Hayden Capital, an investment management firm, released its first-quarter 2026 investment letter. A copy of the letter is available to download here. The portfolio faced difficulties in the first quarter due to concerns about AI disruption and the ongoing conflict in Iran. Companies that are either digitally vulnerable or economically sensitive have been the most affected. As a result, the portfolio declined 28.3% during the quarter, compared with decreases of 4.3% for the S&P 500 and 2.2% for the MSCI World index. Since its inception, the Fund has achieved an annualized return of +11.2% after fees, compared with the S&P 500’s +12.7% and the MSCI World’s +9.8%. There has been a significant shift in capital towards investments linked to AI infrastructure development. The firm is actively seeking companies that can harness this new technology and leverage their data advantages to improve current products and gain a competitive edge over slower adopters. In addition, please check the firm’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Hayden Capital highlighted stocks like Sea Limited (NYSE:SE). Sea Limited (NYSE:SE) is a leading Singapore-based technology company that operates through E-commerce, Digital Financial Services, and Digital Entertainment segments. On May 28, 2026, Sea Limited (NYSE:SE) closed at $91.94 per share. One-month return of Sea Limited (NYSE:SE) was 6.66%, and its shares lost 42.67% over the past 52 weeks. Sea Limited (NYSE:SE) has a market capitalization of $56.31 billion.
Hayden Capital stated the following regarding Sea Limited (NYSE:SE) in its Q1 2026 investor letter:
“Sea Limited (NYSE:SE): Since our last letter, shares in Sea Limited have dipped another -20%. Which is puzzling, as the business has only proven itself stronger since then.
The company generated ~$4.5BN in Free Cash Flow last year, up from $1.7BN in 2023 (+160%). That’s a 10% FCF yield at today’s prices. Earnings are projected to grow another +150% over the next three years. And GMV growth has accelerated in recent quarters (from +21% y/y in Q1 2025 to +30% y/y in Q1 2026) – exceeding both Wall Street’s expectations and the company’s own guidance.
Despite all of this, shares are inexplicably trading at the lowest valuation multiples we’ve seen since late 2023. …” (Click here to read the full text)
Sea Limited (NYSE:SE) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 86 hedge fund portfolios held Sea Limited (NYSE:SE) at the end of the fourth quarter, compared to 113 in the previous quarter. In Q1 2026, Sea Limited (NYSE:SE) generated over $7 billion of revenue, representing 47% year-on-year growth. While we acknowledge the risk and potential of Sea Limited (NYSE:SE) 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 Sea Limited (NYSE:SE) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Sea Limited (NYSE:SE) and shared the list of most widely held stocks by individuals in 2026. In addition, please check out our hedge fund investor letters Q1 2026 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.
