Madison Investments, an investment advisor, released its “Madison Small Cap Fund” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund declined 1.06% outperforming a 3.28% decline for the Russell 2000 Index and a 4.27% decline for the Russell 2500 Index. In the second quarter, the small-cap market was weak. Strong stock selection drove the outperformance. In addition, you can check the fund’s top 5 holdings to know its best picks in 2024.
Madison Small Cap Fund highlighted stocks like Summit Materials, Inc. (NYSE:SUM), in the second quarter 2024 investor letter. Summit Materials, Inc. (NYSE:SUM) is a vertically integrated construction materials company. The one-month return of Summit Materials, Inc. (NYSE:SUM) was 8.39%, and its shares gained 6.04% of their value over the last 52 weeks. On July 19, 2024, Summit Materials, Inc. (NYSE:SUM) stock closed at $38.63 per share with a market capitalization of $6.778 billion.
Madison Small Cap Fund stated the following regarding Summit Materials, Inc. (NYSE:SUM) in its Q2 2024 investor letter:
“Our worst performing sectors for the quarter were Industrials and Materials, both very cyclically sensitive areas. During the second quarter, several bellwether industrial companies reported disappointing results driven by macroeconomic weakness. The Industrial sector has seen some of the strongest fundamentals since the COVID lows as distributors built buffer inventory stock during the days of tight supply chains and strong stimulus demand. And so we were not surprised to see a natural slowdown after several years of growth. However, we are uncertain regarding the magnitude and duration and are watching fundamentals closely. Our worst performing stocks here were Legal Zoom, Summit Materials, Inc. (NYSE:SUM), and WillScot Mobile Mini.
Summit Materials is suffering from a wetter than average spring, which pushes out demand for its building materials. We view this issue as temporary. The start of infrastructure projects and Merger & Acquisition synergies are the company’s larger opportunities in the coming years. We continue to be quite enthused about Summit’s future prospects and opportunistically added to the stock in the second quarter.”
A vast construction site with heavy machinery, materials, and workers, showcasing the company’s global presence.
Summit Materials, Inc. (NYSE:SUM) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held Summit Materials, Inc. (NYSE:SUM) at the end of the first quarter which was 23 in the previous quarter. While we acknowledge the potential of Summit Materials, Inc. (NYSE:SUM) 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 Summit Materials, Inc. (NYSE:SUM) and shared ClearBridge SMID Cap Growth Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q2 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.
