Riverwater Partners, an investment management company, released its “Small Cap Core Strategy” Q3 2024 investor letter. A copy of the letter can be downloaded here. The strategy outperformed its benchmark, the Russell 2000, both in the third quarter and year-to-date, driven by disciplined stock selection across a diverse range of sectors. Energy and IT were the top-performing sectors while Consumer Staples and Healthcare holdings detracted. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Riverwater Partners Small Cap Core Strategy highlighted stocks like Atmus Filtration Technologies Inc. (NYSE:ATMU), in the third quarter 2024 investor letter. Atmus Filtration Technologies Inc. (NYSE:ATMU) engages in the design, manufacture, and sale of filtration products. The one-month return of Atmus Filtration Technologies Inc. (NYSE:ATMU) was -11.25%, and its shares gained 64.88% of their value over the last 52 weeks. On December 30, 2024, Atmus Filtration Technologies Inc. (NYSE:ATMU) stock closed at $38.73 per share with a market capitalization of $3.218 billion.
Riverwater Partners Small Cap Core Strategy stated the following regarding Atmus Filtration Technologies Inc. (NYSE:ATMU) in its Q3 2024 investor letter:
“Our outlook for Q4 2024 and 2025 is optimistic in light of what we consider to be opportunities presented by additions to the portfolio during the third quarter. We purchased three new names in Q3 2024: Merit Medical Systems, Inc. (MMSI), Atmus Filtration Technologies Inc. (NYSE:ATMU) and Uranium Energy Corp. (UEC).
Atmus Filtration Technologies, Inc. (ATMU), which was spun out from Cummins Inc. (CMI) in 2023. ATMU specializes in high-quality filtration products for air, fuel, water, and lubrication. Although the company was founded in 1958, it is now beginning to establish itself as an independent entity. With full control over capital allocation and innovation, ATMU is positioned to broaden its customer base and enhance profit margins. The filtration market is highly attractive given stable and recurring revenues with very attractive returns on capital. These factors, combined with its proven track record, and attractive relative valuation point to a promising future for the company.”
A technician in a protective suit testing a variety of different lubricants and filters.
Atmus Filtration Technologies Inc. (NYSE:ATMU) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 47 hedge fund portfolios held Atmus Filtration Technologies Inc. (NYSE:ATMU) at the end of the third quarter which was 44 in the previous quarter. Atmus Filtration Technologies Inc.’s (NYSE:ATMU) sales increased by about 2% to $404 million in the third quarter from $396 million in Q3 2023. While we acknowledge the potential of Atmus Filtration Technologies Inc. (NYSE:ATMU) 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 Atmus Filtration Technologies Inc. (NYSE:ATMU) and shared the list of most profitable new stocks to invest in. 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.