Manole Capital Management, an investment management company, focused on covering the Financial and Technology sectors, released its second quarter 2024 investor letter. A copy of the same can be downloaded here. There was a sharp increase in the stock market from mid-October 2023 through March 2024. Mega cap technology and growth stocks were the leading sectors while the strength was broader as the Energy, Financials, Healthcare, and Industrial sectors outperformed. A general sense of optimism was present as the S&P 500 had its best first quarter since 2019. The letter discussed news in credit cards and a $30 billion interchange settlement. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Manole Capital Management highlighted stocks like Mastercard Incorporated (NYSE:MA), in the second quarter 2024 investor letter. Mastercard Incorporated (NYSE:MA) is a payment technology company with a market capitalization of $417.853 billion. The one-month return of Mastercard Incorporated (NYSE:MA) was 0.05%, and its shares gained 14.62% of their value over the last 52 weeks. On May 24, 2024, Mastercard Incorporated (NYSE:MA) stock closed at $449.49 per share.
Manole Capital Management stated the following regarding Mastercard Incorporated (NYSE:MA) in its Q2 2024 investor letter:
“We have invested in Mastercard Incorporated (NYSE:MA) and Visa since their IPO’s, in 2006 and 2008 respectively. When both payment companies initially listed, they identified potential legal liabilities stemming from merchant interchange lawsuits. During its IPO roadshow, Visa took a somewhat differentiated tact, by shielding new public shareholders from this liability and putting the risk onto the shoulders of its banking partners, card issuers, and earliest owners.
Over the last few decades, there have been numerous settlements, as well as legislation impacting payment industry. The Durbin Amendment, inside of Dodd-Frank legislation in 2010, altered debit fees. Also, a court ordered interchange settlement was approved over 15 years ago, but it was not fully embraced by the merchant community. Last year, Senator Durbin announced his intention to alter the payment environment again, with his CCCA (Credit Card Competition Act). This created a headwind for the networks, as it appeared that legislation from DC was on the horizon. We wrote numerous articles on this subject, highlighting our view that government interference in setting pricing isn’t ideal. All of our research notes can be read at www.manolecapital.com, under the “Research” tab. If you don’t believe us, since we clearly have a vested interest, there are additional thoughts about how the CCCA would negatively impact consumers…” (Click here to read the full text)
A businessman at a smart POS terminal, demonstrating contactless payment methods.
Mastercard Incorporated (NYSE:MA) is in 10th position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 148 hedge fund portfolios held Mastercard Incorporated (NYSE:MA) at the end of the first quarter which was 141 in the previous quarter. Mastercard Incorporated (NYSE:MA) reported strong revenue and earnings growth in the first quarter 2024. The net revenue increased by 11% and net income rose by 16% in the quarter compared to a year ago on a non-GAAP currency neutral basis. While we acknowledge the potential of Mastercard Incorporated (NYSE:MA) 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.
We discussed Mastercard Incorporated (NYSE:MA) in another article and shared the list of best fintech stocks to buy. Mastercard Incorporated (NYSE:MA) was one of the top contributors to Baron FinTech Fund in the previous quarter. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.
