Riverwater Partners, an investment management company, released its “Micro Opportunities Strategy” Q2 2026 investor letter. A copy of the letter is available to download here. In Q2 2026, the Micro Opportunities strategy underperformed the Russell Microcap Index, despite a positive absolute result. The benchmark performed well during a speculative period for micro caps. Over the past twelve months, the strategy has lagged behind the index. Industrials was the best-performing sector while Information Technology lagged. An accelerating artificial intelligence buildout and a persistent geopolitical supply shock drove the market in the quarter. While the micro-cap rally exhibited speculative traits with significant returns in areas avoided by design. The Fund’s focus remains on owning profitable, well-managed small businesses at reasonable prices rather than pursuing fleeting market trends. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, Riverwater Micro Opportunities Strategy highlighted Zevia PBC (NYSE:ZVIA). Zevia PBC (NYSE:ZVIA) is a beverage company that offers soda, energy drinks, and organic tea under the Zevia brand name. On July 23, 2026, Zevia PBC (NYSE:ZVIA) closed at $1.50 per share, reflecting a market capitalization of $107.66 million. Zevia PBC (NYSE:ZVIA) posted a one-month return of -3.85%, while its shares lost 54.41% over the past 52 weeks.
Riverwater Micro Opportunities Strategy stated the following regarding Zevia PBC (NYSE:ZVIA) in its Q2 2026 investor update:
“We owned Zevia PBC (NYSE:ZVIA) briefly during the quarter, and the episode is worth describing because it illustrates our sell discipline. We purchased the position in early May as fundamentals inflected, with the company moving from roughly $20 million of annual losses toward positive EBITDA under a chief executive whose leadership was central to our thesis. When she resigned unexpectedly in mid-June, we stayed true to our thesis, which stated plainly that we would sell if she left. We honored that commitment and exited the position at a modest gain. We subsequently met her successor, whose experience includes a key role in Celsius’s (CELH) rise, an old micro holding that subsequently turned into a midcap. Zevia remains on our watch list.”
Zevia PBC (NYSE:ZVIA) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 13 hedge fund portfolios held Zevia PBC (NYSE:ZVIA) at the end of the first quarter, compared to 15 in the previous quarter. While we acknowledge the risk and potential of Zevia PBC (NYSE:ZVIA) 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 Zevia PBC (NYSE:ZVIA) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Zevia PBC (NYSE:ZVIA) and shared the list of best up and coming penny stocks to buy. In addition, please check out our hedge fund investor letters Q2 2026 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.
