Strong Results Lifted CTS Corporation (CTS) in Q2

Strong Results Lifted CTS Corporation (CTS) in Q2

Tue, September 22, 2026 at 5:25 PM GMT+3 2 min read

The London Company, an investment management company, released its second-quarter 2026 investor letter for its "Small Cap Strategy." U.S. equities rebounded in the quarter, driven by AI infrastructure spending and positive earnings. The letter can be downloaded here. Despite this optimism, rate outlook uncertainty persisted. Technology, previously weak, surged to lead the market, especially in semiconductors, while energy declined as oil prices fell. Small caps outperformed large caps, with momentum and volatility factors leading, although quality and yield were headwinds for portfolios. The London Company Small Cap portfolio increased 12.9% during the quarter, underperforming the Russell 2000 Index's 21.5% gain, primarily due to stock selection issues. The firm remains confident in the durable, high-quality businesses for attractive long-term compounding. Please review the Fund's top five holdings to learn more about its key selections for 2026.

In its second-quarter 2026 investor letter, London Company Small Cap Strategy highlighted CTS Corporation (NYSE:CTS). CTS Corporation (NYSE:CTS) is a technology company that designs, manufactures, and sells sensors, connectivity components, and actuators. On September 21, 2026, CTS Corporation (NYSE:CTS) closed at $58.67 per share. Over the past month, CTS Corporation (NYSE:CTS) returned 3.49%, but its shares are up 40.83% over the past year. CTS Corporation (NYSE:CTS) has a market capitalization of $1.68 billion, and its stock has traded within a 52-week range of $36.03 to $69.55.

London Company Small Cap Strategy stated the following regarding CTS Corporation (NYSE:CTS) in its Q2 2026 investor letter:

"CTS Corporation (NYSE:CTS) – CTS outperformed following strong quarterly results, supported by improving demand across its diversified industrial and transportation end markets. Management continues to execute well on operational initiatives while benefiting from a more favorable demand backdrop. We remain attracted to CTS's disciplined capital allocation, margin expansion opportunities, and ability to compound earnings over time."

CTS Corporation (NYSE:CTS) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held CTS Corporation (NYSE:CTS) at the end of the second quarter, compared to 23 in the previous quarter. While we acknowledge the potential of CTS Corporation (NYSE:CTS) 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.

In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.

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This article is originally published at Insider Monkey.