The London Company, an investment management company, released “The London Company Small Cap Strategy” third quarter 2024 investor letter. A copy of the letter can be downloaded here. In the quarter, the fund appreciated 7.1% (7%, net) compared to a 9.3% increase in the Russell 2000 Index. The positive impact of sector allocation was mitigated by stock selection in the third quarter. For more information on the fund’s top picks in 2024, please check its top five holdings.
The London Company Small Cap Strategy highlighted stocks like Certara, Inc. (NASDAQ:CERT), in the third quarter 2024 investor letter. Certara, Inc. (NASDAQ:CERT) offers software products and technology-enabled services to customers for bio-simulation in drug discovery, preclinical and clinical research, regulatory submissions, and market access. The one-month return of Certara, Inc. (NASDAQ:CERT) was -5.53%, and its shares lost 28.04% of their value over the last 52 weeks. On November 12, 2024, Certara, Inc. (NASDAQ:CERT) stock closed at $10.60 per share with a market capitalization of $1.706 billion.
The London Company Small Cap Strategy stated the following regarding Certara, Inc. (NASDAQ:CERT) in its Q3 2024 investor letter:
“Certara, Inc. (NASDAQ:CERT) – CERT declined in 3Q reflecting weakness in its end markets due to soft biotech funding and widespread cost-cutting across large biopharma. CERT’s software business is resilient, but the services business has been weaker than expected. We still hold conviction in our long-term thesis on CERT, but appreciate that a near-term catalyst will rely on improvements in end market health. CERT is owns unique software assets in an underpenetrated industry with plenty of whitespace for future growth. We are encouraged to see the company investing through the cycle to come out the other side with a larger salesforce, more cohesive software platform, and new cross-selling opportunities. These actions should further solidify their already leading and protected positioning in biosimulation.”
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Certara, Inc. (NASDAQ:CERT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 11 hedge fund portfolios held Certara, Inc. (NASDAQ:CERT) at the end of the second quarter which was 13 in the previous quarter. The third quarter revenue of Certara, Inc. (NASDAQ:CERT) grew 11% to $94.8 million. While we acknowledge the potential of Certara, Inc. (NASDAQ:CERT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Certara, Inc. (NASDAQ:CERT) and shared TimesSquare Capital Management U.S. Small Cap Growth Strategy’s views on the company. Certara, Inc. (NASDAQ:CERT) detracted from the performance of The London Company Small Cap Strategy in the previous quarter, due to investor skepticism about the company’s guidance for an improving revenue outlook. In addition, please check out our hedge fund investor letters Q3 2024 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.