Bretton Capital Management, an investment management company, released “Bretton Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The market is experiencing a period of high returns, with two consecutive years of around 25% returns and 15 years of mid-teens returns, prompting investors to be cautious. The average stock market return is around 9-10% per year, historically, based on corporate earnings growth and dividends and buybacks. The 20 companies the fund owns are well-positioned and expected to perform well. Against this backdrop, in the fourth quarter, the fund returned -0.98% compared to 2.41% return for the S&P 500. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
In its fourth quarter 2024 investor letter, Bretton Fund emphasized stocks such as Ross Stores, Inc. (NASDAQ:ROST). Headquartered in Dublin, California, Ross Stores, Inc. (NASDAQ:ROST) is an off-price fashion and apparel retailer. The one-month return of Ross Stores, Inc. (NASDAQ:ROST) was -6.97%, and its shares lost 3.69% of their value over the last 52 weeks. On February 14, 2025, Ross Stores, Inc. (NASDAQ:ROST) stock closed at $138.76 per share with a market capitalization of $45.781 billion.
Bretton Fund stated the following regarding Ross Stores, Inc. (NASDAQ:ROST) in its Q4 2024 investor letter:
“Pre-pandemic, TJX and Ross Stores, Inc. (NASDAQ:ROST) were usually in lockstep operationally and performance-wise. The main difference is TJX is much larger and has more divisions: TJ Maxx has higher-end goods; Marshalls has lower price points and is very similar to Ross; HomeGoods and Homesense offer furniture and household goods. But as inflation spiked up, TJX was better able to push through price increases, helped in part due to its relatively higher-income shoppers being less sensitive to inflation. TJX’s earnings growth and share price have outperformed Ross the past few years, but we expect that to converge in the near term. TJX’s and Ross’s earnings increased an estimated 9% and 11%, respectively, and their stocks returned 31% and 10%.”
A close-up of a mannequin outfitted with the company’s latest collection of apparel.
Ross Stores, Inc. (NASDAQ:ROST) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 55 hedge fund portfolios held Ross Stores, Inc. (NASDAQ:ROST) at the end of the third quarter which was 53 in the previous quarter. While we acknowledge the potential of Ross Stores, Inc. (NASDAQ:ROST) 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 Ross Stores, Inc. (NASDAQ:ROST) and shared TimesSquare Capital U.S. Mid Cap Growth Strategy’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q4 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.