Patient Capital Management, a value investing firm, released its “Patient Capital Opportunity Equity Strategy” third quarter 2024 investor letter. A copy of the letter can be downloaded here. During the quarter, the strategy returned 5.58% net of fees compared to the S&P 500’s 5.89% return. According to a three-factor performance attribution model, allocation and selection effects contributed positively to the portfolio’s performance while interaction effects contributed negatively. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Patient Capital Management highlighted stocks like Energy Transfer LP (NYSE:ET) in the third quarter 2024 investor letter. Energy Transfer LP (NYSE:ET) offers energy-related services that owns and operates natural gas transportation pipeline, and natural gas storage facilities. The one-month return of Energy Transfer LP (NYSE:ET) was 1.79%, and its shares gained 17.79% of their value over the last 52 weeks. On October 17, 2024, Energy Transfer LP (NYSE:ET) stock closed at $16.49 per share with a market capitalization of $56.742 billion.
Patient Capital Management stated the following regarding Energy Transfer LP (NYSE:ET) in its Q3 2024 investor letter:
“Energy names disappointed in the quarter following commodity prices lower throughout the period. We took the opportunity to add to our highest conviction ideas. We look to names that have idiosyncratic opportunities and are attractive in a variety of different commodity price environments. Many see risk to energy prices over the next year as supply is expected to outstrip demand by 1.3mb/d even before assuming any incremental OPEC supply comes onto the market. With commodities, consensus is rarely right. We assess companies on through cycle returns and normalized prices. From this perspective, we see a handful of attractive opportunities, including Energy Transfer LP (NYSE:ET), Seadrill (SDRL) and Kosmos (KOS).
Our ownership of Energy Transfer began in 2019 with the belief that the limited supply of new pipelines would provide attractive pricing opportunities over the long-term. At the same time, the company was paying us an attractive dividend (10% yield over the period). So far this investment thesis has largely played out, but we continue to see an attractive long-term setup for the name given our belief that natural gas will be a key ingredient to bridge us to a net carbon neutral world.”
A group of technicians in hazmat suits inspecting a natural gas storage tank.
Energy Transfer LP (NYSE:ET) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Energy Transfer LP (NYSE:ET) at the end of the second quarter which was 32 in the previous quarter. While we acknowledge the potential of Energy Transfer LP (NYSE:ET) 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 Energy Transfer LP (NYSE:ET) and shared Leon Cooperman’s stock portfolio and look at his firm’s top picks. 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.