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 stocks like N-able, Inc. (NYSE:NABL). N-able, Inc. (NYSE:NABL) is a technology company offering unified endpoint management, security operations, and data protection solutions for managed service providers. On May 7, 2026, N-able, Inc. (NYSE:NABL) closed at $5.15 per share. One-month return of N-able, Inc. (NYSE:NABL) was 22.33%, and its shares lost 31.52% over the past 52 weeks. N-able, Inc. (NYSE:NABL) has a market capitalization of $970.15 million.
Conestoga Capital Advisors stated the following regarding N-able, Inc. (NYSE:NABL) in its Q1 2026 investor letter:
“N-able, Inc. (NYSE:NABL) provides cloud-based software solutions for managed service providers (MSPs), enabling them to support the IT and security needs of small and medium sized businesses. The company delivered solid 2025 results; however, its 2026 constant currency ARR growth guidance of 8–9% was perceived as modest relative to the accelerating growth seen in the hardware and semiconductor segments of the AI rally. Additionally, increased planned investments in “agentic AI” capabilities for their platform weighed on near-term margin expansion expectations, causing the stock to trail more speculative peers during the benchmark’s January breakout.”
N-able, Inc. (NYSE:NABL) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 28 hedge fund portfolios held N-able, Inc. (NYSE:NABL) at the end of the fourth quarter, up from 23 in the previous quarter. While we acknowledge the risk and potential of N-able, Inc. (NYSE:NABL) 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 N-able, Inc. (NYSE:NABL) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered N-able, Inc. (NYSE:NABL) and shared the list of penny stocks that aren’t scams. In addition, please check out our hedge fund investor letters Q1 2026 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
