Here’s Why Aristotle Small Cap Equity Strategy Sold Berkshire Hills Bancorp (BHLB)

Aristotle Capital Boston, LLC, an investment advisor, released its “Small Cap Equity Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter started with a risk-off environment from the previous quarter, but later regained momentum driven by broad-based elements. In the second quarter, the strategy delivered a return of 3.25% net of fees (3.41% gross of fees) underperforming the 8.50% total return of the Russell 2000 Index. For more information on the fund’s best picks in 2025, please check its top five holdings.

In its second quarter 2025 investor letter, Aristotle Capital Small Cap Equity Strategy highlighted stocks such as Berkshire Hills Bancorp, Inc. (NYSE:BHLB). Berkshire Hills Bancorp, Inc. (NYSE:BHLB) is a bank holding company for Berkshire Bank. The one-month return of Berkshire Hills Bancorp, Inc. (NYSE:BHLB) was 7.26%, and its shares lost 3.33% of their value over the last 52 weeks. On July 22, 2025, Berkshire Hills Bancorp, Inc. (NYSE:BHLB) stock closed at $26.43 per share, with a market capitalization of $1.224 billion.

Aristotle Capital Small Cap Equity Strategy stated the following regarding Berkshire Hills Bancorp, Inc. (NYSE:BHLB) in its second quarter 2025 investor letter:

“Berkshire Hills Bancorp, Inc. (NYSE:BHLB), is a regional bank primarily serving the NY and New England area. The company announced a merger of equals with Brookline Bancorp. After re-underwriting the combined organization, we chose to exit our position as we were not comfortable with the new management team, nor with the significantly increased loan to deposit ratio.”

Is Berkshire Hills Bancorp Inc. (BHLB) The Best Small Cap Bank Stock To Invest In Now?

Close up of a smart-phone displaying a bank’s online banking platform.

Berkshire Hills Bancorp, Inc. (NYSE:BHLB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held Berkshire Hills Bancorp, Inc. (NYSE:BHLB) at the end of the first quarter, which was 28 in the previous quarter. While we acknowledge the risk and potential of Berkshire Hills Bancorp, Inc. (NYSE:BHLB) 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 Berkshire Hills Bancorp, Inc. (NYSE:BHLB) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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.