Jacob Funds, a mutual fund company, released its fourth-quarter 2025 investor letter. A copy of the same can be downloaded here. After an optimistic quarter, equity markets corrected slightly in November. Although overall economic growth has been robust throughout the year, recent divergent data on consumer spending and the labor market have put doubt on future projections. This pattern has become somewhat familiar over the past few years, as conflicting economic data has become the norm. As for the Fund’s strategy, the recent moderation in AI tech companies seems beneficial, and the firm believes the new productivity cycle will accelerate profit margins and earnings growth, resulting in weaker labor markets. Small companies could benefit from this trend, resulting in potential expansion in valuation multiples, and in turn, be favorable for its Funds compared to peers. In addition, please check the Funds’ top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Jacob Funds highlighted stocks like Prime Medicine, Inc. (NASDAQ:PRME). Prime Medicine, Inc. (NASDAQ:PRME) is a biotechnology company that specializes in gene editing technology. On February 17, 2026, Prime Medicine, Inc. (NASDAQ:PRME) stock closed at $3.31 per share. One-month return of Prime Medicine, Inc. (NASDAQ:PRME) was -17.46%, and its shares are up 0.76% over the past twelve months. Prime Medicine, Inc. (NASDAQ:PRME) has a market capitalization of $597.49 million.
Jacob Funds stated the following regarding Prime Medicine, Inc. (NASDAQ:PRME) in its fourth quarter 2025 investor letter:
“The Jacob Discovery Fund added two new positions in the quarter, Cabaletta Bio and Prime Medicine, Inc. (NASDAQ:PRME). Prime Medicine is a next-generation gene therapy company we have followed for a while, and believe the time is right to make an investment given our increasing confidence we have in their technology and the enormous upside potential should it prove viable. While the field of gene therapy has suffered its share of setbacks and concerns over the past several years – safety, durability and cost all remain obstacles to broader adoption – we are still convinced that many patients suffering from numerous chronic and deadly diseases will be effectively cured by gene therapies. Prime’s elegant and precise gene editing function, if successfully developed, will allow for simpler and safer treatment options, with less off-target activity created by the messier double-stranded DNA breaks associated with first-generation gene therapy technologies like CRISPR. We are still in very early days of prime editing’s development, but a data release late last year in the company’s first clinical trial showed promising efficacy and safety signals in two patients.”
Prime Medicine, Inc. (NASDAQ:PRME) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 30 hedge fund portfolios held Prime Medicine, Inc. (NASDAQ:PRME) at the end of the third quarter, up from 14 in the previous quarter. While we acknowledge the risk and potential of Prime Medicine, Inc. (NASDAQ:PRME) 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 Prime Medicine, Inc. (NASDAQ:PRME) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Prime Medicine, Inc. (NASDAQ:PRME) and shared a list of best biotech penny stocks to buy according to analysts. 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.
