Ariel’s John Rogers likes these small-cap names as the market rally broadens

Covista Stock Surge YTD

20%

Covista's shares have increased by 20% in the current year.

Lazard Stock Decline in 2026

16%

Lazard's shares have decreased by 16% in the year 2026.

Carlyle Group Stock Decline in 2026

29%

Carlyle Group's shares have dropped by 29% in 2026.

§ 01 Executive Snapshot

What: John Rogers of Ariel Investments highlights small-cap stocks amidst AI market volatility.
Who: John Rogers, chairman and co-CEO of Ariel Investments; Covista, Lazard, Carlyle Group, Littelfuse, Knowles.
Why it matters: The focus on small-cap stocks reflects a shift in investment strategy as larger companies face valuation concerns due to the AI craze.

Covista's shares have surged 20% this year, indicating strong performance in the education sector for healthcare professionals.
Lazard and Carlyle Group stocks have declined 16% and 29% respectively in 2026, highlighting potential undervaluation in the financial services sector.
Littelfuse and Knowles stocks have surged approximately 89% and 90% this year, showcasing strong growth in the electronics and components industry.

The current market is experiencing significant volatility driven by the AI trade, reminiscent of the late 1990s internet bubble.
Rogers' focus on small-cap stocks represents a value investing strategy in a market perceived as expensive due to speculative trends in larger tech companies.

Immediate market consequences include a potential shift of investor interest from high-flying tech stocks to undervalued small-cap and financial stocks.
Long-term implications may involve a correction in the market as the AI craze subsides, leading to increased opportunities in overlooked sectors.

Regulatory pressures and market volatility may hinder investment performance in financial services and small-cap stocks.
Competition among investment firms and changing market dynamics could impact the profitability of recommended stocks.

Investors should monitor the performance of Covista, Lazard, and Carlyle Group as indicators of market sentiment towards small-cap and financial stocks.
Upcoming earnings reports and macroeconomic developments will signal the success or failure of Rogers' investment strategies.

§ 07

What small-cap stocks is John Rogers focusing on?

John Rogers is highlighting Covista, Lazard, Carlyle Group, Littelfuse, and Knowles as key small-cap stocks.

Why are small-cap stocks gaining attention in the current market?

Small-cap stocks are gaining attention due to concerns over the high valuations of larger companies amidst the AI market volatility.

How have Covista and Knowles performed this year?

Covista's shares have surged 20%, while Knowles stocks have increased approximately 90% this year.

What risks might affect investment performance in small-cap stocks?

Regulatory pressures and market volatility, along with competition among investment firms, may hinder investment performance in small-cap stocks.