Blue Tower Asset Management, an asset management company, released its third-quarter 2024 investor letter. A copy of the letter can be downloaded here. Blue Tower Asset Management’s Global Value strategy returned 8.80% in Q3 (9.08% gross) driven by the strong performance of the fund’s largest position, Enova (NYSE: ENVA), which gained 34.6%. Reduced interest rates tend to positively impact most stocks, and are particularly advantageous for the portfolio, which has primarily invested in companies with smaller market capitalizations over the years. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Blue Tower Asset Management highlighted stocks like WESCO International, Inc. (NYSE:WCC), in the third quarter 2024 investor letter. WESCO International, Inc. (NYSE:WCC) offers business-to-business distribution, logistics services, and supply chain solutions. The one-month return of WESCO International, Inc. (NYSE:WCC) was 12.10%, and its shares gained 33.61% of their value over the last 52 weeks. On November 4, 2024, WESCO International, Inc. (NYSE:WCC) stock closed at $184.61 per share with a market capitalization of $9.046 billion.
Blue Tower Asset Management stated the following regarding WESCO International, Inc. (NYSE:WCC) in its Q3 2024 investor letter:
“In this letter, I will be exploring our holding in WESCO International, Inc. (NYSE:WCC), an electric infrastructure, component, and communication equipment distributor. These distributors are another indirect way to profit from the ongoing boom in solar technology, electric vehicles, and AI technology. Despite the big boost that these technology trends should provide to these distributor businesses, these distributors are not trading at the expensive multiples of AI-related stocks. While most electric component distributors are benefitting from these trends, Wesco is still realizing the integration benefits from a major 2020 merger and is more levered than peers.
Wesco originated in the Westinghouse Electric and Manufacturing Company in 1922, where it was originally the distribution arm of Westinghouse’s electrical and industrial products.
On February 1, 1994, private equity firm Clayton, Dubilier & Rice (CD&R) purchased Wesco from Westinghouse in a $340M leveraged buyout. Wesco was again sold just 4 years later to The Cypress Group which created the holding company Wesco International. In 1999, the company went public. Over the past 20 years, Wesco engaged in over a dozen acquisitions, growing the scale and geographic scope of the company. In 2020, Wesco completed its largest acquisition with the takeover of Anixter International when it used a combination of cash, Wesco shares, and preferred stock to beat out an offer from CD&R…” (Click here to read the full text)
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WESCO International, Inc. (NYSE:WCC) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 51 hedge fund portfolios held WESCO International, Inc. (NYSE:WCC) at the end of the second quarter which was 50 in the previous quarter. WESCO International, Inc. (NYSE: WCC) finished the third quarter strongly, with sales increasing slightly compared to the second quarter. While we acknowledge the potential of WESCO International, Inc. (NYSE:WCC) 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 WESCO International, Inc. (NYSE:WCC) and shared the list of most promising mid-cap stocks according to hedge funds. 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.