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Here’s Why Conestoga Capital Advisors Sold Semler Scientific (SMLR)

Conestoga Capital Advisors, an asset management company, released its “Micro-Cap Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. Investors are optimistic about the US economy which is heading for a softer landing, and moderating inflation. In the first quarter, the strategy rose 4.93% net-of-fees but trailed the Russell Micro Cap Growth Index’s return of 6.60%. Stock selection negatively impacted the performance but was partially offset by sector allocation. Stock selection in the Industrials and healthcare sectors detracted while Financials and Telecommunications sectors contributed. In addition, please check the fund’s top five holdings to know its best picks in 2024.

Conestoga Capital Advisors Micro-Cap Strategy highlighted stocks like Semler Scientific, Inc. (NASDAQ:SMLR), in the first quarter 2024 investor letter. Semler Scientific, Inc. (NASDAQ:SMLR), with a market capitalization of $164.987 million, offers technology solutions to enhance healthcare’s clinical effectiveness and efficiency. One-month return of Semler Scientific, Inc. (NASDAQ:SMLR) was -9.88%, and its shares lost 16.22% of their value over the last 52 weeks. On May 22, 2024, Semler Scientific, Inc. (NASDAQ:SMLR) stock closed at $23.35 per share.

Conestoga Capital Advisors Micro-Cap Strategy stated the following regarding Semler Scientific, Inc. (NASDAQ:SMLR) in its first quarter 2024 investor letter:

“Semler Scientific, Inc. (NASDAQ:SMLR): SMLR’s core product, QuantaFlo, measures arterial blood flow to aid in the diagnosis of peripheral arterial disease (PAD). Diagnosing PAD early can prevent strokes, heart attacks, and other negative outcomes. In February 2023, the Center for Medicare and Medicaid Services (CMS) announced a surprise decision to eliminate reimbursement for the preventative testing of PAD. We continued to hold SMLR as the plan was phased in over three years and we remained confident that the clinical benefit would take precedent to the rate cuts. During SMLR’s fourth quarter call, they did not issue full year guidance and commented visibility had been reduced due to the CDC’s ruling. With the lack of visibility and un-knowns regarding reimbursement, we decided there were better uses of capital.”

A doctor in focus surrounded by colleagues in a hospital setting.

Semler Scientific, Inc. (NASDAQ:SMLR) trailing 12 months revenue is $65.88 million. As per the recent earnings call, Semler Scientific, Inc. (NASDAQ:SMLR) generated $15.9 million in revenues in the first quarter, a 13% decrease compared to 2023 Q1.

Semler Scientific, Inc. (NASDAQ:SMLR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 11 hedge fund portfolios held Semler Scientific, Inc. (NASDAQ:SMLR) at the end of the first quarter which was 12 in the previous quarter.

In another article, we discussed Semler Scientific, Inc. (NASDAQ:SMLR) and shared Conestoga Capital Advisors’ views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.

If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

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

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

Dr. Inan Dogan

Dr. Ian Dogan

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?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

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…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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Wall Street calls this $3 stock a “Melting Ice Cube.” They said the same thing about BTI before it returned 90%.

Dr. Inan Dogan

Dr. Ian Dogan

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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We looked under the cover and realized they were wrong.

We alerted our subscribers, and BTI returned 90% in just 16 months.

Now if you had invested just $10,000 in BTI in June 2024, you’d be sitting on $19,000 in October 2025.

Today, we have identified a nearly identical pattern in a digital-first giant trading at $3.

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This pattern is a hallmark of our 16.5% annual return track record. The current opportunity offers a 400% upside potential—dwarfing even our 90% BTI return.

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