Aristotle Capital Management, LLC, an investment management firm, released its “Global Equity Strategy” investor letter for the second quarter of 2025. A copy of the letter can be downloaded here. During the quarter, the global equity market surged, with the MSCI ACWI Index rising 11.53%. Aristotle Capital Global Equity Strategy returned 9.58% gross of fees (9.45% net of fees) in the second quarter, underperforming the MSCI ACWI Index’s 11.53% return and the MSCI World Index’s 11.47% return. Additionally, you can review the fund’s top 5 holdings to see its best picks for 2025.
In its second-quarter 2025 investor letter, Aristotle Capital Global Equity Strategy highlighted stocks such as PayPal Holdings, Inc. (NASDAQ:PYPL). PayPal Holdings, Inc. (NASDAQ:PYPL) is a technology platform that enables digital payments. The one-month return of PayPal Holdings, Inc. (NASDAQ:PYPL) was -10.22%, and its shares gained 10.94% of their value over the last 52 weeks. On July 31, 2025, PayPal Holdings, Inc. (NASDAQ:PYPL) stock closed at $68.76 per share, with a market capitalization of $65.692 billion.
Aristotle Capital Global Equity Strategy stated the following regarding PayPal Holdings, Inc. (NASDAQ:PYPL) in its second quarter 2025 investor letter:
"During the quarter, we sold our positions in PayPal Holdings and Rational and invested in Capital One and Uber. We first invested in PayPal Holdings, Inc. (NASDAQ:PYPL), the online and mobile e-commerce payments company, in the third quarter of 2015. Over the past decade, we have admired PayPal’s ability to expand its unique and hard-to-replicate dual-sided network, even amid intensifying competition. In 2023, Alex Chriss succeeded Dan Schulman as CEO and refocused the company on profitable growth by enhancing the checkout experience and deepening user engagement, rather than emphasizing top-line expansion. Partnerships with Apple, J.P. Morgan, Amazon and Shopify support this shift, embedding PayPal more deeply across digital commerce ecosystems. Mr. Chriss has also prioritized higher-margin branded checkout while phasing out select Braintree deals that were unprofitable or contributed little to earnings. Braintree primarily serves large enterprise clients—such as Uber, Airbnb and Live Nation—through unbranded, custom-priced processing agreements. While these actions have moderated near-term revenue growth, we view them as a more disciplined and sustainable approach to long-term value creation. That said, we remain concerned about PayPal’s continued investment in its “One Platform” strategy, which includes expanding into offline and omnichannel payments—a direction that has shown limited success to date. While we will continue monitoring Mr. Chriss’s progress and the broader payments landscape, we ultimately determined PayPal was the most suitable candidate for sale in order to fund what we believe is a more compelling investment opportunity."
A consumer in a cafe paying for goods using a mobile payment app.
PayPal Holdings, Inc. (NASDAQ:PYPL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 92 hedge fund portfolios held PayPal Holdings, Inc. (NASDAQ:PYPL) at the end of the first quarter which was 94 in the previous quarter. While we acknowledge the potential of PayPal Holdings, Inc. (NASDAQ:PYPL) 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 PayPal Holdings, Inc. (NASDAQ:PYPL) and shared the list of stocks Jim Cramer recently talked about. 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.