Clearbridge Small Cap Strategy Believes in AGCO Corporation's (AGCO) Overseas Sales Expansion

ClearBridge Investments, an investment management company, released its “ClearBridge Small Cap Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The small-cap stocks experienced volatility in the second quarter. The Russell 2000 Index rebounded 10% of its November 2024 record highs just 55 days after the “Liberation Day” decline. It was driven by growth, momentum, high-beta, and low-quality stocks. Even though small-cap stocks rose, they failed to outpace the larger-cap peers due to perceived sensitivity to macroeconomic shocks. The Russell 2000 returned 8.5% for the quarter compared to the 11.1% of the Russell 1000 Index. The strategy underperformed the benchmark in this backdrop. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, ClearBridge Small Cap Strategy highlighted stocks such as AGCO Corporation (NYSE:AGCO). AGCO Corporation (NYSE:AGCO) is a global manufacturer of agricultural equipment and replacement parts. The one-month return of AGCO Corporation (NYSE:AGCO) was -3.07%, and its shares gained 18.34% of their value over the last 52 weeks. On September 15, 2025, AGCO Corporation (NYSE:AGCO) stock closed at $109.71 per share, with a market capitalization of $8.187 billion.

ClearBridge Small Cap Strategy stated the following regarding AGCO Corporation (NYSE:AGCO) in its second quarter 2025 investor letter:

"We also added a new holding in AGCO Corporation (NYSE:AGCO), in the industrials sector, which manufactures and distributes agricultural equipment and replacement parts. With a diversified manufacturing footprint globally and approximately 80% of the company’s sales outside of the U.S., we believe AGCO stands to benefit versus more domestically oriented peers, like John Deere, given the new trade and tariff policies under the Trump administration."

AGCO Corporation (NYSE:AGCO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held AGCO Corporation (NYSE:AGCO) at the end of the second quarter, compared to 27 in the previous quarter. While we acknowledge the potential of AGCO Corporation (NYSE:AGCO) 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 AGCO Corporation (NYSE:AGCO) and shared the list of stocks Jim Cramer recently discussed. 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.