Artisan Partners, an investment management company, released its “Artisan Small Cap Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. US stocks concluded a strong year with strong gains in Q4. In Q4, the portfolio's performance was flat and narrowly trailed the Russell 2000® Growth Index. In 2024, the portfolio produced a robust absolute return that was in line with the Russell 2000® Growth Index but outperformed the Russell 2000 Index. In the quarter, its Investor Class fund ARTSX returned 0.61%, Advisor Class fund APDSX posted a return of 0.66%, and Institutional Class fund APHSX returned 0.67%, compared to a return of 1.70% for the Russell 2000 Growth Index. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.

In its fourth quarter 2024 investor letter, Artisan Small Cap Fund emphasized stocks such as Novanta Inc. (NASDAQ:NOVT). Novanta Inc. (NASDAQ:NOVT) offers precision medicine and manufacturing, medical solutions, and robotics and automation solutions. The one-month return of Novanta Inc. (NASDAQ:NOVT) was -3.16%, and its shares lost 18.64% of their value over the last 52 weeks. On March 7, 2025, Novanta Inc. (NASDAQ:NOVT) stock closed at $142.99 per share with a market capitalization of $5.142 billion.

Artisan Small Cap Fund stated the following regarding Novanta Inc. (NASDAQ:NOVT) in its Q4 2024 investor letter:

"Among our top detractors were Halozyme, Crocs and Novanta Inc. (NASDAQ:NOVT). Novanta is a leading provider of photonic and motion-control components for medical and industrial equipment. We believe the company’s products will benefit from several secular growth trends, including warehouse automation, robotic surgery, endoscopy, DNA sequencing and advanced laser material processing. In addition, a high-quality management team is driving attractive margin expansion through a focus on higher value product offerings. Quarterly results were solid, but its forward guidance was weaker than expected due to customer order delays. We remain confident that these delays are a transitory headwind and are remaining patient."

A closeup of a CO2 laser cutting through a piece of metal, demonstrating precision motion.

Novanta Inc. (NASDAQ:NOVT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 13 hedge fund portfolios held Novanta Inc. (NASDAQ:NOVT) at the end of the fourth quarter compared to 8 in the third quarter. In the fourth quarter of 2024, Novanta Inc. (NASDAQ:NOVT) reported $238 million in revenue, representing a 3% organic growth year over year and a 13% reported revenue increase. While we acknowledge the potential of Novanta Inc. (NASDAQ:NOVT) 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 Novanta Inc. (NASDAQ:NOVT) and shared the list of best scientific instruments stocks to buy. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.