WS Amati Global Innovation Fund on Allegro MicroSystems, Inc.
Thesis
Allegro sold off as investors became concerned that the AI capital-expenditure cycle was unsustainable. The fund believes the shares were sold indiscriminately rather than because of deterioration in the core investment case. Allegro's automotive and robotics sensor business continues to grow and gain wallet share. The fund used the weakness to add to its position.
“Allegro’s core business of automotive and robotics sensors continues to grow and gain wallet share.”
Key risks
- Investor concern that the AI capital-expenditure cycle is unsustainable