L1 Capital, an investment management firm, released its “L1 Long Short Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. Over the quarter, global markets moved higher, due to lower inflation data which continued to trend downward as central banks increased interest rate reductions. The portfolio returned 2.4% for the quarter compared to a 7.8% return for the S&P/ASX 200 AI. Over the past five years, the portfolio return was 18.4% p.a compared to 8.4% p.a. for the index. In addition, you can check the fund’s top 5 holdings to know its best picks in 2024.
L1 Long Short Fund highlighted stocks like NNexGen Energy Ltd. (NYSE:NXE), in the third quarter 2024 investor letter. NexGen Energy Ltd. (NYSE:NXE) engages in the acquisition, exploration, and evaluation and development of uranium properties. The one-month return of NexGen Energy Ltd. (NYSE:NXE) was -5.35%, and its shares gained 25.41% of their value over the last 52 weeks. On November 12, 2024, NexGen Energy Ltd. (NYSE:NXE) stock closed at $7.60 per share with a market capitalization of $4.302 billion.
L1 Long Short Fund stated the following regarding NexGen Energy Ltd. (NYSE:NXE) in its Q3 2024 investor letter:
“NexGen Energy Ltd. (NYSE:NXE) (Long -7%) weakened as uranium prices fell 5% over the quarter. We continue to see the uranium market as having positive fundamental supply/demand tailwinds over the medium to long term. NexGen is preparing to develop the world’s largest undeveloped uranium deposit, Arrow, located in Saskatchewan, Canada. This would be a major, new, strategic Western source to address the looming uranium market deficit. We anticipate that NexGen will have completed all regulatory requirements over the course of the next six months, providing a clear pathway to full scale construction of the project. Arrow has the potential to generate more than C$2b of cash flow annually, once developed (2028) – a highly attractive proposition given NexGen’s current market cap of ~C$5.5b.”
A miner in a hard hat and apron holding a piece of uranium ore in the Athabasca Basin, Saskatchewan.
NexGen Energy Ltd. (NYSE:NXE) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 33 hedge fund portfolios held NexGen Energy Ltd. (NYSE:NXE) at the end of the second quarter which was 40 in the previous quarter. While we acknowledge the potential of NexGen Energy Ltd. (NYSE:NXE) 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 NexGen Energy Ltd. (NYSE:NXE) and shared the list of best Uranium stocks to buy according to hedge funds. NexGen Energy Ltd. (NYSE:NXE) detracted from the performance of L1 Long Short Fund in the previous quarter due to weak uranium prices. 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.