Palm Valley Capital Management, an investment management firm, released the “Palm Valley Capital Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. In the third quarter, Palm Valley Capital Fund increased 2.43% compared to a 10.13% and 8.48% return for the S&P SmallCap 600 Index and the Morningstar Small Cap Index, respectively. During the quarter the equity positions in the Fund increased by 8.32% slightly below small-cap benchmarks. Cash equivalents comprised 81.5% of the fund’s assets at the period’s end. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Palm Valley Capital Fund highlighted stocks like Amdocs Limited (NASDAQ:DOX), in the third quarter 2024 investor letter. Amdocs Limited (NASDAQ:DOX) is a software and services provider, headquartered in Saint Louis, Missouri. The one-month return of Amdocs Limited (NASDAQ:DOX) was 4.59%, and its shares gained 5.44% of their value over the last 52 weeks. On October 3, 2024, Amdocs Limited (NASDAQ:DOX) stock closed at $88.16 per share with a market capitalization of $10.213 billion.
Palm Valley Capital Fund stated the following regarding Amdocs Limited (NASDAQ:DOX) in its Q3 2024 investor letter:
“The Fund’s top three contributors in Q3 were Lassonde Industries (ticker: LAS/A CN), Amdocs Limited (NASDAQ:DOX), and WH Group (ticker: WHGLY). Amdocs is one of the Fund’s larger positions. The stock appreciated during the quarter on record revenue and strong margins. The firm continues to facilitate digital and cloud migrations for the world’s leading telecommunications companies. Management has embraced the marketing opportunity from associating its services with AI (artificial intelligence), including tools used to streamline contact center call handling times. Recurring managed services revenue accounts for nearly 60% of the top line and includes agreements with many top providers such as AT&T, Vodafone, TELUS, and Charter. While the sell side sometimes seems to struggle with accepting Amdocs’ mature growth rates, we value the firm’s consistency and strong cash generation.”
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Amdocs Limited (NASDAQ:DOX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Amdocs Limited (NASDAQ:DOX) at the end of the second quarter which was 33 in the previous quarter. Amdocs Limited’s (NASDAQ:DOX) revenue in the second quarter was $1.25 billion, reflecting a 2% increase from Q2 2023 in constant currency. While we acknowledge the potential of Amdocs Limited (NASDAQ:DOX) 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 Amdocs Limited (NASDAQ:DOX) and shared Goldman Sachs top mutual fund manager stock picks. Palm Valley Capital Fund’s performance was significantly hurt by Amdocs Limited (NASDAQ:DOX) 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.