Wasatch Global Investors, an asset management company, released its “Wasatch Small Cap Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. U.S. stocks fell in the quarter as investors considered the potential economic effects of tariffs and government funding cuts. Softer economic data also impacted stocks. The Russell 2000® Growth index ended the quarter with a loss of -11.12%. Additionally, the Wasatch Small Cap Growth strategy declined and lagged the benchmark. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Wasatch Small Cap Growth Strategy highlighted stocks such as Globant S.A. (NYSE:GLOB). Globant S.A. (NYSE:GLOB) is a Luxembourg-based technology services company. The one-month return of Globant S.A. (NYSE:GLOB) was -17.99%, and its shares lost 40.99% of their value over the last 52 weeks. On April 17, 2025, Globant S.A. (NYSE:GLOB) stock closed at $105.93 per share with a market capitalization of $4.667 billion.

Wasatch Small Cap Growth Strategy stated the following regarding Globant S.A. (NYSE:GLOB) in its Q1 2025 investor letter:

"The largest detractor from strategy performance was Globant S.A. (NYSE:GLOB), a global IT-consulting firm. Operating results were mixed for Globant’s most recently reported quarter, and guidance for 2025 was softer than expected. While the stock has been volatile, we continue to like the company. Global IT spending has been sluggish in recent quarters, but while spending has been uneven, we’ve been impressed that Globant has grown at a higher rate than industry peers. We recently talked to Globant’s management team, and they suggested some firms may have paused spending temporarily on some IT projects. While that could weigh on earnings for the industry in the near term, we believe that businesses are in the early innings of implementing AI into their processes and Globant will be a key beneficiary of this trend over the long term."

A close-up of an experienced game engineer's hands typing a complex code on a laptop.

Globant S.A. (NYSE:GLOB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Globant S.A. (NYSE:GLOB) at the end of the fourth quarter which was 29 in the previous quarter. Globant S.A.'s (NYSE:GLOB) fourth quarter revenue reached $642.5 million, representing an increase of 10.6% year-over-year and 4.5% quarter-over-quarter. While we acknowledge the potential of Globant S.A. (NYSE:GLOB) 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 covered Globant S.A. (NYSE:GLOB) and shared the list of worst performing IT services stocks to buy according to analysts. In addition, please check out our hedge fund investor letters Q1 2025 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.