Polen Capital, an investment management company, released its “Polen Focus Growth Strategy” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund returned -0.11% (gross) and -0.31% (net) compared to 8.33% for the Russell 1000 Growth Index and 4.28% for the S&P 500 Index. Generative AI (GenAI) remains the dominant market narrative in the second quarter. The portfolio does not own NVIDIA or other Semiconductor companies that are presently benefitting from the demand for AI hardware. However, with the portfolio’s extensive investment in software and IT services, the firm anticipates that GenAI’s long-term economic gains will go to these industries. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Polen Focus Growth Strategy highlighted stocks like Netflix, Inc. (NASDAQ:NFLX), in the second quarter 2024 investor letter. Netflix, Inc. (NASDAQ:NFLX) is a streaming platform with a market capitalization of $272.907 billion. One-month return of Netflix, Inc. (NASDAQ:NFLX) was -5.33%, and its shares gained 47.85% of their value over the last 52 weeks. On July 19, 2024, Netflix, Inc. (NASDAQ:NFLX) stock closed at $633.34 per share.
Polen Focus Growth Strategy stated the following regarding Netflix, Inc. (NASDAQ:NFLX) in its Q2 2024 investor letter:
“Finally, we trimmed Netflix, Inc. (NASDAQ:NFLX) mostly due to valuation but also as a source of funds to add to the new position in Shopify. As a reminder, we added to our position in August 2022 amid broad concerns about the company’s ability to grow and monetize shared passwords. We expected Netflix to show progress in monetizing shared passwords, leading to robust free cash flow generation. This is now playing out and is appreciated by the market. Hence, given the balance of growth and valuation, we felt it was appropriate to reduce our exposure to a more normal weight.”
A home theater with family members enjoying streaming content together.
Netflix, Inc. (NASDAQ:NFLX) is in 21st position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 107 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of the first quarter which was 89 in the previous quarter. Netflix, Inc. (NASDAQ:NFLX) reported 17% revenue growth in the second quarter. While we acknowledge the potential of Netflix, Inc. (NASDAQ:NFLX) 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 Netflix, Inc. (NASDAQ:NFLX) and shared the list of best communication and media stocks to buy according to hedge funds. Netflix, Inc. (NASDAQ:NFLX) was a top performer in Polen Focus Growth Strategy last quarter. In addition, please check out our hedge fund investor letters Q2 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.
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