Coho Partners, an investment management company released its “Relative Value Equity Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In 2024, the market is led by a handful of stocks, with NVIDIA alone contributing nearly a third of the S&P 500 Index’s total return year-to-date. The Information Technology and Communication Services sectors are performing strongly, and the Russell 1000 Growth Index has almost tripled the returns of the Russell 1000 Value Index year-to-date. Economically Sensitive sectors have returned more than double that of the Demand Defensive sectors. Against this backdrop, the strategy underperformed with a -1% YTD return, relative to the Russell 1000 Value Index’s 6.6% return and the S&P 500 Index’s 15.3% return. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Coho Relative Value Equity Strategy highlighted stocks like CVS Health Corporation (NYSE:CVS), in the second quarter 2024 investor letter. CVS Health Corporation (NYSE:CVS) is a US-based health solutions provider. The one-month return of CVS Health Corporation (NYSE:CVS) was 7.18%, and its shares lost 10.77% of their value over the last 52 weeks. On October 2, 2024, CVS Health Corporation (NYSE:CVS) stock closed at $62.24 per share with a market capitalization of $78.297 billion.
Coho Relative Value Equity Strategy stated the following regarding CVS Health Corporation (NYSE:CVS) in its Q2 2024 investor letter:
“While we believe each of those companies is performing in line with or better than our expectations and that the moves lower are unjustified, both CVS Health Corporation (NYSE:CVS) and Nike reported disappointing performance in recent results. In CVS’ case, management gave an optimistic outlook to 2024 at its December Investor Day, which we believed was consistent with our expectations. Unfortunately, management misestimated its medical loss ratio and the anticipated profitability in its book for Medicare Advantaged lives. This triggered a position paper violation, as the company’s financial flexibility now looks constrained in both 2024 and 2025.”
A row of shelves in a retail pharmacy, demonstrating the variety of drugs and over-the-counter products.
CVS Health Corporation (NYSE:CVS) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 60 hedge fund portfolios held CVS Health Corporation (NYSE:CVS) at the end of the second quarter which was 54 in the previous quarter. In the second quarter, CVS Health Corporation (NYSE:CVS) reported approximately $91.2 billion in revenues, reflecting a 2.6% increase from Q2 2023. While we acknowledge the potential of CVS Health Corporation (NYSE:CVS) 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 CVS Health Corporation (NYSE:CVS) and shared Larry Robbins’ best stocks to buy. 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.
