Diamond Hill Capital, an investment management company, released its “Select Strategy” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In Q2, markets saw a modest boost, delivering positive returns across the majority of regions and nations. The Russell 3000 Index showed a +3% increase in US stocks; however, the majority of the gains came from large-cap stocks, which increased by about +4%. Returns were negative across the cap spectrum, with mid-caps and small caps, as indicated by their respective Russell indices, each down about -3%. The portfolio underperformed the Russell 3000 Index in Q2 and returned -4.96% net of fees compared to 3.22% for the index. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
Diamond Hill Select Strategy highlighted stocks like Starbucks Corporation (NASDAQ:SBUX) in the second quarter 2024 investor letter. Starbucks Corporation (NASDAQ:SBUX) operates as a roaster, marketer, and retailer of coffee. The one-month return of Starbucks Corporation (NASDAQ:SBUX) was -2.12%, and its shares lost 25.74% of their value over the last 52 weeks. On July 29, 2024, Starbucks Corporation (NASDAQ:SBUX) stock closed at $75.20 per share with a market capitalization of $85.179 billion.
Diamond Hill Select Strategy stated the following regarding Starbucks Corporation (NASDAQ:SBUX) in its Q2 2024 investor letter:
“Starbucks Corporation (NASDAQ:SBUX) is the global leader in the coffee industry. Given its significant scale, we believe Starbucks can maintain its average ticket growth and drive decent traffic growth, which should allow for some margin expansion. While macroeconomic and competitive pressures remain intense in China, the country accounts for a minimal percentage of today’s earnings, and we believe the current valuation embeds little to no contribution from China over the long term, which we view as too cynical. As the share price declined recently amid near-term concerns surrounding store sales in North America and China, we capitalized on what we considered an attractive entry point.”
A barista pouring freshly brewed coffee from an espresso machine to a cup in a bustling cafe.
Starbucks Corporation (NASDAQ:SBUX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 69 hedge fund portfolios held Starbucks Corporation (NASDAQ:SBUX) at the end of the first quarter which was 59 in the previous quarter. Starbucks Corporation’s (NASDAQ:SBUX) fiscal second-quarter performance fell short of expectations. The company reported $8.6 billion in revenues for the quarter, a decrease of 1% year-over-year. While we acknowledge the potential of Starbucks Corporation (NASDAQ:SBUX) 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 Starbucks Corporation (NASDAQ:SBUX) and shared Jim Cramer’s top trump trades: winners and losers. During Q2 2024, Madison Investors Fund established a position in Starbucks Corporation (NASDAQ:SBUX). 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.
