Fred Alger Management, an investment management company, released its “Alger Focus Equity Fund” first quarter 2024 investor letter. A copy of the letter can be downloaded here. US markets performed strongly in Q1, with the S&P Index up 10.56%. Class A shares of the fund outperformed the Russell 1000 Growth Index in the quarter. Information Technology and industrial sectors boosted the relative performance while financials and consumer staples weighed down the fund’s performance in the quarter. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Alger Focus Equity Fund highlighted stocks like Adobe Inc. (NASDAQ:ADBE), in the first quarter 2024 investor letter. Adobe Inc. (NASDAQ:ADBE) is a diversified software company that operates through Digital Media, Digital Experience, and Publishing and Advertising. The one-month return of Adobe Inc. (NASDAQ:ADBE) was 24.13%, and its shares gained 16.11% of their value over the last 52 weeks. On July 2, 2024, Adobe Inc. (NASDAQ:ADBE) stock closed at $567.71 per share with a market capitalization of $251.082 billion.
Alger Focus Equity Fund stated the following regarding Adobe Inc. (NASDAQ:ADBE) in its Q1 2024 investor letter:
“Adobe Inc. (NASDAQ:ADBE) is a diversified software company that provides document and creative software to a wide audience, including creative professionals and enterprises. Its flagship products, such as Photoshop, Acrobat, and Creative Suite, set industry standards like PDF and Flash, supporting a broad range of Adobe applications. As such, we believe Adobe is a primary beneficiary of the digitization (i.e., converting analog information into digital format) spending theme. Recently, the company announced a generative Al (Gen Al) tool called Firefly which is a family of creative GenAl models which will be incorporated into Adobe’s product suite, which can be utilized by consumers and enterprises to potentially save time and effort by automating tasks like image and text generation. We believe Adobe has the potential to leverage Al by integrating software programs into its existing products and enhancing developer Application Programming Interfaces (APIs) to facilitate Al-driven workflows. While the company delivered strong fiscal first quarter operating results, shares detracted from performance after management lowered their fiscal second quarter guidance with Al related growth acceleration being pushed out into the second half of 2024 due to difficult year-over-year pricing comparison. particularly within their creative vertical segment.”
A team of engineers and scientists collaborating at a workstation surrounded by their applications and solutions.
Adobe Inc. (NASDAQ:ADBE) is in 20th position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 108 hedge fund portfolios held Adobe Inc. (NASDAQ:ADBE) at the end of the first quarter which was 105 in the previous quarter. Adobe Inc. (NASDAQ:ADBE) generated $5.31 billion in revenue in the quarter, up 11% year-over-year. While we acknowledge the potential of Adobe Inc. (NASDAQ:ADBE) 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.
We discussed Adobe Inc. (NASDAQ:ADBE) in another article and shared the list of best cloud computing stocks to buy. In addition, please check out our hedge fund investor letters Q1 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.