Alta Fox Capital, an investment management company, released its “Alta Fund Opportunities Fund” Q3 2024 investor letter. A copy of the letter can be downloaded here. The fund generated a gross return of 5.65% and net return of 4.16% in the third quarter. The fund generated a gross return of 808.14% and net return of 482.12% since its inception in April 2018 compared to the Russell 2000’s 59.25% and the S&P 500’s 143.73% returns. You can check the fund’s top 5 holdings for its best picks for 2024.
Alta Fox Capital highlighted stocks like REV Group, Inc. (NYSE:REVG) in the third quarter 2024 investor letter. REV Group, Inc. (NYSE:REVG) manufactures, and supplies specialty vehicles, and related aftermarket parts and services. The one-month return of REV Group, Inc. (NYSE:REVG) was 11.61%, and its shares gained 83.77% of their value over the last 52 weeks. On December 17, 2024, REV Group, Inc. (NYSE:REVG) stock closed at $32.60 per share with a market capitalization of $1.699 billion.
Alta Fox Capital stated the following regarding REV Group, Inc. (NYSE:REVG) in its Q3 2024 investor letter:
“REV Group, Inc. (NYSE:REVG) Updated Thoughts
We believe that our original REVG thesis has only strengthened since we initiated the position earlier this year. The quality of REVG’s earnings profile has significantly improved, with Fire & Ambulance (high quality, non-cyclical) exceeding expectations, while RV (lower quality & cyclical) underperformed. Our FY25 estimates now underwrite the RV segment at only 15% of EBITDA (down from 58% of EBITDA in FY23)
We expected other shareholders to be similarly pleased with the Q3 results:
REV surpassed our Fire & Ambulance margin estimate by 100bps in the quarter and re-emphasized imminent margin expansion as their higher-priced backlog is realized over the next 18 months.
Management upgraded EBITDA guidance again and the earnings mix shift improved significantly, justifying a higher multiple for the consolidated entity…” (Click here to read the full text)
A technician installing a replacement part on a specialty vehicle, surrounded by a team of professionals.
REV Group, Inc. (NYSE:REVG) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held REV Group, Inc. (NYSE:REVG) at the end of the third quarter which was 22 in the previous quarter. While we acknowledge the potential of REV Group, Inc. (NYSE:REVG) 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 REV Group, Inc. (NYSE:REVG) and shared the list of best RV and camping stocks to buy. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.
Disclosure: None. This article is originally published at Insider Monkey.