Polen Capital, an investment management company, released its “Polen U.S. Small Company Growth Strategy” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. The third quarter had a strong finish for U.S. small-cap equities, driven by interest rate reductions and fading recessionary concerns. In the third quarter, the fund delivered 7.65% gross, and 7.35% net of fees compared to an 8.41% return for the Russell 2000 Growth Index. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.

Polen U.S. Small Company Growth Strategy highlighted stocks like Alarm.com Holdings, Inc. (NASDAQ:ALRM), in the third quarter 2024 investor letter. Alarm.com Holdings, Inc. (NASDAQ:ALRM) is a company that offers various Internet of Things (IoT) and solutions. The one-month return of Alarm.com Holdings, Inc. (NASDAQ:ALRM) was 11.56%, and its shares gained 1.77% of their value over the last 52 weeks. On November 15, 2024, Alarm.com Holdings, Inc. (NASDAQ:ALRM) stock closed at $59.85 per share with a market capitalization of $2.958 billion.

Polen U.S. Small Company Growth Strategy stated the following regarding Alarm.com Holdings, Inc. (NASDAQ:ALRM) in its Q3 2024 investor letter:

"The Portfolio's top detractors were Progyny, elf Beauty, and Alarm.com Holdings, Inc. (NASDAQ:ALRM). Alarm.com is a technology company providing cloud-based services for remote control, home automation, and residential and commercial security systems monitoring. The company delivered better-than-expected results, in our view, but shares declined due to its reduced full-year earnings forecast. Alarm.com continues to execute well amidst a soft residential security market. Reduced new installation activity has been offset by higher retention and contributions from recent growth initiatives."

A view of a control room with video screens monitoring multiple sites through intelligent automation.

Alarm.com Holdings, Inc. (NASDAQ:ALRM) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Alarm.com Holdings, Inc. (NASDAQ:ALRM) at the end of the second quarter which was 29 in the previous quarter. While we acknowledge the potential of Alarm.com Holdings, Inc. (NASDAQ:ALRM) 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.