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Polen Capital, an investment management company, released its “Polen Focus Growth Strategy” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The U.S. equities have experienced a significant performance surge over the past two years. In the fourth quarter, the strategy returned 4.9% (gross) and 4.65% (net) compared to 7.07% for the Russell 1000 Growth Index and 2.41% for the S&P 500 Index. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Polen Focus Growth Strategy emphasized 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 -17.19%, and its shares gained 36.16% of their value over the last 52 weeks. On March 5, 2025, Broadcom Inc. (NASDAQ:AVGO) stock closed at $191.58 per share with a market capitalization of $900.796 billion.
Polen Focus Growth Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q4 2024 investor letter:
"Broadcom Inc. (NASDAQ:AVGO) (not owned) was another notable relative detractor in the period, owing to a strong earnings report highlighting a demand surge in its AI chip business and a significant ramp-up in its long-term guidance, projecting the AI revenue opportunity to grow to $60-90B in 2027 from $12B in 2024. While Broadcom possesses many compelling assets, it has operated as a highly cyclical semiconductor business that has also been highly acquisitive. We prefer organic and durable growers, but we acknowledge that Broadcom’s assembled assets have advantages in a generative AI world and they have leaned heavily on raising customer prices of its acquired software businesses like VMWare to help grow earnings."
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. Broadcom Inc.’s (NASDAQ:AVGO) consolidated revenue for the fiscal year 2024 reached a record $51.6 billion, up 44% from the previous year. 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.