Conestoga Capital Advisors, an asset management company, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. For the second consecutive year, U.S. equity indices ended the year with double-digit returns after generating modest returns in the fourth quarter of 2024. Conestoga's investment plans were hindered by the enthusiasm for everything artificial intelligence (AI) related, which the firm believes led to a more speculative investing climate. The Conestoga Small Cap Composite surged 1.67% (net) in the fourth quarter compared to the Russell 2000 Growth Index’s 1.70% return. The Conestoga SMid Cap Composite returned -0.68% (net) trailing the Russell 2500 Growth Index’s 2.43% return. The Conestoga Micro Cap Composite advanced 9.91% (net) vs the Russell Microcap Growth Index’s return of 11.55%. Finally, the Conestoga Mid Cap Composite returned -4.63% (net) underperforming the Russell Midcap Growth Index’s 8.14% return. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2024.

In its fourth quarter 2024 investor letter, Conestoga Capital Advisors emphasized stocks such as Verisk Analytics, Inc. (NASDAQ:VRSK). Verisk Analytics, Inc. (NASDAQ:VRSK) offers data analytics solutions to the insurance markets. The one-month return of Verisk Analytics, Inc. (NASDAQ:VRSK) was 7.48%, and its shares gained 19.57% of their value over the last 52 weeks. On February 11, 2025, Verisk Analytics, Inc. (NASDAQ:VRSK) stock closed at $294.30 per share, with a market capitalization of $41.558 billion.

Conestoga Capital Advisors stated the following regarding Verisk Analytics, Inc. (NASDAQ:VRSK) in its Q4 2024 investor letter:

"Based in Jersey City, NJ, Verisk Analytics, Inc.'s (NASDAQ:VRSK) strong competitive positioning in the insurance data and analytical industry was displayed in its 3Q results. Organic revenue growth was 6.8% (led by subscription growth of 9.1%) and EBITDA growth was 9%. The company’s EBITDA margin was 55.2%. The company’s strong growth was driven by price realization and solid renewal trends. Management also had very positive commentary around the strength of its end markets and its bookings momentum."

An engineer using the latest predictive analytics software to formulate solutions.

Verisk Analytics, Inc. (NASDAQ:VRSK) is not on our list of 30 Most Popular Stocks Among Hedge Funds.  As per our database, 42 hedge fund portfolios held Verisk Analytics, Inc. (NASDAQ:VRSK) at the end of the third quarter which was 46 in the previous quarter. In the third quarter, Verisk Analytics, Inc. (NASDAQ: VRSK) reported revenue of $725 million on a consolidated and GAAP basis, which is a 7% increase compared to the previous year. While we acknowledge the potential of Verisk Analytics, Inc. (NASDAQ:VRSK) 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 Verisk Analytics, Inc. (NASDAQ:VRSK) and shared best consulting stocks to buy. 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.