Artisan Partners, an investment management company, released its second-quarter 2026 investor letter for its “Artisan Small Cap Fund”. A copy of the letter can be downloaded here. The fund reported strong absolute returns and modestly outperformed the Russell 2000® Growth Index, which gained 25.7%. Global equities rebounded as resilient US growth, moderating inflation, strong earnings and continued AI investment outweighed delayed rate cuts, rising bond yields and geopolitical uncertainty. Investor Class: ARTSX, Advisor Class: APDSX, and Institutional Class: APHSX returned 26.02%, 26.05%, and 26.11%, respectively, in the second quarter, compared to a 25.71% return for the index. Market leadership favored loss-making, highly leveraged companies, creating a difficult environment for quality-focused active managers. Health care was the strongest relative contributor, while energy, materials, financials and real estate also helped. Technology, industrials and consumer discretionary detracted, partly because the fund did not own oversized index contributors. Software holdings also weakened despite strong fundamentals. The fund remains positive on small-cap opportunities, AI infrastructure and health care, but has reduced software exposure and is staying selective as valuations rise and competitive risks increase. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its second-quarter 2026 investor letter, Artisan Small Cap Fund highlighted Flex Ltd. (NASDAQ:FLEX). Flex Ltd. (NASDAQ:FLEX) provides technology innovation, supply chain, and manufacturing solutions to data center, communications, enterprise, consumer, automotive, healthcare, industrial, and power industries. On July 24, 2026, Flex Ltd. (NASDAQ:FLEX) closed at $127.00 per share. One-month return of Flex Ltd. (NASDAQ:FLEX) was -25.73% and its shares gained 134.72% over the past 52 weeks. Flex Ltd. (NASDAQ:FLEX) has a market capitalization of $43.42 billion with a 52-week trading range between $47.83 – $166.86.
Artisan Small Cap Fund stated the following regarding Flex Ltd. (NASDAQ:FLEX) in its Q2 2026 investor letter:
“Flex Ltd. (NASDAQ:FLEX) is a global manufacturing and supply chain solutions provider with exposure to high-margin AI and cloud data center infrastructure, particularly power and cooling systems. The company’s market capitalization has increasingly moved beyond the mandate of our small-cap strategy, leading us to reallocate capital to more attractive opportunities within our investable universe.”
Flex Ltd. (NASDAQ:FLEX) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 59 hedge fund portfolios held Flex Ltd. (NASDAQ:FLEX) at the end of the first quarter which was 62 in the previous quarter. While we acknowledge the risk and potential of Flex Ltd. (NASDAQ:FLEX) 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 Flex Ltd. (NASDAQ:FLEX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Flex Ltd. (NASDAQ:FLEX) and shared a list of best battery technology stocks to buy for grid storage. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.
Co-Founder and Research Director at Insider Monkey
When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.
Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.
At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.
Do the math. According to Musk, this technology could be worth $250 trillion by 2040.
Put another way, that’s roughly equal to:
175 Teslas
107 Amazons
140 Metas
84 Googles
65 Microsofts
And 55 Nvidias
And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.
It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.
Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.
How could anything be worth that much?
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In fact, Verge argues this company’s supercheap AI technology should concern rivals.
Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.
Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.
When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.
Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…
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Co-Founder and Research Director at Insider Monkey
My name is Inan Dogan. I’m the co-founder and Research Director of Insider Monkey. I have an important message for you today.
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