Artisan Partners, an investment management company, released its fourth-quarter 2025 investor letter for “Artisan Small Cap Fund”. A copy of the letter can be downloaded here. The Fund seeks to invest in companies that possess franchise characteristics, with strong earnings trajectories, and are trading at a discount to the estimated private market value. Despite strong results in 2025, volatility was elevated, and sentiment shifted frequently, influenced by political developments in the US, evolving trade policy rhetoric, changing expectations for monetary policy, and ongoing geopolitical tensions. Against this backdrop, the Fund posted strong absolute returns in the fourth quarter, outperforming both the Russell 2000® Growth Index and the Russell 2000® Index. The portfolio delivered strong results in the quarter across all segments. In contrast, for the full year, the Fund generated strong results but trailed both the indexes. In Q4 2025, the market leadership shifted back to companies with durable profit cycles. Moving to 2026, the firm continues to focus on its proven technique of identifying profit cycles in franchise companies at reasonable valuations. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Artisan Small Cap Fund highlighted stocks like NLIGHT, Inc. (NASDAQ:LASR). NLIGHT, Inc. (NASDAQ:LASR) is a US-based company that engages in the design and development of high-power semiconductor and fiber lasers for aerospace and defense, industrial, and microfabrication applications. On March 16, 2026, NLIGHT, Inc. (NASDAQ:LASR) stock closed at $68.50 per share. One-month return of NLIGHT, Inc. (NASDAQ:LASR) was 34.60%, and its shares gained 643.76% over the past 52 weeks. NLIGHT, Inc. (NASDAQ:LASR) has a market capitalization of $3.822 billion.
Artisan Small Cap Fund stated the following regarding NLIGHT, Inc. (NASDAQ:LASR) in its fourth quarter 2025 investor letter:
“During the quarter, we initiated new positions in NLIGHT, Inc. (NASDAQ:LASR) Guardant Health and Cellebrite. nLIGHT is a US-based developer of high-power semiconductor and fiber lasers. The company previously exited its unprofitable industrial laser business in China to focus on its defense segment, which webelieve positions it well for profitable growth. We initiated a GardenSM position based on its strong franchise in non-kinetic laser weapons, an increasingly critical technology for countering drones and certain advanced missile threats, including future applications in hypersonic defense.”
NLIGHT, Inc. (NASDAQ:LASR) 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 NLIGHT, Inc. (NASDAQ:LASR) at the end of the fourth quarter, up from 34 in the previous quarter. In Q4 2025, NLIGHT, Inc. (NASDAQ:LASR) reported revenue of $81.2 million, an increase of 71% compared to $47.4 million in the fourth quarter of 2024. While we acknowledge the risk and potential of NLIGHT, Inc. (NASDAQ:LASR) 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 NLIGHT, Inc. (NASDAQ:LASR) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered NLIGHT, Inc. (NASDAQ:LASR) and shared a list of best day trading stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 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.
