Alger Fund Sees Long-Term Opportunity in Karman Holdings Despite Near-Term Headwinds
The Alger Mid Cap Focus Fund's Q2 2026 investor letter highlights Karman Holdings (NYSE: KRMN) as a top detractor due to near-term concerns including an earnings shortfall, a change in auditors after internal control disclosures, a secondary offering by existing shareholders, and broader weakness in space-related sentiment following a Blue Origin rocket incident. Despite these issues, the fund believes Karman's differentiated engineering capabilities, long-term defense contract visibility, and exposure to growing government and commercial space budgets support its longer-term opportunity. Karman designs and manufactures mission-critical systems for launch vehicles, missiles, spacecraft, hypersonic systems, and unmanned aircraft. As of July 17, 2026, KRMN closed at $46.17 per share with a market cap of $6.12 billion, down 17.88% over the past 52 weeks. The fund also noted that 43 hedge fund portfolios held KRMN at the end of Q1 2026, up from 36 in the previous quarter.
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