Ariel Investments, an investment management company, released its “Ariel Appreciation Fund” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. The bull market surged in the second quarter, driven by investor enthusiasm for artificial intelligence (AI)-themed stocks. This narrow, momentum-driven rally helped the S&P 500 achieve a modest gain, despite declines in Mid- and Small-Cap companies. The Ariel Appreciation fund fell -6.56% in the quarter, trailing the -3.40% and -3.35% returns of the Russell Midcap Value and Russell Midcap indices. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Ariel Appreciation Fund highlighted stocks like Walgreens Boots Alliance, Inc. (NASDAQ:WBA) in the second quarter 2024 investor letter. Walgreens Boots Alliance, Inc. (NASDAQ:WBA) is a healthcare, pharmacy, and retail company that operates through U.S. Retail Pharmacy, International, and U.S. Healthcare segments. The one-month return of Walgreens Boots Alliance, Inc. (NASDAQ:WBA) was -20.39%, and its shares lost 63.09% of their value over the last 52 weeks. On August 27, 2024, Walgreens Boots Alliance, Inc. (NASDAQ:WBA) stock closed at $9.45 per share with a market capitalization of $8.158 billion.
Ariel Appreciation Fund stated the following regarding Walgreens Boots Alliance, Inc. (NASDAQ:WBA) in its Q2 2024 investor letter:
“Alternatively, shares of retail drugstore operator, Walgreens Boots Alliance, Inc. (NASDAQ:WBA), underperformed following an earnings miss and significant reduction to full year guidance, largely due to continued weakness in its U.S. retail business. In response, management announced a multi-year plan for the U.S. business to reduce the retail footprint, invest in the customer experience, align the retail and healthcare businesses for enhanced go-to-market capabilities and simplify the healthcare portfolio. Meanwhile, the company continues to execute on its cost savings initiatives to optimize profitability and is using excess capital to prioritize the sustainability of its operations and balance sheet. Over the medium-term, we expect a re-rating in shares as WBA’s new CEO rebuilds the leadership team and earns credibility by executing on previously articulated strategic imperatives as well as margin.”
A pharmacist discussing the health benefits of a prescription medication with a customer.
Walgreens Boots Alliance, Inc. (NASDAQ:WBA) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Walgreens Boots Alliance, Inc. (NASDAQ:WBA) at the end of the second quarter which was 41 in the previous quarter. While we acknowledge the potential of Walgreens Boots Alliance, Inc. (NASDAQ:WBA) 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 Walgreens Boots Alliance, Inc. (NASDAQ:WBA) and shared the list of the best dividend stocks under $50. The performance of Ariel Appreciation Fund in the first quarter was adversely affected by Walgreens Boots Alliance, Inc. (NASDAQ:WBA). 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.
