Loomis Sayles, an investment management company, released its fourth-quarter 2025 investor letter for “Small Cap Growth Fund”. A copy of the letter is available to download here. The small caps’ earnings are reaccelerating in 2025, as the firm forecasted a year ago. The market also experienced a low-quality rally within the small-cap space. Against this backdrop, the Small Cap Growth Fund underperformed the Russell 2000 Growth Index benchmark in the quarter, returning 0.51% vs. 1.22% for the benchmark. Heading into 2026, there are many reasons to feel positive about the economy, earnings growth, and the stock market. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Loomis Sayles Small Cap Growth Fund highlighted stocks like Stride, Inc. (NYSE:LRN). Stride, Inc. (NYSE:LRN) is an education management company that provides online education. On March 24, 2026, Stride, Inc. (NYSE:LRN) stock closed at $86.81 per share. One-month return of Stride, Inc. (NYSE:LRN) was 3.60%, and its shares lost 30.97% over the past 52 weeks. Stride, Inc. (NYSE:LRN) has a market capitalization of $3.84 billion.
Loomis Sayles Small Cap Growth Fund stated the following regarding Stride, Inc. (NYSE:LRN) in its fourth quarter 2025 investor letter:
“Varonis Systems, Stride, Inc. (NYSE:LRN) and Commvault Systems were the bottom individual detractors overall. Stride provides virtual learning for K-12 students in roughly half of the states in the country. While this academic year was set up to be strong, challenging integration of meaningful software systems caused students and their families to have poor experience and disenroll. As a result, the company was forced to meaningfully lower guidance for the year when they announced earnings in October.”
Stride, Inc. (NYSE:LRN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 43 hedge fund portfolios held Stride, Inc. (NYSE:LRN) at the end of the fourth quarter, up from 39 in the previous quarter. While we acknowledge the risk and potential of Stride, Inc. (NYSE:LRN) 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 Stride, Inc. (NYSE:LRN) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Stride, Inc. (NYSE:LRN) and shared a list of most promising education stocks according to hedge funds. In its Q4 2025 investor letter, Polen 5Perspectives Small Growth Strategy also cited the same reason for Stride, Inc.’s (NYSE:LRN) decline during the quarter. 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.
