Fred Alger Management, an investment management company, released its “Alger Spectra Fund” fourth quarter 2024 investor letter. A copy of the investor letter can be downloaded here. U.S. equities showed positive performance in the fourth quarter, primarily fueled by a clear outcome in the U.S. presidential election. Against this backdrop, the fund’s Class A shares outperformed the Russell 3000 Growth Index in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Alger Spectra Fund emphasized stocks such as NVIDIA Corporation (NASDAQ:NVDA). NVIDIA Corporation (NASDAQ:NVDA) offers graphics and compute and networking solutions. The one-month return of NVIDIA Corporation (NASDAQ:NVDA) was -10.91%, and its shares gained 79.25% of their value over the last 52 weeks. On February 5, 2024, NVIDIA Corporation (NASDAQ:NVDA) stock closed at $124.83 per share, with a market capitalization of $3.057 trillion.
Alger Spectra Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q4 2024 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is a leading supplier of graphics processing units (GPUs) for a variety of end markets, such as gaming, PCs, data centers, virtual reality, and high-performance computing. The company is leading in most secular growth categories in computing, and especially artificial intelligence and super-computing parallel processing techniques for solving complex computational problems. In our view, Nvidia’s computational power is a critical enabler of AI and therefore essential to AI adoption. Shares contributed to performance during the quarter, driven by strong demand for its data center products, especially the Hopper H200 chips, which generated double-digit billions in revenue, marking the fastest product ramp in the company’s history. Management provided fiscal fourth-quarter revenue guidance above analyst estimates, along with resilient operating margins supported by robust demand and limited competition. In our view, Nvidia’s leadership in scaling AI infrastructure, including advancements in inference and test-time scaling (i.e., reasoning during inference), is driving adoption among enterprises and startups, providing continued demand for its high-performance chips and software solutions. As older-generation chips are repurposed for inference and new clusters are deployed, we believe Nvidia is well-positioned to capitalize on growing compute needs across AI applications.”
NVIDIA Corporation (NASDAQ:NVDA) is in 5th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 193 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the third quarter which was 179 in the previous quarter. NVIDIA Corporation (NASDAQ:NVDA) reported another record quarter in Q3 with $35.1 billion in revenues, representing a 94% year-over-year increase and 17% sequential growth. While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) 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 NVIDIA Corporation (NASDAQ:NVDA) and shared the list of high-flying AI stocks this week. In addition, please check out our hedge fund investor letters Q3 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.