Wasatch Global Investors, an asset management company, released its “Small Cap Growth Strategy” Q2 2026 investor letter. A copy of the letter can be downloaded here. Small-cap equities experienced strong gains in the second quarter, primarily driven by companies associated with artificial intelligence (AI). However, the leadership within this sector remains narrow. Unprofitable companies and those benefiting from rapid AI-driven demand performed well. As a result, the strategy underperformed compared to the Russell 2000® Growth Index, which gained 25.71%. The strategy’s disciplined focus on higher-quality businesses caused it to trail the benchmark, though several AI-related holdings contributed positively. The strategy prioritizes companies with sustainable growth potential, emphasizing the importance of quality investments. Overall, the strategy seeks to balance the transformative potential of AI with a commitment to long-term, quality investments. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, the Wasatch Small Cap Growth Strategy highlighted AAON, Inc. (NASDAQ:AAON) as a material contributor. AAON, Inc. (NASDAQ:AAON) designs and manufactures high-efficiency air conditioning and heating equipment. On July 24, 2026, AAON, Inc. (NASDAQ:AAON) closed at $102.67 per share, reflecting a market capitalization of $8.41 billion. AAON, Inc. (NASDAQ:AAON) posted a one-month return of -19.75%, while its shares gained 20.22% over the past 52 weeks.
Wasatch Small Cap Growth Strategy stated the following regarding AAON, Inc. (NASDAQ:AAON) in its Q2 2026 investor update:
“AAON, Inc. (NASDAQ:AAON) also contributed. The company is a leading manufacturer of heating, ventilation and air conditioning (HVAC) systems for commercial and industrial environments. Data-center cooling demand amid the AI infrastructure build-out has led to accelerated growth for the company, whose commercial HVAC business had already experienced steady growth before the advent of AI. But AI has been a demand accelerant. In AAON’s latest quarterly results, year-over-year net sales grew more than 50% and the company’s total backlog increased 107.4% to a record $2.1 billion.”
AAON, Inc. (NASDAQ:AAON) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 30 hedge fund portfolios held AAON, Inc. (NASDAQ:AAON) at the end of the first quarter, compared to 36 in the previous quarter. While we acknowledge the risk and potential of AAON, Inc. (NASDAQ:AAON) 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 time frame. If you are looking for an AI stock that is more promising than AAON, Inc. (NASDAQ:AAON) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered AAON, Inc. (NASDAQ:AAON) and shared Giverny Capital Asset Management’s views on the company. In addition, please check out our hedge fund investor letters Q2 2026 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.
