Parnassus Investments, an investment management company, released the “Parnassus Mid Cap Fund” fourth-quarter 2025 investor letter. A copy of the letter is available to download here. The Q4 2025 marked the fund’s consecutive quarter of outperformance, returning 1.17% (net of fees) in the quarter, surpassing 0.16% return for the Russell Midcap Index. The performance was supported by investments in the Information Technology sector, as well as holdings in Utilities. During the quarter, the market started to grow beyond artificial intelligence. YTD, the Fund returned 12.85% (net of fees) compared to 10.60% return for the index. Looking ahead to 2026, the Fund is optimistic, as mid-cap stocks may drive the market upward if economic growth continues to expand beyond AI. In the event of a market decline, the Fund believes that its portfolio of leading companies with solid financial positions will provide downside protection. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Parnassus Mid Cap Fund highlighted stocks like Atlassian Corporation (NASDAQ:TEAM). Atlassian Corporation (NASDAQ:TEAM) is a software company that develops collaboration, project management, and software development tools. On March 31, 2026, Atlassian Corporation (NASDAQ:TEAM) closed at $68.25 per share. One-month return of Atlassian Corporation (NASDAQ:TEAM) was -11.14%, and its shares lost 69.53% over the past 52 weeks. Atlassian Corporation (NASDAQ:TEAM) has a market capitalization of $18.00 billion.
Parnassus Mid Cap Fund stated the following regarding Atlassian Corporation (NASDAQ:TEAM) in its fourth quarter 2025 investor letter:
“Atlassian Corporation (NASDAQ:TEAM), which sells tools to software developers, underperformed amid concerns that AI automation could disrupt the software engineering space. We exited Atlassian due to AI-related uncertainty, as its predominantly seat-based pricing model and focus on developers leave it exposed to potential disruption from “vibe-coding” start-ups.”
Atlassian Corporation (NASDAQ:TEAM) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 57 hedge fund portfolios held Atlassian Corporation (NASDAQ:TEAM) at the end of the fourth quarter, compared to 60 in the previous quarter. Atlassian Corporation (NASDAQ:TEAM) reported its first-ever $1 billion cloud revenue in the first quarter of fiscal 2026, marking an increase of 26% year over year. While we acknowledge the risk and potential of Atlassian Corporation (NASDAQ:TEAM) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Atlassian Corporation (NASDAQ:TEAM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Atlassian Corporation (NASDAQ:TEAM) and shared the list of stocks insiders are buying. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
