| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 9.63% | 26.02% | 22.59% |
The Artisan Small Cap Fund delivered strong absolute returns of 26.11% in Q2 2026, modestly outpacing the Russell 2000 Growth Index's 25.71% return despite challenging market conditions that favored lower-quality, unprofitable companies. The portfolio benefited from continued profit-cycle execution across holdings, with health care contributing approximately 260bps to relative performance through strong results from biotechnology and life sciences tools companies including Twist Bioscience, Rhythm Pharmaceuticals, and Guardant Health. AI infrastructure remained a powerful driver, supporting semiconductor holdings like MACOM Technology Solutions, Lattice Semiconductor, and SiTime. Software holdings detracted approximately 283bps as investors questioned long-term growth profiles in an AI-driven environment, leading managers to reduce exposure to an underweight position for the first time since 2005. The managers initiated new positions in Virtu Financial, Murphy USA, and USA Rare Earth while maintaining discipline around market-cap parameters by exiting or trimming positions that grew beyond small-cap mandates. Key risks include persistent inflation, elevated AI valuations, and evolving software competitive dynamics. The managers remain focused on identifying durable profit cycles within franchise companies, expecting market volatility to create attractive entry points in AI infrastructure, biotechnology, and other high-conviction areas.
The Artisan Small Cap Fund seeks to identify profit cycles within high-quality franchise companies trading at reasonable valuations, focusing on four power alleys: health care, technology, industrials and consumer discretionary.
The managers remain committed to their time-tested investment process of identifying profit cycles within franchise companies trading at understandable valuation assumptions. They expect periodic market volatility to create opportunities to add to AI-related positions at more attractive valuations. While it may be too early to conclude that small-cap leadership has materially shifted, recent improvement suggests the asset class may be regaining firmer footing. The managers continue to see attractive long-term opportunities tied to expanding data center capacity and ongoing innovation in AI infrastructure, with particular interest in data center cooling, advanced semiconductor materials and high-speed networking. In health care, they continue to identify attractive opportunities in companies developing novel medicines, medical devices and diagnostic tests. Over a full market cycle, they believe their approach positions the portfolio to deliver attractive long-term outcomes for clients.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jul 17 2026 | 2026 Q2 | ASND, COLL, FLEX, GH, GWRE, IBP, LSCC, MOD, MTSI, MUSA, RYTM, SITM, TWST, VIRT, WAY | AI, Biotechnology, Data centers, growth, Profit Cycle, semiconductors, small caps, software | - | Artisan Small Cap Fund returned 26.11% in Q2 2026, modestly outperforming despite market leadership favoring low-quality companies. Health care and AI infrastructure holdings drove performance, with biotechnology and semiconductor positions delivering strong results. Software was reduced to underweight as AI reshapes competitive dynamics. New positions in Virtu Financial, Murphy USA, and USA Rare Earth reflect conviction in company-specific profit cycles. Managers maintain discipline on quality and valuation while seeing attractive long-term opportunities in AI infrastructure and biotechnology. |
| Apr 18 2026 | 2026 Q1 | BWIN, COMP, FLEX, FLS, FRPT, FTAI, GWRE, IRTC, MOD, MTSI, OLLI, ONTO, PEN, TTAN, TWST | AI, defense, energy, Geopolitical, growth, semiconductors, small cap, technology | - | Small-cap growth fund outperformed benchmark despite negative returns as geopolitical tensions favored commodity sectors over technology. Strong semiconductor stock selection offset energy underweight. Added AI infrastructure and defense positions while harvesting mature holdings. Management confident in company-specific profit cycles across technology, industrials and health care power alleys despite macro headwinds. |
| Jan 21 2026 | 2025 Q4 | BRKR, CLBT, COCO, FLEX, GH, GWRE, HXL, INSM, IRTC, ITGR, LASR, LSCC, MOD, MTSI, PCOR, PEN, PSN, SN, STVN, VSEC | AI, Biotechnology, defense, growth, healthcare, profit cycles, small cap, technology |
MTSI INSM COCO STVN PSN GWRE |
Artisan Small Cap Fund delivered strong Q4 outperformance as markets refocused on profit-driven fundamentals over risk-taking. The team maintains conviction in AI semiconductors, defense aerospace, and biotechnology themes while managing positions with valuation discipline. Portfolio positioning reflects deepening conviction across industrials and healthcare, with the profit cycle approach well-suited for the current environment favoring quality over speculation. |
| Oct 21 2025 | 2025 Q3 | 4350 JP, ALAB, ASND, CGNX, CWAN, IBP, INSM, LOAR, LSCC, MDGL, MOD, MTSI, SN, WAY, WING | AI, Biotech, Health Care, industrials, small caps |
LSCC MOD INSM TWST MTSI CGNX OLLI LSCC MOD INSM TWST MTSI CGNX OLLI |
|
| Jul 22 2025 | 2025 Q2 | BIRK, BWXT, CWAN, FLEX, FRSH, HALO, IOVA, IRTC, LSCC, MDGL, MTSI, SAIA, STVN, TTAN, WING | cash flow, fundamentals, Quality, small caps, Valuation discipline |
FLEX MTSI IRTC CWAN BWXT WING MDGL BIRK SVTA STVN GWRE |
|
| Mar 31 2025 | 2025 Q1 | ALAB, ARIS, ASCB, BFAM, BROS, FRSH, FTAI, GWRE, HALO, INTA, IRTC, KTOS, MOD, MTSI, MYRG, PEN, SG, SN, TWST, VCYT | AI, Biotechnology, Cloud, defense, growth, healthcare, small caps, Trade Policy | - | Artisan Small Cap outperformed in a challenging Q1, declining 10.14% versus the Russell 2000 Growth's 11.12% drop. Strong biotech and software holdings drove relative performance despite AI infrastructure selloff and tariff volatility. The team used market weakness to upgrade the portfolio, adding eight new positions while maintaining focus on resilient franchises with accelerating profit cycles trading at attractive valuations. |
| Dec 31 2024 | 2024 Q4 | ABMD.CO, ALAB, COCO, CROX, FLS, GTLB, HALO, INSM, ITGR, JBT, LSCC, MTSI, NOVT, ONTO, PSN, RGEN, SDHC, SN, STVN, VCYT, VSEC | AI, Biotechnology, energy, healthcare, semiconductors, small cap, technology | - | Artisan Small Cap Fund posted flat Q4 returns but strong full-year performance, driven by AI-benefiting semiconductor holdings like Astera Labs and improving software companies. Healthcare presents attractive opportunities with biotech profit acceleration expected. The team maintains conviction in their profit cycle approach while monitoring Trump administration policy impacts on small-cap positioning. |
| Sep 30 2024 | 2024 Q3 | ADS, APPF, ARGX, CIGI, ELF, GWRE, HL, IBP, INTA, IRTC, LSCC, MKTX, MOD, ONON, ONTO, SN, SPT, SPXC, TYL, VCYT | AI, growth, healthcare, interest rates, Profit Cycle, small caps, technology | - | Artisan Small Cap Fund outperformed in Q3 through strong security selection in healthcare and consumer discretionary. The team added positions in private markets, construction, and commercial real estate while exiting several holdings due to valuation discipline. They see opportunities in AI enablers, rate-sensitive businesses, and water sustainability solutions, maintaining focus on companies with accelerating profit cycles trading below private market value. |
| Jul 20 2024 | 2024 Q2 | AAPL, AMZN, BSY, ETSY, GOOGL, GWRE, INSM, INSP, IOVA, LSCC, META, MSFT, NVDA, ONTO, SMCI, TSLA, TWST, VITA, WING, WK | AI, Biotechnology, healthcare, semiconductors, small caps, software, technology | - | Artisan Small Cap underperformed in Q2 due to cyclical pressures on semiconductor holdings and software weakness from AI spending prioritization. The fund avoided major index winners Super Micro and MicroStrategy on governance and conviction concerns. Management remains patient with quality franchises facing temporary headwinds while selectively adding to compelling valuations with strong long-term conviction. |
| Apr 15 2024 | 2024 Q1 | ARGX, ASND, BL, CCCS, ELF, ETSY, FIVE, FND, FRPT, HALO, IPGP, LSCC, MPWR, MYRG, PCOR, SAIA, SHLS, SMAR, TREX, VMI, WING | AI, Biotechnology, Energy Transition, growth, healthcare, semiconductors, small cap, software | - | Artisan Small Cap underperformed in Q4 despite positive absolute returns, hurt by biotech R&D setbacks and semiconductor cyclical pressures. Small caps rallied on soft landing optimism and Fed dovishness. The team maintains conviction in franchise-quality companies benefiting from secular trends in AI, energy transition, and healthcare innovation, entering 2024 with attractive cross-sector opportunities. |
| Dec 31 2023 | 2023 Q4 | ARGX, ASND, CCCS, DUOL, ETSY, EXAS, FIVE, FND, HALO, IRTC, LSCC, MPWR, PCOR, RGEN, SAIA, SMAR, SWAV, TREX, VMI, WING | Biotechnology, Energy Transition, growth, healthcare, semiconductors, small cap, software, technology | - | Artisan Small Cap Fund posted positive Q4 returns but underperformed due to biotechnology R&D setbacks and semiconductor cyclical pressures. The team maintained conviction in core holdings, believing secular trends will drive recovery. New positions in energy transition and consumer themes reflect opportunistic approach. Despite macro uncertainty, attractive valuations and diverse sector opportunities position the portfolio well for 2024. |
| Sep 30 2023 | 2023 Q3 | ARGX, ASND, BL, BSY, CAVA, CCCS, ETSY, EXAS, FIVE, GLBE, GWRE, HALO, IRTC, LSCC, MTSI, PCOR, PZZA, RGEN, SAIA, SMAR, SPXC, STVN, SWAV, TREX, WCC, WING, WMS | Biotechnology, growth, healthcare, Medical Devices, semiconductors, small cap, software, technology | - | Small cap growth fund declined 7.97% in Q3 as Fed's higher-for-longer stance pressured valuations. Healthcare drove positive security selection through biotech pipeline progress, while medical devices faced GLP-1 headwinds. Manager added industrial and software positions while harvesting select holdings. Despite continued small cap underperformance, maintains conviction in franchise-focused approach with valuations at attractive levels relative to historical periods. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q2 |
AIAI infrastructure investment remained a powerful structural driver, supporting capital flows into semiconductors, data center infrastructure and related industries. The portfolio maintains exposure through holdings in data center cooling, advanced semiconductor materials and high-speed networking. While valuations have moved meaningfully higher and shortage-driven pricing power may prove fleeting, the managers continue to focus on franchises whose intellectual property and competitive positioning should enable market share gains as AI infrastructure designs evolve. |
Data Centers Semiconductors Infrastructure Networking Cooling |
SemiconductorsSemiconductor stocks rose nearly 60% during the quarter, with strong performance from holdings including MACOM Technology Solutions, Lattice Semiconductor, and SiTime. The managers see attractive opportunities in companies positioned to benefit from AI infrastructure expansion, particularly in areas like high-speed networking, advanced materials, and timing solutions. They acknowledge that recent appreciation may have pulled forward some future returns but believe long-term earnings prospects remain compelling. |
AI Data Centers Networking Memory Equipment | |
Data CentersData center exposure remains a key focus area, with holdings benefiting from hyperscale customer demand and AI infrastructure buildout. Modine reported robust demand from hyperscale data center customers and announced a long-term capacity agreement providing visibility through 2029. The managers continue to see attractive opportunities in data center cooling, power management, and infrastructure components as AI drives expanding capacity requirements. |
AI Cooling Infrastructure Hyperscale Power | |
BiotechnologyHealth care was the only power alley to contribute positively to relative performance, adding approximately 260bps. Strong earnings and stock performance came from biotech drug companies such as Rhythm Pharmaceuticals, as well as life sciences tools and diagnostics innovators including Twist Bioscience, Guardant Health and Veracyte. The managers continue to identify attractive opportunities in companies developing novel medicines, medical devices and diagnostic tests, with health care remaining one of the portfolio's largest sector allocations. |
Drug Development Diagnostics Life Science Tools Rare Diseases Genomics | |
SoftwareSoftware holdings detracted approximately 283bps from relative performance despite continued attractive fundamentals. The managers have reduced exposure to an underweight position relative to the benchmark for the first time since Q2 2005. While fundamentals of remaining holdings remain attractive, they are maintaining a more selective posture as AI reshapes competitive dynamics, pricing power and long-term monetization potential across the industry. They continue to maintain modest exposure while waiting on greater clarity around the industry's evolving competitive landscape. |
SaaS Enterprise Software AI Cloud Competitive Dynamics | |
Small CapsSmall caps have begun to show signs of renewed relative strength, outperforming large caps over the past year and ending more than 14 years of large-cap leadership—the longest stretch of small-cap underperformance on record. However, market leadership remained decidedly risk-on, favoring lower quality companies with weaker ROEs, limited profitability and higher balance sheet leverage. This created a challenging environment for active small-cap managers, with the average small-cap growth manager underperforming by roughly 950bps over the past year. |
Market Leadership Quality Relative Performance Risk Appetite Active Management | |
Rare EarthsThe managers initiated a Garden position in USA Rare Earth after the company announced its acquisition of Serra Verde, which they believe will strengthen its franchise and advance its strategy to build an integrated mine-to-magnet platform. The acquisition provides exposure to strategic heavy rare earth production outside China and positions the company as one of the highest quality franchises in the Western Hemisphere poised to benefit from growing rare earth demand and the geopolitical shift away from Eastern Hemisphere-based suppliers. |
Critical Minerals Geopolitics Supply Chain Mining China | |
EnergyEnergy contributed positively to relative performance after detracting last quarter, adding approximately 154bps together with materials. Rising oil prices amid Middle East tensions contributed to market volatility during the quarter. The managers maintain selective exposure in the sector. |
Oil Geopolitics Commodities Middle East | |
| 2026 Q1 |
AIAI-related investment continues to be a very strong trend supporting capital spending and corporate earnings. The fund sees opportunities among companies enabling AI infrastructure buildout including Modine Manufacturing, MACOM, Lattice Semiconductor, Onto Innovation, Flex, Semtech and SiTime. However, investor sentiment toward AI-related equities was uneven with periodic reassessments of valuation and return potential. |
Infrastructure Data Centers Semiconductors Valuation Capital Spending |
DefenseThe fund remains attracted to aerospace and defense, seeing a structural shift driven by modernization and global rearmament. Governments are responding to near-term conflicts, rebuilding inventories, upgrading capabilities and establishing higher baseline readiness levels. This supports sustained demand across mission-critical technologies including sensing, propulsion, communications and missile defense systems. |
Modernization Rearmament Government Spending Mission Critical Defense Electronics | |
SemiconductorsStock selection in information technology was the largest contributor to relative performance, driven primarily by semiconductor holdings. Leadership within AI has shifted toward infrastructure-oriented segments such as memory and optical components, which continue to benefit from sustained data center investment. The fund sees the beginning of a potential memory supercycle supporting accelerating growth. |
Memory Data Centers Optical Components Supercycle Infrastructure | |
EnergyEnergy stocks surged during the quarter, materially outperforming the broader market due to escalating conflict in Iran and subsequent retaliations that contributed to sharp rises in oil prices and disrupted supplies of industrial inputs. The fund's underweight position in energy was a headwind to performance as renewed commodity-driven inflation pressures increased market sensitivity. |
Oil Prices Geopolitical Commodity Inflation Iran Conflict Supply Disruption | |
| 2025 Q4 |
GrowthThe fund seeks long-term growth of capital by investing in growth-oriented common stocks using a quantitative formula that identifies the 50 stocks with highest one-year price appreciation meeting specific criteria. The Growth Strategy considers stock price appreciation as often associated with positive fundamentals such as strong growth or improving profitability. |
Growth Appreciation Momentum |
FinancialsThe fund is currently substantially invested in the Financials sector, with performance tied closely to developments in this industry. Companies in the Financials sector may be adversely affected by changes in the regulatory environment and interest rate fluctuations. |
Financials Banks Interest Rates | |
| 2025 Q1 |
AIThe introduction of China's DeepSeek AI model challenged market assumptions around AI infrastructure spending durability. This development raised questions about US leadership in AI and long-term returns on AI investments, particularly impacting data center capacity enablers in the portfolio. |
DeepSeek Infrastructure Data Centers Semiconductors Cloud |
BiotechnologyStrong performance from biotech holdings including Ascendis with its successful Yorvipath drug launch for hypoparathyroidism and Halozyme's ENHANZE technology platform. The team sees significant profit cycle drivers from new drug approvals and partnerships. |
Drug Launch Rare Diseases Partnerships FDA Approval Platform Technology | |
DefenseAdded Kratos Defense & Security Solutions, which specializes in advanced defense systems including drones and missile systems. The company received a $1.45 billion contract from the US Department of Defense for hypersonic weapons testing capabilities. |
Drones Hypersonics Defense Contracts National Security Weapons Systems | |
Trade PolicySignificant market volatility driven by aggressive tariff announcements affecting China and US allies. The team is monitoring supply chain risks and taking action on companies with tariff exposure, while noting policy volatility's impact on consumer and corporate confidence. |
Tariffs Supply Chain China Policy Volatility Trade War | |
WaterAdded Aris Water Solutions, which provides full-cycle water handling and recycling solutions in the Permian Basin. The company has built proprietary assets including collection pipelines and disposal wells, with potential for margin expansion and new use cases. |
Permian Basin Water Recycling Oil Production Infrastructure Environmental | |
CloudGuidewire's transition from licensed software to subscription-based cloud service is showing strong momentum with 12 new cloud deals signed in Q1. The team believes companies emerging from cloud transitions tend to see accelerating profit growth. |
SaaS Subscription Insurance Software Digital Transformation Recurring Revenue | |
| 2024 Q4 |
AIData centers are energy-intensive and with AI expansion, energy consumption is projected to grow exponentially. Portfolio companies like Astera Labs and MACOM are benefiting from growing AI datacenter spending. Cloud software franchises are making steady progress introducing AI functionality into their leading solution suites. |
Data Centers Semiconductors Cloud Energy |
SemiconductorsSemiconductor holdings delivered strong earnings results with positive forward outlooks. Astera Labs provides connectivity chips for data centers addressing bandwidth bottlenecks. MACOM benefits from AI datacenter spending. Lattice Semiconductor struggled due to cyclical pressures in industrial and telecom markets. |
Connectivity Data Centers Industrial Telecom Cyclical | |
BiotechnologyHealthcare has been largely left behind in this bull market and now presents some of the portfolio's most attractive valuation opportunities. Profit acceleration is anticipated for biotech holdings such as Ascendis and Insmed as each launches new medicines with blockbuster sales potential. |
Pharmaceuticals Rare Diseases Valuations Product Launches | |
Energy TransitionTechnology giants have committed to reducing carbon footprints and achieving net-zero emissions. Data centers require 24/7 power, creating conflict between accelerating power needs and carbon reduction commitments. Nuclear power sources and small modular reactors are being pursued as low-carbon energy solutions. |
Nuclear Data Centers Carbon Clean Energy | |
Natural GasHyperscalers may need to push their emissions goals to satisfy energy demand, likely having investment implications for the energy industry, particularly for companies exposed to natural gas, which may become the go-to fuel source where renewable energy infrastructure is not yet robust or reliable. |
Energy Power Generation Infrastructure Utilities | |
| 2024 Q3 |
AIThe team is focused on AI enablers that remain well positioned to benefit from reasonable industry investment levels because they are gaining market share based on superior technologies. They expect some volatility in AI-exposed stocks given relatively lofty expectations but are being disciplined on valuations. |
Data Centers Semiconductors Technology Infrastructure Growth |
HealthcareHealthcare was one of their power alleys that drove outperformance in Q3, benefiting from one of their better earnings seasons in recent history. The team sees opportunities in companies building annuity-like revenue streams through genetic testing and diagnostic accuracy improvements. |
Biotechnology Diagnostics Medical Devices Pharmaceuticals Innovation | |
WaterThe team has been researching water sustainability issues and PFAS contamination in drinking water. They see market opportunities for companies providing filtration systems, water treatment services, testing and monitoring equipment, and technical consulting services as regulations increase. |
Environmental Regulation Infrastructure Treatment Sustainability | |
Commercial Real EstateThe significant rise in interest rates decimated commercial real estate sales and leasing trends. However, with potential rate cuts, the team believes company-specific profit cycle drivers in this sector might begin to shine as interest rate headwinds abate. |
Interest Rates Property Brokerage Recovery Cyclical | |
| 2024 Q2 |
AIAI has received tremendous attention and driven extraordinary gains among companies directly exposed to the trend, such as those producing GPUs, networking equipment and other data center infrastructure. Corporate decision-makers have been prioritizing spending toward AI-related projects versus enterprise software solutions. |
GPUs Data Centers Enterprise Software Technology Nvidia |
Semiconductor CycleMost semiconductor companies have been impacted by customers destocking elevated inventories in recent quarters, but this seems to be nearing completion. Cyclical pressures continue to hurt companies like Lattice Semiconductor, though the manager expects a return to growth in the second half of 2024. |
Semiconductors Inventory Cyclical Lattice Recovery | |
BiotechnologyThe portfolio includes several biotech investments including Iovance Biotherapeutics focused on TIL cell therapies for cancer patients, and new position Insmed with treatments for serious pulmonary diseases. The manager sees significant unmet medical needs and multi-billion dollar sales potential. |
Cancer Pulmonary Cell Therapy Medical Devices Pipeline | |
CloudMultiple software investments have experienced weak results due to macroeconomic weakness pressuring customers and corporate prioritization of AI spending over enterprise software. The manager believes well-positioned cloud software franchises will leverage generative AI advances to enhance their platforms. |
SaaS Enterprise Software Subscription Generative AI Platforms | |
| 2024 Q1 |
BiotechnologyHealthcare biotechnology holdings faced R&D setbacks despite solid commercial progress. Argenx's Vyvgart failed two additional indications in Q4, Halozyme experienced underperformance related to Argenx setbacks, and Ascendis faced FDA manufacturing questions for TransCon PTH. The team maintains conviction in de-risked biotech assets with proven drugs and diversified pipelines. |
FDA Approval Drug Development Clinical Trials Rare Diseases Autoimmune |
Semiconductor CycleSemiconductor holdings experienced cyclical pressures with Lattice Semiconductor reporting disappointing results due to industrial market weakness in Asia and Europe. The team expects secular trends in data centers, AI, vehicle electrification, and industrial automation to drive solid growth over medium and long-term horizons despite near-term cyclical headwinds. |
FPGA Cyclical Downturn Market Share Industrial Automation Data Centers | |
Energy TransitionPortfolio includes exposure to renewable energy trends through MYR Group, a specialty electrical contractor positioned for grid modernization and the energy transition. The team sees multiyear growth cycles driven by reshoring, energy transition, and grid modernization creating opportunities in electrical infrastructure. |
Grid Modernization Electrical Infrastructure Renewable Energy Utility Spending | |
AISoftware companies are exploring generative AI tools to expand solution capabilities, with the opportunity for software vendors to integrate AI still in early innings. Portfolio companies like Smartsheet are introducing AI-driven features to drive enhanced customer productivity and capture value through increased revenue per user. |
Generative AI Software Integration Productivity Enhancement Revenue Per User | |
Small CapsSmall-cap stocks underperformed for nine of the past ten quarters but rallied strongly in Q4 as investor expectations shifted toward economic soft landing. The team believes small caps were at peak pessimism and sees attractive opportunities across the sector landscape entering 2024, with valuations at reasonable levels for growth equities. |
Underperformance Peak Pessimism Soft Landing Valuation Opportunity | |
| 2023 Q4 |
BiotechnologyHealthcare biotechnology holdings faced R&D setbacks despite solid commercial progress. Argenx's Vyvgart trials for two additional indications failed, Halozyme experienced underperformance related to Argenx setbacks, and Ascendis faced FDA manufacturing questions for TransCon PTH approval. |
Drug Development FDA Approval Clinical Trials Rare Diseases Autoimmune |
Semiconductor CycleSemiconductor holdings experienced cyclical pressures with Lattice Semiconductor reporting disappointing results due to industrial business weakness in Asia and Europe. However, secular trends in data centers, AI, vehicle electrification and industrial automation expected to drive medium-term growth. |
Cyclical Correction Data Centers Industrial Automation FPGA Market Share | |
SoftwareSoftware valuations were attractive relative to resilient subscription-based business models. Management teams focused on margin expansion following pandemic-era tech boom. Holdings continued gaining market share with margins starting to improve as companies refocused on profitability. |
SaaS Margin Expansion Market Share Subscription Models Profitability | |
Energy TransitionPortfolio positioned for renewable energy growth through MYR Group's electrical infrastructure contracting and exposure to grid modernization trends. Valmont benefits from accelerating renewable spending and grid hardening investments. |
Grid Modernization Renewable Infrastructure Electrical Contracting Grid Hardening Utility Spending | |
AIArtificial intelligence represents early-stage opportunity for software vendors to expand solution capabilities through integrated AI tools. Semiconductor holdings benefit from AI-driven secular trends in data centers and industrial applications. |
Generative AI Software Integration Data Center Demand Industrial Applications Early Stage | |
| 2023 Q3 |
GLP1Manager discusses the rapid growth of GLP-1 obesity drugs from Novo Nordisk and Eli Lilly, noting their impact on medical device stocks. While acknowledging public health benefits, believes the effects on cardiovascular disease incidence will take time and that opportunities for innovative franchises to gain share outweigh market expansion concerns. |
Obesity Diabetes Cardiovascular Medical Devices Novo Nordisk |
BiotechnologyPortfolio benefited from encouraging R&D pipeline news from several biotech holdings, particularly Argenx with successful CIDP trial results and FDA approval of subcutaneous injection version. Manager sees additional progress ahead with drugs being studied in multiple indications and growing drug pipeline beyond Vyvgart. |
R&D Pipeline Argenx Vyvgart Clinical Trials | |
AIManager notes generative AI breakthroughs and is impressed by how enterprise software businesses like Bentley, Smartsheet and Procore are integrating AI capabilities into their products to drive enhanced value propositions to customers. Also mentions AI as a way for construction companies to become more efficient. |
Generative AI Enterprise Software Value Proposition Efficiency | |
SemiconductorsSemiconductor industry was one of the worst performing areas as investors grew concerned about macroeconomic weakness. Lattice Semiconductor showed weakness in cyclical end markets like communications and computing, though industrial and automotive markets continued to expand sharply with market share gains. |
Cyclical End Markets Lattice Industrial Automotive | |
Medical DevicesMedical device stocks sold off on fears that rapid adoption of GLP-1 obesity medications will lead to declining incidence of comorbidities. Manager believes public health benefits are real but unlikely to materially restrain growth opportunities for holdings like Shockwave and iRhythm for many years to come. |
GLP-1 Comorbidities Shockwave iRhythm Cardiovascular | |
Small CapsSmall caps continued underperformance against large caps for a fourth consecutive quarter, which has only happened six other times since 1984. Manager notes Russell 2000 trailing P/E ratio relative to Russell 1000 is at levels last seen prior to dot-com bubble, but remains optimistic about long-term prospects despite frustration with prolonged underperformance. |
Underperformance Valuations Russell 2000 Dot-com Long-term |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | MTSI | MACOM Technology Solutions Holdings, Inc. | Information Technology | Semiconductors | Neutral | NASDAQ | Cycles, Execution, Margins, semiconductors, valuation | Login |
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | INSM | Insmed Incorporated | Health Care | Biotechnology | Bull | NASDAQ | Adoption, biotechnology, Drug launch, pipeline, Pulmonary | Login |
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | COCO | The Vita Coco Company, Inc. | Consumer Staples | Beverages | Bull | NASDAQ | Beverages, Branding, Distribution, tariffs, Volume | Login |
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | STVN | Stevanato Group S.p.A. | Health Care | Health Care Supplies | Bull | New York Stock Exchange | biologics, Glp1, healthcare, Packaging, Reimbursement | Login |
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | PSN | Parsons Corporation | Industrials | Engineering & Construction | Bull | New York Stock Exchange | backlog, Contracts, cybersecurity, Defense, infrastructure | Login |
| Jan 21, 2026 | Fund Letters | Craigh Cepukenas | GWRE | Guidewire Software, Inc. | Information Technology | Application Software | Bull | New York Stock Exchange | Discipline, Insurance, Modernization, Software, valuation | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | LSCC | Lattice Semiconductor Corp. | Information Technology | Semiconductors | Bull | NASDAQ | AI data centers, Destocking, FPGAs, Inflection, Margins, robotics | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | MOD | Modine Manufacturing Co. | Consumer Discretionary | Electrical Components & Equipment | Bull | NYSE | Capacity, Cooling, data centers, hyperscale, Revenue upgrade, secular growth | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | INSM | Insmed Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, Bronchiectasis, Commercialization, operating leverage, pipeline, TAM | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | TWST | Twist Bioscience Corp. | Health Care | Life Sciences Tools & Services | Bull | NASDAQ | life sciences, Margins, Ngs, Partnerships, scale, Synthetic dna | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | MTSI | MACOM Technology Solutions Holdings Inc. | Information Technology | Semiconductors | Bull | NASDAQ | Analog rf, design wins, Fab transition, Margins, Optical, recovery | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | CGNX | Cognex Corp. | Information Technology | Electronic Equipment, Instruments & Components | Bull | NASDAQ | AI enablement, Automation, Cost Reduction, Cycle recovery, Machine vision, Sme adoption | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | OLLI | Ollie’s Bargain Outlet Holdings Inc. | Consumer Discretionary | Broadline Retail | Bull | NASDAQ | disruption, Loyalty, Off-price retail, Sourcing, Store growth, Trade-down | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | LSCC | Lattice Semiconductor Corp. | Information Technology | Semiconductors | Bull | NASDAQ | AI data centers, Destocking, FPGAs, Inflection, Margins, robotics | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | MOD | Modine Manufacturing Co. | Consumer Discretionary | Electrical Components & Equipment | Bull | NYSE | Capacity, Cooling, data centers, hyperscale, Revenue upgrade, secular growth | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | INSM | Insmed Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, Bronchiectasis, Commercialization, operating leverage, pipeline, TAM | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | TWST | Twist Bioscience Corp. | Health Care | Life Sciences Tools & Services | Bull | NASDAQ | life sciences, Margins, Ngs, Partnerships, scale, Synthetic dna | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | MTSI | MACOM Technology Solutions Holdings Inc. | Information Technology | Semiconductors | Bull | NASDAQ | Analog rf, design wins, Fab transition, Margins, Optical, recovery | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | CGNX | Cognex Corp. | Information Technology | Electronic Equipment, Instruments & Components | Bull | NASDAQ | AI enablement, Automation, Cost Reduction, Cycle recovery, Machine vision, Sme adoption | Login |
| Oct 21, 2025 | Fund Letters | Craigh Cepukenas | OLLI | Ollie’s Bargain Outlet Holdings Inc. | Consumer Discretionary | Broadline Retail | Bull | NASDAQ | disruption, Loyalty, Off-price retail, Sourcing, Store growth, Trade-down | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | FLEX | Flex Ltd. | Information Technology | Electronic Manufacturing Services | Bull | NASDAQ | Demand, diversification, manufacturing, Margin_expansion, Reshoring | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | MTSI | MACOM Technology Solutions Holdings Inc. | Information Technology | Semiconductors | Bull | NASDAQ | Compound_semiconductors, datacenter, Defense, Margins, Telecom | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | IRTC | iRhythm Technologies, Inc. | Health Care | Health Care Equipment | Bull | NASDAQ | Cardiology, diagnostics, Digital_health, growth, Reimbursement | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | CWAN | Clearwater Analytics Holdings Inc. | Information Technology | Financial Software | Bull | NASDAQ | Accounting, Data, Fintech, Integration, SaaS | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | BWXT | BWX Technologies, Inc. | Industrials | Aerospace & Defense | Bull | NYSE | backlog, Defense, Monopoly, Nuclear, Policy | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | WING | Wingstop Inc. | Consumer Discretionary | Restaurants | Bull | NASDAQ | Branding, Digital, Franchising, Restaurants, Unit_growth | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | MDGL | Madrigal Pharmaceuticals, Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, Efficacy, Fibrosis, Launch, MASH | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | BIRK | Birkenstock Holding plc | Consumer Discretionary | Footwear | Bull | NYSE | Brand, DTC, expansion, Footwear, Pricing | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | SVTA | ServiceTitan, Inc. | Other | Application Software | Bull | NYSE | ARR, expansion, Payments, Software, Vertical_saas | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | STVN | Stevanato Group S.p.A. | Health Care | Life Sciences Tools & Services | Bull | NYSE | biologics, Equipment, growth, Margins, Packaging | Login |
| Jul 22, 2025 | Fund Letters | Craigh Cepukenas | GWRE | Guidewire Software, Inc. | Information Technology | Application Software | Bull | NYSE | Cloud_transition, Fintech, Insurance, Margins, SaaS | Login |
| TICKER | COMMENTARY |
|---|---|
| TWST | Twist Bioscience is a life sciences company that leverages a proprietary silicon-based DNA writing platform, with synthetic biology applications across drug discovery, diagnostics, agriculture and industrial materials. Shares rose 116% after the company reported results well ahead of expectations, supported by strength in DNA synthesis and protein solutions, improving demand for next-generation sequencing and guidance calling for continued momentum. Management also reaffirmed its expectation of reaching adjusted EBITDA breakeven in fiscal Q4 2026. Investor enthusiasm increased following the company's analyst day, where management highlighted Twist's current positioning as a beneficiary of AI-enabled drug discovery and growing demand for DNA synthesis and data generation. We trimmed the position following the stock's strong appreciation, consistent with our position-sizing discipline. |
| MTSI | MACOM designs and manufactures high-performance semiconductors. The company has benefited from a favorable profit cycle across its data center, industrial, defense and telecom end markets, supported by strength in optical networking, satellite communications and defense systems. Shares rose after the company delivered better-than-expected revenue and issued stronger-than-expected guidance, driven by strength in data center hardware, industrial and defense demand. We harvested some capital as the company's market capitalization moved beyond the parameters of our small-cap strategy, while maintaining our conviction in the franchise and its profit cycle. Although valuation expectations have increased, we believe they remain reasonable from a multiyear perspective. |
| LSCC | Lattice is a fabless leader in low-power field-programmable gate arrays. Shares rose after the company reported better-than-expected results and issued stronger-than-expected revenue and profit guidance, marking an important step forward under the new management team. Demand improved across the server, communications and industrial end markets. Lattice also announced a $1 billion acquisition of AMI, a leader in platform firmware and data center infrastructure manageability, which should expand its data center capabilities and broaden its addressable market. We believe the acquisition will accelerate Lattice's profit cycle. We added to this Crop position during the quarter. |
| GWRE | Guidewire, the market leader in software for the property and casualty insurance industry, remained a detractor despite continued fundamental improvement. Like many software companies, the stock came under pressure as investors questioned the business's long-term growth profile and valuation multiples in an AI-driven environment. We believe Guidewire's system-of-record position remains highly defensible and that the company is well positioned to strengthen its competitive advantage by layering AI-enabled capabilities onto its existing platform. |
| IBP | IBP is the second-largest insulation installer in the US and manages the full installation process—from material procurement to scheduling, logistics and installation. Recent results were weaker than expected, as softer residential demand, weather-related disruptions and cost inflation lowered margins despite continued strength in commercial construction. While management highlighted improving residential trends and a growing commercial backlog, the quarter raised questions about the pace of the company's profit cycle. The residential business took a step backward after several quarters of better-than-expected execution, while tougher comparisons in commercial suggest the overall profit cycle may take longer to inflect upward. We reduced the position back to the Garden, as we believe it may take several quarters for the profit cycle to regain momentum. |
| ASND | Ascendis Pharma is a biotechnology company leveraging its proprietary TransCon platform to develop differentiated therapies for patients with significant unmet medical needs. Recent results were mixed, with revenue below expectations but EPS meaningfully ahead, supported by R&D leverage and improving operating discipline. Importantly, patient growth for YORVIPATH remained strong, with more than 1,000 new patients added and enrollment momentum continuing despite temporary revenue headwinds from seasonality, free drug programs and European market access. The early launch of YUVIWEL, a treatment for a rare bone-growth disorder, also appears encouraging. SKYTROFA, a long-acting growth hormone therapy for children with growth hormone deficiency, continues to gain share and could benefit from future label expansion. We reduced the position during the quarter after a competitor with an existing treatment for the same rare hormone disorder as YORVIPATH filed a lawsuit against Ascendis. While we do not believe the lawsuit has merit or is likely to affect US sales, we are mindful of the distraction it could create and the potential headwind to the company's profit cycle. We continue to maintain a large position given our conviction in Ascendis' long-term prospects. |
| VIRT | Virtu Financial is a technology-enabled market maker and execution services provider. We believe it has a strong franchise built on market structure expertise, a low-risk trading model and a scalable platform spanning equities, ETFs, futures, foreign exchange, options and crypto. We initiated a Garden position and later elevated it to a Crop position as our conviction increased. We have owned Virtu previously and are encouraged by the new CEO's strategic changes, including expansion into new products and geographies while maintaining its disciplined risk profile. We believe these initiatives support a durable company-specific profit cycle driven by market share gains, growth in execution services and continued expansion in options, ETF block trading and crypto. A more supportive market environment should make the benefits of these strategic changes increasingly evident over time. |
| MUSA | Murphy USA operates a convenience store and fuel retail network built around an everyday low-price strategy, supported by an advantaged fuel procurement model and low-cost operating structure. The stock had been on our watchlist, and we initiated a Garden position following a management change. We later elevated it to a Crop position as our work increased conviction that the company's everyday low-price fuel and nicotine strategy would matter again. In our view, Murphy is entering a favorable profit cycle, supported by structurally improving fuel margins, continued market share gains, ongoing new store growth and operational improvements under the new management team. |
| SITM | SiTime develops silicon-based timing solutions used across communications, data center and industrial applications. We believe the company is well positioned to benefit from the ongoing transition from legacy quartz timing solutions to higher performance microelectromechanical systems (MEMS) timing devices, with AI infrastructure supporting sustained growth. Recent results significantly exceeded expectations, driven by accelerating demand for AI infrastructure and higher timing content per system, which fueled strong revenue growth and margin expansion. We continue to see multiple catalysts, including higher speed networking, expanding inference workloads and increasing product content. We added to the position during the quarter as our research strengthened our conviction that timing orchestration will become increasingly important in optimizing AI data center performance, while semiconductor-based timing solutions continue to replace legacy quartz technology. |
| COLL | Colliers International is a leading global commercial real estate services firm with the scale and brand to offer a full range of services. We became increasingly concerned about the company's strategic diversification into the global engineering and design industry. While the core commercial real estate franchise continues to perform well, we questioned whether this strategy would create sufficient shareholder value and chose to redeploy capital into higher conviction opportunities. |
| WAY | Waystar is a leading cloud-based revenue cycle management platform that supports over 30,000 health care organizations, including 16 of the top 20 US hospitals. Slower-than-expected demand for certain volume-based solutions reduced our confidence in the company's profit cycle. In addition, we identified more compelling software investment opportunities that had moved back into our preferred market capitalization range. |
| FLEX | Flex is a global manufacturing and supply chain solutions provider with exposure to high-margin AI and cloud data center infrastructure, particularly power and cooling systems. The company's market capitalization has increasingly moved beyond the mandate of our small-cap strategy, leading us to reallocate capital to more attractive opportunities within our investable universe. |
| MOD | Modine is a global leader in thermal management. The company reported a solid quarter, supported by robust demand from hyperscale data center customers and accelerating growth in its climate solutions business. Modine also announced a long-term capacity agreement that reinforced demand visibility through 2029. Margin expansion remained slower than expected as the company continued to ramp capacity and absorb supply chain and input cost pressures. We trimmed the position following the stock's strong appreciation, as it had grown beyond the position size we were comfortable maintaining. We continue to view Modine as a durable franchise with an attractive profit cycle and a reasonable valuation over a multiyear perspective, but we have reduced exposure in line with our risk discipline. |
| RYTM | We saw strong earnings and stock performance from biotech drug companies such as Rhythm Pharmaceuticals, as well as life sciences tools and diagnostics innovators including Twist Bioscience, Guardant Health and Veracyte. |
| GH | We saw strong earnings and stock performance from biotech drug companies such as Rhythm Pharmaceuticals, as well as life sciences tools and diagnostics innovators including Twist Bioscience, Guardant Health and Veracyte. |
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