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American Century Investments, an investment management company, released its first-quarter 2026 investor letter for the "American Century Investments Focused Dynamic Growth Fund". The letter can be downloaded here. U.S. stocks advanced sharply with double-digit quarterly gains largely due to robust earnings, resilient economic data, and momentum in AI-related stocks. However, there was a slight pullback in June as momentum waned and investors anticipated potential interest rate hikes by the Federal Reserve. Growth and AI stocks outperformed value stocks, while large-cap companies generally surpassed small- and mid-cap stocks. Underperformance was noted in healthcare and communication services, while industrials, particularly in aerospace and defense, contributed positively to performance. The fund's investor class returned 16.38%, slightly below the Russell 1000 Growth Index's 16.74%. The investment approach focuses on bottom-up financial analysis to identify large-cap companies with long-term earnings growth potential, while aiming to mitigate non-financial risks. Please review the Fund's top five holdings to gain insights into its key selections for 2026.

In its second-quarter 2026 investor letter, American Century Investments Focused Dynamic Growth Fund highlighted Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) as a newly added position. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is a biotechnology company that develops and commercializes medicines to treat various diseases. On September 08, 2026, Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) closed at $810.31 per share, reflecting a market capitalization of $83.43 billion. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) posted a one‑month return of 0.19%, while its shares gained 43.84% over the past 52 weeks.

American Century Investments Focused Dynamic Growth Fund stated the following regarding Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) in its Q2 2026 investor letter:

"Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN). We've been long-time holders of Regeneron because of what we believed was the strength of its research platform. However, we continued to be disappointed by sluggish commercialization efforts for its macular degeneration treatment. We now believe the stock has limited appreciation potential and preferred to redeploy cash to other investments that we thought were more attractive."

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. According to our database, 63 hedge fund portfolios held Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) at the end of the second quarter, down from 72 in the previous quarter. While we acknowledge the potential of Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) 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 discussed Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) and Harbor Mid Cap Value Fund's bullish views 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.

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This article is originally published at Insider Monkey.