Riverwater Partners Small Cap Strategy Sold Iridium Communications (IRDM) as Growth Slows

Riverwater Partners, an investment management company, released its “Small Cap Strategy” Q3 2025 investor letter. A copy of the letter can be downloaded here. The Small Cap Core Strategy reported solid results for the quarter but did not keep pace with the sharp rally, thus lagging the benchmark. The market’s preference for lower-quality companies persisted in the quarter and contributed significantly to the benchmark’s outperformance. On the other hand, the strategy remains focused on higher-quality companies with enduring fundamentals, consistent revenue, and a transparent path to profitability. The firm strongly believes that the strategy is well-positioned in the challenging quarter. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its third-quarter 2025 investor letter, Riverwater Partners Small Cap Strategy highlighted stocks such as Iridium Communications Inc. (NASDAQ:IRDM). Iridium Communications Inc. (NASDAQ:IRDM) is a communication services company that offers mobile voice and data communications services and products. Iridium Communications Inc.’s (NASDAQ:IRDM) one-month return was 8.98%, and its shares lost 40.07% of their value over the last 52 weeks. On December 15, 2025, Iridium Communications Inc. (NASDAQ:IRDM) stock closed at $17.60 per share, with a market capitalization of $1.868 billion.

Riverwater Partners Small Cap Strategy stated the following regarding Iridium Communications Inc. (NASDAQ:IRDM) in its third quarter 2025 investor letter:

We sold Iridium Communications Inc. (NASDAQ:IRDM) due to concerns about growth trajectory and competitive dynamics in certain end markets. They have also increased their leverage ratio which brings added risk to the stock as growth slows.

Iridium Communications Inc. (NASDAQ:IRDM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 34 hedge fund portfolios held Iridium Communications Inc. (NASDAQ:IRDM) at the end of the third quarter, which was 33 in the previous quarter. While we acknowledge the risk and potential of Iridium Communications Inc. (NASDAQ:IRDM) 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 Iridium Communications Inc. (NASDAQ:IRDM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Iridium Communications Inc. (NASDAQ:IRDM) and shared the list of stocks slump amid Wall Street cheer. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None. This article is originally published at Insider Monkey.