ClearBridge Investments, an investment management company, released its “ClearBridge Large Cap Value Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. US equities continued the journey as the growing number of “winners” concentrated in the market due to the excitement surrounding new weight loss medications and artificial intelligence, while the overall market was being affected by weakening economic indicators. The Russell 1000 Value Index underperformed its growth counterpart in the quarter, returning -2.17% to the Russell 1000 Growth Index’s 8.34% return. The strategy lagged behind its Russell 1000 Value Index benchmark during the quarter and had negative contributions from nine of the 11 sectors it was invested, on an absolute basis. Overall stock selection detracted from the performance, relatively. In addition, please check the fund’s top five holdings to know its best picks in 2024.
ClearBridge Large Cap Value 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 -6.07%, and its shares lost 18.37% of their value over the last 52 weeks. On July 5, 2024, CVS Health Corporation (NYSE:CVS) stock closed at $56.62 per share with a market capitalization of $71.079 billion.
ClearBridge Large Cap Value Strategy stated the following regarding CVS Health Corporation (NYSE:CVS) in its Q2 2024 investor letter:
“Also among detractors, CVS Health Corporation (NYSE:CVS) is coping with a prolonged uptick in the utilization of medical services by its Medicare Advantage clients, which has coincided with government pressure on payer reimbursements. In this environment, CVS severely mispriced its Medicare Advantage book in an attempt to gain share, which has led to large losses in its insurance business. While we believe it will take some time to recover profitability in the segment, the short cycle nature of managed care insurance along with the company’s focus on “margins over members” gives us confidence that it will be able to grow earnings over the next few years. With the stock trading at a very low multiple, we believe the market is capitalizing these losses in perpetuity, which we view as overly pessimistic and which should set the stock up for strong returns over the medium term.”
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, 54 hedge fund portfolios held CVS Health Corporation (NYSE:CVS) at the end of the first quarter which was 67 in the previous quarter. 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.
We discussed CVS Health Corporation (NYSE:CVS) in another article and shared the list of largest companies in every state in the US. Vltava Fund sold its stake in CVS Health Corporation (NYSE:CVS) in Q2 2024. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.
