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 Repligen Corporation (NASDAQ:RGEN) in the second quarter 2024 investor letter. Repligen Corporation (NASDAQ:RGEN) develops and distributes bioprocessing technologies and systems. The one-month return of Repligen Corporation (NASDAQ:RGEN) was -10.95%, and its shares lost 8.89% of their value over the last 52 weeks. On September 6, 2024, Repligen Corporation (NASDAQ:RGEN) stock closed at $147.07 per share with a market capitalization of $8.237 billion.

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

"Repligen Corporation (NASDAQ:RGEN) is a life-sciences company that develops and manufactures products used throughout the complex process of making biological drugs, helping its customers increase efficiency and reduce costs. In May 2024, the company reported first quarter revenue above expectations but profitability below expectations. Revenue declined 17% during the first quarter of 2024, following a 20% decline in 2023. Base business ex-COVID was down 9% in 2023, and COVID revenue now is less than 5% of total revenue, so COVID runoff should have minimal impact on revenue growth going forward. Management pointed to continued weakness among Contract Development and Manufacturing Organization (CDMO) customers as the pace of R&D investments among smaller bio-techs has slowed. That is a result of the tougher funding environment for smaller biotechs due to higher interest rates. As mentioned above, we believe this is an industry-wide phenomenon, and not specific to Repligen. Several other industry participants have reported a similar environment. These include Thermo Fisher Scientific, Danaher and large CDMOs like Catalent and Lonza, supporting our view of an industry-wide headwind.