Conestoga Capital Advisors, an asset management company, released its “Micro-Cap Strategy” second-quarter 2024 investor letter. A copy of the letter can be downloaded here. The second quarter of 2024 may be regarded as a time of moderation. Economic indicators largely reflected slowing growth and easing inflation. The moderation theme also drives equity markets. Large-cap stocks, as measured by the S&P 500, rose 3.9% in the second quarter, however, small-cap stocks lagged again, with the Russell 2000 Index declining -3.3% and the Russell 2000 Growth Index declining -2.9%. The Micro Cap Strategy declined -8.52% net-of-fees in the quarter compared to a -5.57% return for the Russell Microcap Growth Index. Underperformance was mostly caused by negative stock selection effects in the Telecommunications and industrial sectors, with Health Care being the most addictive. Sector allocation effects influenced relative returns. Also, low-beta companies with cheap multiples, the quarter’s biggest winners, were a drag on the portfolio. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Conestoga Capital Advisors highlighted stocks like PROS Holdings, Inc. (NYSE:PRO) in the second quarter 2024 investor letter. PROS Holdings, Inc. (NYSE:PRO) offers software solutions that optimize the processes of selling and shopping in the digital economy. The one-month return of PROS Holdings, Inc. (NYSE:PRO) was -20.70%, and its shares lost 45.46% of their value over the last 52 weeks. On August 16, 2024, PROS Holdings, Inc. (NYSE:PRO) stock closed at $19.00 per share with a market capitalization of $896.92 million.
Conestoga Capital Advisors stated the following regarding PROS Holdings, Inc. (NYSE:PRO) in its Q2 2024 investor letter:
“PROS Holdings, Inc. (NYSE:PRO): PRO markets and sells price optimization software and solutions that leverage their extensive knowledge of Artificial Intelligence. PRO reported a slight 1Q24 revenue beat, and solidly better EBITDA, highlighting several new logos and expansions across its Travel and B2B segments. Full-year revenue and EBITDA guidance was raised slightly and was largely in line with consensus. 2Q guidance, however, came in below consensus and was the primary reason for the stock weakness. While the B2B segment remains the primary growth driver, the Travel segment continues to improve and should contribute to growth over the next several years.”
A computer programmer working on a holographic digital twin technology software solution.
PROS Holdings, Inc. (NYSE:PRO) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held PROS Holdings, Inc. (NYSE:PRO) at the end of the second quarter which was 17 in the previous quarter. PROS Holdings, Inc.’s (NYSE:PRO) subscription revenue was $65.6 million in the second quarter, up 14% year-over-year, and total revenue was $82 million, up 8% year-over-year. While we acknowledge the potential of PROS Holdings, Inc. (NYSE:PRO) 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 PROS Holdings, Inc. (NYSE:PRO) and shared the list of best machine learning stocks according to analysts. In addition, please check out our hedge fund investor letters Q2 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.
