Riverwater Partners, an investment management company, recently released its Q3 2025 investor letter outlining the performance of its “Micro Opportunities Strategy.” While the strategy reported solid absolute returns for the quarter, it failed to keep pace with the benchmark due to a strong market rally. Despite this, Riverwater Partners remains focused on investing in quality companies within the volatile market environment.
For those interested in exploring the fund’s top holdings for 2025, a copy of the investor letter can be downloaded from the provided link. One of the highlighted stocks in the letter is Mayville Engineering Company, Inc. (NYSE:MEC). Mayville Engineering Company, Inc. is a metal fabrication company that specializes in various aspects of manufacturing, including design, prototyping, fabrication, and assembly of aftermarket components.
In the one-month period leading up to the investor letter, Mayville Engineering Company, Inc. saw a substantial return of 21.67%, with a 12.31% gain over the past 52 weeks. As of December 16, 2025, the stock closed at $18.25 per share, with a market capitalization of $370.81 million.
In the investor letter, Riverwater Partners highlighted the performance of Mayville Engineering Company, Inc. within the Industrials sector. Despite facing near-term headwinds due to softening customer demand in certain end markets, the company remains well-positioned to benefit from the ongoing reshoring of manufacturing to the United States.
While Mayville Engineering Company, Inc. is not among the 30 most popular stocks held by hedge funds, the company showed a 6.6% increase in total sales year-over-year in the third quarter of 2025. Riverwater Partners acknowledges the potential of Mayville Engineering Company, Inc. as an investment opportunity but believes that certain AI stocks offer greater upside potential with less downside risk.
For investors seeking undervalued AI stocks that could benefit from current economic trends, Riverwater Partners recommends exploring their report on the best short-term AI stock. This stock is poised to capitalize on Trump-era tariffs and the trend of onshoring manufacturing operations.
In conclusion, Riverwater Partners’ Micro Opportunities Strategy continues to navigate the market landscape by focusing on quality companies like Mayville Engineering Company, Inc. Despite short-term challenges, the fund remains optimistic about the long-term prospects of its investments in the current economic environment.
