The London Company Small Cap Strategy sold Cable One (CABO) due to a Thesis Mismatch

The London Company, an investment management company, released “The London Company Small Cap Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. Following a significant downturn in the first quarter, U.S. equities saw a double-digit rise in the second quarter. The small-cap portfolio appreciated 2.7% (2.4% net) in the second quarter, lagging behind the Russell 2000 Index’s 8.5% gain. Sector allocation contributed to the relative performance, while stock selection was a headwind. Please review the fund's top 5 holdings to gain insight into their key selections for 2025.

In its second quarter 2025 investor letter, The London Company Small Cap Strategy highlighted stocks such as Cable One, Inc. (NYSE:CABO). Cable One, Inc. (NYSE:CABO) is a US-based data, video, and voice services provider. The one-month return of Cable One, Inc. (NYSE:CABO) was 1.50%, and its shares lost 66.06% of their value over the last 52 weeks.  On July 28, 2025, Cable One, Inc. (NYSE:CABO) stock closed at $142.55 per share, with a market capitalization of $802.239 million.

The London Company Small Cap Strategy stated the following regarding Cable One, Inc. (NYSE:CABO) in its second quarter 2025 investor letter:

"Exited: Cable One, Inc. (NYSE:CABO) – Sale reflects heightened competitive activity and share losses to fixed wireless access. Our thesis about less competition in rural markets proved to be incorrect. We sold the remaining position following share weakness."

Cable One, Inc. (NYSE:CABO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held Cable One, Inc. (NYSE:CABO) at the end of the first quarter, which was 20 in the previous quarter. While we acknowledge the potential of Cable One, Inc. (NYSE:CABO) 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 Cable One, Inc. (NYSE:CABO) and shared the list of best all-time low stocks to buy according to analysts. 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.