Ace River Capital, an investment management company, released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q4 2025, the Fund returned -4.55% compared to the S&P 500’s (SPX) +2.7% return and the Russell 2000’s (RTY) +2.2% return. The Fund has delivered -21.95% for the full year compared to +18.0% and +12.8% returns for the indexes, respectively. The firm attributed the unfavorable outcomes in the year to valuation pressures and unique events. Ace River Capital is a highly concentrated portfolio of small- and micro-cap businesses with resilient fundamentals, a solid asset base, and significant reinvestment potential. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Ace River Capital highlighted stocks like RCI Hospitality Holdings, Inc. (NASDAQ:RICK). Headquartered in Houston, Texas, RCI Hospitality Holdings, Inc. (NASDAQ:RICK) is a hospitality company that owns and operates clubs and restaurants. On February 9, 2026, RCI Hospitality Holdings, Inc. (NASDAQ:RICK) stock closed at $23.59 per share. One-month return of RCI Hospitality Holdings, Inc. (NASDAQ:RICK) was -9.02%, and its shares are down 54.05% over the past twelve months. RCI Hospitality Holdings, Inc. (NASDAQ:RICK) has a market capitalization of $205.716 million.
Ace River Capital stated the following regarding RCI Hospitality Holdings, Inc. (NASDAQ:RICK) in its fourth quarter 2025 investor letter:
“During the fourth quarter, RCI Hospitality Holdings, Inc. (NASDAQ:RICK) shares declined roughly 25% following the filing of bribery and tax-related charges against the CEO, CFO, and other executives by the New York Attorney General in September 2025. These developments created significant legal and governance uncertainty and drove the stock to what I would describe as crisis valuation without crisis operations.
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