Conestoga Capital Advisors, an asset management company, released its “Micro Cap Strategy” third-quarter 2023 investor letter. A copy of the same can be downloaded here. The micro capitalization segment of the market proved the most challenging in the quarter with the Russell Micro Cap Index declining -7.93%. The Russell Micro Cap Growth Index fell further with a loss of -11.95%. The Micro Cap Composite also declined 13.34% net of fees during the same period. Particularly difficult stock selection in the Health Care and Consumer Discretionary sectors more than offset stronger stock selection effects in the Technology sector. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Conestoga Micro Cap Composite highlighted stocks like Q2 Holdings, Inc. (NYSE:QTWO) in the third quarter 2023 investor letter. Headquartered in Austin, Texas, Q2 Holdings, Inc. (NYSE:QTWO) is a cloud-based digital solutions provider for financial institutions. On November 15, 2023, Q2 Holdings, Inc. (NYSE:QTWO) stock closed at $35.74 per share. One-month return of Q2 Holdings, Inc. (NYSE:QTWO) was 9.60%, and its shares gained 36.05% of their value over the last 52 weeks. Q2 Holdings, Inc. (NYSE:QTWO) has a market capitalization of $2.096 billion.
Conestoga Micro Cap Composite made the following comment about Q2 Holdings, Inc. (NYSE:QTWO) in its Q3 2023 investor letter:
“Technology was a notably strong sector for Conestoga’s Micro Cap Growth strategy, adding nearly 200 basis points of positive stock selection effects. Q2 Holdings, Inc. (NYSE:QTWO) similarly reported results that beat expectations as it improved margins in its digital solutions for small- to mid-sized banks and financial services companies. Conestoga’s tilt towards companies in the software industry generally added to returns as this was one of the better performing groups within Technology, while the more capital-intensive semiconductors, components and hardware industries were laggards.”
A finance professional at their computer logging into the company’s branded digital banking platform.
Q2 Holdings, Inc. (NYSE:QTWO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held Q2 Holdings, Inc. (NYSE:QTWO) at the end of second quarter which was 27 in the previous quarter.
We discussed Q2 Holdings, Inc. (NYSE:QTWO) in another article and shared Conestoga Capital Advisors’ views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q3 2023 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.
