Multiple Factors Drove UFP Technologies (UFPT) in Q1

Wasatch Global Investors, an asset management company, released its “Wasatch Micro Cap Growth—U.S. Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. During the first quarter, the micro-cap equities performed well. The strategy had a double-digit gain in the quarter, outperforming the Russell Microcap Growth Index benchmark, which rose 6.60%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.

Wasatch Micro Cap Growth—U.S. Strategy highlighted stocks like UFP Technologies, Inc. (NASDAQ:UFPT), in the first quarter 2024 investor letter. UFP Technologies, Inc. (NASDAQ:UFPT) manufactures solutions for medical devices, sterile packaging, and other highly engineered custom products. The one-month return of UFP Technologies, Inc. (NASDAQ:UFPT) was -3.35%, and its shares gained 30.77% of their value over the last 52 weeks. On June 18, 2024, UFP Technologies, Inc. (NASDAQ:UFPT) stock closed at $253.79 per share with a market capitalization of $1.947 billion.

Wasatch Micro Cap Growth—U.S. Strategy stated the following regarding UFP Technologies, Inc. (NASDAQ:UFPT) in its first quarter 2024 investor letter:

"One of the strongest contributors to strategy performance was UFP Technologies, Inc. (NASDAQ:UFPT), which designs and manufactures a broad range of high-performance cushion packaging and specialty foam as well as plastic products for the industrial and consumer markets. In the past, UFP had made precision-molded fiber packaging primarily from recycled paper but divested from that business due to lower margins. Instead, the company acquired businesses serving the medical industry. We projected that soon after the Covid-19 pandemic, elective medical procedures might ramp up—which we hoped would contribute to fast growth and significant margins for UFP. Our projections were realized as the company reported strong results for both the fourth quarter and the full year of 2023. In addition, UFP made several acquisitions that have helped it significantly increase production capacity and capture synergies by sharing best practices, moving operations to the ideal manufacturing locations and standardizing systems for information technology, quality and safety. The company has also invested in infrastructure, equipment and talent to serve robotic-surgery businesses, which compose a growing market segment that already accounts for a significant portion of UFP’s revenue."

A closeup of a pile of disposable wound care products on a lighted background.

UFP Technologies, Inc. (NASDAQ:UFPT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held UFP Technologies, Inc. (NASDAQ:UFPT) at the end of the first quarter which was 16 in the previous quarter. While we acknowledge the potential of UFP Technologies, Inc. (NASDAQ:UFPT) 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 UFP Technologies, Inc. (NASDAQ:UFPT) and shared Diamond Hill Small Cap Fund's views on the company. UFP Technologies, Inc. (NASDAQ:UFPT) was the top contributor of Headwaters Capital Management in the first quarter 2024. In addition, please check out our hedge fund investor letters Q1 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.