Polen Capital, an investment management company, released its “Polen U.S. Small Company Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q1 2025, optimism fueled by the Trump election shifted to fear and uncertainty due to apprehension about cost-cutting measures and emerging trade policies. In the first quarter, the fund delivered -10.53% gross, and -10.83% net of fees, compared to a -11.12% return for the Russell 2000 Growth Index. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025.
In its first-quarter 2025 investor letter, Polen U.S. Small Company Growth Strategy highlighted stocks such as ExlService Holdings, Inc. (NASDAQ:EXLS). ExlService Holdings, Inc. (NASDAQ:EXLS) is a data analytics and digital operations and solutions company. The one-month return of ExlService Holdings, Inc. (NASDAQ:EXLS) was 1.85%, and its shares gained 53.19% of their value over the last 52 weeks. On May 13, 2025, ExlService Holdings, Inc. (NASDAQ:EXLS) stock closed at $46.86 per share with a market capitalization of $7.624 billion.
Polen U.S. Small Company Growth Strategy stated the following regarding ExlService Holdings, Inc. (NASDAQ:EXLS) in its Q1 2025 investor letter:
“ExlService Holdings, Inc. (NASDAQ:EXLS) is a business process outsourcing (BPO) company specializing in the insurance industry. Along with the broad IT services industry, EXL Service Holdings has been hampered by a weaker spending environment in recent quarters. However, early signs of a spending recovery suggest to us that earnings growth may accelerate, creating potential for depressed valuations to re-rate higher. Additionally, the company continues executing its Al strategy, introducing an insurance-specific large language model in partnership with NVIDIA. Given the insurance industry’s traditionally slow pace of digital adoption, we think EXL Service has a long runway for growth ahead as digital adoption gains traction.”
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ExlService Holdings, Inc. (NASDAQ:EXLS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held ExlService Holdings, Inc. (NASDAQ:EXLS) at the end of the fourth quarter which was 22 in the previous quarter. ExlService Holdings, Inc. (NASDAQ:EXLS) reported revenue of $501 million an increase of 15% year-over-year. While we acknowledge the potential of ExlService Holdings, Inc. (NASDAQ:EXLS) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we covered ExlService Holdings, Inc. (NASDAQ:EXLS) and shared the list of Jim Cramer stocks to watch as US-China prepare to begin talks. In addition, please check out our hedge fund investor letters Q1 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.
