Brown Capital Management, an investment management company, released its fourth quarter 2025 investor letter for “The Brown Capital Management Small Company Fund”. A copy of the letter can be downloaded here. In the fourth quarter of 2025, the Small Company Fund (Investor shares) fell 1.50%, behind the Russell 2000® Growth index’s 1.22% gain. Real estate and telecommunications businesses led the benchmark’s performance for the quarter. The Fund was down 11.46% in 2025, significantly lagging the Index’s 13.01% return. The firm’s investment decisions are driven by company fundamentals, and its holdings performed well in terms of revenue and earnings growth in 2025. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, The Brown Capital Management Small Company Fund highlighted stocks like Veracyte, Inc. (NASDAQ:VCYT). Headquartered in South San Francisco, California, Veracyte, Inc. (NASDAQ:VCYT) is a global diagnostic company. On February 20, 2026, Veracyte, Inc. (NASDAQ:VCYT) stock closed at $35.63 per share. One-month return of Veracyte, Inc. (NASDAQ:VCYT) was -12.18%, and its shares lost 9.48% over the past 52 weeks. Veracyte, Inc. (NASDAQ:VCYT) has a market capitalization of $2.817 billion.
The Brown Capital Management Small Company Fund stated the following regarding Veracyte, Inc. (NASDAQ:VCYT) in its fourth quarter 2025 investor letter:
“In the quarter, we added four companies to the Fund—AvePoint Inc. (AVPT), Loar Holdings (LOAR), PDF Solutions (PDFS) and Veracyte, Inc. (NASDAQ:VCYT). Veracyte is a genomic diagnostics company that develops and delivers tests that help physicians diagnose and treat cancer more accurately and less invasively. Veracyte holds a dominant market position with more than 50% market share in each of its core products: Decipher (genomic classifier for prostate cancer) and Afirma (genomic classifier for thyroid cancer). These two products contributed more than 90% of revenue during 2024. Decipher’s market is only 40% penetrated and can continue to deliver double-digit growth for several years. Afirma is more penetrated but offers stability. We think both products are well positioned competitively, given extensive clinical validation, medical guideline inclusion and broad reimbursement coverage. The company’s pipeline—including Prosigna LDT (U.S. breast cancer), Decipher IVD (international prostate), Percepta Nasal swab (lung cancer)— could expand its market opportunity by more than $3 billion. Veracyte turned profitable in 2024 and has shown meaningful margin expansion year to date, and we expect further expansion from here. Veracyte features a solid balance sheet with more than $400 million in cash and has been free cash flow positive since 2023.”
Veracyte, Inc. (NASDAQ:VCYT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held Veracyte, Inc. (NASDAQ:VCYT) at the end of the fourth quarter, up from 25 in the previous quarter. While we acknowledge the risk and potential of Veracyte, Inc. (NASDAQ:VCYT) 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 Veracyte, Inc. (NASDAQ:VCYT) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Veracyte, Inc. (NASDAQ:VCYT) and shared a list of best innovative stocks to buy according to Wall Street analysts. In addition, please check out our hedge fund investor letters Q4 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.
