Merion Road Capital Management, an investment advisor, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the fourth quarter, Merion Road Small Cap Fund had a good performance and returned 5.5% bringing 2024 returns to +17.4%. This compared to 0.3% return for the Russell 2000 Index in the quarter and an 11.4% return in 2024. The long-only portfolio of Merion Road rose 9.0% during the quarter, bringing the 2024 returns to 32.4%. This compared to S&P 500’s 2.5% and 24.9% returns for the same periods. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Merion Road Capital Management highlighted stocks like Victory Capital Holdings, Inc. (NASDAQ:VCTR), in the fourth quarter 2024 investor letter. Victory Capital Holdings, Inc. (NASDAQ:VCTR) is an asset management company. The one-month return of Victory Capital Holdings, Inc. (NASDAQ:VCTR) was 4.43%, and its shares gained 91.83% of their value over the last 52 weeks. On January 31, 2024, Victory Capital Holdings, Inc. (NASDAQ:VCTR) stock closed at $66.18 per share with a market capitalization of $4.304 billion.
Merion Road Capital Management stated the following regarding Victory Capital Holdings, Inc. (NASDAQ:VCTR) in its Q4 2024 investor letter:
“Victory Capital Holdings, Inc. (NASDAQ:VCTR): We are still waiting for all closing conditions to be met for VCTR to close the Amundi transaction. As part of the shareholder vote we were provided with management guidance for standalone operating performance of the two businesses. After adjusting for subsequent AUM growth and announced cost synergies, the pro forma cashflow should conservatively exceed $6.00/share which would put the stock at <10x FCF. In Q4 the company exhausted their prior share repurchase plan, that had $95mm remaining, and re-upped for another $200mm. In other words, they continue to generate prodigious cashflow and return it to shareholders.”
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Victory Capital Holdings, Inc. (NASDAQ:VCTR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held Victory Capital Holdings, Inc. (NASDAQ:VCTR) at the end of the third quarter which was 15 in the previous quarter. While we acknowledge the potential of Victory Capital Holdings, Inc. (NASDAQ:VCTR) 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 Victory Capital Holdings, Inc. (NASDAQ:VCTR) and shared TimesSquare Capital Management U.S. Small Cap Growth Strategy’s views on the company 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.
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Disclosure: None. This article is originally published at Insider Monkey.