Conestoga Capital Advisors, an asset management company, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. For the second consecutive year, U.S. equity indices ended the year with double-digit returns after generating modest returns in the fourth quarter of 2024. Conestoga’s investment plans were hindered by the enthusiasm for everything artificial intelligence (AI) related, which the firm believes led to a more speculative investing climate. The Conestoga Small Cap Composite surged 1.67% (net) in the fourth quarter compared to the Russell 2000 Growth Index’s 1.70% return. The Conestoga SMid Cap Composite returned -0.68% (net) trailing the Russell 2500 Growth Index’s 2.43% return. The Conestoga Micro Cap Composite advanced 9.91% (net) vs the Russell Microcap Growth Index’s return of 11.55%. Finally, the Conestoga Mid Cap Composite returned -4.63% (net) underperforming the Russell Midcap Growth Index’s 8.14% return. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2024.
In its fourth quarter 2024 investor letter, Conestoga Capital Advisors emphasized stocks such as ANSYS, Inc. (NASDAQ:ANSS). ANSYS, Inc. (NASDAQ:ANSS) develops engineering simulation software and services for product design and optimization. The one-month return ANSYS, Inc. (NASDAQ:ANSS) was -0.48%, and its shares gained 3.46% of their value over the last 52 weeks. On February 11, 2025, ANSYS, Inc. (NASDAQ:ANSS) stock closed at $341.43 per share, with a market capitalization of $29.858 billion.
Conestoga Capital Advisors stated the following regarding ANSYS, Inc. (NASDAQ:ANSS) in its Q4 2024 investor letter:
“ANSYS, Inc. (NASDAQ:ANSS) is a market leader in selling computer-aided engineering (CAE) software that allows engineers to simulate how product designs will behave in real world environments before they are manufactured. Despite its pending acquisition by Synopsys (SNPS), the company’s stock reacted favorably to a surprisingly healthy quarter.”
An engineer with a diagram of a systems analysis, illustrating the complexity of its product suite.
ANSYS, Inc. (NASDAQ:ANSS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 60 hedge fund portfolios held ANSYS, Inc. (NASDAQ:ANSS) at the end of the third quarter which was 64 in the previous quarter. While we acknowledge the potential of ANSYS, Inc. (NASDAQ:ANSS) 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 ANSYS, Inc. (NASDAQ:ANSS) and shared AI news and ratings you should not miss. ANSYS, Inc. (NASDAQ:ANSS) detracted from Conestoga Capital Advisors’ performance in the previous quarter. In addition, please check out our hedge fund investor letters Q3 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.