Polen Capital, an investment management company, released its “Polen U.S. SMID Company Growth Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. The portfolio returned -0.28% gross and -0.57 % net of fees in the first quarter compared to an 8.51% return for the Russell 2500 Growth Index. Although the market conditions were relatively stable from the previous quarter, pricing momentum sharply increased in the first quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Polen U.S. SMID Company Growth Strategy highlighted stocks like Endava plc (NYSE:DAVA), in the first quarter 2024 investor letter. Endava plc (NYSE:DAVA) is a technology services provider for clients in the consumer products, healthcare, mobility, and retail verticals. The one-month return of Endava plc (NYSE:DAVA) was -6.75%, and its shares lost 40.29% of their value over the last 52 weeks. On May 28, 2024, Endava plc (NYSE:DAVA) stock closed at $29.14 per share with a market capitalization of $1.683 billion.
Polen U.S. SMID Company Growth Strategy stated the following regarding Endava plc (NYSE:DAVA) in its first quarter 2024 investor letter:
“Like Globant, Endava plc (NYSE:DAVA) is an IT services company, albeit UK-based, focused on payments, financial services, and TMT verticals. Unfortunately, financials and TMT have been among the weakest segments as companies cautiously pull back on investments, negatively impacting Endava’s results over the past several quarters. Further, management issued 2024 guidance that came in well below expectations, underscoring investor concerns around the timing of a reacceleration in growth. The over 40% earnings price decline is likely a result of investors extrapolating the worst- case scenario; however, we remain more positive in the long term, and we trust their ability to play a critical role in facilitating digital transformation across various industries and end markets. The stock is now trading below 20x next year’s earnings for a high- quality business, and recent acquisitions set the company up for continued future success.”
A tech expert in a suit presenting a new IT strategy in front of a corporate audience.
In the quarter, Endava plc’s (NYSE:DAVA) revenues came in at £174.4 million, which was within revenue guidance. This is an 11.8% year-over-year decline in constant currency from £203.5 million during the same period last year.
Endava plc (NYSE:DAVA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held Endava plc (NYSE:DAVA) at the end of the first quarter which was 10 in the previous quarter.
In another article, we discussed Endava plc (NYSE:DAVA) and shared Baron Discovery Fund’s views on the company. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.
If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
