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 Installed Building Products, Inc. (NYSE:IBP). Installed Building Products, Inc. (NYSE:IBP) engages in the installation of insulation for residential and commercial builders. On July 23, 2026, Installed Building Products, Inc. (NYSE:IBP) closed at $222.88 per share. One-month return of Installed Building Products, Inc. (NYSE:IBP) was -2.64% and its shares gained 11.10% over the past 52 weeks. Installed Building Products, Inc. (NYSE:IBP) has a market capitalization of $6.00 billion with a 52-week trading range between $193.11 – $349.00
Artisan Small Cap Fund stated the following regarding Installed Building Products, Inc. (NYSE:IBP) in its Q2 2026 investor letter:
“Installed Building Products, Inc. (NYSE:IBP) is the second-largest insulation installer in the US and manages the full installation process—from material procurement to scheduling, logistics and installation. Recent results were weaker than expected, as softer residential demand, weather-related disruptions and cost inflation lowered margins despite continued strength in commercial construction. While management highlighted improving residential trends and a growing commercial backlog, the quarter raised questions about the pace of the company’s profit cycle. The residential business took a step backward after several quarters of better-than-expected execution, while tougher comparisons in commercial suggest the overall profit cycle may take longer to inflect upward. We reduced the position back to the Garden,as we believe it may take several quarters for the profit cycle to regain momentum.”
Installed Building Products, Inc. (NYSE:IBP) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 36 hedge fund portfolios held Installed Building Products, Inc. (NYSE:IBP) at the end of the first quarter which was 32 in the previous quarter. While we acknowledge the risk and potential of Installed Building Products, Inc. (NYSE:IBP) 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 Installed Building Products, Inc. (NYSE:IBP) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Installed Building Products, Inc. (NYSE:IBP) and shared Giverny Capital Asset Management’s insights on the company. In addition, please check out our hedge fund investor letters Q2 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.
