Keysight Technologies (KEYS) Gains From Equipment Growth Fueled By AI Use Cases

Keysight Technologies (KEYS) Gains From Equipment Growth Fueled By AI Use Cases

Thu, August 20, 2026 at 5:33 PM GMT+3 3 min read

• KEYS -0.60%
• ^GSPC -0.32%

Madison Investments, an investment advisor, released its second-quarter 2026 investor letter for the "Madison Large Cap Fund". A copy of the letter can be downloaded here. In the second quarter, U.S. stock market indices achieved their best performance since 2020, driven largely by a narrow group of Artificial Intelligence-related stocks. As in the pandemic's early days, investors are fixated on who will benefit from AI, reminiscent of the late 1990s internet bubble. Against this backdrop, The Madison Large Cap Fund (class I) returned 8.4% in the second quarter of 2026, compared to a 15.2% increase in the S&P 500 Index. The current market's extreme narrowness is concerning, and history suggests this won't persist. While AI is reshaping society and the economy, today's winners may not remain so, and booms could lead to busts. Additionally, factors such as a volatile federal administration, growing budget deficits, inflation, high interest rates, and strained consumer finances will significantly impact the economy and stock market in the future. Additionally, reviewing the Fund's top five holdings could help identify its best picks for 2026.

In its Q2 2026 investor letter, Madison Large Cap Fund highlighted Keysight Technologies, Inc. (NYSE:KEYS). Keysight Technologies, Inc. (NYSE:KEYS) is a technology company that designs and manufactures electronic design and test solutions serving the communications, electronics, and aerospace and defense (A&D) industries. On August 19, 2026, Keysight Technologies, Inc. (NYSE:KEYS) closed at $319.45 per share. The one-month return of Keysight Technologies, Inc. (NYSE:KEYS) was -2.24%, and its shares gained 97.92% over the past 52 weeks. Keysight Technologies, Inc. (NYSE:KEYS) has a market capitalization of $54.59 billion.

Madison Large Cap Fund stated the following regarding Keysight Technologies, Inc. (NYSE:KEYS) in its Q2 2026 investor letter:

"Electronic test and measurement company Keysight Technologies, Inc. (NYSE:KEYS) again reported strong quarterly results and an even better outlook. Along with Keysight's core end markets remaining strong, it is benefiting from growing demand for AI-specific use cases in optical and electrical equipment."

Keysight Technologies, Inc. (NYSE:KEYS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 66 hedge fund portfolios held Keysight Technologies, Inc. (NYSE:KEYS) at the end of the first quarter, up from 51 in the previous quarter. Keysight Technologies, Inc. (NYSE:KEYS) revenue grew 31% on a reported basis in the second quarter of fiscal 2026 to $1.72 billion. While we acknowledge the potential of Keysight Technologies, Inc. (NYSE:KEYS) 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 Keysight Technologies, Inc. (NYSE:KEYS) and shared a list of stocks that beat Q2 expectations. In addition, please check out our hedge fund investor letters Q2 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.