Aristotle Capital Boston, LLC, an investment advisor, released its “Small Cap Equity Strategy” third quarter 2024 investor letter. A copy of the letter can be downloaded here. The third quarter showed substantial gains for small-cap stocks, with the Russell 2000 index providing a total return of 9.27%. In the third quarter, the fund delivered a return of 7.40% net of fees (7.57% gross of fees) underperforming the Russell 2000 Index’s 9.27% total return. Both security selection and allocation effects drove the underperformance of the strategy in the quarter. For more information on the fund’s best picks in 2024, please check its top five holdings.
Aristotle Small Cap Equity Strategy highlighted stocks like Acadia Healthcare Company, Inc. (NASDAQ:ACHC) in the Q3 2024 investor letter. Acadia Healthcare Company, Inc. (NASDAQ:ACHC) is a behavioral healthcare services company. The one-month return of Acadia Healthcare Company, Inc. (NASDAQ:ACHC) was -24.72%, and its shares lost 41.71% of their value over the last 52 weeks. On October 31, 2024, Acadia Healthcare Company, Inc. (NASDAQ:ACHC) stock closed at $42.69 per share with a market capitalization of $3.965 billion.
Aristotle Small Cap Equity Strategy stated the following regarding Acadia Healthcare Company, Inc. (NASDAQ:ACHC) in its Q3 2024 investor letter:
“Acadia Healthcare Company, Inc. (NASDAQ:ACHC), a behavioral healthcare and substance abuse treatment services company, declined in late September as a result of two negative news headlines related to patient care and questions about billing practices. While we take these developments seriously, we believe investors’ reaction to the news has been more severe than warranted. Industry peers have faced similar levels of scrutiny in the past with limited fundamental impact, and unless additional information is uncovered, we believe the current scrutiny will be resolved without much of an impact on their business. We continue to believe the company is well positioned to be an important part of the solution to an unfortunately growing need for behavioral health services.”
A healthcare professional discussing a treatment plan with a patient in an outpatient clinic.
Acadia Healthcare Company, Inc. (NASDAQ:ACHC) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Acadia Healthcare Company, Inc. (NASDAQ:ACHC) at the end of the second quarter which was 34 in the previous quarter. The second quarter revenue of Acadia Healthcare Company, Inc. (NASDAQ:ACHC) increased 8.8% year-over-year to $796 million. While we acknowledge the potential of Acadia Healthcare Company, Inc. (NASDAQ:ACHC) 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 Acadia Healthcare Company, Inc. (NASDAQ:ACHC) and shared the list of worst beaten down 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.