Ariel Investments, an investment management company, released its “Ariel Fund” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. Due to the economy’s resilience and forecasters’ expectations of a soft landing, all major U.S. indices saw gains in the third quarter. The Federal Reserve turned its attention to the state of the labor market as interest rate reduction was implemented. Against this backdrop, Ariel Fund appreciated +12.08% in Q3 outperforming both the Russell 2500 Value and Russell 2500 indices, which returned +9.63% and +8.75%. For more information on the fund’s top picks in 2024, please check its top five holdings.
Ariel Fund highlighted stocks like Mohawk Industries, Inc. (NYSE:MHK), in the third quarter 2024 investor letter. Mohawk Industries, Inc. (NYSE:MHK) designs and manufactures flooring products. The one-month return of Mohawk Industries, Inc. (NYSE:MHK) was 2.08%, and its shares gained 90.92% of their value over the last 52 weeks. On October 14, 2024, Mohawk Industries, Inc. (NYSE:MHK) stock closed at $158.18 per share with a market capitalization of $9.984 billion.
Ariel Fund stated the following regarding Mohawk Industries, Inc. (NYSE:MHK) in its Q3 2024 investor letter:
“Several stocks in the portfolio had strong returns in the quarter. Manufacturer and distributor of floorcovering products, Mohawk Industries, Inc. (NYSE:MHK) advanced following solid earnings results and a subsequent increase in near-term guidance. Although sales volumes remain low and pricing headwinds continue, improved productivity and lower material costs drove margin expansion. Management also repurchased shares signaling increased confidence that the trough in earnings may be behind the company. In our view, MHK’s healthy balance sheet and progress managing through economic cycles position the company to benefit from long-term growth in residential remodeling, new home construction and commercial projects.”
An aerial view of a house filled with beautiful flooring products.
Mohawk Industries, Inc. (NYSE:MHK) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held Mohawk Industries, Inc. (NYSE:MHK) at the end of the second quarter which was 41 in the previous quarter. Mohawk Industries, Inc. (NYSE:MHK) reported $2.8 billion in net sales for the second quarter 2024, down 5.1% compared to Q2 2023. While we acknowledge the potential of Mohawk Industries, Inc. (NYSE:MHK) 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 Mohawk Industries, Inc. (NYSE:MHK) and shared the list of stocks with the highest consensus return on equity (ROE) according to Goldman Sachs. Mohawk Industries, Inc. (NYSE:MHK) detracted from the performance of Ariel Focus Fund 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.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.