The London Company, an investment management firm, recently released their third-quarter 2025 investor letter outlining the performance of their Income Equity Strategy. The letter highlighted the continued rally of US equities in the third quarter, attributed to factors such as the Fed rate cut, strong corporate earnings, and excitement surrounding artificial intelligence (AI). The portfolio saw a 6.0% gross (5.8% net) appreciation, outperforming the 5.3% increase in the Russell 1000 Value Index. While positive stock selection contributed to the portfolio’s outperformance, it was partially offset by sector exposure headwinds.
One of the stocks mentioned in the investor letter was Fidelity National Information Services Inc. (NYSE:FIS). Fidelity National Information Services is a prominent provider of financial technology solutions for financial institutions, businesses, and developers. The stock had a one-month return of -7.31% and lost 26.94% of its value over the last 52 weeks. As of November 4, 2025, Fidelity National Information Services stock closed at $63.15 per share, with a market capitalization of $32.988 billion.
In the investor letter, The London Company Income Equity Strategy discussed their decision regarding Fidelity National Information Services. They noted that the stock underperformed in the quarter due to inconsistent execution and a weaker outlook that would require acceleration later in the year. Despite the company’s strong market position and recurring revenue base, the additional execution risk led them to sell the position to fund higher conviction ideas within the portfolio.
While Fidelity National Information Services is not among the 30 most popular stocks among hedge funds, 49 hedge fund portfolios held the stock at the end of the second quarter, up from 56 in the previous quarter. The London Company sees potential in Fidelity National Information Services as an investment but believes that certain AI stocks offer greater upside potential with less downside risk. They recommend exploring an undervalued AI stock that could benefit significantly from Trump-era tariffs and the onshoring trend.
Overall, The London Company’s third-quarter 2025 investor letter provides valuable insights into their investment strategy and decision-making process. Investors can review the fund’s top holdings to gain further insight into their key selections for 2025. For more information on their latest investor letter and investment recommendations, interested individuals can download the full letter from their website.
