Applied Aerospace & Defense (AADX) is Positioned for Accelerated Growth

Prosper Stars & Stripes, a long/short equity fund, reported a strong net return of +30.1% for Q2 2026, outperforming both the Russell 2000 Index (+21.5%) and the HFRX Equity Hedge Index (+10.3%). The strong performance was driven by the long book, which generated a 43.2% gross contribution, while average net exposure remained modest at 47%.

Despite inflation concerns, elevated energy prices, and geopolitical uncertainty, U.S. economic growth remained resilient. Markets rallied following easing U.S.-Iran tensions, which led to lower oil prices and increased risk appetite. Small-cap equities, particularly Information Technology, Industrials, and Health Care, saw significant gains, while Energy declined as crude prices fell.

Year-to-date, the Composite returned +23.7%, slightly above the Russell 2000 (+22.6%) and well above the HFRI Equity Hedge Index (+9.7%). In its Q2 2026 investor letter, Prosper Stars & Stripes highlighted Applied Aerospace & Defense, Inc. (NYSE:AADX), a company that designs, engineers, and manufactures integrated aerospace and defense subsystems for space and defense applications.

The fund believes bookings for Applied Aerospace can accelerate, driving revenues, earnings, and multiples higher due to its participation in fast-growing defense programs as a sole-sourced, IP-rich component supplier.