Artisan Partners, an investment management company, released its “Artisan Small Cap Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. The third quarter saw strength in small cap stocks, particularly in July when the return on the Russell 2000 Index was 10.2%. In the quarter, its Investor Class fund ARTSX returned 9.02%, Advisor Class fund APDSX posted a return of 9.04%, and Institutional Class fund APHSX returned 9.06%, compared to a return of 8.41% for the Russell 2000 Growth Index. Outperformance of the fund in the quarter was driven by positive security selection within health care and consumer discretionary sectors. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.

Artisan Small Cap Fund highlighted stocks like Tyler Technologies, Inc. (NYSE:TYL), in the third quarter 2024 investor letter. Tyler Technologies, Inc. (NYSE:TYL) offers integrated information management solutions and services for the public sector. The one-month return of Tyler Technologies, Inc. (NYSE:TYL) was 1.32%, and its shares gained 51.53% of their value over the last 52 weeks. On December 11, 2024, Tyler Technologies, Inc. (NYSE:TYL) stock closed at $625.02 per share with a market capitalization of $26.75 billion.

Artisan Small Cap Fund stated the following regarding Tyler Technologies, Inc. (NYSE:TYL) in its Q3 2024 investor letter:

"Notable trims in the quarter included Tyler Technologies, Argenx and On Holding. Tyler Technologies, Inc. (NYSE:TYL) provides end-to-end information management solutions and services for local government offices. We believe the company will generate durable growth given its defensive end markets, the potential of its cloud subscription transition and the transformative acquisition of NIC (a leading digital government solutions and payments company) that allows for increased cross-sell opportunities. Shares rallied due to strong earnings results, including 23% growth in software as a service (SaaS) revenue and the announcement of its first statewide cloud conversion, which we believe opens the door for more of these larger migrations. We trimmed the shares after the recent performance run, as its market cap outgrew our small-cap mandate."

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Tyler Technologies, Inc. (NYSE:TYL) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held Tyler Technologies, Inc. (NYSE:TYL) at the end of the third quarter which was 27 in the previous quarter. In the third quarter, Tyler Technologies, Inc. (NYSE:TYL) generated $543.3 million in revenues, up 9.8% and organically grew 9.4%. While we acknowledge the potential of Tyler Technologies, Inc. (NYSE:TYL) 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.