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Clearwater Analytics Holdings (CWAN) Shares Slipped in Q1 on Mixed Outlook

Soumya Eswaran
·3-min read

TimesSquare Capital Management, an equity investment management company, released its “U.S. Small Cap Growth Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. In the quarter the fund returned 5.77% (net), compared to a 7.58% return for the Russell 2000 Growth Index. Despite a decline in many equity markets in January, they rebounded over the following two months, resulting in a robust 2024 first quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.

TimesSquare Capital U.S. Small Cap Growth Strategy highlighted stocks like Clearwater Analytics Holdings, Inc. (NYSE:CWAN), in the first quarter 2024 investor letter. Clearwater Analytics Holdings, Inc. (NYSE:CWAN) offers SaaS solutions for investment data aggregation, reconciliation, accounting, and reporting services. The one-month return of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) was -2.83%, and its shares gained 17.69% of their value over the last 52 weeks. On June 20, 2024, Clearwater Analytics Holdings, Inc. (NYSE:CWAN) stock closed at $18.56 per share with a market capitalization of $5.076 billion.

TimesSquare Capital U.S. Small Cap Growth Strategy stated the following regarding Clearwater Analytics Holdings, Inc. (NYSE:CWAN) in its first quarter 2024 investor letter:

"Among the wide variety of Information Technology companies, we prefer critical system providers, specialized component designers, and systems that improve productivity or efficiency for their clients. Clearwater Analytics Holdings, Inc. (NYSE:CWAN) provides web-based investment portfolio accounting, reporting, and reconciliation services. Its fourth quarter results were slightly higher than Street expectations. The company continues to see healthy and broad-based pipeline activity. Its stock price decline of -12% is tied to a mixed outlook inclusive of lower revenues with higher profits."

A wide shot of a large financial data center.

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Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Clearwater Analytics Holdings, Inc. (NYSE:CWAN) at the end of the first quarter which was 26 in the previous quarter. The first quarter revenue of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) was $102.7 million, up 21% year-over-year and EBITDA was $32.2 million, up 42.9% year-over-year. While we acknowledge the potential of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) 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 Clearwater Analytics Holdings, Inc. (NYSE:CWAN) and shared Wasatch Small Cap Growth Strategy's views on the company. In addition, please check out our hedge fund investor letters Q1 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.