Polen Capital, an investment management company, released its fourth-quarter investor letter for “Polen International Growth Strategy”. A copy of the letter can be downloaded here. In 2025, foreign equity markets reached their highest returns in more than a decade, whereas Polan International Growth had flat returns. This was not attributed to weakening business fundamentals among its holdings, but the market’s preference for cyclically sensitive businesses. The strategy seeks to invest in companies with enduring competitive strengths, high returns on invested capital, and consistent earnings. The Strategy returned -2.21% (gross) and -2.52% (net) in Q4 compared to 5.05% return for MSCI ACWI (ex-USA). For 2025, the Strategy returned 0.68% (gross) and -0.52% (net) compared to 32.39% return for the Index. In addition, please check the Strategy’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Polen International Growth Strategy highlighted stocks like Alibaba Group Holding Limited (NYSE:BABA). Alibaba Group Holding Limited (NYSE:BABA) is a Chinese multinational company that focuses on cloud computing, e-commerce, and artificial intelligence. On March 17, 2026, Alibaba Group Holding Limited (NYSE:BABA) stock closed at $136.57 per share. One-month return of Alibaba Group Holding Limited (NYSE:BABA) was -12.33%, and its shares lost 4.63% over the past 52 weeks. Alibaba Group Holding Limited (NYSE:BABA) has a market capitalization of $326.049 billion.

Polen International Growth Strategy stated the following regarding Alibaba Group Holding Limited (NYSE:BABA) in its fourth quarter 2025 investor letter:

"The top three contributors to the Portfolio’s relative performance in the quarter were Tokyo Electron, Alibaba Group (not owned), and ASML. Alibaba Group Holding Limited (NYSE:BABA) (not owned) shares declined -19% during the quarter as profitability in the core e-commerce business has been pressured by heavy investments to compete with Meituan in food and grocery delivery."

Alibaba Group Holding Limited (NYSE:BABA) is in 30th position on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 115 hedge fund portfolios held Alibaba Group Holding Limited (NYSE:BABA) at the end of the fourth quarter, compared to 130 in the previous quarter. While we acknowledge the potential of Alibaba Group Holding Limited (NYSE:BABA) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. 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 Alibaba Group Holding Limited (NYSE:BABA) and shared Emerald Growth Equity Strategy's views 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.