Fabrinet (FN) Advances as Optical Hardware Demand Strengthens

Wasatch Global Investors, an asset management company, released its "Small Cap Growth Strategy" Q4 2025 investor letter. A copy of the letter can be downloaded here. The Wasatch Small Cap Growth Strategy experienced a challenging fourth quarter as small-cap equities lagged broader market indices, reflecting investor caution and a continued preference for larger, more liquid stocks. During the period, the Russell 2000® Growth Index gained 1.22%, while the strategy finished the quarter in negative territory, with performance driven by stock-specific factors rather than macroeconomic stress. Results contrasted with strength in select areas of the small-cap market, as biotechnology emerged as one of the strongest segments, with the biotech component of the Russell 2000® Growth Index rising nearly 27%. For the 2025 calendar year, the Russell 2000 Growth Index advanced 13.01%, while the strategy posted a loss, highlighting the impact of earnings volatility and valuation compression across several holdings despite management citing improving fundamentals and easing financial conditions as potential longer-term supports. In addition, please check the Fund’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Wasatch Global Investors highlighted stocks like Fabrinet (NYSE:FN). Fabrinet (NYSE:FN) provides advanced optical and electronic manufacturing services, serving communications, automotive, and industrial customers with complex, precision-engineered products. The one-month return of Fabrinet (NYSE:FN) was -0.90% while its shares traded between $464.00 and $504.03 over the last 52 weeks. On February 13, 2026, Fabrinet (NYSE:FN) stock closed at approximately $462.05 per share, with a market capitalization of about $17.555 billion.

Wasatch Global Investors stated the following regarding Fabrinet (NYSE:FN) in its Q4 2025 investor letter:

"Fabrinet (NYSE:FN) was also a significant contributor. Fabrinet is a contract manufacturer of laser-based communication hardware. The company’s optical transceivers are noted for their ability to maintain precise thermal control and alignment of internal components during high-speed transmission of data. Fabrinet is seeing increased demand as data centers upgrade their networks to faster and lower-latency communication standards capable of handling complex AI workloads. Favorable trends in telecommunications end markets have added to investor optimism."

Fabrinet (NYSE:FN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 44 hedge fund portfolios held Fabrinet (NYSE:FN) at the end of the third quarter, up from 32 in the previous quarter. While we acknowledge the risk and potential of Fabrinet (NYSE:FN) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. 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 Fabrinet (NYSE:FN) and shared the list of best Russell 2000 stocks to buy. In addition, please check out our hedge fund investor letters Q4 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.