Should You Consider Including Climb Global Solutions (CLMB) in Your Portfolio?

Riverwater Partners, an investment management company, released its “Micro Opportunities Strategy” Q1 2025 investor letter. A copy of the letter can be downloaded here. The strategy generated positive relative results in the first quarter, outperforming the benchmark. The results were driven by owning higher-quality companies compared to those in the microcap benchmark. Both stock selection and sector allocation contributed to the outperformance of the strategy in the quarter. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its first-quarter 2025 investor letter, Riverwater Partners Micro Opportunities Strategy highlighted stocks such as Climb Global Solutions, Inc. (NASDAQ:CLMB). Headquartered in Eatontown, New Jersey, Climb Global Solutions, Inc. (NASDAQ:CLMB) is a value-added information technology distribution and solutions company. The one-month return of Climb Global Solutions, Inc. (NASDAQ:CLMB) was -0.20%, and its shares gained 72.16% of their value over the last 52 weeks. On June 30, 2025, Climb Global Solutions, Inc. (NASDAQ:CLMB) stock closed at $106.91 per share, with a market capitalization of $492.038 million.

Riverwater Partners Micro Opportunities Strategy stated the following regarding Climb Global Solutions, Inc. (NASDAQ:CLMB) in its Q1 2025 investor letter:

"Climb Global Solutions, Inc. (NASDAQ:CLMB) is an information technology distributor with a strong presence across North America and Western Europe.

Key investment highlights of Climb include: • Serves over 7,000 customers and vendors through more than 100 curated partnerships • Specializes in cloud-based and data center software distribution • Differentiates itself by identifying and partnering early with emerging, disruptive technology vendors—enabling robust organic growth. • Strong capital allocation track record with four accretive acquisitions completed by 2023 • Compelling valuation, trading at a market multiple despite expectations for sustained 10–15% EPS growth • Focus on responsible business practices and robust cybersecurity enhances its investment appeal.

Additionally, a newly installed, experienced management team has repositioned CLMB from a transactional model to a sales and marketing oriented culture. This shift, combined with a revamped vendor recruitment strategy, has helped attract high-value software partners in areas such as security and networking."

Climb Global Solutions, Inc. (NASDAQ:CLMB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 9 hedge fund portfolios held Climb Global Solutions, Inc. (NASDAQ:CLMB) at the end of the first quarter, which was 11 in the previous quarter. Climb Global Solutions, Inc.'s (NASDAQ:CLMB) first quarter net sales increased 49% to $138 million. While we acknowledge the potential of Climb Global Solutions, Inc. (NASDAQ:CLMB) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of CLMB 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.

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Disclosure: None. This article is originally published at Insider Monkey.