Pernas Research LLC manages assets in the “Pernas Portfolio” released its third quarter 2024 investor letter. A copy of the letter can be downloaded here. The portfolio returned 18.3% in the quarter compared to a 5.9% return for the S&P 500 Index and a 9.2% return for the Russell 2000 Index. During the quarter, inflation fell, the Fed dropped rates by 50 basis points, high-yield spreads tightened, and some of the portfolio’s smaller-cap stocks rose. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Pernas Research highlighted stocks like Upwork Inc. (NASDAQ:UPWK), in the third quarter 2024 investor letter. Upwork Inc. (NASDAQ:UPWK) is an online marketplace that enables businesses to connect with various independent professionals and agencies. The one-month return of Upwork Inc. (NASDAQ:UPWK) was 13.63%, and its shares gained 16.42% of their value over the last 52 weeks. On October 22, 2024, Upwork Inc. (NASDAQ:UPWK) stock closed at $10.05 per share with a market capitalization of $1.327 billion.
Pernas Research stated the following regarding Upwork Inc. (NASDAQ:UPWK) in its Q3 2024 investor letter:
“Upwork Inc. (NASDAQ:UPWK) is a leading global platform in the online freelance marketplace, connecting businesses with independent professionals (freelancers) for collaboration. The stock has fallen by approximately 85% from its peak due to concerns over slowing growth and fears of AI disruption. However, our analysis suggests these concerns are overstated. The growth slowdown is primarily due to temporary cyclical factors, while the long-term trend of businesses increasingly turning to skilled freelancers remains strong. Although market sentiment views Upwork’s business case as weakening, we see it as strengthening. We estimate a 70% upside potential from current levels, making Upwork a compelling long-term investment. Long form write-up here.”
A close-up of a hand holding a laptop, showing the user navigating their Upwork platform dashboard.
Upwork Inc. (NASDAQ:UPWK) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held Upwork Inc. (NASDAQ:UPWK) at the end of the second quarter which was 31 in the previous quarter. The second quarter revenue of Upwork Inc. (NASDAQ:UPWK) increased 15% year-over-year to $193.1 million. While we acknowledge the potential of Upwork Inc. (NASDAQ:UPWK) 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.