Aristotle Funds, an investment advisor, released its “Core Equity Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. U.S. equity markets reached new all-time highs in Q4 2025, with the S&P 500 Index rising 2.66% and the Bloomberg U.S. Aggregate Bond Index increasing by 1.10%. Within the Russell 1000 Growth Index, healthcare, communication services, and financials were the top performing sectors, while utilities, real estate, and materials lagged. The U.S. economy showed resilience. However, consumer confidence deteriorated toward year-end, raising concerns about future spending and the labor market. The Federal Reserve took a cautious approach due to mixed economic signals and uncertainty around data. Artificial intelligence remained a significant theme of the market. In this environment, the Aristotle Core Equity Fund (Class I-2) returned 3.15% in the quarter compared to the S&P 500 Index’s 2.66% return. Both allocation effects and security selection contributed to the outperformance of the Fund in the quarter. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Aristotle Core Equity Fund highlighted stocks like APi Group Corporation (NYSE:APG). APi Group Corporation (NYSE:APG) is a business services provider that focuses on safety and specialty services. On February 26, 2026, APi Group Corporation (NYSE:APG) stock closed at $45.13 per share. One-month return of APi Group Corporation (NYSE:APG) was 8.56%, and its shares gained 72.38% over the past 52 weeks. APi Group Corporation (NYSE:APG) has a market capitalization of $19.457 billion.
Aristotle Core Equity Fund stated the following regarding APi Group Corporation (NYSE:APG) in its fourth quarter 2025 investor letter:
“APi Group Corporation (NYSE:APG) is a global business services provider specializing in fire and life safety, security, elevator and escalator services, as well as specialty infrastructure solutions. The company operates through two main segments: Safety Services, which accounts for the majority of revenue and profit and focuses on fire protection and building systems across North America, Europe, and Asia-Pacific; and Specialty Services, which delivers critical infrastructure and industrial plant services, including maintenance and repair for utilities and energy sectors. With 29,000 employees in over 500 locations across 20 countries, APi Group serves a diverse range of end markets such as commercial, health care, industrial, utilities, and government agencies, generating substantial recurring revenue through statutory and contracted services.
APi Group’s investment case centers on its strong position in industries driven by regulatory compliance and recurring service requirements, notably fire safety inspections and elevator maintenance. The company benefits from government incentives, such as those provided by the Infrastructure Investment and Jobs Act and the CHIPS Act, which contribute to increased infrastructure spending and growth opportunities in the U.S. APi’s strategy of acquiring service-focused companies with stable, non-discretionary revenue streams has supported its expansion, including its recent entry into the elevator market. The company funds acquisitions through free cash flow and has set ambitious three-year financial goals targeting revenue growth, margin improvement, and robust free cash flow conversion, positioning APi for sustained profitability and operational efficiency. Although APi stock is trading above the five-year average multiple, we believe the higher valuation is justified by the anticipated mid-teen annual earnings growth over the next three years.”
APi Group Corporation (NYSE:APG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 56 hedge fund portfolios held APi Group Corporation (NYSE:APG) at the end of the fourth quarter, compared to 58 in the previous quarter. While we acknowledge the risk and potential of APi Group Corporation (NYSE:APG) 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 APi Group Corporation (NYSE:APG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered APi Group Corporation (NYSE:APG) and shared a list of best HVAC stocks to buy. 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.
