Wasatch Global Investors, an asset management company, released its “Small Cap Growth Strategy” Q1 2026 investor letter. A copy can be downloaded here. The Wasatch Small Cap Growth Strategy lagged the benchmark, Russell 2000® Growth Index, in the quarter, which returned -2.81%. U.S. small-cap stocks were volatile in the quarter, due to shifting investor sentiment. Enthusiasm for artificial intelligence continued to support infrastructure buildout companies, but it triggered sell-offs in stocks of industries deemed vulnerable to AI disruption. Geopolitical tensions further contributed to the market swings. In this volatile environment, the firm remains focused on identifying companies with sustainable competitive advantages. In addition, you can check the Fund’s top 5 holdings for its best picks for 2026.
In its first-quarter 2026 investor letter, Wasatch Small Cap Growth Strategy highlighted Nova Ltd. (NASDAQ:NVMI). Nova Ltd. (NASDAQ:NVMI) is an Israeli company that designs and develops process control systems used in the manufacture of semiconductors. On June 18, 2026, Nova Ltd. (NASDAQ:NVMI) closed at $575.31 per share. One-month return of Nova Ltd. (NASDAQ:NVMI) was 14.26%, and its shares gained 148.87% over the past 52 weeks. Nova Ltd. (NASDAQ:NVMI) has a market capitalization of $18.29 billion.
Wasatch Small Cap Growth Strategy stated the following regarding Nova Ltd. (NASDAQ:NVMI) in its Q1 2026 investor letter:
“Nova Ltd. (NASDAQ:NVMI) and Camtek Ltd. (CAMT) were two of the largest contributors to performance during the quarter. Both companies provide equipment used in semiconductor manufacturing to improve chip performance and reduce defects. AI-driven semiconductor demand contributed to strong returns for both companies during the quarter, extending the momentum seen over the past year.”
Nova Ltd. (NASDAQ:NVMI) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 22 hedge fund portfolios held Nova Ltd. (NASDAQ:NVMI) at the end of the first quarter, up from 20 in the previous quarter. While we acknowledge the risk and potential of Nova Ltd. (NASDAQ:NVMI) 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 NOVA LTD. (NASDAQ:NVMI) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Nova Ltd. (NASDAQ:NVMI) and shared Baron Opportunity Fund’s insights 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.
