Mairs & Power, an investment advisor, released the “Mairs & Power Growth Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The stock market was surprisingly calm in the fourth quarter, despite some upheaval domestically and abroad. The market performance drivers in 2024 were mega cap Technology stocks. The fund had another positive year in 2024 and ended with 19.62% gain. The S&P Total Return (TR) was up 25.02%, and the Fund’s peer group, as measured by the Morningstar Large Blend Category, was up 20.51% over the same period of time. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Mairs & Power Growth Fund emphasized stocks such as NVIDIA Corporation (NASDAQ:NVDA). NVIDIA Corporation (NASDAQ:NVDA) offers graphics and compute and networking solutions. The one-month return of NVIDIA Corporation (NASDAQ:NVDA) was -1.76%, and its shares gained 77.77% of their value over the last 52 weeks. On February 20, 2025, NVIDIA Corporation (NASDAQ:NVDA) stock closed at $140.11 per share, with a market capitalization of $3.431 trillion.
Mairs & Power Growth Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q4 2024 investor letter:
“We prefer to invest in our backyard, as Minnesota and the Upper Midwest are blessed with a rich and diverse business community. As such, seven out of our 10 largest relative bets are based in our region (MN, WI, IA, SD, ND, IL). That said, we are unafraid to look beyond our geographic area if we find exceptional opportunities. In 2019, we found such an opportunity in a graphics processing technology company called NVIDIA Corporation (NASDAQ:NVDA). At the time, we felt NVIDIA would be a good way to leverage the growing interest in video games, as most of its chips were popular amongst “gamers” to enhance graphics. But what really grabbed our interest was its smaller, albeit faster-growing, data center business that was positioned to benefit from the emergence of high-performance computing, such as deep learning and machine learning, and the related field of AI. The rest, as they say, is history. NVIDIA is one of a number of Technology holdings that we have added over the past decade, which has raised eyebrows since our Firm was well-known for avoiding the Tech Bubble in the late 1990s. Unlike the dot-com companies that operated at the turn-of-the-century, many of today’s technology companies are established businesses with significant cash flows. We have argued, and continue to argue, that many of these investments are perfectly aligned with our investments process in that they embody durable competitive advantages, above-average growth prospects, and excellent management teams.”
NVIDIA Corporation (NASDAQ:NVDA) is in 5th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 223 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the fourth quarter which was 193 in the previous quarter. NVIDIA Corporation (NASDAQ:NVDA) reported another record quarter in fiscal Q3 2025 with $35.1 billion in revenues, representing a 94% year-over-year increase and 17% sequential growth. While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) 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 NVIDIA Corporation (NASDAQ:NVDA) and shared the list of top AI stocks on Wall Street’s radar right. In addition, please check out our hedge fund investor letters Q4 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.