Polen Capital, an investment management company, released its “Polen US SMID Company Growth Strategy” fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. SMID cap stocks initially rose by more than 10% following November’s U.S. Presidential election, in another volatile quarter. However, they relinquished nearly all of those gains in December, as the U.S. Federal Reserve signaled that interest rate cuts would occur more slowly than anticipated, with reductions expected to start in 2025. Against this backdrop, the fund returned 3.0% gross, and 2.7% net of fees compared to the Russell 2500 Growth Index return of 2.4%. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
Polen US SMID Company Growth Strategy highlighted stocks like Fox Factory Holding Corp. (NASDAQ:FOXF), in the fourth quarter 2024 investor letter. Fox Factory Holding Corp. (NASDAQ:FOXF) designs, engineers, manufactures, and markets performance-defining products and systems. The one-month return of Fox Factory Holding Corp. (NASDAQ:FOXF) was -9.39%, and its shares lost 55.62% of their value over the last 52 weeks. On January 31, 2024, Fox Factory Holding Corp. (NASDAQ:FOXF) stock closed at $27.32per share with a market capitalization of $1.139 billion.
Polen US SMID Company Growth Strategy stated the following regarding Fox Factory Holding Corp. (NASDAQ:FOXF) in its Q4 2024 investor letter:
“We sold our position in Fox Factory Holding Corp. (NASDAQ:FOXF), which has been an unsuccessful investment. Fox Factory makes high-end shocks for bicycles and powered vehicles. The company was negatively impacted by pandemic disruptions in the bicycle supply chain. While these headwinds have abated, the company faces additional weakness in its powered vehicles segment, which we expect to continue due to growing dealer inventories and a myriad of issues at the auto OEMs. Given new stock ideas, we believe Fox Factory will weather this challenging period, but we don’t see it as the best opportunity for our capital.”
A cyclist in full gear on their mountain bike, the Performance Cycling Components visible.
Fox Factory Holding Corp. (NASDAQ:FOXF) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 12 hedge fund portfolios held Fox Factory Holding Corp. (NASDAQ:FOXF) at the end of the third quarter which was 14 in the previous quarter. While we acknowledge the potential of Fox Factory Holding Corp. (NASDAQ:FOXF) 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 Fox Factory Holding Corp. (NASDAQ:FOXF) and shared Conestoga Capital Advisors’ views on the company in the previous quarter. 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.