Is Veralto (VLTO) Trading at a Fair Valuation?

Artisan Partners , an investment management firm, issued its first-quarter 2026 investor letter for the "Artisan Mid Cap Value Fund". A copy of this letter is available for download here . In Q1 2026, the portfolio underperformed the benchmark Russell Midcap Value Index as the market favored momentum-driven stocks over quality factors. Some holdings faced company-specific setbacks and negative sentiment. The Fund's Investor Class: ARTQX returned -4.93%, Advisor Class: APDQX declined by -4.90%, and Institutional Class: APHQX fell by -4.97%, all trailing the Index's 3.68% gain. The equity market in the quarter was mixed, with mid- and small-cap indices showing resilience despite lagging large-cap growth stocks. Volatility increased, initially fueled by interest in AI and private credit, but escalated after the outbreak of war in Iran, leading to rising oil prices. Sector performance varied, with energy leading the gains. The Fund continues to seek companies capable of value growth during market dislocations at attractive entry points. Also, review the Fund's top five holdings to see its best picks for 2026.

In its first-quarter 2026 investor letter, Artisan Mid Cap Value Fund highlighted Veralto Corporation (NYSE: VLTO ) as a newly added position. Veralto Corporation (NYSE:VLTO) is an industrial technology company specializing in water analytics, water treatment, marking and coding, and packaging and color solutions. On July 7, 2026, Veralto Corporation (NYSE:VLTO) closed at $93.10 per share, reflecting a market capitalization of $22.86 billion. Veralto Corporation (NYSE:VLTO) posted a one-month return of 12.68%, while its shares lost 9.06% over the past 52 weeks.

Artisan Mid Cap Value Fund stated the following regarding Veralto Corporation (NYSE:VLTO) in its Q1 2026 investor letter:

"We initiated six new positions in Q1, representing an above-average rate of new purchase activity. Increased market volatility and greater dispersion in US equities during the quarter created more opportunities to add new names that meet our three margin-of-safety criteria: attractive business economics, sound financial condition and attractive valuation. Additionally, we sought to use recent volatility to upgrade the portfolio's quality. Our three largest new buys by position size were Brown & Brown, Veralto Corporation (NYSE:VLTO) and IQVIA Holdings.

Veralto is a provider of water quality and product quality solutions that was spun out of Danaher in 2023. The shares have traded off from prior levels and now reflect more modest expectations, creating an opportunity to invest in a historically high-quality compounder at a more reasonable valuation. The company's conservative guidance for full-year EPS disappointed the market. From a business economics perspective, Veralto benefits from attractive end markets and durable competitive advantages. Its Water Quality and Product Quality & Innovation segments operate in niches characterized by high regulatory requirements, mission-critical applications and significant switching costs. These factors, combined with a "razor/razor-blade" model, drive a high level of recurring, consumable driven revenue and strong pricing power…" ( Click here to read the full text )

Veralto Corporation (NYSE:VLTO) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026 . According to our database, 57 hedge fund portfolios held Veralto Corporation (NYSE:VLTO) at the end of the first quarter, up from 55 in the previous quarter. While we acknowledge the potential of Veralto Corporation (NYSE:VLTO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock .

In another article , we covered Veralto Corporation (NYSE:VLTO) and shared Brown Advisory Large-Cap Growth Strategy's insights on the company. In addition, please check out our hedge fund investor letters Q1 2026 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey .

Sinergia Empresarial continuará el seguimiento de esta información sobre is Veralto (VLTO) Trading at a Fair Valuation? y ampliará la cobertura conforme se confirmen nuevos elementos relevantes para el ecosistema empresarial.