Thrivent Small Cap Growth Fund Q2 2026 Portfolio Review
Thrivent Small Cap Growth Fund returned 25.54% during Q2 2026, underperforming the Russell 2000 Growth Index return of 25.71%. The fund exited GeneDx Holdings after Q1 results reduced confidence in revenue and profitability.
Intelligence analysis by Llama
Thrivent Small Cap Growth Fund's Q2 2026 performance was modestly underwhelming, with JFrog's strong revenue growth and customer consolidation being a positive contributor. The fund exited GeneDx Holdings due to reduced confidence in revenue and profitability.
Imagine you're running a small business, and you need to deliver software to your customers quickly and securely. JFrog is a company that helps you do just that, and it's been doing a great job. The fund that owns JFrog is happy with its performance, but it's also being careful about other companies it invests in. It recently stopped investing in a company called GeneDx because it wasn't doing well. The fund is trying to make smart decisions to make money for its investors.
Analysis
A $60B Vote of Confidence
Thrivent Small Cap Growth Fund's Q2 2026 performance was marked by a modest underperformance of the Russell 2000 Growth Index return of 25.71%. The fund's return of 25.54% was still a respectable figure, but it highlights the challenges faced by small-cap growth funds in the current market environment. The fund's positive contributors, such as JFrog, demonstrate the importance of strong revenue growth and customer consolidation in the DevOps and software supply-chain security space. JFrog's execution remained strong across its DevOps and software supply-chain security, reinforcing its status as a high-quality platform with long-term optionality.
Why Cursor?
The fund's exit from GeneDx Holdings was a notable development in Q2 2026. The position was exited after Q1 results reduced confidence in revenue and profitability, with FY26 guidance reset and concerns over reimbursement mix and competition. This decision highlights the fund's willingness to adapt to changing market conditions and adjust its portfolio composition accordingly.
The Road Ahead
Looking ahead, the fund's investment strategy and portfolio composition will be crucial in determining its future performance. The addition of ALHC and VMI to the portfolio is a positive development, with ALHC being added for disciplined membership growth and differentiated care management, and VMI for undervalued durability in utility/infrastructure demand and attractive entry amid agricultural softness. These new positions demonstrate the fund's ability to identify undervalued opportunities and make strategic investments in the market.
Key points
- Thrivent Small Cap Growth Fund returned 25.54% during Q2 2026, underperforming the Russell 2000 Growth Index return of 25.71%
- The fund exited GeneDx Holdings after Q1 results reduced confidence in revenue and profitability
- JFrog's strong revenue growth and customer consolidation in DevOps and software supply-chain security reinforce its status as a high-quality platform with long-term optionality
- ALHC was added for disciplined membership growth and differentiated care management
- VMI was added for undervalued durability in utility/infrastructure demand and attractive entry amid agricultural softness
If JFrog continues to execute well and customer consolidation in DevOps and software supply-chain security remains strong, the fund's growth thesis could be reinforced. Additionally, the addition of ALHC and VMI to the portfolio could provide opportunities for growth and returns.
The fund's exit from GeneDx Holdings highlights the risks associated with investing in companies with uncertain revenue and profitability trajectories. If JFrog's execution were to falter or customer consolidation were to slow, the fund's growth thesis could be undermined.
