Do You Believe in the Long-Term Growth Potential of Vertex (VERX)?

Janus Henderson Investors, an investment management company, released its “Janus Henderson Venture Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund returned -8.61% in the first quarter, compared to the Russell 2000 Growth Index’s -11.12% return. Stock selection in the consumer discretionary sector contributed to the fund’s relative performance in the quarter, while selection in healthcare detracted. Stocks declined in the quarter as the uncertainty over tariffs and other Trump administration policies dampened the optimism that had driven momentum in the fourth quarter of 2024. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Janus Henderson Venture Fund highlighted stocks such as Vertex, Inc. (NASDAQ:VERX). Vertex, Inc. (NASDAQ:VERX) offers enterprise tax technology solutions for retail trade, wholesale trade, and manufacturing industries. The one-month return Vertex, Inc. (NASDAQ:VERX) was -14.58%, and its shares lost 0.23% of their value over the last 52 weeks. On July 1, 2025, Vertex, Inc. (NASDAQ:VERX) stock closed at $35.38 per share with a market capitalization of $5.607 billion.

Janus Henderson Venture Fund stated the following regarding Vertex, Inc. (NASDAQ:VERX) in its Q1 2025 investor letter:

“Relative performance was hindered by our position in Vertex, Inc. (NASDAQ:VERX), which furnishes comprehensive tax compliance software to mid-market companies. While Vertex met its revenue targets, earnings-per-share guidance was slightly weaker than expected, as the company has chosen to invest in future revenue growth opportunities. We believe the resulting sell off in the stock was out of line with fundamentals and may reflect a less certain near-term environment for enterprise spending. We continue to believe in Vertex’s long-term potential and believe the stock is attractively valued relative to its peers.”

A finance executive overseeing the implementation of a tax solution.

Vertex, Inc. (NASDAQ:VERX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held Vertex, Inc. (NASDAQ:VERX) at the end of the first quarter, which was 23 in the previous quarter. In the first quarter, Vertex, Inc. (NASDAQ:VERX) reported revenue of $177.1 million, marking an increase of 12.9% from Q1 2024. While we acknowledge the potential of Vertex, Inc. (NASDAQ:VERX) 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 Vertex, Inc. (NASDAQ:VERX) and shared TimesSquare Capital U.S. Small Cap Growth Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of VERX as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.