The London Company, an investment management company, released “The London Company Large Cap Strategy” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. U.S. equities increased in the fourth quarter and most of the major indices saw positive gains. The quarter’s economic data was mixed but generally encouraging. The portfolio returned 0.8% (0.6% net) during the quarter compared to a 2.8% increase for the Russell 1000 Index. Positive sector exposure has contributed to offset the negative impact of stock selection on the relative performance. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
In its fourth quarter 2024 investor letter, The London Company Large Cap Strategy emphasized stocks such as CarMax, Inc. (NYSE:KMX). CarMax, Inc. (NYSE:KMX) is a used vehicle retailer headquartered in Richmond, Virginia. The one-month return of CarMax, Inc. (NYSE:KMX) was -2.56%, and its shares gained 8.39% of their value over the last 52 weeks. On February 24, 2025, CarMax, Inc. (NYSE:KMX) stock closed at $82.89 per share with a market capitalization of $12.784 billion.
The London Company Large Cap Strategy stated the following regarding CarMax, Inc. (NYSE:KMX) in its Q4 2024 investor letter:
“Exited: CarMax, Inc. (NYSE:KMX) – Sale reflects our lack of conviction in management’s ability to navigate a potentially more challenging consumer environment while balancing the demands of investment in omni-channel capabilities. Separately, the auto finance business represents over 50% of company earnings and there is risk of rising potential losses.”
A happy customer inspecting a newly purchased used car with the help of a sales assistant.
CarMax, Inc. (NYSE:KMX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held CarMax, Inc. (NYSE:KMX) at the end of the fourth quarter compared to 44 in the third quarter. While we acknowledge the potential of CarMax, Inc. (NYSE:KMX) 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 CarMax, Inc. (NYSE:KMX) and shared Madison Mid Cap Fund’s views on the company. 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.