Is it Now A Great Time to Invest in APi Group (APG)?

SouthernSun Asset Management, an investment management firm, released its “SMID Cap Investment” second-quarter 2025 investor letter. The fund focuses on disciplined, long-term investing in resilient businesses, navigating volatile markets with deep research, patience, and an unwavering commitment to capital stewardship. During the second quarter of 2025, the SMID Cap Composite returned 10.53% on a gross basis (10.34% net) versus the Russell 2500®, which returned 8.59% and the Russell 2500® Value, which returned 7.29%, over the same period. Over the trailing-twelve-months, the composite returned 3.34% on a gross basis (2.62% net) versus the Russell 2500®, which returned 9.91% and the Russell 2500® Value, which returned 10.47%, over the same period. The fund’s top 5 holdings are also listed in the letter, showing the firm’s main investment positions heading into 2025. A copy of SouthernSun Asset Management’s Q2 2025 investor letter is available for download here.

One of the companies mentioned in the letter is APi Group Corporation (NYSE:APG). APi Group Corporation (NYSE:APG) provides safety and specialty services worldwide. Over the past month, APi Group Corporation (NYSE:APG) rose by 2.43%, and its shares gained 56.76% over the last 12 months. On August 12, 2025, APi Group Corporation (NYSE:APG) shares closed at $35.47, with a market capitalization of $14.752 billion.

Here is what they have to say about APi Group Corporation (NYSE:APG) in their investor letter:

"APi Group Corporation (NYSE:APG), a leading provider of fire and life safety, security, elevator and escalator, and specialty services, was the top contributor in the SMID Cap strategy this quarter. The core Safety Services segment delivered strong results, with organic revenue growth of 6% and Adjusted EBITDA growth of 21%. Organic growth was driven by continued execution of the inspection-first strategy, while margins expanded due to improvements in the international business (Chubb, acquired in 2022) and the shift to higher margin inspection and service work. In contrast, the smaller Specialty Services segment remained weak and was further impacted by adverse weather during the quarter.

However, backlog grew approximately 7%, and management anticipates a return to organic growth next quarter. We attended the Investor Day in New York this May, where management laid out ambitious plans to scale the business to over $10 billion in revenue and $1.6 billion in Adjusted EBITDA by 2028. While these are lofty targets, we believe the company has meaningful organic and inorganic growth opportunities, and we have strong confidence in the leadership of CEO Russ Becker and his team to execute on this vision."

APi Group Corporation (NYSE:APG) is not included in our list of the 30 most popular stocks among hedge funds. According to our data, 49 hedge fund portfolios held positions in APi Group Corporation (NYSE:APG) at the end of the first quarter of 2025, up from 48 in the previous quarter. Adjusted diluted earnings per share for the second quarter was $0.39, representing a $0.06 increase or 18.2% compared to the prior year period. While we acknowledge the potential of APG 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 APi Group Corporation (NYSE:APG) and Andreas Halvorsen’s views on the company. 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.