GMO, an investment management company, released its year-end letter for 2025. A copy of the letter is available to download here. As a market-neutral strategy that seeks to exploit the significant disparity between the valuations of value and growth stocks, the strategy is satisfied with its long-term performance. The Strategy returned 15.8% gross (13.4% net) for 2025. Since its inception, it has achieved a cumulative gross return of 69.3% (50.6% net), without any substantial reduction in the valuation gap. This was fueled by strong stock selection efforts, supported by a proprietary valuation model, along with robust risk management practices. In addition, you can check the portfolio’s top 5 holdings to find out its best picks for 2025.
In its fourth-quarter 2025 investor letter, GMO highlighted stocks like HubSpot, Inc. (NYSE:HUBS). HubSpot, Inc. (NYSE:HUBS) is a software company that offers a cloud-based customer relationship management (CRM) platform for businesses. On March 31, 2026, HubSpot, Inc. (NYSE:HUBS) stock closed at $244.10 per share. One-month return of HubSpot, Inc. (NYSE:HUBS) was -12.38%, and its shares lost 58.84% over the past 52 weeks. HubSpot, Inc. (NYSE:HUBS) has a market capitalization of $12.87 billion.
GMO stated the following regarding HubSpot, Inc. (NYSE:HUBS) in its fourth quarter 2025 investor letter:
“One of the worst performers in the group for the year, which averaged an 80-bp short position and added 0.4% to absolute performance, was HubSpot, Inc. (NYSE:HUBS). If you are anxious to know what severe economic challenges HubSpot faced to send its shares crashing more than 40%, we will have to disappoint you—HubSpot grew its customers and revenues by broadly 20% during the year without compromising margins. Quite simply, high expectations for huge earnings beats meant that even strong results were viewed as insufficient, leading to sharp sell-offs. This is a key reason why we are not obsessing over identifying the catalyst for future growth stock underperformance—the weight of expectation built into valuations will inevitably lead to investor disappointment at some point.”
HubSpot, Inc. (NYSE:HUBS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 56 hedge fund portfolios held HubSpot, Inc. (NYSE:HUBS) at the end of the fourth quarter, compared to 63 in the previous quarter. While we acknowledge the risk and potential of HubSpot, Inc. (NYSE:HUBS) 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 HubSpot, Inc. (NYSE:HUBS) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered HubSpot, Inc. (NYSE:HUBS) and shared Brown Advisory Mid-Cap Growth Strategy’s views on the company. 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.
