Conestoga Capital Advisors, an asset management company, released its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets started the year with a rally due to optimism about a strong economy and expectations of moderating inflation and lower interest rates. However, concerns over slowing earnings from major Technology companies, geopolitical tensions, and an upcoming announcement on tariffs led to a sharp decline in equities by the end of the first quarter. Investors sought safety, driving U.S. Treasury yields down. The Conestoga Small Cap Composite returned -11.35% (net) in the first quarter compared to the Russell 2000 Growth Index’s -11.12% return. The Conestoga SMid Cap Composite returned -5.73% compared to the Russell 2500 Growth Index’s -10.80% return. The Conestoga Micro-Cap Composite returned -8.24% vs the Russell Microcap Growth Index’s return of -17.75%. Finally, the Conestoga Mid Cap Composite returned 0.96% (net), compared to the Russell Midcap Growth Index’s -7.12% return. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2025.
In its first-quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks such as Roper Technologies, Inc. (NASDAQ:ROP). Roper Technologies, Inc. (NASDAQ:ROP) designs and develops software and technology-enabled products and solutions. The one-month return of Roper Technologies, Inc. (NASDAQ:ROP) was 2.91%, and its shares gained 7.81% of their value over the last 52 weeks. On May 1, 2025, Roper Technologies, Inc. (NASDAQ:ROP) stock closed at $557.59 per share with a market capitalization of $59.877 billion.
Conestoga Capital Advisors stated the following regarding Roper Technologies, Inc. (NASDAQ:ROP) in its Q1 2025 investor letter:
“Roper Technologies, Inc. (NASDAQ:ROP) is a diversified industrial and technology (license and Software-as-a-Service) consolidator with a long history of mid-teens free-cash-flow growth. ROP is a best-in-class operator and allocator of capital. In the quarter, the company experienced accelerating organic growth and bookings momentum, and management believes this year will be good for M&A activity (at more reasonable prices). For the last several years, ROP has faced numerous macroeconomic headwinds that appear to be abating, setting up a more promising outlook.”
A close-up of a fuel pump operated by a robotic arm, symbolizing the company’s technology-driven industrial solutions.
Roper Technologies, Inc. (NASDAQ:ROP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 54 hedge fund portfolios held Roper Technologies, Inc. (NASDAQ:ROP) at the end of the fourth quarter compared to 40 in the third quarter. Roper Technologies, Inc.’s (NASDAQ:ROP total revenue grew 12% to $1.9 billion in the first quarter 2025. While we acknowledge the potential of Roper Technologies, Inc. (NASDAQ:ROP) 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 covered Roper Technologies, Inc. (NASDAQ:ROP) and shared stock picks from Charles Akre and John Neff with tremendous upside potential. 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.