Wedgewood Partners, an investment management company, released its third-quarter 2025 investor letter. The letter is available for download here. AI stocks remain the favorite topic of Wall Street in the third quarter. In the third quarter, Wedgewood Composite’s net return was 5.9% compared to the Standard & Poor’s 8.1%, the Russell 1000 Growth Index’s 10.5%, and the Russell 1000 Value Index’s 5.3% return for the same period. In addition, you can check the fund’s best 5 holdings to know its best picks in 2025.
In its third-quarter 2025 investor letter, Wedgewood Partners highlighted stocks such as CDW Corporation (NASDAQ:CDW). CDW Corporation (NASDAQ:CDW) is an information technology (IT) solutions provider. The one-month return of CDW Corporation (NASDAQ:CDW) was -2.56%, and its shares lost 28.16% of their value over the last 52 weeks. On October 22, 2025, CDW Corporation (NASDAQ:CDW) stock closed at $156.36 per share, with a market capitalization of $20.493 billion.
Wedgewood Partners stated the following regarding CDW Corporation (NASDAQ:CDW) in its third quarter 2025 investor letter:
“CDW Corporation (NASDAQ:CDW) detracted from performance during the quarter as the market has yet to perceive CDW as an “AI winner.” The Company’s revenues grew +10% while adjusted operating income grew just +2%. CDW’s core small business customers are in the nascent stages of updating their IT stacks to be more AI-friendly, including moving many of them to the cloud, plus updating their network and edge devices, which have been neglected since the large buildout related to COVID-19 policies. Many small businesses are hesitant to hire dedicated IT professionals to help with their IT infrastructure. CDW is instrumental for these countless companies. As AI value propositions inevitably trickle down to small businesses, we expect CDW will play an important role for both customers and AI vendors in implementing these solutions.”
CDW Corporation (NASDAQ:CDW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 44 hedge fund portfolios held CDW Corporation (NASDAQ:CDW) at the end of the second quarter, which was 44 in the previous quarter. In the second quarter of 2025, CDW Corporation (NASDAQ:CDW) reported consolidated net sales of $6 billion, up 10% compared to Q2 2024. While we acknowledge the potential of CDW Corporation (NASDAQ:CDW) 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.
