Renaissance Investment Management – Small Cap Growth Strategy’s Q4 2025 Investor Letter

Renaissance Investment Management, an investment management company, released its Q4 2025 “Small Cap Growth Strategy.” In the fourth quarter, Small Cap Growth stocks posted their third consecutive quarter of gains, with the Russell 2000 Growth Index increasing by 1.2%. Both the Health Care and Real Estate sectors performed positively during this period. The Strategy maintains its preference for reasonably priced growth companies that demonstrate above-average growth potential and rising earnings estimates. The Renaissance Small Cap Growth Strategy underperformed the Index and experienced a decline in the quarter. The “low quality” rally that began in the second quarter persisted into the fourth quarter. Additionally, companies with negative earnings emerged as strong performers in the fourth quarter, achieving even greater gains than the lowest ROE stocks. Looking ahead to 2026, the Strategy remains optimistic about the positive environment for small-cap growth stocks. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.

A copy of Renaissance Investment Management – Small Cap Growth Strategy’s Q4 2025 investor letter can be downloaded here.