Wasatch Global Investors, an asset management company, released its “Wasatch Small Cap Growth Strategy” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. Small-cap equities experienced volatility in the third quarter but ultimately achieved solid gains. In July, they rose sharply due to optimism about a potential soft landing for the U.S. economy and anticipated interest-rate cuts. In September, the Federal Reserve lowered its benchmark interest rate for the first time since 2020. This environment led investors to shift their focus from mega-cap technology stocks to small-cap equities. Against this backdrop, the strategy gained 9.45%, outperforming the benchmark Russell 2000® Growth Index, which was up 8.41%. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Wasatch Small Cap Growth Strategy highlighted stocks like JFrog Ltd. (NASDAQ:FROG), in the third quarter 2024 investor letter. Incorporated in 2008, JFrog Ltd. (NASDAQ:FROG) provides an end-to-end hybrid software supply chain platform. The one-month return of JFrog Ltd. (NASDAQ:FROG) was -1.70%, and its shares lost 1.92% of their value over the last 52 weeks. On January 2, 2025, JFrog Ltd. (NASDAQ:FROG) stock closed at $30.70 per share with a market capitalization of $3.425 billion.
Wasatch Small Cap Growth Strategy stated the following regarding JFrog Ltd. (NASDAQ:FROG) in its Q3 2024 investor letter:
“JFrog Ltd. (NASDAQ:FROG) was one of the largest detractors from strategy performance during the period. The company provides programming tools and repositories for developing and updating computer software. JFrog’s stock price was down after the company lowered earnings guidance. We’re taking a closer look at the company and its growth potential. We expected JFrog to benefit from artificial intelligence as an increased volume of programming code goes through its repositories. But weak results of late have made us question that thesis.”
A corporate executive standing in front of a large monitor, demonstrating the DevOps package repository.
JFrog Ltd. (NASDAQ:FROG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held JFrog Ltd. (NASDAQ:FROG) at the end of the third quarter which was 33 in the previous quarter. In the third quarter JFrog Ltd. (NASDAQ:FROG) reported $109.1 million in revenues, up 23% year-over-year. While we acknowledge the potential of JFrog Ltd. (NASDAQ:FROG) 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 JFrog Ltd. (NASDAQ:FROG) and shared TimesSquare Capital U.S. Small Cap Growth Strategy’s views on the company. 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.