Conestoga Capital Advisors, an asset management company, released its first-quarter 2026 investor letter. A copy of the letter can be downloaded here. The first quarter of 2026 started with optimism about the domestic economy and attractive small-cap valuations, but was marked by volatility amid geopolitical unrest in the Middle East and shifting expectations for interest rates. This unrest drove up energy prices and created a cautious global market. Energy, Basic Materials, and Industrials performed well, while software companies faced challenges due to AI disruption concerns. Market sensitivity to geopolitical events, energy prices, and inflation remains high. The first quarter saw high volatility in the Russell Microcap Growth Index, which rose over +11% by late January, then fell -18% to a -4.25% quarter-end loss, compared to -7.14% for the Conestoga Micro Cap Composite. Initial positive relative performance declined as the war in the Middle East escalated, leading investors to unwind popular momentum trades and to cover significant short positions in biotechnology. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Conestoga Capital Advisors highlighted Planet Labs PBC (NYSE:PL) as a leading contributor. Headquartered in San Francisco, California, Planet Labs PBC (NYSE:PL) operates a fleet of satellites, designing and launching constellations to provide high-frequency geospatial data. On May 7, 2026, Planet Labs PBC (NYSE:PL) closed at $35.24 per share. One-month return of Planet Labs PBC (NYSE:PL) was 1.64%, and its shares gained 889.89% over the past 52 weeks. Planet Labs PBC (NYSE:PL) has a market capitalization of $12.6 billion.
Conestoga Capital Advisors stated the following regarding Planet Labs PBC (NYSE:PL) in its Q1 2026 investor letter:
“Planet Labs PBC (NYSE:PL) operates the world’s largest fleet of Earth-imaging satellites, providing daily high-resolution data and insights to government and commercial clients. The stock significantly beat the benchmark in 1Q26 after reporting fourth-quarter revenue growth of 41% and achieving its first full year of positive free cash flow. Investor enthusiasm was further stoked by PL’s deepening integration of generative AI; by layering automated object detection and “Dark Vessel” tracking over its massive imagery archive, PL has transitioned from a data provider to an indispensable AI powered intelligence platform for global security and ESG monitoring.”
Planet Labs PBC (NYSE:PL) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 50 hedge fund portfolios held Planet Labs PBC (NYSE:PL) at the end of the fourth quarter, up from 40 in the previous quarter. In Q4 2025, Planet Labs PBC (NYSE:PL) reported revenue of $86.8 million, representing an increase of 41% year-over-year. While we acknowledge the risk and potential of Planet Labs PBC (NYSE:PL) 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 Planet Labs PBC (NYSE:PL) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Planet Labs PBC (NYSE:PL) and shared the list of under-the-radar stocks that are on fire. 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.
