Artisan Partners, an investment management company, released its first-quarter 2026 investor letter for the “Artisan Small Cap Fund”. A copy of the letter is available to download here. US equities were mixed in Q1 2026, with major indices hitting all-time highs in January before retreating amid geopolitical tensions, changing monetary policy, and economic uncertainty. Energy stocks surged, outpacing the market, while value outperformed growth as investors moved from tech to commodity-sensitive sectors. Market leadership broadened, with mid- and small-cap indices performing better than large caps. The Iran conflict influenced market behavior. AI-related investments supported capital spending and earnings, though investor sentiment was mixed. The portfolio saw negative absolute returns but outpaced the Russell 2000® Growth Index, offering some downside protection. Investor Class: ARTSX, Advisor Class: APDSX, and Institutional Class: APHSX returned -2.72%, -2.68%, and -2.69%, respectively, in the first quarter compared to -2.81% return for the index. The market shifted towards cyclical, commodity sectors, less aligned with high-quality franchises, due to geopolitical events and energy shocks. Despite this, many portfolio companies maintained solid earnings aligned with their profit cycles. The Firm views this environment as supportive of its stock selection approach, focused on bottom-up stock selection across industries. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Artisan Small Cap Fund highlighted Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI). Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) is a US-based retailer of closeout merchandise and excess inventory. On June 4, 2026, Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) closed at $74.47 per share. One-month return of Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) was -9.41%, and its shares lost 37.61% over the past 52 weeks. Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) has a market capitalization of $4.50 billion.
Artisan Small Cap Fund stated the following regarding Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) in its Q1 2026 investor letter:
“In addition to Compass, we added to our positions in Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) and Flowserve during the quarter. Ollie’s Bargain Outlet is a closeout driven discount retailer that delivers a “treasure-hunt” shopping experience by offering branded merchandise at compelling values. We added Ollie’s to the portfolio’s CropSM following an acceleration in comparable store sales, reinforcing our thesis of a long runway for square footage growth and a more favorable competitive environment. Weaker peers have been exiting the market, which has been enabling Ollie’s to access a greater volume of attractive closeout deals and negotiate improved terms with vendors, given its scale. This dynamic may also support more favorable real estate opportunities through improved site availability and lease economics.”
Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 36 hedge fund portfolios held Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) at the end of the first quarter, compared to 39 in the previous quarter. While we acknowledge the risk and potential of Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) 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 Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Ollie’s Bargain Outlet Holdings, Inc. (NASDAQ:OLLI) and shared the list of stocks Jim Cramer discussed. In addition, please check out our hedge fund investor letters Q1 2026 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
