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 ServiceNow, Inc. (NYSE:NOW). ServiceNow, Inc. (NYSE:NOW) offers intelligent workflow automation solutions for digital businesses. The one-month return of ServiceNow, Inc. (NYSE:NOW) was -10.51%, and its shares gained 19.23% of their value over the last 52 weeks. On March 5, 2025, ServiceNow, Inc. (NYSE:NOW) stock closed at $915.79 per share with a market capitalization of $189.099 billion.

Polen Focus Growth Strategy stated the following regarding ServiceNow, Inc. (NYSE:NOW) in its Q4 2024 investor letter:

"Similar to last quarter, ServiceNow, Inc. (NYSE:NOW) was a top relative contributor, a testament to the consistent, high-level execution they’ve demonstrated over the past several years. The company’s latest earnings report highlighted across-the-board strength, with better-than-expected results across key metrics such as renewal rates, subscription growth, average contract value growth per $1M+ customer, etc. This is a company on offense, attacking a large and growing addressable market and positioning it for a long growth runway—especially considering their early success at integrating GenAI capabilities, which should only drive increasing workflow efficiencies for customers in the years ahead.

We trimmed our positions in UnitedHealth Group, Amazon, ServiceNow, and Gartner during the quarter. ServiceNow and Gartner were valuation-related trims. With ServiceNow, we still expect 20%+ revenue and earnings growth for the foreseeable future. Still, the strong stock price performance has reduced the future return potential somewhat, and we used the proceeds to add to our Eli Lilly position."

A team of software engineers at desks working on code for a cutting-edge cloud computing solution.

ServiceNow, Inc. (NYSE:NOW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 110 hedge fund portfolios held ServiceNow, Inc. (NYSE:NOW) at the end of the fourth quarter compared to 78 in the third quarter. In the fourth quarter of 2024, ServiceNow, Inc's (NYSE:NOW) subscription revenue increased 21% year-over-year to $2.866 billion. While we acknowledge the potential of ServiceNow, Inc. (NYSE:NOW) 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 ServiceNow, Inc. (NYSE:NOW) and shared the list of big-cap stocks are plunging so far in 2025. 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.