Andvari Associates, an investment management firm, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. Andvari achieved a full-year performance of 13.3%, significantly surpassing the long-term market average, on an absolute basis. However, on a relative scale, the fund fell short of the market, which is disappointing. This underperformance can largely be attributed to the weaker performance of equity allocation. Additionally, the firm increased the overall allocation to fixed income for clients who are approaching or are at retirement age, which has also played a role. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
Andvari Associates highlighted stocks like SBA Communications Corporation (NASDAQ:SBAC) in the fourth quarter 2024 investor letter. SBA Communications Corporation (NASDAQ:SBAC) is an independent owner and operator of wireless communications infrastructure. The one-month return of SBA Communications Corporation (NASDAQ:SBAC) was 2.03%, and its shares lost 6.80% of their value over the last 52 weeks. On January 24, 2024, SBA Communications Corporation (NASDAQ:SBAC) stock closed at $207.94 per share with a market capitalization of $22.358 billion.
Andvari Associates stated the following regarding SBA Communications Corporation (NASDAQ:SBAC) in its Q4 2024 investor letter:
“During the last quarter of 2024, investors shifted their worries back again to interest rates and inflation. It now seems the Fed will not cut rates as much as the market was expecting back in August. As a result, three of our holdings most sensitive to rates-the cell tower REITs American Tower (AMT) and SBA Communications Corporation (NASDAQ:SBAC), and real estate data group CoStar-declined in the last quarter. These three were also down for the year: AMT at -12% while SBAC and CoStar each at -18%
The general investment case for all three remains the same. They all have very high-margin businesses that serve the real estate industry. They all have an above average ability to grow their businesses due to the mission-critical nature of their products to their customers. With AMT and SBAC, mobile data usage continues to grow, which requires the mobile phone networks to add more and larger antennas to current towers as well as to new towers.
Furthermore, these REITs either own the land beneath the towers or they have long-term leases in place. Land permitted for mobile towers is generally scarce because it’s a long regulatory process to add new towers. Plus, no one wants to see a large tower from their backyard. This gives AMT and SBAC pricing power. Their contracts call for steady rent increases over time. The same goes with CoStar. Their tools and services for commercial and rural land brokers, as well as owners of apartment complexes and hotels, are necessary and valuable…” (Click here to read the full text)
Aerial view of tall antenna towers and the landscape around them.
SBA Communications Corporation (NASDAQ:SBAC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held SBA Communications Corporation (NASDAQ:SBAC) at the end of the third quarter which was 45 in the previous quarter. While we acknowledge the potential of SBA Communications Corporation (NASDAQ:SBAC) 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 SBA Communications Corporation (NASDAQ:SBAC) and shared Wells Fargo’s top growth stocks and the stocks with the highest consensus EPS growth estimates. In addition, please check out our hedge fund investor letters Q3 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.