Artisan Partners, a high value-added investment management firm, published its ‘Artisan Mid Cap Fund’ second quarter 2021 investor letter – a copy of which can be downloaded here. A return of 10.45% was recorded by its Investor Class: ARTMX, 10.46% by its Advisor Class: APDMX, and 10.52% by its Institutional Class: APHMX, in the second quarter of 2021, all below the Russell Midcap® Growth Index that delivered an 11.07% return, but outperforming the Russell Midcap® Index that was up by 7.50% for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their top bets for 2021.
In the Q2 2021 investor letter of Artisan Partners, the fund mentioned BigCommerce Holdings, Inc. (NASDAQ: BIGC) and discussed its stance on the firm. BigCommerce Holdings, Inc. is an Austin, Texas-based IT service management company with a $4.3 billion market capitalization. BIGC delivered a -6.70% return since the beginning of the year, while its 12-month returns are down by -44.05%. The stock closed at $59.58 per share on September 2, 2021.
Here is what Artisan Partners has to say about BigCommerce Holdings, Inc. in its Q2 2021 investor letter:
“BigCommerce is a SaaS e-commerce platform powering both customers’ branded e-commerce stores as well as connections to online marketplaces, social networks and offline point-of-service systems. The company’s apabilities include store design, catalog management, hosting, checkout, order management, reporting and pre-integration into third party services offering payments, shipping, and accounting. We initiated a small GardenSM position last quarter— amid the broader tech selloff—given our belief the company is poised to gain share as brands seek to expand their direct-to-consumer sales. While Shopify is clearly thriving as an e-commerce enabler for small and medium businesses, our research suggests BigCommerce is increasingly seen as a robust solution for larger brands seeking to upgrade their older solutions while maintaining flexibility to integrate with other systems and partners. Our thesis was supported by Q1 results, which showed strong topline growth (+41% YoY) and positive trends among its larger enterprise customers—where BigCommerce saw 58% YoY growth in annual recurring revenue. Based on these encouraging datapoints, we added to our GardenSM position.”
Based on our calculations, BigCommerce Holdings, Inc. (NASDAQ: BIGC) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. BIGC was in 21 hedge fund portfolios at the end of the first half of 2021, compared to 26 funds in the previous quarter. BigCommerce Holdings, Inc. (NASDAQ: BIGC) delivered an 8.15% return in the past 3 months.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
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Disclosure: None. This article is originally published at Insider Monkey.