In this article, we discuss Lone Pine’s Non-AI Strategy Falters: Non-AI Stocks Weighing Down Stephen Mandel’s 2026 Returns.
Stephen Mandel Jr. is a prominent American hedge fund manager widely recognized as one of the most successful Tiger Cubs, a group of investors who began their careers under the legendary Julian Robertson at Tiger Management. In 1997, Mandel founded Lone Pine Capital, a Greenwich-based firm named after a resilient pine tree at his alma mater, Dartmouth College. Over the decades, Mandel established a reputation as a master of fundamental, bottom-up stock picking, blending growth and value strategies with analytical rigor. The 13F portfolio of his hedge fund was worth over $13.6 billion at the end of the fourth quarter of 2025.
READ MORE: David Einhorn Stock Portfolio: Top 10 Stock Picks.
Mandel has accumulated non-AI stocks in his portfolio that have seen declines in their share prices over the past few months. The primary catalyst for these declines has been the escalation of conflict in Iran and a subsequent naval blockade. This has created an immediate oil supply shock, driving energy prices higher. While the energy sector benefited, it has acted as a massive tax on non-AI industries like manufacturing and transportation, which saw margins compress as fuel and logistical costs spiked. Investors are aggressively rotating capital toward companies with tangible AI monetization, leaving traditional value stocks ignored.
Our Methodology
For this article, we selected stocks by combing through the 13F portfolio of Lone Pine Capital at the end of the fourth quarter of 2025. The non-AI stocks were ranked according to the year-to-date decline in share price and the top 10 from this list were filtered out. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q4 2025 database of 1041 elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Stephen Mandel of Lone Pine Capital
Lone Pine’s Non-AI Strategy Falters: Non-AI Stocks Weighing Down Stephen Mandel’s 2026 Returns
10. Carvana Co. (NYSE:CVNA)
Lone Pine Capital’s Stake: $751 Million
YTD Decline in Share Price: 4%
Carvana Co. (NYSE:CVNA) is a long-term holding in the 13F portfolio of Lone Pine Capital. The fund first disclosed a stake in the company back in the fourth quarter of 2019. This holding comprised a little over 25 million shares. The fund increased this position by over 400% in the next quarter, growing the share ownership to over 127 million. In the following quarter, this stake was trimmed by over 83% and sold off completely within months. Another position was opened in the fourth quarter of 2020 and sold off by late 2021. The present holding was disclosed in the first quarter of 2025. Filings for the fourth quarter of 2025 show that the fund owned 44 million shares in the firm, roughly the same as in the previous quarter.
Wall Street has started treating Carvana Co. (NYSE:CVNA) as a hyper-growth machine that has successfully escaped its 2022-2023 liquidity crisis. The stock is currently being treated as one of the top retail picks with significant upside potential. The firm ended 2025 with record revenue of $20.3 billion, up 49%, and record adjusted EBITDA of $2.2 billion. With a 9.3% net income margin in 2025, Carvana has proven it can generate massive cash flow, which is a key requirement for institutional accumulation in the current rate environment. Management has a long-term vision of selling 3 million retail units annually, up from 600,000 in 2025. The firm already has the 34 reconditioning centers and logistics fleet needed to scale toward that 3-million-unit goal without needing new capital infusions.
