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Aristotle Atlantic Partners, LLC, an investment advisor, released its “Core Equity Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The S&P 500 Index fell 4.27% in the first quarter of 2025, marking a sluggish start to the year for the U.S. equities market. On the other hand, bonds offered a measure of stability, as the Bloomberg U.S. Aggregate Bond Index rose 2.78%. Aristotle Atlantic’s Core Equity strategy returned -5.90% gross of fees (-5.99% net of fees) in the quarter, underperforming the S&P 500 Index’s -4.27% total return. The relative underperformance was due to a mix of security selection and allocation effects. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.
In its first-quarter 2025 investor letter, Aristotle Atlantic Core Equity Strategy highlighted stocks such as Broadcom Inc. (NASDAQ:AVGO). Broadcom Inc. (NASDAQ:AVGO) designs and develops various semiconductor and infrastructure software solutions. The one-month return of Broadcom Inc. (NASDAQ:AVGO) was -10.25%, and its shares gained 35.26% of their value over the last 52 weeks. On April 21, 2025, Broadcom Inc. (NASDAQ:AVGO) stock closed at $166.21 per share with a market capitalization of $815.112 billion.
Aristotle Atlantic Core Equity Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q1 2025 investor letter:
"Broadcom Inc. (NASDAQ:AVGO) detracted from performance in the first quarter. The release of the DeepSeek AI model and analysis of technological specifications stunned investors. This raised concerns about a rapid decline in AI model development costs and the effect that will have on capex spending for new infrastructure and advanced semiconductors used for accelerated computing needs. The entire AI infrastructure investment space saw significant declines in the final week of January following the DeepSeek announcements and continued to see further weakness in March as concerns around AI capex cuts increased."
A technician working at a magnified microscope, developing a new integrated circuit.
Broadcom Inc. (NASDAQ:AVGO) is in 12th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 161 hedge fund portfolios held Broadcom Inc. (NASDAQ:AVGO) at the end of the fourth quarter compared to 128 in the third quarter. While we acknowledge the potential of Broadcom Inc. (NASDAQ:AVGO) 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.
