Diamond Hill Capital, an investment management company, released its “Mid Strategy” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. The fourth quarter posted another period of favorable gains for equity markets, with small and large cap positions being stronger performers, returning 2.19% and 2.41%. While the mid-cap range was a relative laggard, with the Russell Mid Cap Index returning 0.16%. The Strategy returned 3.65% (net) in Q4, compared to 0.16% return for the Russell Midcap Index. YTD, the strategy returned 13.47%, outperforming the 10.60% return for the Index. In 2025, AI-related spending remained a key driver in equity markets, though December saw a pause as investors became more cautious about AI developments and potential market bubbles. Given the elevated equity market valuations, the Strategy is well-positioned to withstand ongoing uncertainty. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Diamond Hill Mid Strategy identified VeriSign, Inc. (NASDAQ:VRSN) as its leading detractor. VeriSign, Inc. (NASDAQ:VRSN) is a technology company that provides internet infrastructure and domain name registry services. On March 19, 2026, VeriSign, Inc. (NASDAQ:VRSN) stock closed at $239.65 per share. One-month return of VeriSign, Inc. (NASDAQ:VRSN) was 11.00%, and its shares lost 1.99% over the past 52 weeks. VeriSign, Inc. (NASDAQ:VRSN) has a market capitalization of $21.91 billion.
Diamond Hill Mid Strategy stated the following regarding VeriSign, Inc. (NASDAQ:VRSN) in its fourth quarter 2025 investor letter:
“Shares of internet infrastructure provider VeriSign, Inc. (NASDAQ:VRSN) declined after Berkshire Hathaway reduced its stake in the company earlier in 2025, a move driven by regulatory considerations rather than company fundamentals. Despite near-term pressure, the company continues to benefit from high customer switching costs, proprietary technology, US government support and disciplined capital allocation.”
VeriSign, Inc. (NASDAQ:VRSN) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 54 hedge fund portfolios held VeriSign, Inc. (NASDAQ:VRSN) at the end of the fourth quarter, up from 44 in the previous quarter. VeriSign, Inc.’s (NASDAQ:VRSN) fourth quarter net income reached $206 million compared to $213 million in the previous quarter and $191 million in Q4 2024. While we acknowledge the risk and potential of VeriSign, Inc. (NASDAQ:VRSN) 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 VeriSign, Inc. (NASDAQ:VRSN) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered VeriSign, Inc. (NASDAQ:VRSN) and shared a bullish thesis on the company. 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.
