Ensemble Capital Management, an investment management company, released its second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the first half of 2024, the strategy increased 8.02% compared to the S&P 500’s 15.29% return. Although the average stock in the S&P 500 has only increased by 5.07% so far this year, the S&P 500 was remarkably up over 15%. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Ensemble Capital Management highlighted stocks like Illumina, Inc. (NASDAQ:ILMN) in the second quarter 2024 investor letter. Illumina, Inc. (NASDAQ:ILMN) offers sequencing- and array-based solutions for genetic and genomic analysis. The one-month return of Illumina, Inc. (NASDAQ:ILMN) was 10.07%, and its shares lost 35.31% of their value over the last 52 weeks. On July 18, 2024, Illumina, Inc. (NASDAQ:ILMN) stock closed at $115.79 per share with a market capitalization of $18.445 billion.
Ensemble Capital Management stated the following regarding Illumina, Inc. (NASDAQ:ILMN) in its Q2 2024 investor letter:
“Next, we’d like to discuss our position in Illumina, Inc. (NASDAQ:ILMN). Despite its poor stock performance over the past two years, we believe it’s an important competitively advantaged company and has become very undervalued for two reasons.
First, its acquisition of GRAIL – the first multi-cancer early detection screening technology, one that has required huge amounts of investment and meaningfully diluted earnings while coming under fire from regulators for being anti-competitive.
Second, a slowdown in its core genetic sequencing business due a slowdown after the COVID pandemic subsided, tighter capital markets for customers during 2022 and 2023, exacerbated by an important product cycle transition that ultimately improves its competitive positioning and business outlook…” (Click here to read the full text)
A research facility with medical professionals surrounded by diagnostic equipment.
Illumina, Inc. (NASDAQ:ILMN) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 48 hedge fund portfolios held Illumina, Inc. (NASDAQ:ILMN) at the end of the first quarter which was 58 in the previous quarter. While we acknowledge the potential of Illumina, Inc. (NASDAQ:ILMN) 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 Illumina, Inc. (NASDAQ:ILMN) and shared the list of best medical device 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.
