Montaka Global Investments, an investment management company, released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Montaka’s December 2025 investor letter explains that while global equity markets performed strongly in 2025, driven largely by artificial intelligence (AI) and a small number of high-performing technology stocks, the fund did not outperform during the year due to significant dispersion in stock returns across its portfolio. Some holdings generated strong gains, while others declined due to short-term factors such as concerns about AI disruption, weakness in housing-related sectors, and negative sentiment toward alternative assets and enterprise software. The letter argues that these declines are likely temporary and that many of these businesses remain fundamentally strong but currently undervalued. Looking ahead, the fund maintains a positive market outlook, believing that long-term opportunities remain strong as AI adoption accelerates, driving major investments in data centres, semiconductors, energy infrastructure, and critical commodities like lithium. The managers also note that rising geopolitical competition, resource scarcity, and technological disruption are reshaping the global economy, but they believe their strategy of investing in high-quality companies benefiting from long-term structural trends will continue to deliver strong returns over time. Consequently, the portfolio has been adjusted by adding to undervalued positions, trimming holdings that rallied strongly, and initiating a new investment in a lithium producer to benefit from expected future supply shortages linked to renewable energy and battery demand. In addition, you can check the Strategy’s top 5 holdings to determine its best picks for 2025.

In its fourth-quarter 2025 investor letter, Montaka Global Investments highlighted stocks like Floor & Decor Holdings, Inc. (NYSE:FND). Floor & Decor Holdings, Inc. (NYSE:FND) is a specialty retailer offering hard-surface flooring and related accessories to professional contractors and homeowners through its warehouse-style stores. The one-month return of Floor & Decor Holdings, Inc. (NYSE:FND) was -24.95% while its shares traded between $49.89 and $92.40 over the last 52 weeks. On March 24, 2026, Floor & Decor Holdings, Inc. (NYSE:FND) stock closed at approximately $51.42 per share, with a market capitalization of about $5.55 billion.

Montaka Global Investments stated the following regarding Floor & Decor Holdings, Inc. (NYSE:FND) in its Q4 2025 investor letter:

"As we’ve discussed in prior letters, we view Floor & Decor Holdings, Inc. (NYSE:FND) like a coiled spring – an advantaged specialty retailer waiting patiently for a rebound in US residential property sales, which remain near GFC lows. Based on our assessment, the company’s undervaluation is extreme."

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Floor & Decor Holdings, Inc. (NYSE:FND) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. As per our database, 47 hedge fund portfolios held Floor & Decor Holdings, Inc. (NYSE:FND) at the end of the fourth quarter, which was 44 in the previous quarter. While we acknowledge the risk and potential of Floor & Decor Holdings, Inc. (NYSE:FND) 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'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.

In another article, we covered Floor & Decor Holdings, Inc. (NYSE:FND) 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.