This is what lowers Motorola Solutions' (MSI) performance

In the third-quarter investor letter of 2025, Mairs & Power, the investment management firm, provided insights into its Mairs & Power Balanced Fund. The fund recorded a return of 6.47% during the first nine months of 2025, which fell short of the composite benchmark indexes. These indexes, consisting of a 60% weight on the S&P 500 Total Return Index and a 40% weight on the Bloomberg U.S. Government/Credit Bond Index, saw an increase of 11.35%. Additionally, the Morningstar Moderate Allocation peer group posted a gain of 10.73%.

Despite the fund's underperformance, the market remains largely dominated by major technology stocks, especially those involved in artificial intelligence (AI). Mairs & Powers third-quarter letter specifically pointed out certain tech companies, including Motorola Solutions, Inc. (NYSE: MSI), for their disappointing performance.

Motorola Solutions, a provider of public safety and enterprise security solutions, reported a one-month return of -3.14% and a significant 52-week decline of 21.66%. As of December 11, 2025, the companys stock closed at $368.05 per share, with a market capitalization of $61.319 billion.

The Mairs & Power report noted that the Information Technology sector contributed most to the underperformance during the period. While AI-driven companies posted strong gains, the Funds limited exposure to those stocks was a drawback. Furthermore, certain companies, including Motorola Solutions, underperformed despite having generally positive underlying results. Challenges included an expected dilution of earnings due to acquisitions and tariff-related headwinds that weighed on performance.

In terms of market interest, Motorola Solutions was held in 51 hedge fund portfolios at the end of Q3 2025, a slight decrease from 55 portfolios in the prior quarter. Although the company shows promise, some analysts suggest that other AI stocks could offer better growth potential and lower risk.

Motorola Solutions was not among the 30 most popular stocks held by hedge funds, reflecting the market's cautious outlook on the stock despite its relevance in the security tech space. For investors interested in potentially more undervalued AI stocks, there are other opportunities that might also benefit from the ongoing tariff dynamics.

For more information, readers are encouraged to explore further analyses of hardware stocks and insights on the best-performing tech stocks in the market.

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• Here’s What Dampens Motorola Solutions’ (MSI) Performance