Investment management company Vulcan Value Partners recently released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. In 2024, the US economy was stronger than expected; the large-cap stocks led the robust U.S. equities markets. Although it is still excessively high, inflation did decrease throughout the course of the year. The largest market cap U.S. Companies performed better than the whole market. Lastly, U.S. stocks outperformed the majority of equities in non-U.S. markets. During Q4 and 2024, Focus and Focus Plus were the best performing strategies while Small Cap was the worst performing. However, all strategies had positive returns for the year. In the quarter, the Large Cap Composite returned -0.1% net of fees and expenses, the Small Cap Composite returned -7.3% net, the Focus Composite returned 6.3% net, the Focus Plus composite returned 7.4% and the All-Cap Composite returned -2.5% net. For more information on the fund’s best picks in 2024, please check its top five holdings.
Vulcan Value Partners highlighted stocks like The Middleby Corporation (NASDAQ:MIDD) in the fourth quarter 2024 investor letter. The Middleby Corporation (NASDAQ:MIDD) manufactures and services foodservice, food processing, and residential kitchen equipment. The one-month return of The Middleby Corporation (NASDAQ:MIDD) was 5.43%, and its shares gained 0.28% of their value over the last 52 weeks. On January 17, 2025, The Middleby Corporation (NASDAQ:MIDD) stock closed at $142.03 per share with a market capitalization of $7.64 billion.
Vulcan Value Partners stated the following regarding The Middleby Corporation (NASDAQ:MIDD) in its Q4 2024 investor letter:
“We purchased two new positions during the quarter: Fortune Brands Innovations Inc. and The Middleby Corporation (NASDAQ:MIDD). Middleby is a leading global provider of high-performance foodservice equipment with a focus on technology-driven solutions for the commercial, residential, and food processing sectors. With more than 120 well-known brands, Middleby’s products are found around the world in restaurants, residential kitchens, and food-processing facilities. Many of the company’s brands are over 100 years old and possess leading positions in their respective product ranges. The business is capital-light and generates robust free cash flow. Restaurant equipment replacement cycles are typically around seven years. During Covid, restaurant chains focused on making investments in the front of the house, such as digitization of menus, ordering kiosks, curbside pickup, and delivery. We believe that Middleby will benefit from pent-up demand over the next several years. There have been several recent precedent transactions in the commercial foodservice equipment and food processing industries. While our appraised value is less demanding than these transactions, the company is still trading at a discount to our estimate of intrinsic worth.”
A professional kitchen bustling with activity, utilizing different pieces of Kitchen Equipment, such as Conveyor Ovens, Fryers, Steam Cookers and Warming Equipment.
The Middleby Corporation (NASDAQ:MIDD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held The Middleby Corporation (NASDAQ:MIDD) at the end of the third quarter which was 25 in the previous quarter. In the third quarter, The Middleby Corporation (NASDAQ:MIDD) reported revenue of $943 million, which is a 5% decrease sequentially from Q2 and a 4% decrease from Q3 2023. While we acknowledge the potential of The Middleby Corporation (NASDAQ:MIDD) 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 The Middleby Corporation (NASDAQ:MIDD) and shared the list of best home appliance stocks to buy according to analysts. 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.