Meridian Funds, managed by ArrowMark Partners, released its “Meridian Contrarian Fund” third quarter 2023 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund returned -6.16% (net) compared to a -4.78% return for the Russell 2500 Index. Furthermore, the fund underperformed its secondary benchmark, the Russell 2500 Value Index, which returned -3.66% during the same period. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Meridian Contrarian Fund highlighted stocks like Ambarella, Inc. (NASDAQ:AMBA) in the third quarter 2023 investor letter. Headquartered in Santa Clara, California, Ambarella, Inc. (NASDAQ:AMBA) develops low-power system-on-a-chip, or SoC, semiconductors and software for edge AI applications. On November 29, 2023, Ambarella, Inc. (NASDAQ:AMBA) stock closed at $57.34 per share. One-month return of Ambarella, Inc. (NASDAQ:AMBA) was 22.23%, and its shares lost 22.44% of their value over the last 52 weeks. Ambarella, Inc. (NASDAQ:AMBA) has a market capitalization of $2.287 billion.
Meridian Contrarian Fund made the following comment about Ambarella, Inc. (NASDAQ:AMBA) in its Q3 2023 investor letter:
“Ambarella, Inc. (NASDAQ:AMBA) designs system-on-a-chip semiconductor solutions that specialize in visual processing for the security, industrial, and automotive markets. We have owned Ambarella since the third quarter of 2017 when earnings declined due to sales shortfalls at large customer GoPro. Our thesis was that emerging artificial intelligence (AI), automotive, industrial, and security markets would soon dwarf the company’s declining consumer market. After significant outperformance in 2021driven by strong demand for AI-enabled computer vision chips in a variety of applications, Ambarella’s stock has been weak since2022 and was again this quarter. Ambarella’s legacy products, mainly image processors for low-end security cameras, are in decline while the company re-focuses its resources on its computer vision chips, which are enabled for AI processing. The company has a core competency in placing very complicated algorithms on individual chips in a very power-efficient way, placing Ambarella in a strong leadership position as AI capabilities shift from centralized data centers to inference at the edge, a fast-growing future market. We also believe that the company’s superior technology makes it a highly attractive acquisition target for many larger technology companies. As such, the stock remains in the portfolio, though we reduced the position during the quarter as we believe an earnings growth catalyst may be several quarters in the future.”
A leading semiconductor chip on a computer robot arm, reflecting the technology advances of the company.
Ambarella, Inc. (NASDAQ:AMBA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held Ambarella, Inc. (NASDAQ:AMBA) at the end of third quarter which was 23 in the previous quarter.
We discussed Ambarella, Inc. (NASDAQ:AMBA) in another article and shared the list of best military drone stocks to invest in. In addition, please check out our hedge fund investor letters Q3 2023 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.
