Here's What Makes Magnite (MGNI) a Great Investment Pick

Apis Capital Advisors, an investment management company, released its “Apis Flagship Fund” second-quarter 2025 investor letter. The Apis Flagship Fund posted a net return of 23.7% in Q2 2025, reflecting strong alpha generation from the firm’s high-conviction positions. During the quarter, long investments contributed 35.9% on a gross basis, while short positions detracted 4.9%. As of June 30, the portfolio remained meaningfully exposed to equities, with gross exposures of 92% long and 32% short, resulting in a net long position of approximately 60%. Management emphasized that this positioning reflects confidence in select opportunities while maintaining prudent hedges against broader market risks. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025. A copy of Apis Flagship Fund’s Q2 2025 investor letter is available for download here.

One of the companies mentioned in the letter is Magnite Inc. (NASDAQ:MGNI). Magnite Inc. (NASDAQ:MGNI) operates as an independent omni-channel sell-side advertising platform in the United States and internationally. Over the past month, Magnite Inc. (NASDAQ:MGNI) returned -3.56%, and its shares gained 84.09% of their value over the last 12 months. On September 22, 2025, Magnite Inc. (NASDAQ:MGNI) shares closed at $24.16, with a market capitalization of $3.446 billion.

Here is what they have to say about Magnite Inc. (NASDAQ:MGNI) in their investor letter:

"Magnite Inc. (NASDAQ:MGNI) is one of the largest independent sell-side platforms (SSPs) – effectively serving as enterprise software for digital publishers, including websites and connected TV channels. Its platform enables publishers to manage ad serving, optimize yield, and target audiences more effectively by connecting their ad inventory to a broad network of demand partners.

In return, SSPs earn a percentage of ad spend flowing through their platforms. Magnite benefits from deep integrations with publishers and demand-side platforms, creating high switching costs and a durable competitive moat. The company is widely recognized for its fast, reliable technology infrastructure.

Two major trends are reshaping the digital advertising landscape. First, ad budgets continue to shift from traditional linear TV to Connected TV (CTV) as platforms like Netflix and others expand their ad-supported offerings. Second, a recent antitrust ruling against Google may significantly alter the dynamics of the open web advertising market – specifically for video and display ads on browser-based websites. The court found Google had engaged in anti-competitive practices, and a follow-up hearing this September could result in structural changes that benefit independent ad tech providers..." (Click here to read the full text)

Magnite Inc. (NASDAQ:MGNI) is not included in our list of the 30 most popular stocks among hedge funds. According to our data, 34 hedge fund portfolios held positions in Magnite Inc. (NASDAQ:MGNI) at the end of the second quarter of 2025, up from 28 in the previous quarter. MGNI surpassed earnings expectations, posting an EPS of $0.2 compared to the forecast of $0.17. While we acknowledge the potential of MGNI 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 Magnite Inc. (NASDAQ:MGNI) and Choice Equity Capital’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.