Longleaf Partners, managed by Southeastern Asset Management, released its “Partners Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund returned 10.42% in the third quarter, compared to the S&P 500’s 5.89% return and Russell 1000 Value’s 9.43% return. In the quarter, there were very few detractors, and more than half of the portfolio holdings generated double-digit returns. The market is starting to see the value in many of the companies that the firm highlighted in the first two letters this year, which is positive. For more information on the fund’s best picks in 2024, please check its top five holdings.
Longleaf Partners Fund highlighted stocks like FedEx Corporation (NYSE:FDX) in the second third quarter 2024 investor letter. Founded in 1971, FedEx Corporation (NYSE:FDX) offers transportation, e-commerce, and business services. The one-month return of FedEx Corporation (NYSE:FDX) was 1.99%, and its shares gained 19.72% of their value over the last 52 weeks. On October 24, 2024, FedEx Corporation (NYSE:FDX) stock closed at $272.87 per share with a market capitalization of $66.668 billion.
Longleaf Partners Fund stated the following regarding FedEx Corporation (NYSE:FDX) in its Q3 2024 investor letter:
“FedEx Corporation (NYSE:FDX) – Global logistics company FedEx was a detractor this quarter, after being a top performer in Q2. The company reported a challenging quarter, missing expectations in a tough revenue environment. Some one-off issues also impacted results, including the US Postal Service contract expiring. While anticipated cost savings did not materialize to the extent the market expected, we believe these savings are likely to come through soon. We are also awaiting a final decision on the potential spin-off of the FedEx Freight business, as we wrote about last quarter. The market has consistently undervalued FedEx’s less-than-truckload operations. A spin-off or sale could unlock substantial value, as peers like Old Dominion and Saia trade at higher multiples on revenue and cash flow than those currently reflected by the market and in our appraisal of FedEx Freight.”
A driver unloading packages from a van for a time-critical delivery.
FedEx Corporation (NYSE:FDX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 59 hedge fund portfolios held FedEx Corporation (NYSE:FDX) at the end of the second quarter which was 56 in the previous quarter. While we acknowledge the potential of FedEx Corporation (NYSE:FDX) 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 FedEx Corporation (NYSE:FDX) and shared the list of best delivery stocks to invest in. FedEx Corporation (NYSE:FDX) was the top contributor to the performance of Longleaf Partners fund in the previous quarter. 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.