Riverwater Micro Opportunities Strategy’s Overview on Douglas Dynamics (PLOW)

Riverwater Partners, an investment management company, released its “Micro Opportunities Strategy” Q4 2025 investor letter. A copy of the letter can be downloaded here. Both Q4 and the full year 2025 were challenging for the strategy, which struggled to match the benchmark performance in Q4 and FY2025. The underweight exposure in speculative areas of the market led to the underperformance in the second half of the year. Low-quality stocks with poor fundamentals outperformed the market in the year. The strategy’s emphasis on high-quality stocks lagged behind the broader market trends. Heading to 2026, the Strategy focuses on micro-cap companies with broader sales and growth trajectories and believes that the low-quality stock market rallies will be short-lived. In addition, you can check the fund’s top five holdings to determine its best picks for 2025.

In its fourth-quarter 2025 investor letter, Riverwater Partners Micro Opportunities Strategy highlighted stocks such as Douglas Dynamics, Inc. (NYSE:PLOW). Douglas Dynamics, Inc. (NYSE:PLOW), with a market capitalization of $841.683 million, is a manufacturer and upfitter of commercial work truck attachments and equipment. One-month return of Douglas Dynamics, Inc. (NYSE:PLOW) was 8.14%, and its shares gained 47.72% of their value over the last 52 weeks. On January 16, 2026, Douglas Dynamics, Inc. (NYSE:PLOW) stock closed at $36.53 per share.

Riverwater Partners Micro Opportunities Strategy stated the following regarding Douglas Dynamics, Inc. (NYSE:PLOW) in its fourth quarter 2025 investor letter:

“Douglas Dynamics, Inc. (NYSE:PLOW) is a leading North American manufacturer of commercial snow and ice control equipment and work truck solutions, serving municipal, commercial, and contractor end markets through a portfolio of well-established brands such as FISHER®, WESTERN®, SnowEx®, Henderson®, and Dejana. The company operates through two segments: Work Truck Attachments, which is highly levered to winter snowfall patterns, and Work Truck Solutions, which provides truck upfitting, municipal solutions, and more diversified, less weather-dependent revenue streams. This combination gives PLOW a unique cyclical profile, with meaningful upside during normalized winters and increasing stability as the Solutions business scales and diversification initiatives take hold.

Douglas Dynamics, Inc. (NYSE:PLOW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 20 hedge fund portfolios held Douglas Dynamics, Inc. (NYSE:PLOW) at the end of the third quarter, up from 18 in the previous quarter. In Q3 2025, the consolidated net sales of Douglas Dynamics, Inc. (NYSE:PLOW) increased 25% to $162.1 million, and gross profit grew 23% to $38.1 million. While we acknowledge the potential of Douglas Dynamics, Inc. (NYSE:PLOW) 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.

In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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