Soumya Eswaran
3 min read
In This Article:
Qualivian Investment Partners, an investment partnership focused on long-only public equities, released its Q1 2025 investor letter. A copy of the letter can be downloaded here. The fund outperformed the iShares MSCI USA Quality Factor ETF (QUAL) by 66.0% and 59.4% on a gross and net basis, since inception through March 31, 2025. It also exceeded the S&P 500 by 32.7% and 26.1% respectively, on a gross and net basis. In Q1 2025, the fund outperformed QUAL by 5.3% and 5.2% on a gross and net basis, and we outperformed the S&P 500 by 5.2% and 5.1% on a gross and net basis. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Qualivian Investment Partners highlighted stocks such as Watsco, Inc. (NYSE:WSO). Watsco, Inc. (NYSE:WSO) engages in the distribution of air conditioning, heating, and refrigeration equipment, and related parts and supplies. The one-month return of Watsco, Inc. (NYSE:WSO) was 1.81%, and its shares lost 4.40% of their value over the last 52 weeks. On June 30, 2025, Watsco, Inc. (NYSE:WSO) stock closed at $441.62 per share, with a market capitalization of $17.868 billion.
Qualivian Investment Partners stated the following regarding Watsco, Inc. (NYSE:WSO) in its Q1 2025 investor letter:
"Watsco, Inc. (NYSE:WSO) is the largest HVAC2 distributor and continues to get larger via a superior technology stack and accretive consolidation. They are founder-led and laser-focused on long term value creation. They are fond of reminding investors that “We focus on the next quarter century, not the next quarter.”
A commercial air conditioning unit mounted atop a residential roof in a suburban neighbourhood.
Watsco, Inc. (NYSE:WSO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Watsco, Inc. (NYSE:WSO) at the end of the first quarter, which was 33 in the previous quarter. While we acknowledge the potential of Watsco, Inc. (NYSE:WSO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.
In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of WSO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
