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Diamond Hill Capital, an investment management company, released its “Small Cap Fund” fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. In Q4, markets rose unevenly, ending another positive year for markets. Stocks rose generally after the US election, but several lost most or all of their gains before the end of the year. Against this backdrop, the strategy outperformed the Russell 2000 Index in Q4 and for the full year. Relative strength in Q4 was concentrated among industrials holdings outperforming benchmark peers by a wide margin. Additionally, consumer staples and energy holdings also provided relative tailwinds. On the other hand, consumer discretionary holdings were the main cause of strategy’s relative weakness. Even though holdings were quite favorable on an absolute basis, underweight to the technology sector was another headwind in Q4. The strategy returned 0.93% in Q4 and 13.22% in 2024, compared to 0.33% and 11.54% return for Russell 2000 Index for the same periods. For more information on the fund’s top picks in 2024, please check its top five holdings.
In its fourth quarter 2024 investor letter, Diamond Hill Small Cap Fund emphasized stocks such as Rocky Brands, Inc. (NASDAQ:RCKY). Rocky Brands, Inc. (NASDAQ:RCKY) designs, manufactures, and markets footwear and apparel. One-month return of Rocky Brands, Inc. (NASDAQ:RCKY) was 21.89%, and its shares gained 68.40% of their value over the last 52 weeks. On February 12, 2025, Rocky Brands, Inc. (NASDAQ:RCKY) stock closed at $88.53 per share with a market capitalization of $1.452 billion.
Diamond Hill Small Cap Fund stated the following regarding Rocky Brands, Inc. (NASDAQ:RCKY) in its Q4 2024 investor letter:
"Other bottom Q4 contributors included Astrana Health, Live Oak Bancshares and Rocky Brands, Inc. (NASDAQ:RCKY). Footwear and apparel manufacturer Rocky Brands saw slower demand for its boots given unfavorable seasonal weather, which in turn weighed on wholesale shipments."
A fashion model wearing a complete look featuring the company's apparel.
Rocky Brands, Inc. (NASDAQ:RCKY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held Rocky Brands, Inc. (NASDAQ:RCKY) at the end of the third quarter which was 14 in the previous quarter. Rocky Brands, Inc. (NASDAQ:RCKY) reported sales of $114.5 million in the third quarter of 2024, which were down 2.4% year-over-year. While we acknowledge the potential of Rocky Brands, Inc. (NASDAQ:RCKY) 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.