Fred Alger Management, an investment management company, released its “Alger Mid Cap Focus Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets regained their strength in the second quarter of 2025. Class A shares of the fund outperformed the Russell Midcap Growth Index during the quarter. The Industrials and Energy sectors contributed to the relative performance of the strategy in the quarter, while Information Technology and Consumer Discretionary sectors detracted. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its second quarter 2025 investor letter, Alger Mid Cap Focus Fund highlighted stocks such as Clearwater Analytics Holdings, Inc. (NYSE:CWAN). Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is a technology company that develops and provides a Software-as-a-Service (SaaS) solution for investment analytics and reporting solutions. The one-month return of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) was -4.83%, and its shares gained 5.60% of their value over the last 52 weeks. On July 23, 2025, Clearwater Analytics Holdings, Inc. (NYSE:CWAN) stock closed at $21.30 per share, with a market capitalization of $6.036 billion.
Alger Mid Cap Focus Fund stated the following regarding Clearwater Analytics Holdings, Inc. (NYSE:CWAN) in its second quarter 2025 investor letter:
“Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is a leading provider of cloud-based investment analytics and reporting solutions, primarily serving insurance companies, institutional investors, and corporate clients. During the quarter, Clearwater made several acquisitions, aiming to enhance its platform into a comprehensive, end-to-end investment management solution. However, shares detracted from performance due to market concerns that the debt incurred to finance these acquisitions increased the company’s risk profile, as well as potential integration risks associated with managing multiple acquisitions simultaneously. In our view, these acquisitions have the potential to be transformational, significantly expanding Clearwater’s total addressable market and strengthening its competitive position. Further, we consider the elevated debt levels and integration risks temporary. Although investor apprehension surrounding these acquisitions led to share price weakness this quarter, we recognize management’s rationale that these strategic moves were essential to broaden the product offering and support longer-term growth. Furthermore, the company continues to deliver strong financial results and provided robust guidance for the fiscal year.”
A wide shot of a large financial data center.
Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held Clearwater Analytics Holdings, Inc. (NYSE:CWAN) at the end of the first quarter, which was 88 in the previous quarter. In the first quarter of 2025, Clearwater Analytics Holdings, Inc. (NYSE:CWAN) reported revenue of $126.9 million, representing an increase of 23.5% year-on-year. While we acknowledge the risk and potential of Clearwater Analytics Holdings, Inc. (NYSE:CWAN) 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 Clearwater Analytics Holdings, Inc. (NYSE:CWAN) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Clearwater Analytics Holdings, Inc. (NYSE:CWAN) and shared the list of growth stocks that could double by 2027. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
