Diamond Hill Capital, an investment management company, released its “Small Cap Fund” second-quarter 2024 investor letter. A copy of the same can be downloaded here. Equity markets reported mixed results in the second quarter of 2024. However, the broad market Russell 3000 Index and the large-cap-focused Russell 1000 Index advanced approximately 3%, most other market segments posted negative returns. Diamond Hill Small Cap Fund slightly trailed its benchmark, the Russell 2000 Index, in Q2 and returned -3.42% while the benchmark return was -3.28% during the same period. For more information on the fund’s top picks in 2024, please check its top five holdings.
Diamond Hill Small Cap Fund highlighted stocks like Magnolia Oil & Gas Corporation (NYSE:MGY), in the second quarter 2024 investor letter. Magnolia Oil & Gas Corporation (NYSE:MGY) is an independent oil and natural gas company. The one-month return of Magnolia Oil & Gas Corporation (NYSE:MGY) was -8.44%, and its shares gained 5.54% of their value over the last 52 weeks. On August 7, 2024, Magnolia Oil & Gas Corporation (NYSE:MGY) stock closed at $23.99 per share with a market capitalization of $4.777 billion.
Diamond Hill Small Cap Fund stated the following regarding Magnolia Oil & Gas Corporation (NYSE:MGY) in its Q2 2024 investor letter:
“We continue finding attractively valued, resilient companies the market is overlooking amid its increasingly narrow focus on the mega-cap technology stocks dominating the major indices. In Q2, we initiated new positions in Magnolia Oil & Gas Corporation (NYSE:MGY), Thermon Group Holdings and Astrana Health.
Magnolia Oil & Gas is a small-cap exploration and production company based in the Eagle Ford shale region. The company has a strong and experienced management team with a disciplined capital-allocation framework, owner mindset and strong balance sheet. Further, the company’s low wellhead breakeven numbers and low debt levels make it an attractive, relatively lower-risk opportunity to gain exposure to the commodities cycle’s upside.”
Aerial view of an oil and natural gas drilling operation on a leasehold position.
Magnolia Oil & Gas Corporation (NYSE:MGY) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held Magnolia Oil & Gas Corporation (NYSE:MGY) at the end of the first quarter which was 25 in the previous quarter. In the second quarter, Magnolia Oil & Gas Corporation (NYSE:MGY) reported total GAAP net income attributable to Class A common stock of $96 million and total adjusted net income of $104 million or $0.52 per diluted share. While we acknowledge the potential of Magnolia Oil & Gas Corporation (NYSE:MGY) 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 Magnolia Oil & Gas Corporation (NYSE:MGY) and shared the list of oil stocks with the biggest upside. 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.
