RiverPark Advisors, an investment advisory firm and sponsor of the RiverPark family of mutual funds, released its “RiverPark Large Growth Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. During the third quarter, the markets performed strongly with the Russell 1000 Growth Index (RLG) and the S&P 500 index returning 3.19% and 5.89% respectively and RPX returning 3.73%. A weaker-than-expected jobs report that raised fears of a coming recession caused the RLG to drop 8.8% from the end of June to the fifth of August, giving the quarter a rocky start. As China passed a significant stimulus package and the Fed began its rate-cutting cycle with a 0.50% decrease to a goal of 4.75%-5.00%, those losses quickly reversed. In addition, please check the fund’s top five holdings to know its best picks in 2024.

RiverPark Large Growth Fund highlighted stocks like Snap Inc. (NYSE:SNAP), in the third quarter 2024 investor letter. Snap Inc. (NYSE:SNAP) is a technology company that offers a visual messaging application that help people to people to communicate visually through short videos and images. The one-month return of Snap Inc. (NYSE:SNAP) was 5.57%, and its shares lost 32.65% of their value over the last 52 weeks. On December 17, 2024, Snap Inc. (NYSE:SNAP) stock closed at $11.18 per share with a market capitalization of $18.751 billion.

RiverPark Large Growth Fund stated the following regarding Snap Inc. (NYSE:SNAP) in its Q3 2024 investor letter:

"Snap Inc. (NYSE:SNAP): SNAP was a top detractor in the third quarter following a second quarter earnings report that fell short of high expectations. While the company reported strong Daily Active User (DAU) growth (432 million +10% year-over-year) and time spent watching content on the app (+25% year-over-year), revenue of $1.24 billion was below the midpoint of the company’s guidance and slightly below investor expectations. Management pointed to weakness in their Brand Advertising vertical, specifically highlighting demand for retail, technology, and entertainment advertising for slowing through the quarter. SNAP did exceed EBITDA expectations by $15 million due to better operating leverage, but guided third quarter EBITDA below expectations as the company plans to make some targeted investments around AI infrastructure.

We believe that improvements in SNAP’s ad platform and continued growth in DAU should lead to continued acceleration in revenue growth over the next several quarters and years. With 2023 revenue of $4.6 billion (as compared with Meta’s $134 billion), we believe SNAP has a long runway for both revenue growth and expanded profitability."

A young adult family using a Camera to record moments of their daily life.

Snap Inc. (NYSE:SNAP) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 34 hedge fund portfolios held Snap Inc. (NYSE:SNAP) at the end of the third quarter which was 44 in the previous quarter. Snap Inc.'s (NYSE:SNAP) third quarter total revenue increased 15% year-over-year to $1.37 billion. While we acknowledge the potential of Snap Inc. (NYSE:SNAP) 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 Snap Inc. (NYSE:SNAP) and shared the list of best augmented reality stocks to buy. In addition, please check out our hedge fund investor letters Q3 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.