Polen Capital, an investment management company, released its first-quarter 2025 investor letter for “Polen 5Perspectives Small Growth Strategy”. A copy of the letter is available to download here. Polen 5Perspectives Small Growth Composite Portfolio returned 3.3% gross and 3.0% net of fees, respectively, in the first quarter of 2026, compared to the -2.8% return of the Russell 2000 Growth Index. Small caps performed strongly at the start of the first quarter, but market volatility caused a shift in focus. Initially, fears of AI disruption in software dominated, followed by worries over private credit redemptions raising broader systemic risk concerns. By March, concerns shifted mainly to increasing geopolitical risks and their impact on rates and inflation. This heightened volatility is expected to continue for the foreseeable future. The importance of adopting a flexible approach to opportunities has become clear this year. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Polen 5Perspectives Small Growth Strategy highlighted GeneDx Holdings Corp. (NASDAQ:WGS). GeneDx Holdings Corp. (NASDAQ:WGS) is a genomics company specializing in pediatric and rare disease diagnostics. On May 13, 2026, GeneDx Holdings Corp. (NASDAQ:WGS) closed at $38.94 per share. One-month return of GeneDx Holdings Corp. (NASDAQ:WGS) was -40.48%, and its shares lost 38.78% over the past 52 weeks. GeneDx Holdings Corp. (NASDAQ:WGS) has a market capitalization of $1.16 billion.
Polen 5Perspectives Small Growth Strategy stated the following regarding GeneDx Holdings Corp. (NASDAQ:WGS) in its Q1 2026 investor letter:
“GeneDx Holdings Corp. (NASDAQ:WGS) is a provider of genomic testing and diagnostics, using advanced sequencing technology to help clinicians diagnose rare diseases and inform treatment decisions. After more than doubling in the back half of 2025, shares underperformed during the quarter as investors digested gains and near-term expectations reset. While the company continues to report solid revenue growth and improving profitability, some variability in testing volumes and reimbursement dynamics created modest uncertainty. Additionally, broader volatility across high-growth healthcare names weighed on sentiment despite continued progress in execution.”
GeneDx Holdings Corp. (NASDAQ:WGS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 39 hedge fund portfolios held GeneDx Holdings Corp. (NASDAQ:WGS) at the end of the fourth quarter, up from 34 in the previous quarter. In Q1 2026, GeneDx Holdings Corp.’s (NASDAQ:WGS) total revenue came in $12 billion lower than anticipated, despite stronger than expected volume growth. While we acknowledge the potential of GeneDx Holdings Corp. (NASDAQ:WGS) 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.