Polen Capital Management Llc released its "Polen Focus Growth Strategy" Q2 2026 investor letter. A copy of the letter can be downloaded here. Polen Focus Growth returned 6.33% (net of fees) in the second quarter of 2026, significantly underperforming the Russell 1000 Growth Index's 16.74% gain, as the market rally remained narrowly focused on AI infrastructure and semiconductor stocks.
During the quarter, Polen Capital repositioned the portfolio toward companies benefiting from structural growth in AI infrastructure, power demand, and aerospace. Looking ahead, the managers remain confident in the long-term earnings potential of the portfolio but acknowledge that changing market dynamics and the rising opportunity cost of patience require a more nimble approach. They remain focused on competitively advantaged businesses with durable growth prospects, while selectively participating in AI infrastructure, commercial aerospace, and power infrastructure opportunities where supply constraints and long-term demand could support sustained earnings growth.
In addition, please check the Fund's top five holdings to know its best picks in 2026. In its second-quarter 2026 investor letter, Polen Focus Growth Strategy highlighted stocks like NVIDIA Corporation (NASDAQ:NVDA). NVIDIA Corporation (NASDAQ:NVDA) is a semiconductor company that develops GPUs and computing platforms powering artificial intelligence, data centers, and high-performance computing.
The one-month return of NVIDIA Corporation (NASDAQ:NVDA) was 11.09% while its shares traded between $164.07 and $236.54 over the last 52 weeks. On August 13, 2026, NVIDIA Corporation (NASDAQ:NVDA) stock closed at approximately $224.09 per share, with a market capitalization of about $5.46 trillion. Polen Focus Growth Strategy stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q2 2026 investor letter: In terms of existing positions, we added to NVIDIA (NASDAQ:NVDA) during the quarter as the valuation had meaningfully compressed, not because the business deteriorated, but because earnings have grown much faster than the share price.
NVIDIA remains the dominant provider of data center graphics processing units (GPUs) and related systems, and we believe the company is also increasingly well positioned to gain share in data center central processing units (CPUs), which represents another large market opportunity. In a market rightly focused on the scale of AI infrastructure investment, we think NVIDIA remains one of the clearest beneficiaries, but importantly, it also has the competitive advantages, ecosystem, balance sheet, and earnings power that fit our investment criteria. We believe the stock offered an attractive opportunity to add to one of the world's most advantaged businesses at a more reasonable valuation.
NVIDIA Corporation (NASDAQ:NVDA) is in 4th position on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. As per our database, 275 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the first quarter, which was 264 in the previous quarter. While we acknowledge the risk and potential of NVIDIA Corporation (NASDAQ:NVDA) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame.
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