Greystone Capital Management, an investment management company, released its third-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the third quarter, the return for separate accounts managed by the firm ranged from +8.0% to +10.7%. The median account returned +10.1%, net of fees. The third quarter result was favorably compared to the +5.9% and +9.3% returns for the S&P 500 and Russell 2000. The fund’s return generally varies from the major indices as the fund’s portfolio concentrates on small companies outside the major indices. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
Greystone Capital Management highlighted stocks like NN, Inc. (NASDAQ:NNBR) in the Q3 2024 investor letter. NN, Inc. (NASDAQ:NNBR) designs, manufactures, and sells high-precision components and assemblies. The one-month return of NN, Inc. (NASDAQ:NNBR) was -17.15%, and its shares gained 58.25% of their value over the last 52 weeks. On November 1, 2024, NN, Inc. (NASDAQ:NNBR) stock closed at $3.1650 per share with a market capitalization of $158.08 million.
Greystone Capital Management stated the following regarding NN, Inc. (NASDAQ:NNBR) in its Q3 2024 investor letter:
“During the quarter I sold our entire stake in NN, Inc. (NASDAQ:NNBR), despite our recent purchases along with my optimism about the investment. The reasons for the sale are two-fold. First, we made two new investments recently, one toward the end of last quarter and the other in Q3, which represent much better uses of capital than our smaller position in NNBR.
Second, I’ve been doing a fair amount of reflection on past portfolio mistakes and successes, leading me to the realization that owning higher quality businesses, with no room for anything else, is my desired path forward. NNBR is not a great business. A potentially great investment, but not a great business. There is a big difference. One is a shorter-term return stream with a fixed valuation / price target, and a larger than desired room for error. The other is what your portfolios should contain if we want to maximize long-term results. To date, my biggest investment mistakes have been selling quality businesses too early and replacing them with lower quality businesses under the guise of cheapness/opportunity cost. Our returns would be much better if I stopped doing this. Moving forward, I think it’s prudent to focus on (and own) higher quality businesses that can compound their value over a long period of time. I am currently penning more thoughts on this topic which I look forward to sharing once complete.”
A manager signing off on a precision stamping for a flight control component.
NN, Inc. (NASDAQ:NNBR) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held NN, Inc. (NASDAQ:NNBR) at the end of the second quarter which was 19 in the previous quarter. While we acknowledge the potential of NN, Inc. (NASDAQ:NNBR) 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 NN, Inc. (NASDAQ:NNBR) and shared the list of best conglomerate stocks to buy. Greystone Capital Management added NN, Inc. (NASDAQ:NNBR) to its portfolio during Q1 2024, considering its potential for improvement. In addition, please check out our hedge fund investor letters Q3 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.