Prosper Stars & Stripes, a long/short equity fund, recently released its first-quarter 2026 investor letter. A copy of the letter is available to download here. In Q1 2026, the portfolio underperformed with a net return of (-5.6%) compared to the Russell 2000 Index’s +0.9% return and the HFRX Equity Hedge Index’s -1.5% return. Long book performance was negative, while the short book contributed positively. Geopolitics significantly influenced the first quarter, contributing to increased inflation pressures and elevated energy prices. Additionally, you can review the Portfolio’s top 5 holdings to see its best picks for 2026.
In its first-quarter 2026 investor letter, Prosper Stars & Stripes highlighted York Space Systems, Inc. (NYSE:YSS). York Space Systems, Inc. (NYSE:YSS) is a space and defense company that provides a comprehensive suite of mission-critical solutions. On June 17, 2026, York Space Systems, Inc. (NYSE:YSS) closed at $30.30 per share. One-month return of York Space Systems, Inc. (NYSE:YSS) was 6.50%, and its shares gained 71.38% over the last three months. York Space Systems, Inc. (NYSE:YSS) has a market capitalization of $3.93 billion.
Prosper Stars & Stripes stated the following regarding York Space Systems, Inc. (NYSE:YSS) in its Q1 2026 investor letter:
“York Space Systems, Inc. (NYSE:YSS) was the largest detractor in our long book in the quarter. The company is a space and defense prime contractor, with hardware and software capabilities that enable it to meet a wide range of mission requirements. Its offering is the satellite “bus,” the functional backbone of any spacecraft which integrates the power, altitude & orbit control, thermal control, telemetry, tracking & command, and structural integrity which is then coupled with the satellite payload. York is founder led, with its CEO Dirk Wallinger, seasoned with experience at Orbital Sciences, General Dynamics, and Lockheed Martin. The company’s vertically integrated model allows it to manufacture satellites approximately 20% faster and at 50% lower cost than its competitors. York currently has 33 satellites in orbit, with more than 100 additional units expected to be delivered over the next 21 months, providing strong revenue visibility. Space remains a major focus area for the U.S. Department of War, particularly through initiatives such as the Space Development Agency, which is targeting a proliferated constellation of roughly 1,000 satellites in low Earth orbit by the end of 2026. Despite these favorable fundamentals, the January IPO traded below its offering price, triggering technical selling in a temporarily soft aerospace and defense market. Following its first earnings report as a public company, the stock recovered. However, we exited our position as the visibility into funding and competition became more difficult to confidently discern.”
York Space Systems, Inc. (NYSE:YSS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 34 hedge fund portfolios held York Space Systems, Inc. (NYSE:YSS) at the end of the first quarter. In Q1 2026, York Space Systems, Inc. (NYSE:YSS) delivered revenue of $116 million, up 9% year-on-year. While we acknowledge the risk and potential of York Space Systems, Inc. (NYSE:YSS) 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 YORK SPACE SYSTEMS, INC. (NYSE:YSS) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered York Space Systems, Inc. (NYSE:YSS) and shared the list of best space stocks to buy according to Reddit and Social Media. 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.
