Diamond Hill Capital, an investment management company, released its “Mid Cap Strategy” fourth-quarter 2023 investor letter. A copy of the same can be downloaded here. During Q4, the markets experienced a sharp rebound, resulting in positive returns in most regions and countries. The portfolio had a better performance than the Russell Midcap Index during the Q4 period, but it underperformed for the entire calendar year. The strategy experienced relative strength in Q4, which was mainly due to the real estate holdings and exposure. These benefited from the declining interest rates environment. Holdings in industrials, financials, and consumer discretionary also added to the performance, as well as the below-benchmark exposure to energy. However, the below-benchmark exposure to technology and above-benchmark exposure to consumer staples detracted from the relative performance. The strategy delivered returns of 13.68% (net of fees) in Q4 and 9.88% (net of fees) for the full year. This compares to the Russell Midcap Index returns of 12.82% and 17.23% for Q4 and the full year, respectively. In addition, you can check the top 5 holdings of the strategy to know its best picks in 2023.
Diamond Hill Mid Cap Strategy featured stocks like CubeSmart (NYSE:CUBE) in the fourth quarter 2023 investor letter. CubeSmart (NYSE:CUBE) is a real estate investment trust that offers affordable, easily accessible, and secure storage spaces. On March 7, 2024, CubeSmart (NYSE:CUBE) stock closed at $44.58 per share. One-month return of CubeSmart (NYSE:CUBE) was 1.18%, and its shares lost 4.58% of their value over the last 52 weeks. CubeSmart (NYSE:CUBE) has a market capitalization of $10.086 billion.
Diamond Hill Mid Cap Strategy stated the following regarding CubeSmart (NYSE:CUBE) in its fourth quarter 2023 investor letter:
“Other top contributors in Q4 included CubeSmart (NYSE:CUBE), Webster Financial and Parker-Hannifin. Shares of self-storage real estate investment trust CubeSmart rose as storage rents showed signs of bottoming in Q3, which could boost fundamentals looking forward. Further, REITs more broadly rallied during the quarter as long-term interest rates rapidly declined. Similarly, HSA-focused bank Webster Financial rose alongside financials in the wake of the Fed’s November meeting, which investors broadly interpreted to signal an end to rate hikes and a potential pivot to cuts sometime in 2024. Diversified industrial and aerospace manufacturer Parker-Hannifin’s management team is executing well, diversifying the company beyond heavily cyclical areas to higher-, steadier-growing areas like aerospace and strategically deploying capital — decisions which are contributing to resilient top-line growth and margin expansion.”
A row of self-storage units in a self-storage complex, showing the affordability and security offered by the company.
CubeSmart (NYSE:CUBE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, CubeSmart (NYSE:CUBE) was held by 22 hedge fund portfolios, up from 19 in the previous quarter, according to our database.
We discussed CubeSmart (NYSE:CUBE) in another article and shared the list of best dividend stocks for an early retirement portfolio. In addition, please check out our hedge fund investor letters Q4 2023 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.
