Brown Capital Management, an investment management company, released its “The Brown Capital Management Small Company Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. The Small Company Fund returned -6.57%, underperforming the Russell 2000 Growth index’s 2.92% decline. Fundamental and macroeconomic factors drove the underperformance of the fund in the quarter. The fund aims to identify and invest in Exceptional Growth Companies (EGCs) that focus on products and services their customers cannot live without. In addition, check the fund’s top five holdings to know its best picks in 2024.

Brown Capital Management Small Company Fund highlighted stocks like Neogen Corporation (NASDAQ:NEOG), in the second quarter 2024 investor letter. Neogen Corporation (NASDAQ:NEOG) develops, manufactures, and markets various products and services dedicated to food and animal safety. The one-month return of Neogen Corporation (NASDAQ:NEOG) was -6.09%, and its shares lost 22.20% of their value over the last 52 weeks. On September 6, 2024, Neogen Corporation (NASDAQ:NEOG) stock closed at $15.42 per share with a market capitalization of $3.341 billion.

Brown Capital Management Small Company Fund stated the following regarding Neogen Corporation (NASDAQ:NEOG) in its Q2 2024 investor letter:

"Neogen Corporation (NASDAQ:NEOG) develops, manufactures and sells a variety of food-safety and animal-safety tests, products and services globally. The Food Safety division develops and markets tests for food toxins, pathogens, allergens, spoilage organisms, drug residues, genetic modifications, sanitation and dehydrated culture media for custom testing. The Animal Safety division develops and markets diagnostic tests, veterinary instruments, nutritional supplements, disinfectants, insecticides and rodenticides. The company also offers genomic testing for a wide range of agricultural and companion animals to improve breeding selection. On Dec. 14, 2021, the company agreed to merge with 3M’s food safety business. We reduced our exposure to Neogen given the size of the deal and the inherent risks associated with the merger. The combined-company cost savings and improved revenue growth have not materialized. As a result of the fundamental deterioration, we exited the company during the quarter."

A research laboratory showing advanced diagnostic equipment used to protect public health.

Neogen Corporation (NASDAQ:NEOG) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held Neogen Corporation (NASDAQ:NEOG) at the end of the second quarter which was 17 in the previous quarter. While we acknowledge the potential of Neogen Corporation (NASDAQ:NEOG) 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.