Meridian Funds, managed by ArrowMark Partners, released its “Meridian Contrarian Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. The U.S. Federal Reserve, “Fed”, reduced interest rates by 0.5% on September 18, offering much-needed relief to investors. This key decision aimed to stabilize the markets following a turbulent August filled with worries about declining job market indicators. Against this backdrop, the fund returned 6.85% (net) during the quarter underperforming the 8.75% returns of the Russell 2500 Index and 9.63% returns of the secondary benchmark the Russell 2500 Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Meridian Contrarian Fund highlighted stocks like Navitas Semiconductor Corporation (NASDAQ:NVTS) in the third quarter 2024 investor letter. Founded in 2013, Navitas Semiconductor Corporation (NASDAQ:NVTS) designs, develops, and markets gallium nitride power integrated circuits, silicon carbide, associated high-speed silicon system controllers, and digital isolators. The one-month return of Navitas Semiconductor Corporation (NASDAQ:NVTS) was -7.87%, and its shares lost 65.16% of their value over the last 52 weeks. On November 27, 2024, Navitas Semiconductor Corporation (NASDAQ:NVTS) stock closed at $2.46 per share with a market capitalization of $459.518 million.
Meridian Contrarian Fund stated the following regarding Navitas Semiconductor Corporation (NASDAQ:NVTS) in its Q3 2024 investor letter:
“Navitas Semiconductor Corporation (NASDAQ:NVTS) designs and produces highly efficient power semiconductors, leading the way in Gallium Nitride (GaN) technology, which enables superior energy efficiency and charging speeds compared to traditional silicon. Handling GaN is challenging, and Navitas has a significant competitive advantage with its technology. We initially invested in early 2023 when the company lost favor due to a downturn in the highly cyclical mobile phone end-market. The stock declined in the period when revenue guidance came in lower than expected, driven by continued weak conditions in the EV and solar markets, which delayed customer product launches. During the quarter, we increased our position, confident in the long-term secular outlook for energy-efficient semiconductors, Navitas’ ongoing technological leadership, and its strong balance sheet, with over $100m in net cash. We believe the company is well-positioned to weather the current cyclical downturn.”
Aerial view of a large solar panel array under construction in a rural China landscape.
Navitas Semiconductor Corporation (NASDAQ:NVTS) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held Navitas Semiconductor Corporation (NASDAQ:NVTS) at the end of the third quarter which was 15 in the previous quarter. Navitas Semiconductor Corporation (NASDAQ: NVTS) reported third-quarter 2024 revenue of $21.7 million, remaining essentially flat compared to the prior year and showing a 6% increase sequentially from the previous quarter. While we acknowledge the potential of Navitas Semiconductor Corporation (NASDAQ:NVTS) 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 Navitas Semiconductor Corporation (NASDAQ:NVTS) and shared the list of best semiconductor penny stocks to invest in. In addition, please check out our hedge fund investor letters Q3 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.