Sands Capital Management, LLC released its Q1 2026 investor letter for its “Select Growth Strategy”. A copy of the letter is available to download here. Select Growth mainly targets leading U.S. businesses, driving positive structural changes. U.S. large-cap growth stocks fell in the first quarter. Sharp dispersion driven by AI advances marked the quarter, but late in the quarter, geopolitical tensions with Iran caused a broad-based risk-off move across the market. AI continued to influence market behavior, with AI-related investments increasing dispersion and shifting capital to asset-heavy sectors benefiting from AI infrastructure demand, which faced less disruption risk. While equities struggled, corporate fundamentals remained strong. Select Growth underperformed the Russell 1000 Growth Index, returning -12.9% vs. -9.8%, due to concerns about AI disruption affecting sector and stock choices. The Strategy’s focus on higher-growth, asset-light, service businesses faced challenges as markets rotated toward more capital-intensive, lower-risk sectors. Underweights in cyclical and defensive sectors slightly hurt relative results amid the broader market shift. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Sands Capital Select Growth Strategy highlighted Lam Research Corporation (NASDAQ:LRCX) as a newly added position. Lam Research Corporation (NASDAQ:LRCX) is a leading semiconductor equipment company that supplies semiconductor processing equipment for the fabrication of integrated circuits. On June 8, 2026, Lam Research Corporation (NASDAQ:LRCX) closed at $324.45 per share. One-month return of Lam Research Corporation (NASDAQ:LRCX) was 12.17%, and its shares gained 256.54% over the past 52 weeks. Lam Research Corporation (NASDAQ:LRCX) has a market capitalization of $405.75 billion.
Sands Capital Select Growth Strategy stated the following regarding Lam Research Corporation (NASDAQ:LRCX) in its Q1 2026 investor letter:
“Lam Research Corporation (NASDAQ:LRCX) is a leading global provider of semiconductor fabrication equipment. Our research indicates that Lam is a market share leader in numerous leading edge etch applications, where transistor structures are etched onto silicon wafers, with primary exposure to memory and a secondary focus on logic chips. Semiconductor manufacturing is becoming more complex, as more functionality is packed into a fixed physical space, increasing capital intensity and raising the cost of producing advanced chips. In our view, Lam plays a critical role in enabling future computing performance. Traditional drivers of computing improvements, such as frequency scaling and power efficiency, have slowed, shifting innovation toward new architectures including three-dimensional structures, parallel processing, and task specific accelerators. These advances require increasingly sophisticated manufacturing processes, where Lam’s capabilities play an essential role. We believe Lam is well positioned to benefit from a multiyear investment cycle as the industry transitions to more advanced nodes and as demand for memory increases to support the growth of AI applications.”
Lam Research Corporation (NASDAQ:LRCX) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 123 hedge fund portfolios held Lam Research Corporation (NASDAQ:LRCX) at the end of the first quarter, up from 104 in the previous quarter. Lam Research Corporation’s (NASDAQ:LRCX) revenue for the March quarter of 2026 was $5.84 billion, representing a 9% sequential increase and a 24% increase compared to Q1 2025. While we acknowledge the risk and potential of Lam Research Corporation (NASDAQ:LRCX) 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 Lam Research Corporation (NASDAQ:LRCX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Lam Research Corporation (NASDAQ:LRCX) and shared Green Alpha Investment’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.
