NASDAQ:CSGP) is an information, analytics, and online marketplace services provider for commercial and residential property markets. The one-month return of CoStar Group, Inc. (NASDAQ:CSGP) was 6.77%, and its shares lost 10.32% of their value over the last 52 weeks. On January 27, 2024, CoStar Group, Inc. (NASDAQ:CSGP) stock closed at $76.44 per share with a market capitalization of $31.34 billion.
Andvari Associates stated the following regarding CoStar Group, Inc. (NASDAQ:CSGP) in its Q4 2024 investor letter:
“During the last quarter of 2024, investors shifted their worries back again to interest rates and inflation. It now seems the Fed will not cut rates as much as the market was expecting back in August. As a result, three of our holdings most sensitive to rates-the cell tower REITs American Tower (AMT) and SBA Communications (SBAC), and real estate data group CoStar Group, Inc. (NASDAQ:CSGP)-declined in the last quarter. These three were also down for the year: AMT at -12% while SBAC and CoStar each at -18%
CoStar, the third of our triumvirate serving the real estate industry, continues to grow in all its most significant business lines. In the 3rd quarter of 2024, CoStar Suite grew revenues by 10%, Apartments.com grew 15.5%, and the new Homes.com business (competitor to Zillow) grew revenues 169%. CoStar also had its first ever (as far as I can tell) Investor Day in December. It was quite informative and Andvari was able to add new details to our understanding of and appreciation for the business.
CoStar, the third of our triumvirate serving the real estate industry, continues to grow in all its most significant business lines. In the 3rd quarter of 2024, CoStar Suite grew revenues by 10%, Apartments.com grew 15.5%, and the new Homes.com business (competitor to Zillow) grew revenues 169%. CoStar also had its first ever (as far as I can tell) Investor Day in December. It was quite informative and Andvari was able to add new details to our understanding of and appreciation for the business.
For example, CoStar has thousands of employees that create, find, and curate real estate data and content. Researchers are on the phone every day asking questions about commercial tenants and leasing terms. They’re in hundreds of cities and towns taking photos of buildings, apartments, and residential neighborhoods. CoStar even owns a plane with two rotating teams that fly it daily to take photos of new construction. As a result of all this, CoStar updates data on one million tenants every year and copyrights 350,000 new photos every 45 days…” (Click here to read the full text)
An elegant residential building set against the modern skyline.
CoStar Group, Inc. (NASDAQ:CSGP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 43 hedge fund portfolios held CoStar Group, Inc. (NASDAQ:CSGP) at the end of the third quarter which was 42 in the previous quarter. While we acknowledge the potential of CoStar Group, Inc. (NASDAQ:CSGP) 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 CoStar Group, Inc. (NASDAQ:CSGP) and shared Parnassus Growth Equity Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q3 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.