Polen Capital, an investment management company, released its “Polen Focus Growth Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund returned -0.11% (gross) and -0.31% (net) compared to 8.33% for the Russell 1000 Growth Index and 4.28% for the S&P 500 Index. Generative AI (GenAI) remains the dominant market narrative in the second quarter. The portfolio does not own NVIDIA or other Semiconductor companies that are presently benefitting from the demand for AI hardware. However, with the portfolio’s extensive investment in software and IT services, the firm anticipates that GenAI’s long-term economic gains will go to these industries. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Polen Focus Growth Strategy highlighted stocks like The Home Depot, Inc. (NYSE:HD) in its Q2 2024 investor letter. The Home Depot, Inc. (NYSE:HD) a home improvement retailer. The one-month return of The Home Depot, Inc. (NYSE:HD) was 3.56%, and its shares gained 11.77% of their value over the last 52 weeks. On July 19, 2024, The Home Depot, Inc. (NYSE:HD) stock closed at $363.36 per share with a market capitalization of $360.31 billion.
Polen Focus Growth Strategy stated the following regarding The Home Depot, Inc. (NYSE:HD) in its Q2 2024 investor letter:
“In the second quarter, the top relative contributors to the Portfolio’s performance were all names we do not hold: The Home Depot, Inc. (NYSE:HD), Meta Platforms, and AbbVie. With Home Depot, much of the quarter’s weakness came in April, as a higher-than-expected inflation reading caused investors to question the likelihood of imminent rate cuts in 2024. Given Home Depot’s sensitivity to interest rates, as it relates to home improvement projects, the stock sold off in the period.”
A home improvement store overflowing with a variety of products and supplies.
The Home Depot, Inc. (NYSE:HD) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 70 hedge fund portfolios held The Home Depot, Inc. (NYSE:HD) at the end of the first quarter which was 70 in the previous quarter. In the first quarter, HD recorded $36.4 billion in sales a 2.3% decrease from Q1 2023, and diluted earnings per share of $3.63 compared to $3.82 in Q1 2023. A delayed springtime and persistent slowdown in certain larger discretionary projects affected the quarter. While we acknowledge the potential of The Home Depot, Inc. (NYSE:HD) 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 The Home Depot, Inc. (NYSE:HD) and shared list of the best dividend stocks. 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.
