Bonhoeffer Capital Management, an asset management company, released its second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter of 2024, the fund returned a loss of 4.2% net of fees compared to 5.7% returns for MSCI World ex-US, a broad-based index, and 1.0% return for the DFA International Small Cap Value Fund. The fund’s stocks have an average EV/EBITDA of 3.8 and a weighted average earnings/free cash flow yield of 14.4% as of June 30, 2024. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Bonhoeffer Capital Management highlighted stocks like Millicom International Cellular S.A. (NASDAQ:TIGO) in the second quarter 2024 investor letter. Millicom International Cellular S.A. (NASDAQ:TIGO) offers cable and mobile services. The one-month return of Millicom International Cellular S.A. (NASDAQ:TIGO) was 6.03%, and its shares gained 74.30% of their value over the last 52 weeks. On September 13, 2024, Millicom International Cellular S.A. (NASDAQ:TIGO) stock closed at $27.26 per share with a market capitalization of $4.67 billion.
Bonhoeffer Capital Management stated the following regarding Millicom International Cellular S.A. (NASDAQ:TIGO) in its Q2 2024 investor letter:
“Increasing use of transaction processing in the markets of our respective firms, as well as the rollout of fiberoptic and 5G networks has offered growth opportunities within the telecom and transaction processing theme. It is important to note, that given that most of our firms are holding companies and have multiple components of value (including real estate), the timeline for realization of value may be longer than for more mono-industry-focused firms.
Millicom International Cellular S.A. (NASDAQ:TIGO) is one of the remaining telecom firms in the portfolio. The company retains favorable market conditions including operating in many two-player markets or in markets where the number of participants is getting smaller. With fewer players, telco firms can recover pricing power to offset the increasing cost of network construction and operations. In Columbia, one of its key markets, a large player has entered bankruptcy which will reduce the number of market players. In addition, Millicom is in negotiations to buy the assets of the firm out of bankruptcy.
Some additional promise on the horizon for Millicom includes investor interest in Lati, Millicom’s tower spin-off, from US tower firms such as SBA Communications. In addition, Millicom continues to implement cost cuts identified by the new CEO and the team that was put in place by the new large shareholder, Xavier Niel. Mr. Neil has executed tender offers for Millicom shares (the latest of which was at $25.75 per share) which has increased his stake in Millicom to 40%. TIGO’s management has recommended shareholders not to accept Mr. Niel’s tender offers because management believes the prices offered were too low. We agree.”
A telecom tower in a city skyline indicating the companys expansive reach.
Millicom International Cellular S.A. (NASDAQ:TIGO) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held Millicom International Cellular S.A. (NASDAQ:TIGO) at the end of the second quarter which was 9 in the previous quarter. While we acknowledge the potential of Millicom International Cellular S.A. (NASDAQ:TIGO) 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 Millicom International Cellular S.A. (NASDAQ:TIGO) and shared Bonhoeffer Capital Management’s views on the company. 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.
