Night Watch Investment Management, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. In the fourth quarter the fund LP depreciated by -2.92% net of fees and ended the quarter at 10.30%. In the fourth quarter of 2024, the market experienced significant volatility. The initial excitement following the US elections quickly gave way to discouragement as rising inflation figures prompted the Federal Reserve to revise their interest rate cut expectations for 2025 downward. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Night Watch Investment Management highlighted stocks like United Airlines Holdings, Inc. (NASDAQ:UAL) in the fourth quarter 2024 investor letter. Headquartered in Chicago, Illinois, United Airlines Holdings, Inc. (NASDAQ:UAL) offers air transportation services. The one-month return of United Airlines Holdings, Inc. (NASDAQ:UAL) was 4.85%, and its shares gained 132.45% of their value over the last 52 weeks. On January 7, 2025, United Airlines Holdings, Inc. (NASDAQ:UAL) stock closed at $101.21 per share with a market capitalization of $33.29 billion.
Night Watch Investment Management stated the following regarding United Airlines Holdings, Inc. (NASDAQ:UAL) in its Q4 2024 investor letter:
“During H2 we pivoted out of the aerospace supply chain, into United Airlines Holdings, Inc. (NASDAQ:UAL). We’re cognizant of the poor track record that airlines have in generating returns for their shareholders. At the same time, we saw clear catalysts for an improving US airline market: Southwest and American Airlines were struggling to make money and decided against further growing their fleet. A Jet Blue Chapter 11 filing will allow them to cancel their airplane lease obligations and would see further capacity disappear from the US. As a best-in-class airline, UAL now has a chance to reach their target of 14% EBIT Margins (versus 9% in 2024), which would lower the ~6x P/E we paid to something closer to 3x. UAL has moved up by roughly 6% since our acquisition price at $60 and we are happy to hold our shares as long as the tightened supply provides a tailwind.”
An Airbus single-aisle aircraft overfly a major city, showcasing the airline services of the company.
United Airlines Holdings, Inc. (NASDAQ:UAL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 54 hedge fund portfolios held United Airlines Holdings, Inc. (NASDAQ:UAL) at the end of the third quarter which was 56 in the previous quarter. United Airlines Holdings, Inc.’s (NASDAQ:UAL) top line revenue grew 2.5% year-over-year to $14.8 billion in the third quarter. While we acknowledge the potential of United Airlines Holdings, Inc. (NASDAQ:UAL) 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 United Airlines Holdings, Inc. (NASDAQ:UAL) and shared the list of best aviation stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q4 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.