Aristotle Capital Boston, LLC, an investment advisor, released its first-quarter 2026 investor letter for “Small Cap Equity Fund”. A copy of the letter is available to download here. U.S. small-cap equities delivered strong performance in the first quarter amid macroeconomic and geopolitical volatility, outpacing large-cap stocks. Improving earnings, attractive relative valuations, and a focus on domestic sectors supported the small caps in the quarter. In this backdrop, the Aristotle Small Cap Equity Fund (Class I-2) delivered a total return of 1.50% in the quarter, outperforming the Russell 2000 Index’s 0.89% return. The performance was supported by security selection in the information technology and financials sectors, along with underweight allocations to healthcare and industrials. The fund remains optimistic about the long-term outlook for U.S. small-cap equities. Please review the Strategy’s top five holdings to gain insights into their key selections for 2026.
In its first-quarter 2026 investor letter, Aristotle Small Cap Equity Fund highlighted Advanced Energy Industries, Inc. (NASDAQ:AEIS) as one of its leading contributors. Advanced Energy Industries, Inc. (NASDAQ:AEIS) is a leading precision power conversion, measurement, and control solutions provider for semiconductor equipment and data centers. On May 21, 2026, Advanced Energy Industries, Inc. (NASDAQ:AEIS) stock closed at $313.05 per share. One-month return of Advanced Energy Industries, Inc. (NASDAQ:AEIS) was -18.15%, and its shares gained 170.01% over the past 52 weeks. Advanced Energy Industries, Inc. (NASDAQ:AEIS) has a market capitalization of $12.52 billion.
Aristotle Small Cap Equity Fund stated the following regarding Advanced Energy Industries, Inc. (NASDAQ:AEIS) in its Q1 2026 investor letter:
“Advanced Energy Industries, Inc. (NASDAQ:AEIS) is a provider of power electronics conversion products. The stock extended a strong multi-quarter rally fueled by earnings revisions, AI-related infrastructure spending, and improving semiconductor capital expenditure trends. We maintain our position, as we believe the company’s exposure to AI-driven semiconductor and data-center demand should continue to drive shareholder value.”
Advanced Energy Industries, Inc. (NASDAQ:AEIS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held Advanced Energy Industries, Inc. (NASDAQ:AEIS) at the end of the fourth quarter, compared to 28 in the previous quarter. While we acknowledge the risk and potential of Advanced Energy Industries, Inc. (NASDAQ:AEIS) 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 Advanced Energy Industries, Inc. (NASDAQ:AEIS) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Advanced Energy Industries, Inc. (NASDAQ:AEIS) and shared Baron Discovery Fund’s views on the company. In addition, please check out our hedge fund investor letters Q1 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.
