Rowan Street Capital, an investment management company, released its Q4 2025 investor letter. A copy of the letter can be downloaded here. Rowan Street generated solid results in 2025 but underperformed the S&P 500 Index. The Composite returned +11.1% (net) in 2025 compared to +17.9% for the Index. Rowan Street delivered a cumulative net return of +252% over the past three years, compared to +78% for the Index during the same period. It is a concentrated strategy with a focus on long-term compounding. 2025 performance was driven by Tesla, its new position in the year. Rowan Street invests in the same set of companies, allowing time and compounding to build growth. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Rowan Street Capital highlighted stocks such as Shopify Inc. (NASDAQ:SHOP). Shopify Inc. (NASDAQ:SHOP) is a Canada-based e-commerce technology company that provides a cloud-based platform for individuals and companies to create and manage their operations. The one-month return for Shopify Inc. (NASDAQ:SHOP) was -29.29%, and its shares lost 4.20% over the last 52 weeks. On February 9, 2026, Shopify Inc. (NASDAQ:SHOP) stock closed at $118.40 per share, with a market capitalization of $154.522 billion.
Rowan Street Capital stated the following regarding Shopify Inc. (NASDAQ:SHOP) in its fourth quarter 2025 investor letter:
“We initiated our investment in Shopify Inc. (NASDAQ:SHOP) in the first quarter of 2022, after the stock had already declined more than 60% from its pandemic peak. Growth had slowed from extraordinary COVID-era levels, sentiment toward technology stocks had turned sharply negative, and valuation multiples were compressing across the sector. At the time, we believed we were paying a reasonable price for a high-quality business we had followed for many years.
Shopify Inc. (NASDAQ:SHOP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 91 hedge fund portfolios held Shopify Inc. (NASDAQ:SHOP) at the end of the third quarter, compared to 69 in the previous quarter. While we acknowledge the potential of Shopify Inc. (NASDAQ:SHOP) 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.
