ClearBridge Investments, an investment management company, released its “ClearBridge SMID Cap Growth Strategy” first quarter 2024 investor letter. A copy of the letter can be downloaded here. Strong corporate earnings, enthusiasm over AI, and anticipation of interest rate cuts boosted the equity market rally in the first quarter. The growth stocks outperformed their value counterparts during the quarter as benchmark Russell 2500 Growth Index returning 8.51% versus the 6.07% return of the Russell 2500 Value Index. Against this backdrop, the strategy underperformed its Russell 2500 Growth Index benchmark in the quarter. Industrials and healthcare sectors were the leading contributors while the real estate and IT sectors detracted. In addition, please check the fund’s top five holdings to know its best picks in 2024.
ClearBridge SMID Cap Growth Strategy highlighted stocks like Maximus, Inc. (NYSE:MMS), in the first quarter 2024 investor letter. Founded in 1975, Maximus, Inc. (NYSE:MMS) is a provider of government services. The one-month return of Maximus, Inc. (NYSE:MMS) was 4.78%, and its shares gained 5.92% of their value over the last 52 weeks. On June 24, 2024, Maximus, Inc. (NYSE:MMS) stock closed at $88.69 per share with a market capitalization of $5.392 billion.
ClearBridge SMID Cap Growth Strategy stated the following regarding Maximus, Inc. (NYSE:MMS) in its first quarter 2024 investor letter:
“We exited a position in Maximus, Inc. (NYSE:MMS), in the industrials sector, which operates as a provider of government services in the U.S. and internationally. Given our concerns over difficult earnings comparisons expected in fiscal 2024 after the resumption of Medicaid determinations, disruption from a potential change in presidential administration, and new uncertainties over potential AI disruption to its services over the next 10 years, we made the decision to sell the position.”
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Maximus, Inc. (NYSE:MMS) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held Maximus, Inc. (NYSE:MMS) at the end of the first quarter which was 24 in the previous quarter. Maximus, Inc.’s (NYSE:MMS) revenue for the second quarter of fiscal year 2024 was reported at $1.35 billion, indicating an 11.7% year-over-year growth. While we acknowledge the potential of Maximus, Inc. (NYSE:MMS) 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 addition, please check out our hedge fund investor letters Q1 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.
