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What Makes BILL Holdings (BILL) a Secular Long-Term Opportunity?

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3 months ago

September 7, 2024

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What Makes BILL Holdings (BILL) a Secular Long-Term Opportunity?

Parnassus Investments, an investment management company, released the “Parnassus Mid Cap Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the Fund (Investor Shares) declined -5.80% (net of fees) underperforming the Russell Midcap Index’s -3.35% return. Stock selection drove the underperformance of the portfolio. The portfolio’s strong holdings can mitigate market downturns and capitalize on growth opportunities as cyclical pressures decrease and long-term trends prevail. In addition, please check the fund’s top five holdings to know its best picks in 2024.

Parnassus Mid Cap Fund highlighted stocks like BILL Holdings, Inc. (NYSE:BILL) in the second quarter 2024 investor letter. BILL Holdings, Inc. (NYSE:BILL) provides cloud-based software solutions to simplify, digitize, and automate complex back-office financial operations. The one-month return of BILL Holdings, Inc. (NYSE:BILL) was 17.30%, and its shares lost 52.54% of their value over the last 52 weeks. On September 6, 2024, BILL Holdings, Inc. (NYSE:BILL) stock closed at $55.06 per share with a market capitalization of $5.874 billion.

Parnassus Mid Cap Fund stated the following regarding BILL Holdings, Inc. (NYSE:BILL) in its Q2 2024 investor letter:

“During the quarter, we increased our overweight allocation to the Information Technology sector. In the Software industry, we initiated a new position in BILL Holdings, Inc. (NYSE:BILL), which runs leading payments platform Bill.com. BILL presented an opportunity to own a category-leading SMB-focused payments automation platform (Bill.com) at a historically attractive valuation. We believe the market overextrapolated near-term cyclical growth headwinds and underestimated the company’s long-term secular growth opportunity.”

A group of finance professionals hard at work in an office, signifying accounts payable and accounts receivable.

BILL Holdings, Inc. (NYSE:BILL) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held BILL Holdings, Inc. (NYSE:BILL) at the end of the second quarter which was 40 in the previous quarter. While we acknowledge the potential of BILL Holdings, Inc. (NYSE:BILL) 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 BILL Holdings, Inc. (NYSE:BILL) and shared the list of tech stocks billionaire Ray Dalio is selling. In addition, please check out our hedge fund investor letters Q2 2024 page for more investor letters from hedge funds and other leading investors.

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