Wedgewood Partners released its Q4 2025 investor letter, anticipating increased market volatility. The Wedgewood Composite returned -1.8% in Q4, with YTD gains of 4.3%. The letter highlighted poor stock selection, past performers due for correction, and being underweight in AI stocks driving underperformance in 2025. Crowded AI investments and stretched valuations are expected to pressure investment decisions in 2026.

Meta Platforms, Inc. (NASDAQ:META) was a leading detractor in Wedgewood Partners’ Q4 performance. META stock closed at $620.25 per share on January 16, 2026, with a one-month return of -6.24% and a market capitalization of $1.56 trillion. Despite +26% revenue growth, Meta’s EPS increased only +20% due to increased spending on AI ambitions.

In Q3 2025, Meta Platforms, Inc. (NASDAQ:META) reported $51.2 billion in revenue, a 26% increase. 273 hedge funds held META in Q3, up from 260 in the previous quarter. While acknowledging META’s potential, Wedgewood Partners believes certain AI stocks offer better upside potential with less downside risk. META is in the third position on the list of 30 Most Popular Stocks Among Hedge Funds.

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