Veeva Systems (VEEV) Fell Due to a Broader Sector Rotation

Conestoga Capital Advisors, an asset management company, released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q4 2025, Conestoga Capital Advisors Mid Cap Strategy returned -5.75% net of fees compared to the Russell Midcap Growth Index’s -3.70% return. The underperformance was driven by negative stock selection in the Technology and Industrials sectors, while positive sector allocation effects partially eased underperformance. The Mid Cap Composite returned -4.73% net of fees for the full year 2025, trailing the benchmark return of 8.66%. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks like Veeva Systems Inc. (NYSE:VEEV). Veeva Systems Inc. (NYSE:VEEV) is a technology company that provides a cloud-based software platform for the life sciences industry. On February 19, 2026, Veeva Systems Inc. (NYSE:VEEV) stock closed at $182.57 per share. One-month return of Veeva Systems Inc. (NYSE:VEEV) was -17.76%, and its shares lost 19.14% over the past 52 weeks. Veeva Systems Inc. (NYSE:VEEV) has a market capitalization of $30.011 billion.

Conestoga Capital Advisors stated the following regarding Veeva Systems Inc. (NYSE:VEEV) in its fourth quarter 2025 investor letter:

"Veeva Systems Inc. (NYSE:VEEV) is a leading provider of cloud-based software solutions specifically designed for the global life sciences industry. Despite maintaining a dominant market position and raising full-year guidance, the stock retreated in the fourth quarter. The decline was largely driven by a broader sector rotation out of higher-valuation software names and investor caution regarding the timing of large enterprise deal closures. We remain confident in VEEV’s strategic value to the pharmaceutical industry and its expanding product runway in data and commercial cloud."

Veeva Systems Inc. (NYSE:VEEV) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 57 hedge fund portfolios held Veeva Systems Inc. (NYSE:VEEV) at the end of the third quarter, compared to 61 in the previous quarter. While we acknowledge the potential of Veeva Systems Inc. (NYSE:VEEV) 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 Veeva Systems Inc. (NYSE:VEEV) and shared Baron Asset Fund's views on the company. 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.