Core Insights - Rowan Street Capital's Q4 2025 investor letter indicates solid results for the year but underperformance compared to the S&P 500 Index, with a net return of +11.1% versus +17.9% for the Index [1] - The firm achieved a cumulative net return of +252% over the past three years, significantly outperforming the Index's +78% during the same period [1] - The performance in 2025 was notably driven by Tesla, which was a new position for the firm that year [1] Company Focus - Rowan Street Capital employs a concentrated investment strategy focusing on long-term compounding, investing in a consistent set of companies to allow time and compounding to build growth [1] - The Trade Desk, Inc. (NASDAQ:TTD) was highlighted as a key stock in the investor letter, with a one-month return of -27.19% and a 52-week loss of 77.51% [2] - As of February 9, 2026, The Trade Desk, Inc. had a market capitalization of $13.221 billion, with shares closing at $27.04 [2] Investment Rationale - Rowan Street Capital initially invested in The Trade Desk, Inc. in early 2020, believing it was creating essential infrastructure for the open internet through a profitable, data-driven advertising platform [3] - The position in The Trade Desk grew from approximately 3% to over 12% of the portfolio at its peak due to strong execution and compounding fundamentals [3] Market Position - The Trade Desk, Inc. is not among the 30 most popular stocks among hedge funds, with 42 hedge fund portfolios holding the stock at the end of Q3, down from 60 in the previous quarter [4] - While acknowledging The Trade Desk's potential, the company believes that certain AI stocks present greater upside potential and lower downside risk [4]

Core Insights - Rowan Street Capital's Q4 2025 investor letter indicates solid results for the year but underperformance compared to the S&P 500 Index, with a Composite return of +11.1% versus +17.9% for the Index [1] - The firm achieved a cumulative net return of +252% over the past three years, significantly outperforming the Index's +78% during the same period [1] - The performance in 2025 was notably driven by Tesla, which was a new position for the firm [1] Company Focus - Meta Platforms, Inc. (NASDAQ:META) is highlighted as the largest position in Rowan Street's portfolio, with an investment held for nearly eight years, compounding at approximately 19% annually [3] - As of February 9, 2026, Meta's stock closed at $677.22 per share, with a one-month return of 7.31% and a 52-week loss of 5.92% [2] - Meta Platforms has a market capitalization of $1.713 trillion and is ranked third among the 30 Most Popular Stocks Among Hedge Funds, with 273 hedge fund portfolios holding the stock at the end of Q3 2025 [3] Investment Perspective - While acknowledging Meta's potential, the firm suggests that certain AI stocks may offer greater upside potential and less downside risk [3] - The firm emphasizes the importance of long-term compounding in its investment strategy, focusing on a concentrated set of companies [1]

Core Insights - Rowan Street Capital's Q4 2025 investor letter indicates solid results for the year but underperformance compared to the S&P 500 Index, with a Composite return of +11.1% versus +17.9% for the Index [1] - The firm achieved a cumulative net return of +252% over the past three years, significantly outperforming the Index's +78% return during the same period [1] - The performance in 2025 was notably driven by Tesla, which was a new position for Rowan Street [1] Company Focus: Shopify Inc. (NASDAQ:SHOP) - Shopify Inc. is highlighted as a key investment, with a one-month return of -29.29% and a 52-week loss of 4.20%, closing at $118.40 per share on February 9, 2026, with a market capitalization of $154.522 billion [2] - Rowan Street initiated its investment in Shopify in Q1 2022 after the stock had declined over 60% from its pandemic peak, believing it was a reasonable price for a high-quality business despite slowing growth and negative sentiment towards technology stocks [3] - Shopify is not among the 30 most popular stocks among hedge funds, with 91 hedge fund portfolios holding the stock at the end of Q3, up from 69 in the previous quarter [5]

Performance Summary - Rowan Street Capital's fund performance in Q3 2025 remained unchanged at +0.22%, with year-to-date returns of +20.4% net of fees, outperforming the S&P 500's +14.8% [1] - Over the past three years, the firm's capital compounded at approximately +54.2% annually, resulting in a cumulative return of +266%, significantly exceeding the S&P 500's +24.9% annualized gain [1] Investment Focus - The fund highlighted Adyen N.V. (OTC:ADYEY) as a key investment, which has shown a one-month return of 6.01% and a 52-week gain of 12.84% [2] - As of October 22, 2025, Adyen N.V. stock closed at $17.26 per share, with a market capitalization of $54.62 billion [2] Adyen N.V. Analysis - Adyen N.V. has compounded at an exceptional 44% annualized rate since its acquisition in 2023, initiated during a period of extreme pessimism when the stock had dropped nearly 50% [3] - The market's overreaction to short-term challenges overlooked Adyen's unique position as a global payments platform built entirely in-house, providing a structural advantage over competitors [3] - The stock rebounded sharply as fundamentals stabilized and growth reaccelerated, reflecting the firm's long-term investment strategy and confidence in Adyen's management [3] Hedge Fund Interest - Adyen N.V. was held by one hedge fund portfolio at the end of Q2 2025, an increase from zero in the previous quarter, indicating growing interest [4] - Despite recognizing Adyen's potential, the analysis suggests that certain AI stocks may offer greater upside potential with less downside risk [4]