This Fund Sold Its $5 Million EPAM Stake Amid the Stock's Steep, Years-Long Decline

Arkansas-based Meridian Management fully exited its stake in EPAM Systems (NYSE:EPAM) in the third quarter, selling 31,788 shares for an estimated $5 million, according to an SEC filing on Monday.

What Happened

Meridian reported a complete sale of its EPAM Systems (NYSE:EPAM) holding in its latest Form 13-F, filed with the Securities and Exchange Commission on Monday. The move involved the disposition of 31,788 shares, with an estimated trade value of $5 million based on the period’s average share price.

What Else to Know

Top holdings after the filing:

• NYSEMKT:VEA: $34.2 million (7.8% of AUM)
• NYSEMKT:IVV: $33.9 million (7.7% of AUM)
• NASDAQ:VCIT: $28.8 million (6.6% of AUM)
• NYSEMKT:GVI: $20.8 million (4.7% of AUM)
• NYSEMKT:IJH: $18.6 million (4.2% of AUM)

As of Tuesday, EPAM shares were priced at $158.12, down 16.5% over the past year and trailing the S&P 500, which is up nearly 19% over the same period.

Company Overview

Company Snapshot

EPAM Systems, Inc. is a leading provider of digital engineering and software development services, operating at scale with over 61,000 employees worldwide. The company differentiates itself by combining deep technical expertise with consulting and design capabilities to deliver end-to-end digital transformation for large enterprise clients. EPAM's broad industry reach and focus on complex, mission-critical projects position it as a strategic partner for organizations seeking to modernize and innovate their technology infrastructure.

Foolish Take

Meridian Management’s complete exit from EPAM Systems last quarter likely reflects some skepticism around the high-volatility technology stock after a years-long stretch of volatility.

EPAM shares are still down about 80% from 2021 highs, though the company has been hard at work on a turnaround. In August, EPAM reported $1.35 billion in quarterly revenue, up 18% year-over-year, while raising full-year guidance and announcing a new $1 billion share repurchase program. CEO Arkadiy Dobkin highlighted the firm's "return to greater consistency" and steady organic growth, as well as rising demand for AI-driven software modernization—an encouraging sign for long-term investors betting on digital transformation.

For Meridian, the move comes amid a portfolio anchored in diversified ETFs like IVV and VEA, suggesting a large focus on lower-risk, broad-market exposure. But for investors focused on fundamentals, EPAM’s balance sheet strength, recurring enterprise contracts, and accelerating AI integration could make its depressed valuation look more like an opportunity than an exit signal.

Glossary

13F reportable assets: Assets that institutional investment managers must disclose in quarterly SEC Form 13F filings.
Assets under management (AUM): The total market value of investments managed by a fund or investment firm.
Full exit: When an investor sells its entire position in a particular security or company.
Disposition: The act of selling or otherwise removing an asset from a portfolio.
Trailing: A performance comparison over a specific past period, usually relative to a benchmark or index.
Digital platform engineering: The design and development of large-scale, integrated technology systems that support digital business operations.
Technology integration services: Services that combine different technology systems and software to work together within an organization.
End-to-end digital transformation: Comprehensive modernization of business processes, systems, and customer experiences using digital technologies.
Mission-critical projects: Projects essential to an organization's core operations, where failure could cause significant disruption.
TTM: The 12-month period ending with the most recent quarterly report.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends EPAM Systems and Vanguard FTSE Developed Markets ETF. The Motley Fool has a disclosure policy.