Burke Wealth Management, an investment management company, released its “Focused Growth Strategy” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The market had another outstanding year in 2024, with the S&P 500 rising 25.0%. The strategy had an even better year, with net returns of 28.4%. Looking a bit closer, it is clear that, similar to 2023, 2024 had a rise that was appreciated by everyone, but the overall market returns were concentrated in a small handful of stocks. In addition, please check the fund’s top five holdings to know its best picks in 2024.

In its fourth quarter 2024 investor letter, Burke Wealth Management emphasized stocks such as Snowflake Inc. (NYSE:SNOW). Snowflake Inc. (NYSE:SNOW) offers cloud-based data platform to support various organizations. The one-month return of Snowflake Inc. (NYSE:SNOW) was -15.68%, and its shares lost 1.53% of their value over the last 52 weeks. On March 19, 2025, Snowflake Inc. (NYSE:SNOW) stock closed at $155.96 per share with a market capitalization of $51.48 billion.

Burke Wealth Management stated the following regarding Snowflake Inc. (NYSE:SNOW) in its Q4 2024 investor letter:

"Snowflake Inc. (NYSE:SNOW): Chapter two of the Prodigal Son Returns features Snowflake. Snowflake’s return to the portfolio required some tangible progress on the product innovation front as well as an uptick in business momentum before I was ready to slaughter the proverbial fattened calf. To review, we sold our stake in Snowflake following its fourth quarter 2023 earnings release in which legendary CEO Frank Slootman announced his retirement and 2024 guidance came in significantly below expectations. While new CEO Sridhar Ramaswamy has an excellent reputation as an innovator in the technology sector, we needed to see some tangible signs of progress on that front as well as a stabilization in the core data analytics business before repurchasing the stock. That is what we got with the release of third quarter earnings. Consumption trends in the core business have stabilized and are improving while there are several exciting new product offerings around AI that have been added to the platform. We were early to Snowflake when we made our initial purchase in the summer of 2023. We subscribed to the belief that any companies seeking to implement AI solutions in their business will first need to make sure their data is both accessible and secure, which would drive tremendous demand for Snowflake’s platform. We still do. As we discussed in the agentic age portion of this letter, sometimes the path from installing the data center compute power necessary for generative AI and arrival of the applications necessary to unlock the productivity promises is not always straight. That said, while the path may be winding we remain confident in the ultimate destination. We think Snowflake is going to be a big player in helping enterprises get their data accessible and safely delivering AI solutions to that data, whether it be their own or from trusted partners, that will drive the productivity enhancing business insights that are the reasons for the hundreds of billions of dollars being invested in artificial intelligence."

A software engineer at work, surrounded by a wall of computer monitors connected to a 'Data Cloud' platform.

Snowflake Inc. (NYSE:SNOW) is in not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 85 hedge fund portfolios held Snowflake Inc. (NYSE:SNOW) at the end of the fourth quarter which was 71 in the previous quarter. While we acknowledge the potential of Snowflake Inc. (NYSE:SNOW) 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 Snowflake Inc. (NYSE:SNOW) and shared the list of best SaaS stocks to buy according to billionaires. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.