Conestoga Capital Advisors, an asset management company, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter began with a historically poor start but gained momentum later as tariff fears subsided and market volatility dropped precipitously. Conestoga Mid Cap Composite returned 3.46% net-of-fees in the quarter, trailing the Russell Mid Cap Growth Index’s 18.20% return. After a strong first quarter in 2025, investor enthusiasm shifted towards high-beta and AI stocks following the “Liberation Day” announcements, creating a narrow leadership group that posed challenges for the Mid Cap Strategy in the second quarter. Please review the fund’s top 5 holdings to gain insight into their key selections for 2025.
In its second quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks such as Copart, Inc. (NASDAQ:CPRT). Copart, Inc. (NASDAQ:CPRT) is an online auction and vehicle remarketing services company. The one-month return of Copart, Inc. (NASDAQ:CPRT) was -4.85%, and its shares lost 8.54% of their value over the last 52 weeks. On July 25, 2025, Copart, Inc. (NASDAQ:CPRT) stock closed at $46.69 per share, with a market capitalization of $45.15 billion.
Conestoga Capital Advisors stated the following regarding Copart, Inc. (NASDAQ:CPRT) in its second quarter 2025 investor letter:
“Copart, Inc. (NASDAQ:CPRT) is a leading provider of salvage auctions in the U.S., Canada and the United Kingdom. Shares sold off sharply after missing fiscal 3Q revenue estimates. This is the second quarter in a row of softer than expected unit volume growth due, in large part, to some drivers electing to reduce insurance coverage which results in lower accident claims volume. We believe this headwind is temporary as insurance carriers have finally priced their way back to profitability which was pressured during the pandemic.”
A busy car auction being held at a leading car dealership, buyers and sellers engaging in active bidding.
Copart, Inc. (NASDAQ:CPRT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held Copart, Inc. (NASDAQ:CPRT) at the end of the first quarter, which was 53 in the previous quarter. While we acknowledge the potential of Copart, Inc. (NASDAQ:CPRT) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
