Columbia Acorn Fund, distributed by Columbia Management Investment Distributors, released its second quarter 2024 investor letter. A copy of the fund can be downloaded here. In the quarter, the fund returned -6.01%, while the benchmark, the Russell 2500 Growth Index, returned -4.22%. The second quarter brought a significant change in market sentiment. The underperformance of the holdings in the quarter was primarily driven by a disappointing earnings season. In addition, you can check the fund’s top 5 holdings for its best picks for 2024.
Columbia Acorn Fund highlighted stocks like Sprout Social, Inc. (NASDAQ:SPT), in the second quarter 2024 investor letter. Sprout Social, Inc. (NASDAQ:SPT) designs, develops, and operates a web-based social media management platform. The one-month return of Sprout Social, Inc. (NASDAQ:SPT) was -18.90%, and its shares lost 48.66% of their value over the last 52 weeks. On September 10, 2024, Sprout Social, Inc. (NASDAQ:SPT) stock closed at $25.41 per share with a market capitalization of $1.45 billion.
Columbia Acorn Fund stated the following regarding Sprout Social, Inc. (NASDAQ:SPT) in its Q2 2024 investor letter:
“Sprout Social, Inc. (NASDAQ:SPT) is a software company specializing in social media management. Companies use Sprout to place advertising on social media sites, monitor customer feedback, track returns on spending, engage with influencers and make real-time changes to marketing campaigns. The stock pulled back sharply due to a disappointing first quarter and reduced guidance for the full year, driven by an elongated sales cycle for large deals. A CEO change also weighed on sentiment around the stock. We added to the position on weakness, viewing the valuation as inexpensive for an asset-light software company that has been growing revenues by approximately 20% annually.”
A marketing manager in a boardroom making decisions about the company’s social media management platform.
Sprout Social, Inc. (NASDAQ:SPT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held Sprout Social, Inc. (NASDAQ:SPT) at the end of the second quarter which was 22 in the previous quarter. The Sprout Social, Inc.’s (NASDAQ:SPT) second quarter revenue was $99.4 million, up 25% year-over-year. While we acknowledge the potential of Sprout Social, Inc. (NASDAQ:SPT) 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 Sprout Social, Inc. (NASDAQ:SPT) and shared Alger Weatherbie Specialized Growth 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.
