TimesSquare Capital Management, an equity investment management company, released its “U.S. Mid Cap Growth Strategy” second-quarter investor letter. A copy of the same can be downloaded here. The equity markets performed well in the second quarter, as long as one held only a small number of the biggest, fastest-growing U.S. stocks. Given the Magnificent Seven’s superior performance, differences in growth and value among large caps were downplayed. There wasn’t much style diversity between mid-caps, small caps, or outside the U.S. In the second quarter, the strategy returned -2.94% (gross) and -3.14% (net) while the Russell Midcap Growth Index returned -3.21%. In addition, please check the fund’s top five holdings to know its best picks in 2024.
TimesSquare Capital U.S. Mid Cap Growth Strategy highlighted stocks like Regal Rexnord Corporation (NYSE:RRX), in the second quarter 2024 investor letter. Regal Rexnord Corporation (NYSE:RRX) is a global manufacturer of industrial powertrain solutions, power transmission components, electric motors and electronic controls, air-moving products, and specialty electrical components and systems. The one-month return of Regal Rexnord Corporation (NYSE:RRX) was -5.67%, and its shares lost 2.88% of their value over the last 52 weeks. On September 12, 2024, Regal Rexnord Corporation (NYSE:RRX) stock closed at $148.85 per share with a market capitalization of $9.905 billion.
TimesSquare Capital U.S. Mid Cap Growth Strategy stated the following regarding Regal Rexnord Corporation (NYSE:RRX) in its Q2 2024 investor letter:
“Many of our Industrials positions provide necessary business-to-business operational services, highly technical components, automation & efficiency improvements, or essential infrastructure services. Here there was a -25% showing from Regal Rexnord Corporation (NYSE:RRX), which specializes in motion control systems, climate solutions, and similar mechanical components for a variety of end markets. There were ongoing pressures on its Power Efficiency and Automation & Motion Control segments that related to destocking in the automation or HVAC end markets. Meanwhile the soon-to-be-divested Industrial Powertrain operations showed better-than-expected results, and the net results were inline revenues and earnings, though lower guidance to adjust for the divestiture. Regal’s management expects a recovery in orders later in 2024 and in the meanwhile will reduce its debt levels, so we added to our position.”
A technician inspecting a specialized industrial machinery in an engineering lab.
Regal Rexnord Corporation (NYSE:RRX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Regal Rexnord Corporation (NYSE:RRX) at the end of the second quarter which was 31 in the previous quarter. While we acknowledge the potential of Regal Rexnord Corporation (NYSE:RRX) 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 Regal Rexnord Corporation (NYSE:RRX) and shared Oppenheimer’s favorite stocks for the next 12 months and the top stock picks. 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.