Why Procore (PCOR) Could Turn AI Fears Into a Long-Term Growth Opportunity

Why Procore (PCOR) Could Turn AI Fears Into a Long-Term Growth Opportunity

Thu, September 10, 2026 at 4:25 PM GMT+3 3 min read

Prosper Stars & Stripes, a long/short equity fund, recently released its second-quarter 2026 investor letter. The letter can be downloaded here. In Q2 2026, the portfolio delivered a strong net return of +30.1% compared to the Russell 2000 Index's +21.5% return and the HFRX Equity Hedge Index's +10.3% return. The long book drove performance, generating a 43.2% gross contribution, while average net exposure remained relatively modest at 47%. U.S. economic growth remained resilient despite inflation concerns, elevated energy prices, and geopolitical uncertainty. Markets rallied sharply after easing U.S.-Iran tensions pushed oil prices lower, supporting renewed risk appetite. Small-cap equities benefited significantly, with Information Technology, Industrials, and Health Care leading gains, while Energy declined as crude prices fell. Year to date, the Composite returned +23.7%, slightly ahead of the Russell 2000's +22.6% and well above the HFRI Equity Hedge Index's +9.7%. Additionally, you can review the Portfolio's top 5 holdings to see its best picks for 2026.

In its second-quarter 2026 investor letter, Prosper Stars & Stripes highlighted Procore Technologies, Inc. (NYSE:PCOR). Procore Technologies, Inc. (NYSE:PCOR), a cloud-based construction management platform, detracted from the portfolio's performance this quarter. On September 9, 2026, Procore Technologies, Inc. (NYSE:PCOR) closed at $54.13 per share. Over the past month, Procore Technologies, Inc. (NYSE:PCOR) declined 12.93% and its shares lost 23.33% over the past 52 weeks. Procore Technologies, Inc. (NYSE:PCOR) has a market capitalization of $8.81 billion, and its stock has traded within a 52-week range of $38.03 to $82.32.

Prosper Stars & Stripes stated the following regarding Procore Technologies, Inc. (NYSE:PCOR) in its Q2 2026 investor letter:

"Procore Technologies, Inc. (NYSE:PCOR) was the largest detractor from our long book during the second quarter. Procore sells cloud-based project management software into the commercial construction industry. Its platform is the system of record for construction projects (drawings, schedules, budgets, change orders) connecting owners, general contractors, and subcontractors in a single, shared workspace. While the market's concern is AI agents replace traditional seat-based software, we see Procore as an enabler and beneficiary of AI rather than a casualty. Its revenue model is aligned with customers; the company charges by project volume, not by seat, allowing unlimited users across its constituencies. It also provides mission-critical collaboration software to an industry that has been slow to adopt technology. A proprietary data set and more than three million users help position the company to deliver AI solutions that we believe its customers will want from their existing system of record. The fundamentals supported our thesis: Q1 results, reported May 5th, showed revenue growth of nearly 16% and free cash flow growth of 20%, in addition to management raising its full-year guidance. We exited our position during the quarter in keeping with our stop-loss discipline but have subsequently reinvested."

Procore Technologies, Inc. (NYSE:PCOR) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 53 hedge fund portfolios held Procore Technologies, Inc. (NYSE:PCOR) at the end of the second quarter which was 35 in the previous quarter. While we acknowledge the potential of Procore Technologies, Inc. (NYSE:PCOR) 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 Procore Technologies, Inc. (NYSE:PCOR) and shared Spyglass Capital Management LLC's insight on the company. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.

READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.

This article is originally published at Insider Monkey.