Artisan Partners, an investment management company, released its “Artisan Small Cap Fund” first quarter 2024 investor letter. A copy of the letter can be downloaded here. Equity markets surged at the beginning of 2024 in anticipation of the US economy entering a “goldilocks” scenario – a soft landing combined with decreasing inflation, potentially leading to a cut in interest rates by the Fed. In the first quarter, its Investor Class fund ARTSX returned 9.43%, Advisor Class fund APDSX posted a return of 9.42%, and Institutional Class fund APHSX returned 9.48%, compared to a return of 7.58% for the Russell 2000 Growth Index. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Artisan Small Cap Fund highlighted stocks like Onto Innovation Inc. (NYSE:ONTO), in the first quarter 2024 investor letter. Onto Innovation Inc. (NYSE:ONTO) designs, develops, manufactures, and supports process control tools that perform optical metrology. The one-month return of Onto Innovation Inc. (NYSE:ONTO) was 20.88%, and its shares gained 110.53% of their value over the last 52 weeks. On May 28, 2024, Onto Innovation Inc. (NYSE:ONTO) stock closed at $229.94 per share with a market capitalization of $11.331 billion.
Artisan Small Cap Fund stated the following regarding Onto Innovation Inc. (NYSE:ONTO) in its first quarter 2024 investor letter:
“We initiated new GardenSM positions in Onto Innovation Inc. (NYSE:ONTO) during the quarter. Onto Innovation provides process control solutions and inspection systems needed for advanced semiconductor packaging inspection and optical metrology. Wafer-level packaging inspection is a small yet rapidly growing segment within process control tied to increasing chipset sales from AI, edge computing and wearable technology advancements. Optical metrology growth is driven by a transition to 3D architecture, which requires greater numbers of sensitive layers to be measured and tracked. This growth is further supported by gross margin and operating margin expansion as increasing complexity should drive pricing power.”
A technician observing a macro defect inspection process, the precision of the company’s systems.
Onto Innovation Inc.’s (NYSE:ONTO) first-quarter revenue soared to $229 million, the top end of the guidance range, marking a robust 15% increase over the same period last year and a solid 5% increase from the fourth quarter. This growth was fueled by strong and expected demand for logic packaging and high bandwidth memory for AI devices. The company also delivered a strong operating cash flow of $57 million, representing 25% of the revenue.
Onto Innovation Inc. (NYSE:ONTO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Onto Innovation Inc. (NYSE:ONTO) at the end of the first quarter which was 23 in the previous quarter.
In another article, we discussed Onto Innovation Inc. (NYSE:ONTO) and shared the list of best semiconductor stocks to invest in. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.
If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
