Here's Why RS Large Cap Value Strategy Held Its Position in Corpay (CPAY)

RS Investments, an investment management company, released its “RS Large Cap Value Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the second quarter, the strategy underperformed its benchmark, the Russell 1000 Value Index (the “Index”), and returned 3.55% (net) versus a return of 3.79% for the Index. The strong performance from stock selection in Health Care and Communication Services aided relative performance in the quarter, while stock selection in Consumer Discretionary and Industrials detracted. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its second-quarter 2025 investor letter, RS Large Cap Value Strategy highlighted stocks such as Corpay, Inc. (NYSE:CPAY). Corpay, Inc. (NYSE:CPAY) is a payment company that helps businesses and consumers manage vehicle-related expenses. The one-month return of Corpay, Inc. (NYSE:CPAY) was -6.13%, and its shares gained 7.20% of their value over the last 52 weeks. On August 7, 2025, Corpay, Inc. (NYSE:CPAY) stock closed at $304.50 per share, with a market capitalization of $21.502 billion.

RS Large Cap Value Strategy stated the following regarding Corpay, Inc. (NYSE:CPAY) in its second quarter 2025 investor letter:

"Corpay, Inc. (NYSE:CPAY), a business-to-business (B2B) cross-border and truck-fleet payments processor, declined 4.9% during the quarter; this was due, we believe, to investor concern that tariffs will reduce cross-border transactions and trucking volumes. The founder & CEO, who owns $800M in stock (thus aligning our incentives), took advantage of reduced valuations by announcing two acquisitions. We held our position because the CEO has a successful track record of acquiring under-earning assets and improving their ROIC."

Corpay, Inc. (NYSE:CPAY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held Corpay, Inc. (NYSE:CPAY) at the end of the first quarter, which was 49 in the previous quarter. While we acknowledge the potential of Corpay, Inc. (NYSE:CPAY) 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 Corpay, Inc. (NYSE:CPAY) and shared the list of undervalued tech stocks flying under Wall Street’s radar. 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.