Montaka Global Investments, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. All of the companies in Motaka’s portfolio have significant and growing competitive advantages, which aligns with the firm’s investment strategy. All of them are situated within advantageous tailwinds and structural changes. Furthermore, they continue to be substantially undervalued despite recent great stock price performance. Montaka’s investee companies account for 75% of Montaka’s total portfolio and yearly portfolio turnover is roughly 25% (representing ~4 year holding period, on average). In addition, please check the fund’s top five holdings to know its best picks in 2024.
Montaka Global Investments highlighted stocks like Floor & Decor Holdings, Inc. (NYSE:FND), in the fourth quarter 2024 investor letter. Floor & Decor Holdings, Inc. (NYSE:FND) is a multi-channel specialty retailer of hard surface flooring and related accessories. The one-month return of Floor & Decor Holdings, Inc. (NYSE:FND) was -0.34%, and its shares lost 6.62% of their value over the last 52 weeks. On January 22, 2024, Floor & Decor Holdings, Inc. (NYSE:FND) stock closed at $100.73 per share with a market capitalization of $10.8 billion.
Montaka Global Investments stated the following regarding Floor & Decor Holdings, Inc. (NYSE:FND) in its Q4 2024 investor letter:
“We also expect a recovery in the all-important US housing market to accelerate in 2025. It’s worth highlighting that high mortgage rates, combined with recession fears over recent years, resulted in a collapse of existing home sales.
But under the hood, households are in far better financial health, on average. Indeed, most homeowners have large equity cushions in their home. Mortgage debt in the US, as a percentage of GDP, is 45%, down from a peak of 73% during the housing bust following the GFC.
A recovery in the US housing market would be helpful for US consumption, and the health of the broader economy. And it would be particularly potent for big-box specialist hard-surface flooring retailer, Floor & Decor Holdings, Inc. (NYSE:FND), a top 10 holding in Montaka’s portfolio. As home sales increase, so too does demand for home renovation inputs, including hard-surface flooring…” (Click here to read the full text)
An overhead view of a website displaying the multiple options of flooring products available for purchase.
Floor & Decor Holdings, Inc. (NYSE:FND) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held Floor & Decor Holdings, Inc. (NYSE:FND) at the end of the third quarter which was 34 in the previous quarter. While we acknowledge the potential of Floor & Decor Holdings, Inc. (NYSE:FND) 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 Floor & Decor Holdings, Inc. (NYSE:FND) and shared the list of stocks that Jim Cramer recently discussed. Montaka Global Investments established a position Floor & Decor Holdings, Inc. (NYSE:FND) 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.