Here’s Why Alight (ALIT) Fell in Q2

Greenlight Capital, an investment management firm, released its second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the Greenlight Capital funds returned 2.8% net of fees and expenses, compared to 4.3% for the S&P 500 index. The longs in the portfolio underperformed the S&P 500 and the shorts outperformed the inverse of the S&P 500. However, the portfolio maintained a neutral net long exposure of about 40%. In addition, please check the fund’s top five holdings to know its best picks in 2024.

Greenlight Capital highlighted stocks like Alight, Inc. (NYSE:ALIT), in the second quarter 2024 investor letter. Alight, Inc. (NYSE:ALIT) is a cloud-based integrated digital human capital and business solutions provider. The one-month return of Alight, Inc. (NYSE:ALIT) was -5.92%, and its shares lost 6.66% of their value over the last 52 weeks. On August 23, 2024, Alight, Inc. (NYSE:ALIT) stock closed at $7.15 per share with a market capitalization of $3.983 billion.

Greenlight Capital stated the following regarding Alight, Inc. (NYSE:ALIT) in its Q2 2024 investor letter:

“However, it wasn’t all roses. We had three material losers in the long portfolio (and an undisclosed loser in the short portfolio), and deservedly so. Alight, Inc. (NYSE:ALIT) fell from $9.85 to $7.38. While the core business is quite steady with a high degree of recurring revenues, it underperformed slightly in the first quarter. Additionally, the smaller and lumpier parts of the business disappointed for the second quarter in a row. Management’s deteriorating credibility has compounded the issue and the situation has attracted an activist investor. We now expect the company to either change management or sell itself.”

A person viewing their financial progress on a computer, highlighting the financial health offerings of the company.

Alight, Inc. (NYSE:ALIT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 42 hedge fund portfolios held Alight, Inc. (NYSE:ALIT) at the end of the second quarter which was 44 in the previous quarter. While we acknowledge the potential of Alight, Inc. (NYSE:ALIT) 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 Alight, Inc. (NYSE:ALIT) and shared Polen U.S. Small Company Growth’s views on the company. In addition, please check out our hedge fund investor letters Q2 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.