Do You Believe in the Long-Term Growth Potential of Tandem Diabetes Care (TNDM)?

Meridian Funds, managed by ArrowMark Partners, released its “Meridian Growth Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here.  Uncertainty surrounding prospective tariff policies weighed on investor sentiment and risk assets in the quarter, leading U.S. equities to experience their weakest performance since 2022.  Value stocks outperformed their growth counterparts within the small-cap space. Against this backdrop, the fund returned -8.01% (net) compared to the Russell 2500 Growth Index’s -10.80% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Meridian Growth Fund highlighted stocks such as Tandem Diabetes Care, Inc. (NASDAQ:TNDM). Headquartered in San Diego, California, Tandem Diabetes Care, Inc. (NASDAQ:TNDM) offers technology solutions for people living with diabetes. The one-month return of Tandem Diabetes Care, Inc. (NASDAQ:TNDM) was -7.32%, and its shares lost 60.36% of their value over the last 52 weeks. On June 3, 2025, Tandem Diabetes Care, Inc. (NASDAQ:TNDM) stock closed at $20.63 per share with a market capitalization of $1.374 billion.

Meridian Growth Fund stated the following regarding Tandem Diabetes Care, Inc. (NASDAQ:TNDM) in its Q1 2025 investor letter:

“Tandem Diabetes Care, Inc. (NASDAQ:TNDM) provides technology solutions for individuals living with diabetes in the U.S. and internationally. The company’s automated insulin delivery systems are positioned to gain market share within a large and growing addressable market, where more than half of Type 1 diabetes patients still administer insulin manually. During the quarter, Tandem reported top-line growth that exceeded expectations, driven by strong performance in its international division. However, U.S. results were weaker than anticipated due to muted seasonality and shipping delays.

Despite these near-term challenges, we believe Tandem’s platform remains well-positioned for long-term growth across both the Type 1 and emerging Type 2 diabetes markets, with further opportunities for incremental share gains. We slightly reduced our position during the period based on a reassessment of the company’s risk/reward profile.”

A hospital room with a patient using a medical device to administer insulin.

Tandem Diabetes Care, Inc. (NASDAQ:TNDM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Tandem Diabetes Care, Inc. (NASDAQ:TNDM) at the end of the first quarter, which was 38 in the previous quarter. While we acknowledge the potential of Tandem Diabetes Care, Inc. (NASDAQ:TNDM) 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 undervalued AI stock set for massive gains.

In another article, we covered Tandem Diabetes Care, Inc. (NASDAQ:TNDM) and shared Alger Weatherbie Specialized Growth Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 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.