TimesSquare Capital Management, an equity investment management company, released its “U.S. Small Cap Growth Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the quarter the fund returned 5.77% (net), compared to a 7.58% return for the Russell 2000 Growth Index. Despite a decline in many equity markets in January, they rebounded over the following two months, resulting in a robust 2024 first quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.
TimesSquare Capital U.S. Small Cap Growth Strategy 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 -4.87%, and its shares gained 110.33% of their value over the last 52 weeks. On June 20, 2024, Onto Innovation Inc. (NYSE:ONTO) stock closed at $221.79 per share with a market capitalization of $10.929 billion.
TimesSquare Capital U.S. Small Cap Growth Strategy stated the following regarding Onto Innovation Inc. (NYSE:ONTO) in its first quarter 2024 investor letter:
“Among the wide variety of Information Technology companies, we prefer critical system providers, specialized component designers, and systems that improve productivity or efficiency for their clients. Onto Innovation Inc. (NYSE:ONTO) designs, develops, and produces high-performance control metrology, defect inspection, lithography, and data analysis systems used by microelectronics device manufacturers. The company generated better-than-expected fourth quarter results that were driven by specialty devices and advanced packaging as customers continued with investments in AI and power semiconductors. This led to an 18% advance and we trimmed the position on this strength.”
A technician observing a macro defect inspection process, the precision of the company’s systems.
Onto Innovation Inc. (NYSE:ONTO) is not on our list of 31 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. The first quarter revenue of Onto Innovation Inc. (NYSE:ONTO) surged to $229 million, up 5% from the previous quarter and 15% from the first quarter of 2023. While we acknowledge the potential of Onto Innovation Inc. (NYSE:ONTO) 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 Onto Innovation Inc. (NYSE:ONTO) and shared the list of fastest growing fintech companies in 2024. In addition, please check out our hedge fund investor letters Q1 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.
