Outside of the NVIDIA revolution (NVDA) that seemed to dominate the second quarter, leading to rallies in most of the major large-cap indices, there were some other big winners in the robotics and automation sector in Q1.
Most of the major large-cap indexes have rallied to new recovery highs, but the broad market has continued to lag. In fact, through mid-year, the S&P 500’s YTD gains were largely concentrated in just a handful of mega-cap issues including AAPL, MSFT, GOOGL, NVDA, AMZN, TSLA, and META – now dubbed the “magnificent seven.”
Moreover, only 28% of the index’s constituents posted gains that matched or beat the index itself in the first-half, while 35% of its constituents ended the June quarter in negative territory for the year.
Intuitive Surgical (ISRG) became a solid performance during the period.
According to company’s quarterly report, AI has been enhancing their product portfolio with clinical applications, diagnostic support, operational efficiency, electronic health record systems, practice workflow, and supply chain management for years. The maker of Da Vinci Robotic Surgical System’s stock was up 33.9% in Q2.
Symbotic (SYM), the provider of inventory management and warehouse automation systems to retailers and distributors, gained a whopping 87% during the quarter.
The company’s comprehensive proprietary AI-powered, self-learning software seamlessly orchestrates hundreds of industrial robots, and can manage the entire end-to-end system.
Another top contributor to performance this period was AI voice pioneer, SoundHound (SOUN).
The company’s proprietary independent voice AI platform allows its customers across the automotive, hospitality, entertainment, and electronics industries to voice-enable their products and services. The stock was up nearly 65% for Q2.
Following a challenging first quarter, the outlook is much improved for the balance of the year. The Federal Reserve’s $400B emergency facility appears to have stemmed the tide of the regional bank crisis. Since then, investor sentiment has recovered dramatically, encouraged in part by the perceived new potential of the AI revolution.
We continue to remain laser-focused on investing in leading Robotics and Automation businesses where the fundamentals are sound, the end-markets are growing, and the adoption rates are accelerating. In our view, this is the best possible path to follow in order to maximize long-term value.
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