Soumya Eswaran
3 min read
In This Article:
Riverwater Partners, an investment management company, released its “Small Cap Strategy” Q1 2025 investor letter. A copy of the letter can be downloaded here. The Small Cap Core Strategy outperformed the Russell 2000 in Q1 2025, driven by strong stock selection and sector allocation. Within this strategy, the firm focuses on bottom-up fundamental research rather than making top-down macroeconomic bets. While much of the market discourse today is centered on tariffs and U.S. fiscal policy, the firm’s focus remains on identifying high-quality companies. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.
In its first-quarter 2025 investor letter, Riverwater Partners Small Cap Strategy highlighted stocks such as Bowhead Specialty Holdings Inc. (NYSE:BOW). Bowhead Specialty Holdings Inc. (NYSE:BOW) is a specialty property and casualty insurance products provider. The one-month return of Bowhead Specialty Holdings Inc. (NYSE:BOW) was -0.85%, and its shares gained 48.57% of their value over the last 52 weeks. On June 27, 2025, Bowhead Specialty Holdings Inc. (NYSE:BOW) stock closed at $37.29 per share, with a market capitalization of $1.222 billion.
Riverwater Partners Small Cap Strategy stated the following regarding Bowhead Specialty Holdings Inc. (NYSE:BOW) in its Q1 2025 investor letter:
"Our interest in Bowhead Specialty Holdings Inc. (NYSE:BOW) stems from its strategic positioning in the attractive specialty insurance market, particularly within the Excess and Surplus (E&S) space. Their business model balances a "craft" approach for complex, individual risks with the newly launched "flow" business, Baleen, which targets smaller, hard-to-place risks using a tech-enabled platform. Critically, Bowhead leverages its strategic partnership with American Family (AmFam), utilizing AmFam's "A" rating, to help grow.
