Fred Alger Management, an investment management company, released its “Alger Small Cap Focus Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. Changing trade, monetary, and fiscal policies increased volatility in US stocks. The emergence of artificial intelligence (AI) models from China added to the uncertainty. Against this backdrop, the class A shares of the fund underperformed the Russell 2000 Growth Index. The Communication Services and Energy sectors contributed to the relative performance of the fund in the quarter, while the Health Care and Information Technology sectors detracted. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.
In its first-quarter 2025 investor letter, Alger Small Cap Focus Fund highlighted stocks such as Guidewire Software, Inc. (NYSE:GWRE). Guidewire Software, Inc. (NYSE:GWRE) offers a platform for property and casualty (P&C) insurance companies. The one-month return of Guidewire Software, Inc. (NYSE:GWRE) was -1.10%, and its shares gained 77.32% of their value over the last 52 weeks. On April 17, 2025, Guidewire Software, Inc. (NYSE:GWRE) stock closed at $191.33 per share with a market capitalization of $16.049 billion.
Alger Small Cap Focus Fund stated the following regarding Guidewire Software, Inc. (NYSE:GWRE) in its Q1 2025 investor letter:
“Guidewire Software, Inc. (NYSE:GWRE) is the market leader in providing SaaS and software solutions for the property and casualty (PnC) insurance segment, serving major customers throughout the industry. The company offers a comprehensive suite of solutions covering policy, billing, and claims, and is recognized as the most advanced cloud technology provider among its competitors. We believe that new customer adoption of cloud solutions, combined with the ongoing migration of existing clients to the cloud, represents a key long term growth driver, positioning the company for continued cross selling and upselling opportunities. During the quarter, Guidewire reported strong fiscal second-quarter results, driven by better than-expected growth in annual recurring revenue (ARR). • Xometry is a leading two-sided marketplace for on-demand manufacturing services. The company provides real-time access to global manufacturing demand and capacity, with sourcing and pricing available across a network of buyers and sellers. In our view, this marketplace enables buyers (e.g., engineers and product designers) to efficiently source manufacturing processes and sellers of manufacturing services to grow their businesses.”
An insurance adjuster reviewing images and paperwork to process a claim.
Guidewire Software, Inc. (NYSE:GWRE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 60 hedge fund portfolios held Guidewire Software, Inc. (NYSE:GWRE) at the end of the fourth quarter which was 51 in the previous quarter. While we acknowledge the potential of Guidewire Software, Inc. (NYSE:GWRE) 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 covered Guidewire Software, Inc. (NYSE:GWRE) and shared Wasatch U.S. Select Strategy’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 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.