Ariel Investments, an investment management company, released its “Ariel Fund” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. Due to investor excitement for stocks with an artificial intelligence (AI) theme, the bull market surged through the second quarter. The S&P 500 edged a small gain despite the loss in Mid- and Small-Cap stocks because of this narrow, momentum-driven rally. The fund decreased -5.64% in the quarter against this backdrop, underperforming the Russell 2500 Value Index’s -4.31% and the Russell 2500 Index’s -4.27% return. For more information on the fund’s top picks in 2024, please check its top five holdings.
Ariel Fund highlighted stocks like Royal Caribbean Cruises Ltd. (NYSE:RCL), in the second quarter 2024 investor letter. Royal Caribbean Cruises Ltd. (NYSE:RCL) is a cruise company. The one-month return of Royal Caribbean Cruises Ltd. (NYSE:RCL) was -7.63%, and its shares gained 45.64% of their value over the last 52 weeks. On August 6, 2024, Royal Caribbean Cruises Ltd. (NYSE:RCL) stock closed at $150.26 per share with a market capitalization of $38.68 billion.
Ariel Fund stated the following regarding Royal Caribbean Cruises Ltd. (NYSE:RCL) in its Q2 2024 investor letter:
“Global cruise vacation company, Royal Caribbean Cruises Ltd. (NYSE:RCL), advanced on another quarterly earnings beat and subsequent raise in full-year guidance. Stronger than anticipated consumer demand, healthy onboard spend, robust pricing and solid cost containment lifted recent results. Additionally, RCL is benefitting from several new megaships, more island destinations and re-entry into the China market. The resiliency of the core cruise consumer, in combination with management’s superior operational expertise and revised earnings outlook, lays the foundation for RCL to exceed its three-year strategic imperative, the Trifecta Program, a year earlier than expected.”
An aerial view of a luxurious cruise ship, surrounded by the blue horizon.
Royal Caribbean Cruises Ltd. (NYSE:RCL) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 56 hedge fund portfolios held Royal Caribbean Cruises Ltd. (NYSE:RCL) at the end of the first quarter which was 54 in the previous quarter. In the second quarter, Royal Caribbean Cruises Ltd. (NYSE:RCL) performed exceptionally well, surpassing expectations. It delivered adjusted earnings per share of $3.21 and net yield growth of 13.3%. While we acknowledge the potential of Royal Caribbean Cruises Ltd. (NYSE:RCL) 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 Royal Caribbean Cruises Ltd. (NYSE:RCL) and shared the list of best travel and leisure stocks to buy. 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.
