Here’s Why TAT Technologies Ltd. (TATT) is Growing Rapidly

Prosper Stars & Stripes, a long/short equity fund, recently released its second quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund underperformed and generated a net return of +9.6% compared to a total return of +8.5% for the long-only small-cap Russell 2000 Index (the “Russell”), and a total return of +5.0% for the long/short equity hedge fund peer group represented by the HFRX Equity Hedge Index (the “HFRX”). For the six months ended 2025, Prosper Stars & Stripes returned a net return of (0.8%) compared to (1.8%) for the Russell and +5.9% for the HFRI. The portfolio demonstrated strong outperformance relative to its net exposure during the quarter. In the second quarter of 2025, US equities reversed the declines seen in the first quarter. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Prosper Stars & Stripes highlighted stocks such as TAT Technologies Ltd. (NASDAQ:TATT). TAT Technologies Ltd. (NASDAQ:TATT) provides solutions and services to the commercial and military aerospace and ground defense industries. The one-month return of TAT Technologies Ltd. (NASDAQ:TATT) was 1.60%, and its shares gained 108.76% of their value over the last 52 weeks. On August 29, 2025, TAT Technologies Ltd. (NASDAQ:TATT) stock closed at $36.45 per share, with a market capitalization of $469.742 million.

Prosper Stars & Stripes stated the following regarding TAT Technologies Ltd. (NASDAQ:TATT) in its second quarter 2025 investor letter:

“More recently, the Composite initiated a position in TAT Technologies Ltd. (NASDAQ:TATT). Though relatively underfollowed, the company is taking the right steps to scale operationally and as an investment. Its largest business segment is the MRO of auxiliary power units. With aerospace demand growing steadily for decades and incumbents hesitant to expand capacity, TATT is capitalizing on the gap and growing rapidly. We expect EBITDA to rise from approximately $19 million in 2024 to about $39 million in 2027. During this growth and discover phase, we anticipate the stock will trade with a high teens EV/EBITDA multiple taking the stock into the mid $50s. As a catalyst, the company is relocating its domicile from Israel to the U.S., where most of its business occurs. We believe this transition, combined with business growth, could lead to future index inclusion, broader investor awareness, and ultimately a higher valuation.”

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TAT Technologies Ltd. (NASDAQ:TATT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held TAT Technologies Ltd. (NASDAQ:TATT) at the end of the second quarter, which was 9 in the previous quarter. TAT Technologies Ltd.’s (NASDAQ:TATT) revenue increased by 18% in the second quarter to $43 million. While we acknowledge the risk and potential of TAT Technologies Ltd. (NASDAQ:TATT) 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 TAT Technologies Ltd. (NASDAQ:TATT) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered TAT Technologies Ltd. (NASDAQ:TATT) and shared the list of best small cap defense stocks to buy according to hedge funds. 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.