Wedgewood Partners, an investment management company, released its third-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the third quarter, Wedgewood Composite’s net return was 5.8% compared to the Standard & Poor’s 5.9%, the Russell 1000 Growth Index’s 3.2%, and the Russell 1000 Value Index’s 9.4% return for the same period. Year to date, the composite returned 22.4% compared to the 22.1%, 24.6%, and 16.7% returns for the indexes, respectively. In addition, you can check the fund’s top 5 holdings to know its best picks in 2024.
Wedgewood Partners highlighted stocks like Microsoft Corporation (NASDAQ:MSFT), in the third quarter 2024 investor letter. Microsoft Corporation (NASDAQ:MSFT) is a multinational software company that develops and supports software, services, devices, and solutions. The one-month return of Microsoft Corporation (NASDAQ:MSFT) was -1.56%, and its shares gained 29.49% of their value over the last 52 weeks. On October 23, 2024, Microsoft Corporation (NASDAQ:MSFT) stock closed at $424.60 per share with a market capitalization of $3.156 trillion.
Wedgewood Partners stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q3 2024 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) detracted from portfolio performance during the quarter. The Company posted continued healthy organic revenue growth of +13% and growth in operating income of +16%, helped by healthy seat growth in Office365, plus gains from pricing and premium mix shift. The market has revalued Microsoft’s earnings multiple higher over the past several quarters the hopes that the Company can create new revenue streams from its AI “Copilot” products. We are not yet convinced that Copilot will be the revenue growth driver that the market expects; however, we think Microsoft has plenty of mission-critical SMB and enterprise products, along with potential profitability upside from Azure, to keep earnings growing at an attractive, double-digit clip.”
A development team working together to create the next version of Windows.
Microsoft Corporation (NASDAQ:MSFT) is in second position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 279 hedge fund portfolios held Microsoft Corporation (NASDAQ:MSFT) at the end of the second quarter which was 293 in the previous quarter. In the quarter, Microsoft Corporation’s (NASDAQ:MSFT) revenue was $64.7 billion, up 15% in reported currency and 16% in constant currency and earnings per share was $2.95, representing a 10% increase in reported currency and an 11% increase in constant currency. While we acknowledge the potential of Microsoft Corporation (NASDAQ:MSFT) 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 Microsoft Corporation (NASDAQ:MSFT) and shared the list of best esports stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q3 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.