Multiple Tailwinds Lifted HEICO Corp. (HEI.A) in Q2

Conestoga Capital Advisors, an asset management company, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter began with a historically poor start, but gained momentum later as tariff fears subsided and market volatility dropped precipitously. Conestoga Smid Cap Composite underperformed the Russell 2500 Growth Index in the quarter and returned 5.00% net-of-fees vs 11.31% for the index. Sector allocation effects were positive, while sector allocation effects were negative. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2025.

In its second quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks such as HEICO Corporation (NYSE:HEI-A). HEICO Corporation (NYSE:HEI-A) is a company that designs, manufactures, and sells aerospace, defense, and electronics-related products and services. The one-month return of HEICO Corporation (NYSE:HEI-A) was -1.98%, and its shares gained 35.49% of their value over the last 52 weeks. On July 25, 2025, HEICO Corporation (NYSE:HEI-A) stock closed at $253.62 per share, with a market capitalization of $39.14 billion.

Conestoga Capital Advisors stated the following regarding HEICO Corporation (NYSE:HEI-A) in its second quarter 2025 investor letter:

"HEICO Corporation (NYSE:HEI-A) is a commercial and military aircraft aftermarket parts company which designs, manufactures, repairs and distributes jet engine and aircraft component replacement parts. The company has benefited from solid travel growth, albeit slower than the pandemic recovery, as well as healthy parts and maintenance spending due to the delayed retirement of older aircraft given production issues at Boeing (BA) and Airbus."

HEICO Corporation (NYSE:HEI-A) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 65 hedge fund portfolios held HEICO Corporation (NYSE:HEI-A) at the end of the first quarter, which was 67 in the previous quarter. While we acknowledge the potential of HEICO Corporation (NYSE:HEI-A) 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 addition, please check out our hedge fund investor letters Q2 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.