The London Company Small Cap Strategy saw a 2.7% rise in the second quarter, lagging behind the Russell 2000 Index’s 8.5% gain. Sector allocation impacted performance, while stock selection was a challenge. Review the fund’s top 5 holdings for insight into their 2025 selections.

Gates Industrial Corporation plc (NYSE: GTES) showed strong performance in Q2 2025, with a one-month return of 8.04% and 42.47% growth over 52 weeks. On July 28, 2025, GTES closed at $25.26 per share with a market cap of $6.511 billion.

In their investor letter, London Company highlighted GTES’ performance, driven by automotive replacement demand. GTES leveraged pricing power and operational efficiency to offset tariff costs, enhancing margin gains. The stable replacement channel and capital allocation strategy contribute to long-term shareholder value.

Despite being held by 40 hedge fund portfolios in Q1, GTES is not among the 30 most popular stocks. With $848 million in total sales in Q1, GTES showed core growth of 1.4%. While acknowledging GTES’ potential, some AI stocks are seen as offering greater upside potential with lower downside risk.

Read more at Yahoo Finance: Gates Industrial Corporation Plc (GTES) Surged on a Demand Uptick in Automotive Replacement