Ariel Investments, an investment management company, released its “Ariel Global Fund” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. Despite significant volatility, global markets reported gains in the third quarter. The Ariel Global fund appreciated +6.94% in the quarter outperforming the +6.61% return of its primary benchmark, the MSCI ACWI Index, and trailing the +9.42% return of its secondary benchmark, the MSCI ACWI Value Index. Ariel follows a non-consensus approach to identify undervalued, out-of-favor franchises that are misunderstood and mispriced. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Ariel Global Fund highlighted stocks like Comerica Incorporated (NYSE:CMA) in the third quarter 2024 investor letter. Headquartered in Dallas, Texas, Comerica Incorporated (NYSE:CMA) offers various financial products and services that operate through Commercial Banks, Retail Banks, Wealth Management, and Finance segments. The one-month return of Comerica Incorporated (NYSE:CMA) was 9.18%, and its shares gained 55.20% of their value over the last 52 weeks. On November 19, 2024, Comerica Incorporated (NYSE:CMA) stock closed at $67.77 per share with a market capitalization of $8.904 billion.
Ariel Global Fund stated the following regarding Comerica Incorporated (NYSE:CMA) in its Q3 2024 investor letter:
“We purchased Comerica Incorporated (NYSE:CMA) a financial holding company whose revenue is primarily generated across three business segments: the Commercial Bank, the Retail Bank and Wealth Management. The company offers a high-touch business model with an enhanced focus on long-term customer relationships. Lower deposit levels and declining demand for loans driven by the Fed’s quantitative tightening regime as well as deteriorating credit conditions presented an attractive entry point. Looking ahead, we believe the company is well-positioned to take advantage of economic growth, which should lead to enhanced deposit gathering and loan generation. Additionally, we expect more moderate rate cuts to allow for margin expansion and slower deposit cost increases. At today’s valuation, we believe the risk/reward is skewed to the upside.”
A shot of a financial advisor meeting with a wealthy couple discussing their portfolio.
Comerica Incorporated (NYSE:CMA) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 46 hedge fund portfolios held Comerica Incorporated (NYSE:CMA) at the end of the third quarter which was 38 in the previous quarter. Comerica Incorporated (NYSE:CMA) reported earnings of $184 million in the third quarter or $1.33 per share. While we acknowledge the potential of Comerica Incorporated (NYSE:CMA) 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 Comerica Incorporated (NYSE:CMA) and shared the list of best local bank stocks to invest in. 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.