Madison Investments, an investment advisor, released its “Madison Small Cap Fund” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund declined 1.06% outperforming a 3.28% decline for the Russell 2000 Index and a 4.27% decline for the Russell 2500 Index. In the second quarter, the small-cap market was weak. Strong stock selection drove the outperformance. In addition, you can check the fund’s top 5 holdings to know its best picks in 2024.
Madison Small Cap Fund highlighted stocks like Option Care Health, Inc. (NASDAQ:OPCH) in its Q2 2024 investor letter. Option Care Health, Inc. (NASDAQ:OPCH) provides home and alternate site infusion services. The one-month return of Option Care Health, Inc. (NASDAQ:OPCH) was 5.83%, and its shares lost 7.47% of their value over the last 52 weeks. On July 19, 2024, Option Care Health, Inc. (NASDAQ:OPCH) stock closed at $30.33 per share with a market capitalization of $5.272 billion.
Madison Small Cap Fund stated the following regarding Option Care Health, Inc. (NASDAQ:OPCH) in its Q2 2024 investor letter:
“Portfolio activity was de minimis in the second quarter. Option Care Health, Inc. (NASDAQ:OPCH) is the leading provider of in-home infusion and alternative site infusion services in the U.S., with a dominant 22% share. The market is heavily fragmented with CVS and Optum as the only other players with scale. In-home infusion is gaining share over infusion centers and clinicians and patients value in-home care due to patient convenience and better outcomes. We expect the penetration of the infusion market to continue along historical trends. As a business, Option Care is a prodigious free cash flow generator and it returns capital to its shareholders in the form of buybacks. We admire the company’s recurring revenue profile and its long growth runway. Our intrinsic value for the company is $42/share, which is derived from discounted cash flow analysis.”
A home infusion nurse in full PPE gown delivering treatments to a patient in their own home.
Option Care Health, Inc. (NASDAQ:OPCH) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 39 hedge fund portfolios held Option Care Health, Inc. (NASDAQ:OPCH) at the end of the first quarter which was 35 in the previous quarter. The commitment of the more than 7,500 team members to providing unmatched patient care and figuring out how to serve more patients is demonstrated by Option Care Health, Inc.’s (NASDAQ:OPCH) revenue growth of more than 12% in the first quarter. While we acknowledge the potential of Option Care Health, Inc. (NASDAQ:OPCH) 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 Option Care Health, Inc. (NASDAQ:OPCH) and shared the list of best healthcare stocks to buy under $50. 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.
