In this piece, we will take a look at Piper Sandler’s top technical stock picks and the top 20 stocks.
The start of October has seen another wild swing for markets. September’s second half saw Wall Street rejoice as the Federal Reserve delivered its highly anticipated interest rate cut. After an initial muted response from markets predicated on worries that the jumbo 50 basis point rate cut might have been due to economic worries, markets soared. Between the day the rate cut was announced and at the September end, the flagship S&P index and the broader NASDAQ index gained 2.6% and 3.5%, respectively.
However, trading during the first four days of October paints a different picture. From October 1st to the 4th, the flagship S&P shed 0.20% and the broader NASDAQ ended up losing 0.28%. This bearishness was fueled by the Labor Department’s JOLTS data which showed that job openings in America grew in September. For markets, this meant that the Fed now had more room to keep rates higher for longer, and investors started to price out a 50 basis point cut in November. Additionally, job openings grew by 8.040 million and beat economist estimates by nearly half a million openings. Investors also dealt with a tough global geopolitical environment after tensions continued to escalate in the Middle East following Iran’s attacks on Israel.
After the JOLTS data, October 4th came with more good news for investors who were worried about the economy. JOLTS was followed by the highly anticipated nonfarm payrolls data, which further dented hopes for interest rate cuts. This data showed that unemployment in America had fallen to 4.1% and the nonfarm payrolls had jumped by 254,000 which was the highest figure for the preceding six months. Economists had predicted the payrolls to grow by 140,000, so safe to say, the latest data blew these out of the park.
On the surface, the immediate implications of this would seem to imply that as rates can now stay higher for longer than investors had expected, stocks should fall. However, on the day of the nonfarm payroll data release, the flagship S&P and the broader NASDAQ gained 0.90% and 1.22% higher, respectively. Sounds strange, right? Well, some fresh commentary from Baird Wealth Management’s investment strategy analyst Ross Mayfield can provide some insights. He believes that the latest data set was “not the perfect report, but that’s kind of what you need for a soft landing anyways. Some broad based jobs added, but nothing too concerning for the Fed, right, in the form of reaccelerating wage inflation. So kind of a perfect Goldilocks soft landing report.” However, Mayfield adds that the nonfarm jobs report gives the Fed “reason to only go 25 basis points in November, probably 25 in December as well.” Yet, the somewhat ‘still warm’ labor market doesn’t take rate cuts completely off the table. According to the Baird analyst, “the Fed is trying to get back to neutral policy” and subsequently 25 basis points should be the way to go for the rest of the year.
Brad Bernstein, managing director at UBS Private Wealth Management, believes that some stock categories are better suited for the rapidly evolving environment that we’re facing right now. In an interview a day before the nonfarm data release, the Bernstein executive shared that financials, technology, and utility stocks have seen strong performance this year. Starting from financials, the analyst outlined that due to the low interest rates, “the improving yield curve for their balance sheet and what that means for their ability to lend at higher rates and pay cheaper rates on cash savings.”
As for utility stocks, Bernstein outlined that these have benefited from the Fed’s rate cut cycle, adding that small cap stocks have started to shine in the third quarter. According to him, “small cap has worked well in the last few months as well. So one interesting take away from the third quarter is for the first time the equal weight S&P outperformed the S&P. And small cap outperformed the S&P. So we’re seeing a real broadening out of markets and diversified portfolios, balanced portfolios look fantastic for the next 12 to 24 months in our opinion.” For more details on what investment bank Goldman Sachs believes about this bifurcation in the stock market, be sure to check out Goldman Sachs’ Best Hedge Fund Stock Picks: Top 20 Stocks.
The Baird analyst shared his take on the stock market after the nonfarm payroll data release. As per Mayfield, the optimistic economic outlook stemming from the labor market means that cyclical stocks might be worth their while (we covered some cyclical stocks as part of our coverage of 10 Best Consumer Cyclical Stocks To Buy Now). When building a portfolio, the analyst believes that “on the equity side, I really want to do anything but get too defensive here, you know, we have soft landing as our base case we think economic growth is strong, earnings are on the rise.”
These shifts in the stock market, which appear to be in their early stages, have also impacted analyst earnings estimates. According to FactSet, between June 30th to September 30th, the bottom up EPS estimate for Q3 has been revised downwards by 3.9%. This is a striking figure since FactSet adds that average downward revisions for the previous 20, 40, 60, and 80 quarters were 3.3%, 3.3%, 3.2%, and 4.1%, respectively. Consequently, except for the 80 quarter revisions, the current revisions have surpassed all estimates. Sector wise, only information technology Q3 EPS estimates have been revised upwards (by 0.3%) while all others have seen downward revisions. Within these, energy, materials, and industrials lead the pack with their EPS revised downwards by 19.2%, 9.4%, and 8.5%, respectively.
One way to see how investor sentiment is matching these shifts is by analyzing technical patterns. Therefore, let’s take a look at Piper Sandler’s bottom up stocks that are seeing improved technical ratings.
A close-up of a laptop monitor with stock market prices scrolling up and down.
Our Methodology
To make our list of Piper Sandler’s top technical stock picks, we relied on the firm’s list of stocks with improving technical grade ratings lower than or at 19 as of the third week of August. These stocks had ratings higher than or at 20 in the preceding five weeks. The stocks were ranked by the number of hedge fund investors that had bought the shares during Q2 2024.
For these stocks, we also mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
20. SkyWater Technology, Inc. (NASDAQ:SKYT)
Number of Hedge Fund Holders In Q2 2024: 8
SkyWater Technology, Inc. (NASDAQ:SKYT) is a small backend semiconductor company. The firm offers chip production development services to manufacture signal processors, integrated circuits, and other items. SkyWater Technology, Inc. (NASDAQ:SKYT)’s presence in the radiation hardened integrated circuits market makes it a key partner of the Pentagon. This is important for the firm since national security concerns resulting from a global chip supply chain have forced the US government to earmark billions of dollars in spending through the CHIPS and Science Act. SkyWater Technology, Inc. (NASDAQ:SKYT) could benefit from the ripples of this spending as the firm canceled a $1.8 billion plan to build a manufacturing facility in Indiana. Being a defense contractor also means stable revenue that is insulated from the semiconductor industry’s cyclical downturns. As an illustration, SkyWater Technology, Inc. (NASDAQ:SKYT)’s shares soared by a whopping 48% in August after second quarter revenue jumped by 33% on the back of strong performance by its tooling business. The quarter saw SkyWater Technology, Inc. (NASDAQ:SKYT) post a positive non GAAP EPS for the first time in its history, and the tooling business primarily serves the needs of the aerospace and defense industry.
SkyWater Technology, Inc. (NASDAQ:SKYT)’s management commented on the tooling business, called ATS, during the Q2 2024 earnings call:
“First, our strong results for second quarter and continued confidence in the growth expected in our ATS business for fiscal 2024 underscore the strategic importance of multiple aerospace and defense programs underway at SkyWater. Altogether, our expectation is that, the majority of our growth this year will be driven by several strategic A&D programs, witnessing consistently strong demand coupled with steady improvements in our capabilities and operational execution.
For Q2 specifically, we witnessed some pull-ins of demand from the second half, which we expect will result in a slightly front-half loaded year for our ATS business in 2024. Overall, we believe these programs are secure and well-funded. The added revenue tailwind of record level tool sales is yet another proof point of our customers’ confidence in SkyWater as a trusted domestic source of critical semiconductor technology.”
19. Omnicell, Inc. (NASDAQ:OMCL)
Number of Hedge Fund Holders In Q2 2024: 18
Omnicell, Inc. (NASDAQ:OMCL) is a healthcare services provider. The firm caters to the needs of healthcare providers and pharmacies by allowing them to manage inventory, automate drug dispensing systems, and package medications. As of H1 2024, 47% of the firm’s $523 million in revenue came via its connected devices and associated items. As a result, this segment is key to Omnicell, Inc. (NASDAQ:OMCL)’s hypothesis and it requires the firm to regularly roll out product updates to grow revenue. On this front, Omnicell, Inc. (NASDAQ:OMCL) is currently upgrading its XT dispensing systems, which could create tailwinds for the company moving forward. Additionally, with the Fed having started its rate cut cycle, businesses should find more resources to spend on product upgrades. The company also benefits from a diversified business model through which it also generates high margin revenue via services. The services business offers support for Omnicell, Inc. (NASDAQ:OMCL)’s hardware products and additional services such as inventory management and IV compounding.
Brown Capital was full of praise for Omnicell, Inc. (NASDAQ:OMCL) in its Q4 2023 investor letter. Here is what the firm said:
“Omnicell is one of the leading manufacturers of medication-adherence solutions for healthcare-delivery systems. Studies have shown that wasted medications alone cost hospitals nearly $800 million annually. Omnicell aims to solve this problem. Its products, which consist of automated dispensing systems, medication cabinets and pharmacy robotics, ensure the right medication gets to the right person in the right quantity, saving lives, money and headaches. This is the second consecutive quarter Omnicell has been among our top detractors as macroeconomic factors plaguing the company persist. Hospital budgets remain tight, leading to delays in purchases and slower upgrade cycles, causing Omnicell management to reduce guidance once again. Given ongoing uncertainty around demand, management announced a restructuring plan that will generate $45 million to $55 million in annual cost savings.”
18. Phreesia, Inc. (NYSE:PHR)
Number of Hedge Fund Holders In Q2 2024: 22
Phreesia, Inc. (NYSE:PHR) is a healthcare specific SaaS provider. The firm enables providers and others to manage appointments, automate registration, manage revenue, and conduct other operations. Phreesia, Inc. (NYSE:PHR) is not a profitable company as its trailing twelve month profit is -$100 million. Consequently, investors are laser focused on growth, cost control, and recurring revenue – with the last being quite important to enable Phreesia, Inc. (NYSE:PHR) to manage its margins and turn a profit. Consequently, the stock soared by 8% in September after Q2 earnings saw the firm beat operating income expectations by a whopping 56.5% and post an operating margin of 6.4%. While Phreesia, Inc. (NYSE:PHR)’s shares are down 3.2% year to date, a key catalyst for the firm could be its Network Solutions business division. This division is responsible for increasing patient access to healthcare coverage by enabling greater communications, and with technology evolving, Phreesia, Inc. (NYSE:PHR) could increase the revenue from this business. As of H1 2024, Network Solutions grew revenue by 95% annually, and Phreesia, Inc. (NYSE:PHR) also benefits from a stable subscription business for predictable revenue.
Phreesia, Inc. (NYSE:PHR)’s management shared details about Network Solutions during the Q2 2025 earnings call:
“So first point, Daniel, the Network Solutions revenue is actually the first revenue line both in the history of the company, going back to 2005. So I just want to make sure, when you said [nascent] (ph), it’s the earliest revenue we had and the first product we had. I think what you have to appreciate is how much smaller the network was then. And we had done 54 million visits the year we went public. And so one of the reasons the Network Solutions has grown so much, we’re now working with over 100 brands. And I think that’s because the size of the network has grown so much that it gives us a nice tailwind to be able to have a lot of these conversations with a lot more people, frankly, that we won’t a few years ago.
So I think that is a very different sort of thing. And I think as you talked about next year, I want to also clarify, we’ve never talked about 20% growth as any kind of target. I think we’ll talk to you, we’ll keep giving you updates about the things we’ll talk about ‘26 in December. But that’s really – I mean, that’s – I think you’ll get updates from us. But this year, you obviously have the growth the revenue that we’re targeting.”
17. Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY)
Number of Hedge Fund Holders In Q2 2024: 25
Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY) is a biotechnology company focusing on developing drugs for neural disorders. It is a revenue generating and profitable biotechnology firm with trailing twelve month revenue and net income sitting at $656 million and $115 million, respectively. However, unlike diversified biotechnology companies, Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY)’s sole commercial drug is its narcolepsy medicine WAKIX. Consequently, Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY)’s hypothesis is substantially dependent on this treatment, and while it holds key patents that will expire in 2029 and 2030, any competitors that offer better outcomes could lead to headwinds for the shares. This fact also increases the role of Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY)’s drug pipeline, and as of H2 2024, the firm has four drugs that could enter phase three trials by 2024 end. These include treatments that target sleep disorders and a neurodevelopmental disorder.
Harmony Biosciences Holdings, Inc. (NASDAQ:HRMY)’s management shared important details about its pipeline during the Q2 2024 earnings call:
“Moving on to Pitolisant [indiscernible] resistant on GR program. We are on track to initiate the dosing optimization study in the fourth quarter of this year and a pivotal bioequivalent study in the first quarter of 2025 with PADUFA 2026. For the Idiopathic Hypersomnia or IH program, we are on track to submit an sNDA in the fourth quarter of this year. The submission will be based on the totality of the data generated from the EPI [ph] study, including data from the ongoing long-term extension study, which strongly support pitolisant efficacy in patients with IH. We have [indiscernible] defined other supporting information that will be included in the sNDA, including real-world evidence from pitolisant use in Idiopathic Hypersomnia in Europe to further strengthen our submission.
We are optimistic and remain committed in bringing the new treatment option to patients living with IH In our neuro behavioral franchise, we remain on track to report top-line data from the Phase 3 reconnect registrational trial of ZYN002 in Fragile X syndrome in mid-2025. In the rare epilepsy franchise, patient enrollment continues in the EPX-100 Phase 3 ARGUS trial for Dravet Syndrome with the top end data expected in 2026. We are also preparing to initiate a Phase 3 study in LGS another rare and severe developmental epileptic encephalopathy with high unmet medical need later this year. In summary, we have made significant progress in advancing our late-stage pipeline across three distinct franchises. If successful, these programs could result in at least one new product or indication launch each year over the next five years, along with the potential to help hundreds of thousands of patients across all the raise neurological disorders we are investigating.”
16. YETI Holdings, Inc. (NYSE:YETI)
Number of Hedge Fund Holders In Q2 2024: 31
YETI Holdings, Inc. (NYSE:YETI) is a consumer cyclical goods company that makes and sells products that are used in outdoor activities. Some of the items that it sells include bags, coolers, hats, and associated items. This means that the firm’s products are relatively undifferentiated, and it opens up a wide market for competitors. YETI Holdings, Inc. (NYSE:YETI)’s troubles are exacerbated by the fact that Chinese firms are able to provide similar products at lower costs. Consequently, since volumes are key for retailers as they help beef up margins, the firm can face trouble in the future if its market remains saturated. In a July note, Piper Sandler kept an Overweight rating on YETI Holdings, Inc. (NYSE:YETI)’s shares and a $54 share price target based on optimism surrounding the earnings results due in August. After these results, the firm’s stock soared by 16.5%. This was due to a well rounded set of results which saw YETI Holdings, Inc. (NYSE:YETI)’s revenue and EPS of $463.5 million and $0.70 beat analyst estimates of $452.4 million and $0.64. This helped assuage market concerns about saturation eating YETI Holdings, Inc. (NYSE:YETI)’s market share, and the cherry on top came in the form of margin improvement by 2.8 percentage points annually to 57.7%.
Diamond Hill Capital mentioned YETI Holdings, Inc. (NYSE:YETI) in its Q1 2024 investor letter. Here is what the fund said:
“YETI Holdings (Yeti) designs and sells outdoor and recreational products. We initiated a short position in Q1 as we believe the company faces a combination of existing market saturation and intensifying competition from companies like Stanley and Hydro Flask. We also believe a 2023 product recall obscured a broader demand deceleration for Yeti’s products.”
15. Akamai Technologies, Inc. (NASDAQ:AKAM)
Number of Hedge Fund Holders In Q2 2024: 31
Akamai Technologies, Inc. (NASDAQ:AKAM) is a cloud computing company that caters to the needs of the SaaS industry. It allows SaaS firms to run security and analytics and deliver media and content. Akamai Technologies, Inc. (NASDAQ:AKAM)’s shares are down 13% year to date as they are yet to recover from a 16% drop in February. Its business is divided into three segments, Security, Delivery, and Compute which account for 50%, 35%, and 15% of the revenue as of H1 2024. Within these, Delivery’s revenue dropped 12% annually in H1 on the back of a weaker SaaS industry. Consequently, Akamai Technologies, Inc. (NASDAQ:AKAM)’s Security business has to perform in the future, and the growth in AI and the broader software computing industry could create tailwinds for its Compute business. The firm made a $450 million acquisition to beef up its Security division earlier this year, and it could grow its top line revenue in the future.
Akamai Technologies, Inc. (NASDAQ:AKAM)’s management commented on its Delivery business during the Q2 2024 earnings call:
“In Q2, delivery accounted for one third of our revenue, or $329 million. This is quite a change from five years ago when delivery accounted for two thirds of Akamai revenue. The diversification of our revenue across new markets through continuous innovation has long been a core part of Akamai’s strategy for long-term profitable revenue growth. A little more than a decade ago, we expanded our business into security with the creation of web app firewall as a cloud service. We did this to meet what we recognized as a growing customer need in a way that was complementary to what Akamai was already doing for customers with delivery. The opportunity was clear to us because we listened to our customers. We created what has proved to be a very successful cloud service for web app firewall.”
14. BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX)
Number of Hedge Fund Holders In Q2 2024: 33
BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) is an American biotechnology company that primarily sells a drug to help patients manage swelling or angioedema. As of H1 2024, 98.6% of its sales came from this treatment which is called ORLADEYO. Consequently, and especially since BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) is an unprofitable firm, its hypothesis is dependent on the ability to develop new drugs. On this front, the firm had been developing two drugs to treat a blood disorder and Netherton syndrome. Among these, the former drug called BCX10013 was discontinued earlier this year after weak data, and the latter, called BCX17725 is currently under Phase 1 enrollment. Consequently, any additional tailwinds to BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) from these drugs generating revenue appear to be far off in the future. This also means that all the pressure is now on ORLADEYO to perform and for BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) to improve margins through manufacturing efficiencies to turn a profit.
BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX)’s management is quite optimistic about its flagship and only drug. Here’s what it shared during the Q2 2024 earnings call:
“This increasing enthusiasm from physicians matches well with the considerable opportunity that remains for ORLADEYO. For example, the market research on Slide 12 shows that three out of four patients currently on injectable prophy are willing to switch. We also have updated administrative claims-based studies to size the market that you can see on Slide 9. Since we first did these studies prior to the ORLADEYO launch, the number of treated HAE patients in the US has grown to 8,500, and the total number of patients — of HAE patients has increased to over 11,000. As I described earlier, patients from all segments are benefiting from ORLADEYO with comparable success in treatment outcomes, patient retention, and rate of paid therapy. Even with the strong first three years of the launch and the 2,500 prescriptions through the end of 2023, fewer than one in four US HAE patients has tried ORLADEYO.
With a high patient desire for oral therapy and the growing physician intent to prescribe, there is way more opportunity in front of us than behind us. Finally, it is also increasingly clear that our global expansion is working. Ex-US sales in the second quarter were $12.4 million, up 51% year-over-year. We recently exceeded 500 patients in Europe and we are already selling ORLADEYO in over 20 countries globally, with many more actively preparing for market authorization, access, and launch. To summarize, the operational improvements we saw in Q2 on top of what we saw in Q1 mean that the increasing paid rates and high patient compliance are sustainable, and we are on track toward our long-term goal of 85% paid treatment in the US. In addition, patient and prescriber confidence are growing stronger because both groups are experiencing not just the convenience but also the efficacy of ORLADEYO.
We’ve been describing $1 billion in peak global revenue for ORLADEYO for a few years now. The path to that sustainable peak is increasingly clear. Now, I’ll hand the call over to Anthony to describe our financial performance.”
13. Inspire Medical Systems, Inc. (NYSE:INSP)
Number of Hedge Fund Holders In Q2 2024: 35
Inspire Medical Systems, Inc. (NYSE:INSP) is a mid sized medical device company known primarily for its Inspire system that helps patients suffering from sleep apnea. The Inspire system accounts nearly for all of the firm’s revenue, making it dependent on the product for solid share price performance. Consequently, Inspire Medical Systems, Inc. (NYSE:INSP)’s key competitive advantage of allowing sleep apnea patients to manage their disorder through a surgical implant is crucial for the firm’s continued success. The reliance on sleep apnea as the sole source of revenue was evident in Inspire Medical Systems, Inc. (NYSE:INSP)’s share price movements in June when the stock dropped by 17%. This was because research showed that weight loss drugs could also treat sleep apnea, and consequently, investors were worried that Inspire Medical Systems, Inc. (NYSE:INSP)’s market could shrink in the future. Yet, the TAM for the firm is sizeable, as estimates show that more than one billion people suffer from sleep apnea worldwide. Inspire Medical Systems, Inc. (NYSE:INSP) is also busy upgrading products, and it plans to launch the Inspire V soon which could add tailwinds to the stock down the road.
Headwaters Capital Management mentioned Inspire Medical Systems, Inc. (NYSE:INSP) in its Q2 2024 investor letter. Here is what the fund said:
“Stepping back from these narratives, the only real concern I have with INSP is the plateauing utilization at existing centers. Utilization by existing physicians has hit a temporary ceiling given the time required to implant the device and allocated OR time by doctors. However, the company can drive improved utilization with the introduction of the Company’s 5th generation device, Inspire V, which should gain FDA approval by the end of 2024. The new device reduces the implant time from 1.5 hours to 1 hour, which will enable existing surgeons to complete more implants per OR day. Inspire V also makes the surgical procedure much easier for surgeons, which should drive greater surgeon adoption in addition to improved utilization. Given that the device won’t be commercially available until early 2025, near-term results for INSP are unlikely to improve. As I detailed in the Q3 ’23 letter, I’m less concerned about weight loss drugs given that the net impact of losing/adding patients at the bottom/top of the patient funnel is likely to be neutral to positive for the company, although there could be a temporary disruption to patient flow as consumers trial the new drugs. I expect the competing product to have minimal impact on INSP and the insurance coverage will prove to be a temporary headwind. INSP’s current valuation embeds many of these concerns and ignores the fact that the company is still growing at +20% annually with improving profitability. Med tech assets with these financial attributes and a TAM as large as sleep apnea have historically traded at much higher multiples. As a result, we continue to own the stock and will patiently endure these growing pains as we await more positive results next year.”
12. Masimo Corporation (NASDAQ:MASI)
Number of Hedge Fund Holders In Q2 2024: 35
Masimo Corporation (NASDAQ:MASI) is a medical devices company that primarily makes and sells monitoring devices. Its products enable healthcare providers to monitor patient oxygen levels, hemoglobin, brain function, and other body functions. Masimo Corporation (NASDAQ:MASI)’s business benefits from growth and recurring aspects as the firm sells sensor housings and sensors. These enable it to simultaneously target new customers with its housings and then continue earning recurring revenue via the sensors. Additionally, due to the hardware-centric nature of its business, Masimo Corporation (NASDAQ:MASI) also has to ensure that it keeps manufacturing costs low. On this front, the firm is opening a new plant in Malaysia, and the higher the volume of its shipments, the greater its economies of scale and cost control. Additionally, the firm has also halted Apple’s latest Apple Watch sales due to patent disputes, and provided that it launches its own medical monitoring watch, Masimo Corporation (NASDAQ:MASI)’s stock could see tailwinds. Its stock soared by 19% in September after management changes, and the firm is also planning to spin out its consumer business which could generate more positive sentiment.
Masimo Corporation (NASDAQ:MASI)’s management shared details about cost control during the Q2 2024 earnings call:
“For the second quarter, our consolidated non-GAAP gross margin was 54%, which included gross margins of 62.5% for healthcare and 35% for non-healthcare. Healthcare gross margins improved 240 basis points year over year and rose 20 basis points sequentially, which is attributable to the relocation of sensor manufacturing to Malaysia combined with increased operational efficiencies and a favorable mixed benefit from higher consumable sales.
Our progress on this front gives us confidence in achieving our long-term goal of 30% operating margins for the healthcare business in five years. For our consolidated business, non-GAAP operating profit was $73 million. Our operating margin of 15% improved sequentially from the first quarter but declined modestly versus last year due to the return of performance-based compensation to normalized levels in 2024. Excluding the impact of performance-based compensation, our operating expenses decreased 4% versus the prior year period due to cost reduction initiatives. Even with the return of performance-based compensation, we delivered 13% earnings growth to achieve non-GAAP earnings per share of $0.86 for the second quarter.”
11. Paylocity Holding Corporation (NASDAQ:PCTY)
Number of Hedge Fund Holders In Q2 2024: 36
Paylocity Holding Corporation (NASDAQ:PCTY) is a software as a service (SaaS) firm that provides organizational management products. Its software allows firms to manage their payroll, human resources, tax compliance, and other operations. The firm primarily serves small and medium businesses, which makes it unsurprising that the stock is down by 16% over the past 12 months as these organizations are the hardest hit by high interest rates. However, Paylocity Holding Corporation (NASDAQ:PCTY) is an upstart gaining market share and could see tailwinds once rates lower and the economy maintains growth. Additionally, the firm is focused on growth through acquisitions after it acquired spending firm Airbase in September. This creates risks and potential for Paylocity Holding Corporation (NASDAQ:PCTY). The firm’s free cash flow will drop as it funds the deal, but the affair is also expected to add $20 million to Paylocity Holding Corporation (NASDAQ:PCTY)’s run rate revenue. Crucially for the firm though, it is profitable and generated $208 million in net income in its four latest quarters. Yet, since Paylocity Holding Corporation (NASDAQ:PCTY) is focusing on profitability instead of growth, the stock might suffer if the acquisition costs add up.
Paylocity Holding Corporation (NASDAQ:PCTY)’s management shared details about its cost focus during the Q2 2024 earnings call:
“Yes. I think you’re trying to get at the same question of what does the growth model look like on a go-forward basis for this business. We’re at $1.4 billion in revenue, and we feel like we can continue to grow this business on a recurring revenue basis double-digits. I think that’s what we’re talking about doing. And at the same time, we can increase profitability. The size of the opportunity is big enough. As you mentioned, everybody has to get paid some way. So the payroll component of it is often displacement. We then try to add additional products beyond that. And so we feel like we’re approaching this with a growth priority, but a fairly balanced view on profitability going forward, and we think there’s still a really big TAM for us to attack.”
10. Teleflex Incorporated (NYSE:TFX)
Number of Hedge Fund Holders In Q2 2024: 36
Teleflex Incorporated (NYSE:TFX) is a medical instruments company that makes and sells devices such as catheters and blood withdrawal products. The nature of its industry means that a key driver of the firm’s hypothesis is economies of scale since they allow the firm to compete on a cost basis. Between 2021 and 2023, Teleflex Incorporated (NYSE:TFX) has grown its revenue by roughly $160 million, which isn’t much considering that the trailing twelve month revenue is $3 billion. This slow growth has also affected the firm’s valuation, with its forward P/E ratio of 15 being lower than the sector median of 16. However, Teleflex Incorporated (NYSE:TFX) might see significant tailwinds in the future due to the FDA’s advisory to healthcare professionals to move away from a rival’s balloon pumps. The firm is the second biggest player in the market, and it could grow its revenue as a result. Teleflex Incorporated (NYSE:TFX)’s stable market has also meant that the firm has paid dividends for 48 years.
Janus Henderson mentioned Teleflex Incorporated (NYSE:TFX) in its Q2 2024 investor letter. Here is what the fund said:
“Teleflex, a medical device company, was among the top relative detractors. The stock underperformed in the quarter despite reporting earnings results that were in line with estimates. In a period of very high levels of medical utilization post-Covid 19 for many companies, Teleflex’s results, particularly from its key product, UroLift, have been underwhelming. Also weighing on the stock is conservative 2024 guidance due to the impact of recent acquisitions on the business. We remain attracted to the company from a valuation standpoint, as we believe its longer-term growth prospects are undervalued by the market; however, we are monitoring the company’s capital allocation decisions to include further M&A and/or share repurchases.”
9. EPAM Systems, Inc. (NYSE:EPAM)
Number of Hedge Fund Holders In Q2 2024: 37
EPAM Systems, Inc. (NYSE:EPAM) is a business services company that provides software and engineering products. The firm provides engineering and software development services to a variety of industries such as financial services, healthcare, and media. Its shares are down 32% year to date as demand for information technology services is slow in an economy constrained by high interest rates. EPAM Systems, Inc. (NYSE:EPAM)’s stock tumbled by 27% in May after the firm’s first quarter earnings results saw it guide second quarter EPS at a $10.15 midpoint and revenue at $1.135 billion. Both of these missed analyst estimates of $2.44 and $1.17 billion. The firm’s full year midpoints of revenue and EPS guidance of $4.62 billion and $10.15 also missed estimates of $4.81 billion and $10.17. This pessimism has also reduced the valuation, with EPAM Systems, Inc. (NYSE:EPAM) currently trading at a forward P/E of 46.30. Consequently, the stock might have bottomed out, and the firm can also see sizeable catalysts from AI adoption in the industry as its software services allow businesses to integrate AI into their operations.
EPAM Systems, Inc. (NYSE:EPAM)’s management shared details about its AI services during the Q2 2024 earnings call:
“Today, I would like to highlight our up-to-date progress in that area and how EPAM is helping clients pragmatically initiate and then move use cases beyond pilots into production deployments. Our current approach to AI transformation is 3 dimensional. Dimension 1, EPAM internal transformation and GenAI enablement investments.
We set an ambition goal for ourselves to upskill and effectively train an absolute majority of the company on the usage of GenAI fundamentals and to do so both responsibly and with the EPAM-level technical depth. A dedicated program was established to execute this. And today, with the help of our educational platforms, internal specialized tools and our global maintenance community, close to 100% of the EPAMers have gone through training and applying AI in their daily work activities. While most of the companies have announced similar programs, we believe that during the last 24 months, our early and highly focused efforts across a broad range of EPAMers allow us to better understand future opportunities and to invest in differentiated IP and accelerators around GenAI-enabled engineering solution.
Our combination of training, IP and open-source style internal initiatives have now become drivers of scale in our advanced GenAI practitioner communities across all EPAM organizational unit and practices. We assume that well over 10% of EPAMers are now advanced GenAI technical practitioners, while over 1,000 are becoming strong internal AI champions with ability to lead GenAI-enabled business solutions. We believe all that has enabled our dimension 2, client transformation opportunities. Our AI client project today has evolved from exploratory pilots and proof-of-concept late last year to now EPAM being selected by clients as a primary AI partner with involvement into hundreds of GenAI-led engagements. We are helping to change the full value chain of SLDC from one side and enabling implementation of real GenAI-driven business use cases from another.”
8. Darling Ingredients Inc. (NYSE:DAR)
Number of Hedge Fund Holders In Q2 2024: 37
Darling Ingredients Inc. (NYSE:DAR) is a food and fuel products raw materials company. It provides products to enable pharma, food, fuel, and other firms to make their products. Consequently, as Darling Ingredients Inc. (NYSE:DAR)’s customers see their sales grow during a robust economy, the firm’s shares are down by 26% year to date. These troubles have also been exacerbated by a slowdown in the renewable industry market, which provides Darling Ingredients Inc. (NYSE:DAR) with key tax credits. However, the firm’s scale that allows it to command 17% of the global market share means that once industrial activity picks up, Darling Ingredients Inc. (NYSE:DAR) can experience significant tailwinds. Additionally, disputes over whether the 45Z tax credit should apply to international feed stocks as well could make a sizeable impact on Darling Ingredients Inc. (NYSE:DAR)’s income statement since bioenergy products account for roughly 10% of the firm’s revenue as of H1 2024.
Southern Sun Asset Management mentioned Darling Ingredients Inc. (NYSE:DAR) in its Q2 2024 investor letter. Here is what the fund said:
“Darling Ingredients Inc. (NYSE:DAR) is the largest publicly traded company turning edible by-products and food waste into sustainable products and a leading producer of renewable energy. DAR was the top detractor in the Small Cap strategy in the second quarter. The stock has struggled after a difficult reset period in the third quarter of last year, as fears regarding new industry supply of renewable diesel and the lack of government support have increased. Over time and through thoughtful leadership and capital allocation, the company has built a vertically integrated growth engine with attractive returns on capital while consolidating the industry and driving innovation. After a strong year of EBITDA growth in 2023, we expect 2024 to be an important year of transition before growth resumes over the next 2-3 years, as recent M&A and growth capex drive deleveraging and free cash flow. The company is currently constructing sustainable aviation fuel (SAF) capacity expected to come online in 4Q24 and is evaluating further SAF expansion for the future, as growth and incentives in that market provide significant margin expansion and return on investment. The valuation is compelling, in our opinion, based on multiple scenarios and valuation methodologies. We spent time with local leadership in Brazil during the second quarter – reviewing significant investments that have been made over recent years as well as touring important production facilities. Brazil is the most important international market for Darling where they have consolidated the industry and enjoy very strong market share. While these investments have put some strain on the balance sheet in the near term, we believe the growth in cash flow and return on invested capital will deliver improved stock performance in the years ahead.”
7. Match Group, Inc. (NASDAQ:MTCH)
Number of Hedge Fund Holders In Q2 2024: 43
Match Group, Inc. (NASDAQ:MTCH) is an American software company that operates a portfolio of dating applications. It owns some of the best known apps such as Tinder and Match. The past couple of years haven’t been great for the firm on the revenue front. Match Group, Inc. (NASDAQ:MTCH) earned $3 billion, $3.2 billion, and $3.4 billion in revenue during 2021, 2022, and 2023. This shows that growth has stalled, and between the 2021 start and the recent market close, the firm’s shares have bled 75%. Naturally, the drop indicates that investor sentiment isn’t great, and it has also led to activist investors smelling blood. So far in 2024, Elliot Management has built a $1 billion stake in the firm and Starboard Value has acquired 6.6% of Match Group, Inc. (NASDAQ:MTCH)’s shares. Consequently, the activist action is now at the heart of the firm’s hypothesis, and a turnaround or taking the firm private might generate tailwinds for Match Group, Inc. (NASDAQ:MTCH)’s stock. On the business front, the firm is currently seeing mixed response from paying Tinder users but its Hinge app posted 48% annual revenue growth to $134 million in the second quarter.
Since Tinder is key to Match Group, Inc. (NASDAQ:MTCH)’s business, here’s what management commented during the Q2 2024 investor call:
“Tinder delivered $480 million of direct revenue, up 1% year-over-year, up 4% FX neutral. Tinder payers climbed 8% year-over-year to approximately $9.6 million, an improvement from the 9% year-over-year decline last quarter and above our expectations.
Payers were down 78,000 sequentially. Tinder’s Q2 RPP increased 10% year-over-year. While growth in subscription revenue at Tinder was solid at 7% year-over-year in Q2, Tinder continued to experience pressure on a la carte revenue, which was down 17% year-over-year in the quarter. Tinder is rolling out various initiatives to address the ALC weakness, including unbundling current features such as Passport and See Who Likes You into ALC to attract users who may not be as open to subscriptions. Both are in test now. Additionally, the team will shortly be testing two new ALC features, one that contextualizes someone’s likes and another that helps foster ongoing engagement after matching. As a result, we’re optimistic that Q2 will be a trough for declines in year-over-year ALC revenue and that trends will gradually improve in the second half of the year.”
6. Insulet Corporation (NASDAQ:PODD)
Number of Hedge Fund Holders In Q2 2024: 44
Insulet Corporation (NASDAQ:PODD) is a specialty medical devices company. The firm makes and sells products that enable diabetics to use insulin and monitor their blood sugar levels. Its business model provides Insulet Corporation (NASDAQ:PODD) with a double edged sword. On one hand, its insulin pod delivery system is the first of its kind which continuously monitors patient glucose levels throughout the day and delivers insulin accordingly without needing syringes. On the flip side, since Insulet Corporation (NASDAQ:PODD) relies exclusively on its pods, the firm can struggle in the future if competitors arise to challenge its market position. Additionally, the firm’s hypothesis is also dependent on continuous product upgrades. On this front, Insulet Corporation (NASDAQ:PODD)’s shares have gained a massive 27% since late August after the Omnipod 5 was approved by the FDA. Piper Sandler followed with a share price upgrade that increased the target to $285 from $230 and kept an Overweight rating on the shares.
Brown Capital mentioned Insulet Corporation (NASDAQ:PODD) in its Q2 2024 investor letter. Here is what the fund said:
“Insulet is a medical-device company that produces the Omnipod Insulin Management System, the first commercial, tubeless, insulin-patch pump. Insulin-dependent diabetics historically relied on syringes or tubed insulin pumps to administer the medicine. The Omnipod offers a distinct form factor for insulin delivery: a sleek, disposable, multiday pod that attaches to the body. As technology advanced, these pumps were paired with continuous glucose monitoring (CGM) systems that automatically transmit glucose data wirelessly to the insulin pump. Pumps could then use this real-time information to dynamically adjust the insulin-infusion rate, mimicking the function of a healthy pancreas and dramatically improving a patient’s quality of life. After reeling late last year over concerns that GLP-1s, the popular weight-loss drugs, will curb diabetes and reduce insulin-pump demand, Insulet’s shares have slowly rebounded as the company’s results have remained strong.”
5. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Number of Hedge Fund Holders In Q2 2024: 44
Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is a biotechnology company that sells medicines for sleep disorders, seizures, lung cancer, and other ailments. When compared to risky biotechnology stocks, the firm is stable as it generated $3.9 billion in trailing twelve month revenue and $395 million in profits over the same period. Consequently, Jazz Pharmaceuticals plc (NASDAQ:JAZZ) has a solid operations base with which to generate cash flow, which is key to maintaining growth since it enables the firm to invest in new drugs to maintain and grow revenue. Right now, Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is focused on seeking approval for its seizure drugs in Japan, and if it receives approval then it could grow revenue. Two other drugs in Phase Three trials are treatments for lung and gastroesophageal cancer, indicating a robust pipeline with the potential to generate tailwinds for Jazz Pharmaceuticals plc (NASDAQ:JAZZ)’s stock. During Q2, out of the firm’s $1 billion revenue, its Sleep business accounted for 46.9% or $485 million in sales. Since Jazz Pharmaceuticals plc (NASDAQ:JAZZ) holds a key patent for sleep drugs, this business could continue to provide sizeable cash in the future.
Jazz Pharmaceuticals plc (NASDAQ:JAZZ)’s management shared details about its Sleep division during the Q2 2024 earnings call:
“I’ll also note that a large number of narcolepsy patients initiated Xywav therapy in the first quarter of this year as a result of Xyrem being removed from certain formularies, with a meaningful percentage of those patients initially utilizing bridging and support programs as they transitioned to Xywav. In the second quarter, we’ve seen a normalization in the use of these programs as many of those patients who initiated in the first quarter resumed commercial coverage following the usual benefits review and authorization process. Turning to our quarterly patient metrics, there were approximately 9,925 narcolepsy patients taking Xywav exiting the second quarter, an increase of approximately 25 patients from the prior quarter. I’ll highlight that we are receiving promising early feedback from the field nurse educator program we launched earlier this year.
This program enables new Xywav patients to interact in person with trained healthcare professionals as they begin oxybate therapy, providing an additional layer of support during the time when patients are titrating and optimizing their oxybate therapies and are most likely to have questions or discontinue treatment. Moving to IH, we continue to view this indication as the strongest growth opportunity for Xywav. Exiting the second quarter, there were approximately 3,300 active IH patients on Xywav, an increase of approximately 250 from the prior quarter. Our expanded field force has been active in the market for a full quarter now, with a particular focus on increasing the depth and breadth of IH prescribers, which continues to drive demand.”
4. Veeva Systems Inc. (NYSE:VEEV)
Number of Hedge Fund Holders In Q2 2024: 50
Veeva Systems Inc. (NYSE:VEEV) is a specialty cloud software provider that caters to the needs of the life sciences industry. Its software enables pharmaceutical and biotechnology companies to manage regulatory requirements and customer relations among other operations. Since it is a software as a service (SaaS) provider, Veeva Systems Inc. (NYSE:VEEV)’s narrative depends on its ability to grow revenue, manage costs, and land contracts for recurring revenue. Consequently, the firm’s shares tanked by 15.6% in late May and early June after Veeva Systems Inc. (NYSE:VEEV)’s first quarter earnings saw it reduce revenue guidance by $30 million and reduced R&D spending by 1.5%. Piper Sandler increased its share price target for the life sciences SaaS provider to $230 from $224 in August and kept an Overweight rating on the shares. The optimism was based on insights into Veeva Systems Inc. (NYSE:VEEV)’s deal pipeline with major customers. Overall, while the firm has struggled in a tight economy constrained by rates, it is one of the biggest specialty software providers of its kind and can see tailwinds once economic conditions improve.
Ensemble Capital mentioned Veeva Systems Inc. (NYSE:VEEV) in its Q2 2024 investor letter. Here is what the fund said:
“The broad adoption of Veeva’s software reflects customers’ need to be more efficient. Veeva has over 1,400 customers and its software has been used by 47 of the top 50 biopharma companies like Ely Lilly, emerging biotechs like Replimune, medical device firms like Boston Scientific, and CROs like ICON that run outsourced clinical trials. Its revenue has become more diversified as a result, with the top 10 customers accounting for 28% of revenue in fiscal 2024, down from 61% in fiscal 2012. It has also expanded internationally with 59% of revenue from North America, 28% Europe and Other, 11% Asia Pacific, and 3% the Rest of World in fiscal 2024.
The majority, 94%, of Veeva’s revenue comes from biopharma customers, 4% medtech and 2% consumer products as of fiscal 2q24. Of its biopharma revenue, 66% comes from large enterprises, 25% small medium businesses (SMBs), 4% emerging biotechs and 5% CROs. While Veeva counts most large biopharma companies as its customers, it has many more products left to sell them, and further to penetrate SMBs and emerging biotechs. Veeva recently launched Vault Basics, a low-cost, easy-to-deploy software package that offers smaller companies a chance to expand.”
3. Twilio Inc. (NYSE:TWLO)
Number of Hedge Fund Holders In Q2 2024: 54
Twilio Inc. (NYSE:TWLO) is a software company that provides developers with the capability to develop automated calling, messaging, and SaaS platforms. Its business model, which allows businesses to develop communications systems such as chat bots, is particularly well suited to meet business needs in the AI era. However, Twilio Inc. (NYSE:TWLO)’s shares are down 5% year to date, after a massive 22% drop in February which the stock is yet to recover from. The drop was due to the firm’s fourth quarter results which saw its Q1 revenue guidance of $1.03 billion to $1.04 billion miss analyst estimates of $1.05 billion. SaaS and software hypothesis is built on growth, and Twilio Inc. (NYSE:TWLO)’s shares weren’t helped by the fact that management failed to provide full year guidance. Piper Sandler boosted the share price target to $83 from $77 in August and kept an Overweight rating on the shares. and the optimism followed Twilio Inc. (NYSE:TWLO)’s second quarter earnings that saw the firm share 5.5% and 6.6% annual revenue growth for its third and fourth quarters, respectively.
Twilio Inc. (NYSE:TWLO)’s management shared key details for cost savings, another key factor for software firm hypothesis, during the Q2 2024 earnings call:
“Listen, I think we’ve done a lot on margins. If you just take a step back and think about the expansion that we got last year, and then coming into this year, our initial guide assumes very little operating margin leverage. If you look at our current guide for the year at the midpoint, it’s about — I’d say 250-ish basis points of margin expansion. So we continue to find opportunities to get expansion on both the OpEx line as well as the stock-based compensation line. And we don’t think we’re done. So we’ve talked about fact that we’re going to get the Segment business to break even by the second quarter of next year. That business lost $16 million in the second quarter, $21 million in the first quarter.
So you can see that there’s an opportunity to get leverage there. And then in addition, in the broader business, I’d say in communications and the G&A functions, there’s a lot of work that we’re doing around, you mentioned automation. We are a remote-first company, so we do have the opportunity to leverage lower-cost geographies as a way to continue to get efficiencies. And so we’re doing all of these things and continue to do them. I would say, I’m not going to give you an exact inning, but I would say we have a lot of opportunity to continue to expand margins both on the non-GAAP side as well as the GAAP side, including stock-based compensation. In terms of the profit, in terms of what’s coming from improvements in process versus cost discipline, I think it’s a little bit of both.
It’s largely cost discipline though. We continue to believe that we can run this company without having to add a lot of incremental costs. You’ve seen us do that now for 6 quarters in a row. And so we’re really just much more disciplined in terms of how we’re running the company, and that’s something Khozema drives pretty regularly with the team.”
2. DexCom, Inc. (NASDAQ:DXCM)
Number of Hedge Fund Holders In Q2 2024: 64
DexCom, Inc. (NASDAQ:DXCM) is a specialty medical devices company that enables diabetics to monitor their glucose levels. Just like Insulet, whose devices enable patients needing insulin to take the medicine round the clock, DexCom, Inc. (NASDAQ:DXCM)’s systems enable round the clock monitoring of sugar levels. Consequently, the firm enjoys a significant competitive strength in the market, and given the ironically stable nature of its market, DexCom, Inc. (NASDAQ:DXCM) can continue operating smoothly in the future. However, since 94% of the firm’s revenue comes through its disposable sensors for diabetics, a strong competitor that offers superior products can disrupt DexCom, Inc. (NASDAQ:DXCM)’s business. Additionally, while investor worries of weight loss drugs shrinking the diabetes market have since dissipated, future drugs that reduce the need for round the clock monitoring can prove to be a headache. Additionally, since 85% of DexCom, Inc. (NASDAQ:DXCM)’s H1 2024 revenue was through distributors, any troubles on this front could create headwinds. Potential catalysts for the stock include deeper market penetration and innovation.
Artisan Partners mentioned DexCom, Inc. (NASDAQ:DXCM) in its Q2 2024 investor letter. Here is what the fund said:
“Dexcom detracted from performance in the quarter as the stock price gave back all the strong gains from the first quarter of this year. The company reported strong first quarter earnings, beating consensus estimates for the top and bottom lines, highlighted by 25% organic revenue growth. Additionally, it raised the low end of full-year revenue guidance based on the strong start to the year, with record new patient starts. Dexcom is launching an over-the-counter continuous glucose monitoring device set to target the over 25 million Type 2 diabetes patients who are not dependent on insulin. Furthermore, the medical device company recently expanded its salesforce to better address the ~200K primary care physicians in the United States. We see several catalysts going forward, and the stock is trading at a discount to historical valuation metrics.”
1. Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH)
Number of Hedge Fund Holders In Q2 2024: 72
Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH) is a drug manufacturer that sells drugs to help patients with asthma, diabetes, those undergoing surgery, and others. The fact that it sells generics means that Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH) has to operate with high product volume shipments to ensure beefy margins and profitability. The drug maker also benefits from the fact that it operates in the specialty generics market, which is a niche sector of the industry but one that carries high revenue potential. Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH) also competes in the inhalable products market and makes generics which enable it to capitalize on fast growing markets as soon as patents expire. The company is also rapidly growing its portfolio and secured the FDA’s approval for an asthma generic. Additionally, one of Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH)’s leading products, Baqsimi, has patents that will expire in 2036 to provide the firm with a stable source of revenue for more than a decade from now. The firm is also shifting its portfolio composition, and it aims to make proprietary products account for at least 50% of its products by 2025.
Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH)’s management shared details about its star drug during the Q2 2024 earnings call:
“At the same time, the sales also benefited from initial stocking as we started BAQSIMI distribution in the United States. BAQSIMI has swiftly become a cornerstone of our diabetes portfolio, offering patients a convenient and effective solution to severe hypoglycemia. We believe the glucagon market remains underserved with significant growth potential as BAQSIMI continues to be underutilized among diabetic patients. Similarly, our global transition of BAQSIMI has continued to make progress. Our dedication to broadening our capabilities to provide BAQSIMI’s accessibility for patients worldwide remains steadfast. Furthermore, we persist in prioritizing investments in sales and marketing endeavors to bolster BAQSIMI’s market standing, seizing upon the existing underutilization of glucagon. Looking forward, BAQSIMI remains a primary focal point for Amphastar and we eagerly anticipate its significant impact on individuals navigating diabetes management.”
AMPH is one of the top Piper Sandler stocks seeing favorable technical movements. While we acknowledge the potential of AMPH as an investment, our conviction lies in the belief that some 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 more promising than AMPH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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