Here’s Why Alaska Air Group (ALK) Rose in Q4

Diamond Hill Capital, an investment management company, released its “Mid Cap Strategy” fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. Q4 witnessed an uneven increase in markets, capping off yet another positive year for the markets. In general, equities rose after the US election, but some gave up most or all of those gains by the end of the year. The portfolio trailed the Russell Midcap Index in Q4 and for the full year. The strategy returned -2.18% (gross) and -2.35% (net) in the quarter compared to 0.62% for the index. For the full year, the strategy returned 11.39% (gross) and 10.61% (net) compared to 15.34% return for the index. In addition, you can check the top 5 holdings of the strategy to know its best picks in 2024.

In its fourth quarter 2024 investor letter, Diamond Hill Mid Cap Strategy emphasized stocks such as Alaska Air Group, Inc. (NYSE:ALK). Based in Seattle, Washington, Alaska Air Group, Inc. (NYSE:ALK) is an airline operator. The one-month return of Alaska Air Group, Inc. (NYSE:ALK) was -26.80%, and its shares gained 45.82% of their value over the last 52 weeks. On March 17, 2025, Alaska Air Group, Inc. (NYSE:ALK) stock closed at $55.15 per share with a market capitalization of $6.788 billion.

Diamond Hill Mid Cap Strategy stated the following regarding Alaska Air Group, Inc. (NYSE:ALK) in its Q4 2024 investor letter:

Other top contributors in Q4 included Alaska Air Group, Inc. (NYSE:ALK), Webster Financial and Liberty Media-Formula One. Shares of regional airline Alaska Air rose in the quarter as management provided more details about the company’s recent acquisition of Hawaiian Airlines, which investors received positively.

Alaska Air Group, Inc. (NYSE:ALK) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held Alaska Air Group, Inc. (NYSE:ALK) at the end of the fourth quarter compared to 28 in the third quarter. While we acknowledge the potential of Alaska Air Group, Inc. (NYSE:ALK) 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 Alaska Air Group, Inc. (NYSE:ALK) and shared the list of undervalued stocks with the highest upside potential. In addition, please check out our hedge fund investor letters Q4 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.