Meridian Funds, managed by ArrowMark Partners, released its “Meridian Small Cap Growth Fund” second quarter 2024 investor letter. A copy of the same can be downloaded here. Major index returns increased throughout the quarter due to strong profits from large-cap technology companies, especially those connected to artificial intelligence. But the market’s breadth revealed a different picture. The fund returned -3.54% (net) in the second quarter compared to the Russell 2000 Growth Index’s -2.92% return. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Meridian Small Cap Growth Fund highlighted stocks like LegalZoom.com, Inc. (NASDAQ:LZ) in its Q2 2024 investor letter. LegalZoom.com, Inc. (NASDAQ:LZ) is an online platform that supports the legal, compliance, and business management needs of small businesses, and consumers. The one-month return of LegalZoom.com, Inc. (NASDAQ:LZ) was 1.07%, and its shares lost 36.95% of their value over the last 52 weeks. On September 20, 2024, LegalZoom.com, Inc. (NASDAQ:LZ) stock closed at $6.62 per share with a market capitalization of $1.163 billion.
Meridian Small Cap Growth Fund stated the following regarding LegalZoom.com, Inc. (NASDAQ:LZ) in its Q2 2024 investor letter:
“LegalZoom.com, Inc. (NASDAQ:LZ) is a leading online platform providing small businesses with legal, compliance, and tax services that allow them to start and operate within the required regulations. The stock underperformed during Q2 on weak guidance from management that indicated its small businesses, the company’s core customers, were under pressure. We believe that the company will continue to gain share due to its strong brand and network effects which will allow them to sell a broad range of services to small businesses. We also see room for significant operating leverage as the expanded range of products and services begins to generate revenue after several years of investment. We added to our position during the period on share price weakness.”
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LegalZoom.com, Inc. (NASDAQ:LZ) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held LegalZoom.com, Inc. (NASDAQ:LZ) at the end of the second quarter which was 24 in the previous quarter. In the second quarter, LegalZoom.com, Inc. (NASDAQ:LZ) generated $177 million in revenues, up 5% year-over-year. While we acknowledge the potential of LegalZoom.com, Inc. (NASDAQ:LZ) 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 LegalZoom.com, Inc. (NASDAQ:LZ) and shared Madison Small Cap Fund’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.