Will Endava (DAVA) be Able to Bounce Back?

Core Insights - Night Watch Investment Management's fourth-quarter 2025 investor letter indicates that despite high volatility in individual stocks, the fund finished the quarter approximately flat, reflecting a broad-based performance without reliance on any single security [1] Company Overview - Endava plc (NYSE:DAVA) is identified as a technology services provider catering to sectors such as consumer products, healthcare, mobility, and retail [2] - As of January 6, 2026, Endava's stock closed at $6.67 per share, with a one-month return of -0.30% and a significant decline of 78.65% over the last 52 weeks [2] - The market capitalization of Endava plc is reported at $362.365 million [2] Market Perception and Analysis - The market perceives Endava plc as an "AI loser," primarily due to the nature of the IT services industry, which bills by the hour. Increased programming efficiency could lead to a decrease in billable work [3] - An alternative perspective suggests that lower costs may enable a wider range of IT projects for Endava's customers, potentially compensating for lower prices per project with higher volumes [3] Hedge Fund Interest - Endava plc is not among the 30 most popular stocks among hedge funds, with 14 hedge fund portfolios holding the stock at the end of the third quarter, an increase from 11 in the previous quarter [4] - While acknowledging Endava's investment potential, the analysis suggests that certain AI stocks may offer greater upside potential and carry less downside risk [4]