Investment management firm Vulcan Value Partners recently released its Q4 2024 Investor Letter. A copy of the letter can be downloaded here. The U.S. economy performed better than expected in 2024. Large-cap stocks led the strong US stock market. Inflation has declined over the year, although it remains excessively high. The largest U.S. companies by market capitalization performed better than the broader market. Finally, U.S. stocks outperformed most stocks in the non-U.S. market. During Q4 and 2024, Focus and Focus Plus were the best performing strategies, while small caps performed the worst. However, all strategies yielded positive annual returns. For the quarter, the Large Cap Composite returned -0.1% net before fees and expenses, the Small Cap Composite returned a net -7.3%, the Focus Composite returned a net 6.3%, and the Focus Plus Composite returned a net -7.3%. The return was 7.4%, and the all-cap composite returned 7.4%. Net -2.5%. For more information on the fund’s best picks for 2024, check out its top 5 holdings.
Vulcan Value Partners highlighted stocks like Alphabet Inc. (NASDAQ:GOOG) in its Q4 2024 investor letter. Google’s parent company, Alphabet Inc. (NASDAQ:GOOG), offers a variety of platforms and services that operate through its Google Services, Google Cloud, and Other Bets segments. Alphabet Inc. (NASDAQ:GOOG) has a 1-month return of 1.49% and the stock has increased 32.35% of its value over the past 52 weeks. On January 16, 2025, Alphabet Inc. (NASDAQ:GOOG) stock closed at $194.41 per share, giving it a market cap of $2.386 trillion.
Vulcan Value Partners said this about Alphabet Inc. (NASDAQ:GOOG) in its Q4 2024 investor letter:
“Five companies contributed significantly to results: Amazon.com Inc., Salesforce Inc., Live Nation Entertainment Inc., Carlyle Group Inc., and Alphabet Inc. (NASDAQ:GOOG).Alphabet had a strong third quarter. In particular, Google Cloud’s revenue increased by 35% during the period, and the segment’s profit expanded significantly. The risk of disruption to core search has not been fully mitigated, but Alphabet’s technical problems have not gone away. We continue to monitor antitrust litigation against our company and will comply with discipline as more information becomes available.”
User’s hand typing a search query in the Google search box. Highlights the company’s search capabilities.
Alphabet Inc. (NASDAQ:GOOG) ranks #7 on our list of the 30 most popular stocks among hedge funds. According to our database, 160 hedge fund portfolios owned Alphabet (NASDAQ:GOOG) at the end of the third quarter, compared to 165 in the previous quarter. While we appreciate the potential of Alphabet Inc. (NASDAQ:GOOG) as an investment, we believe AI stocks are more likely to deliver higher returns in a shorter time frame. If you’re looking for an AI stock with as much promise as NVIDIA, but trading at less than 5x earnings, check out our report on the cheapest AI stocks.
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