| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 8.8% | 1.4% | 5.7% |
| 2025 | 2024 |
|---|---|
| 5.7% | 12.1% |
Diamond Hill Large Cap Fund returned 1.41% in Q4 2025 versus 3.81% for the Russell 1000 Value Index, with underperformance driven primarily by lack of exposure to AI beneficiaries like Alphabet, Micron, and other technology stocks. The fund remains cautious of AI-driven market exuberance where investor sentiment appears to outpace business fundamentals. Instead, managers continue finding attractive opportunities among high-quality, cash-generative businesses with defensive characteristics including Colgate, Aon, and Berkshire Hathaway, which underperformed despite solid fundamentals. Key contributors included General Motors benefiting from industry volume stabilization, AIG reporting strong earnings with potential acquisition interest from Chubb, and Capital One following strong results and accelerated buybacks. New positions were initiated in Cooper Companies, Dover Corp, Wix.com, Solventum, and EQT at attractive valuations. The fund sold Caterpillar, Hartford Insurance, Nasdaq, and HCA Healthcare as they reached intrinsic value estimates. The value-oriented approach focuses on businesses trading at discounts while maintaining conviction in defensive positioning.
Focus on fundamentally stable, high-quality, cash-generative businesses trading at discounts to intrinsic value while remaining cautious of AI-driven market exuberance.
The fund continues to find more attractive opportunities among high-quality, cash-generative businesses with defensive characteristics, despite these areas underperforming in 2025. The managers remain cautious of AI-driven market exuberance and maintain conviction in their value-oriented approach focused on businesses trading at discounts to intrinsic value.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 27 2026 | 2025 Q4 | AIG, AON, BRK-B, CAT, CB, CL, COF, COO, DOV, EQT, GM, GOOGL, HCA, HIG, LH, MU, NDAQ, SOLV, SYY, WIX, ZTS | AI, Defensive, financials, healthcare, large cap, Quality, technology, value |
GM AIG COF ZTS LH SYY COO DOV WIX SOLV EQT |
The fund remains cautious of AI-driven market exuberance where investor sentiment often appears to outpace business fundamentals. AI optimism drove strong performance in information technology and communication services sectors, with hundreds of billions in AI-related capital spending supporting stocks like Micron and Sandisk. The fund continues to find attractive opportunities among high-quality, cash-generative businesses with defensive characteristics including Colgate, Aon and Berkshire Hathaway. These fundamentally stable businesses underperformed in 2025 but continue to perform in-line with expectations. The portfolio focuses on fundamentally stable, higher quality businesses trading at discounts to intrinsic value estimates. New positions like Dover Corp were initiated when stocks traded at significant discounts to estimated intrinsic value. |
| Oct 24 2025 | 2025 Q3 | AIG, CAT, EQH, FDX, KMX, LHX, MLM, TMO, ZTS | AI, consumer, defense, Large Caps, value |
FDX ZTS |
The portfolio lags its benchmark due to weakness in IT and consumer discretionary holdings but emphasizes long-term value discipline. Managers added exposure to high-quality names like FedEx and Thermo Fisher, while cautioning against AI-driven overvaluation in mega-caps. They see opportunities in defense, logistics, and healthcare leaders trading below intrinsic value. |
| Jul 27 2025 | 2025 Q2 | ADBE, AON, BRK/A, DIS, FERG, KMX, RRX, TXN | cash flow, Intrinsic Value, Large Caps, Quality, volatility |
RRX FERG ADBE |
The commentary highlights high-quality large-cap companies trading below intrinsic value following tariff-driven volatility. Management focuses on strong cash generation, durable franchises, and disciplined capital allocation. Valuation gaps created by macro noise are positioned as opportunities. |
| Apr 24 2025 | 2025 Q1 | ABT, AIG, BRK/A, COF, COOP, GIS, HD, RRX, TGT | - | - | |
| Dec 31 2024 | 2024 Q4 | CL, FCX, GM, LULU | - | - | |
| Sep 30 2024 | 2024 Q3 | ACN, AON, BLDR, COP, HCA, HUM, NVR, PH, WTI | - | - | |
| Jul 26 2024 | 2024 Q2 | AMZN, GOOG, IP, KMX, RRX, SBUX, TGT, TXN | - | - | |
| Apr 15 2024 | 2024 Q1 | AIG, ALL, BWA, CAT, GM, HCA, HUM, KEYR, LH, SBAC, SYY | - | - | |
| Jan 2 2024 | 2023 Q4 | AIG, ALL, BAC, BWA, CARR, CVX, KKR, PFE | - | - | |
| Sep 30 2023 | 2023 Q3 | AIG, CAT CB, EXR, FANG | - | - | |
| Jul 25 2023 | 2023 Q2 | AIG, AMZN, DIS, FERG, HCA, KMX, MSFT | - | - | |
| Mar 31 2023 | 2023 Q1 | ALL, AMZN, BKNG, FRC, RRX, SIVBQ, TFC | - | - | |
| Dec 31 2022 | 2022 Q4 | ABT, AIG, AMZN, CAT, COP, FCX, GOOG, HD, MSFT, TFC, UNP | - | - | |
| Oct 26 2022 | 2022 Q3 | ABT, AIG, COP, DE, GOOG, NDAQ, PFE, SYK, VFC | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
QualityThe company emphasizes investing in businesses with excellent economics, durable competitive advantages, and high-integrity management. This quality focus is evident in concentrated equity holdings and operating business acquisitions. |
Durable Advantages Management Quality Economic Moats Competitive Position | |
ValueManager emphasizes investing in controlled companies trading at significant discounts to NAV, with European holding companies showing discounts of 30-68%. The strategy focuses on securities mispricing where real value exists, contrasting with overvalued technology stocks. |
Discounts NAV Mispricing Undervalued Controlled | |
| 2025 Q3 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
ConsumerThe consumer segment includes DJL Petfoods (pet food ingredients distributor) and TSDC Wholesale (food and grocery wholesale). DJL exemplifies RDCP 2.0 characteristics as an asset-light but infrastructure-critical business with long-standing customer relationships, exceptional retention rates, and exposure to growing pet ownership and premiumisation trends. These businesses benefit from structural advantages and recurring revenue streams. |
Pet Care Food Distribution Consumer Staples Wholesale Distribution | |
DefenseThe team initiated a position in Curtiss-Wright, believing the company is entering a period where multiple near-term growth drivers are converging, including rising defense budgets, commercial aerospace production ramps, nuclear power plant life extensions and new builds, and submarine production. |
Defense Budgets Aerospace Nuclear Submarines | |
| 2025 Q2 |
QualityThe company emphasizes investing in businesses with excellent economics, durable competitive advantages, and high-integrity management. This quality focus is evident in concentrated equity holdings and operating business acquisitions. |
Durable Advantages Management Quality Economic Moats Competitive Position |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 27, 2026 | Fund Letters | Chuck Bath | AIG | American International Group, Inc. | Financials | Property & Casualty Insurance | Bull | New York Stock Exchange | buybacks, capital return, Expenses, Insurance, Mna | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | COF | Capital One Financial Corporation | Financials | Consumer Finance | Bull | New York Stock Exchange | buybacks, Consumerfinance, creditcards, earnings, Economy | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | ZTS | Zoetis Inc. | Health Care | Pharmaceuticals | Bear | New York Stock Exchange | Animal Health, Demand, guidance, healthcare, pipeline | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | LH | Labcorp Holdings Inc. | Health Care | Diagnostics & Research | Bear | New York Stock Exchange | diagnostics, healthcare, Margins, restructuring, scale | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | SYY | Sysco Corporation | Consumer Staples | Food Distribution | Bear | New York Stock Exchange | consumer, Defensiveness, Distribution, Foodservice, scale | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | COO | The Cooper Companies, Inc. | Health Care | Health Care Supplies | Bull | New York Stock Exchange | Contact lenses, growth, Medicaldevices, valuation, Womenshealth | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | DOV | Dover Corporation | Industrials | Industrial Conglomerates | Bull | New York Stock Exchange | Cyclicality, Execution, Industrials, Margins, valuation | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | WIX | Wix.com Ltd. | Information Technology | Application Software | Bull | NASDAQ | AI, Platforms, SaaS, Software, valuation | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | SOLV | Solventum Corporation | Health Care | Health Care Technology | Bull | New York Stock Exchange | Healthcare IT, Margins, R And D, spinoff, turnaround | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | EQT | EQT Corporation | Energy | Oil & Gas Exploration & Production | Bull | New York Stock Exchange | Commodities, Cost leadership, energy, infrastructure, Naturalgas | Login |
| Oct 24, 2025 | Fund Letters | Chuck Bath | FDX | FedEx Corporation | Industrials | Air Freight & Logistics | Bull | NYSE | cost-cutting, Freight, Logistics, Margins, restructuring, spin-off, Transportation | Login |
| Oct 24, 2025 | Fund Letters | Chuck Bath | ZTS | Zoetis Inc. | Health Care | Pharmaceuticals | Bull | NASDAQ | Animal Health, growth, innovation, Pets, pharmaceuticals, pipeline, valuation | Login |
| Jul 27, 2025 | Fund Letters | Chuck Bath | RRX | Regal Rexnord Corporation | Industrials | Electrical Components & Equipment | Bull | NYSE | Automation, deleveraging, efficiency, Industrials, Margins, powertrain, synergies | Login |
| Jul 27, 2025 | Fund Letters | Chuck Bath | FERG | Ferguson plc | Industrials | Trading Companies & Distributors | Bull | NYSE | consolidation, construction, Distribution, HVAC, infrastructure, Margins, scale | Login |
| Jul 27, 2025 | Fund Letters | Chuck Bath | ADBE | Adobe Inc | Information Technology | Application Software | Bull | NASDAQ | AI, cashflow, Creativity, growth, Moat, Software, Subscription | Login |
| Jan 27, 2026 | Fund Letters | Chuck Bath | GM | General Motors Company | Consumer Discretionary | Automobile Manufacturers | Bull | New York Stock Exchange | Autos, Cyclicality, EV, marketshare, Pricing | Login |
| TICKER | COMMENTARY |
|---|---|
| AIG | Property and casualty insurer American International Group (AIG) reported better-than-expected earnings, with strong expense management and share repurchases offsetting a weakening pricing environment. Shares also benefited from reports that fellow insurer Chubb is exploring a potential acquisition of the company. |
| AON | increased exposure to insurance brokers (Aon and Willis Towers Watson) |
| BRK-B | Our annual pilgrimage to Omaha was running according to plan until, as we headed to the airport while listening to the final moments of the annual shareholder's meeting, Buffett dropped the bombshell: he would step down as CEO at year-end. We believe the most important aspect of Berkshire—its culture—is likely to endure. Abel inherits Berkshire's massive $382 billion cash position and will likely allocate more capital than Warren and Charlie did over much of their investing careers. |
| CAT | Construction + Mining at low mid-cycle levels; dealer destock largely complete. Non-Residential + manufacturing starts inflecting (manufacturing starts 5X trailing 12-month average in June). Pricing Re-Accelerating, inventories bottoming → classic machinery trough signals. De-Globalization + OBBB tailwinds (bonus depreciation = ~700bps spend tailwind). Five Prior Cycles = ~150% avg alpha vs. S&P 500® Index from trough to peak. |
| CB | Chubb is one of our core property & casualty insurance holdings. It is well-diversified across products and geographies. The company has consistently generated returns on equity comfortably ahead of the industry owing to a combination of running advantaged lines of business with a disciplined underwriting and operating culture. Pricing trends in the insurance markets have generally been strong in recent years, and consequently Chubb has been earning returns on tangible equity in the low 20s. While competitive forces may in time push that back toward a normalized level a few points lower, Chubb we believe would still be valued at 10–11x earnings looking out a few years. |
| COF | We added to Capital One Financial Corporation, which was a core new addition in the prior quarter. |
| COO | Cooper was a top contributor during the quarter after reporting good operating results and announcing several shareholder-friendly developments. In terms of operating results, the company demonstrated progress in alleviating supply constraints for its premium daily silicone hydrogel contact lenses, announced new private label contract wins in the U.S. and Europe, and delivered innovation in myopia control and multifocal lens platforms. |
| DOV | Diversified industrial conglomerate Dover Corp. is in the middle of an underappreciated transition from a merger-and-acquisition-focused holding company to a more execution-focused operating company, which we believe creates a long runway for continued margin expansion. Furthermore, recent portfolio moves have increased its exposure to higher growth end markets, and after several years of sluggish growth, various cyclical headwinds seem likely to subside. |
| EQT | We sold EQT Corp (EQT) and trimmed Range Resources Corp (RRC) to reduce natural gas price exposure. EQT Corp: Shares weak as company digests acquisitions, and a competitor announced expansion into key territory. |
| GM | For insight into the real economy operating beneath this AI and data center boom, we must look elsewhere within the S&P 500, including bellwethers like General Motors |
| GOOGL | In the third quarter, Google, Kairos Power, and the Tennessee Valley Authority announced a major collaboration centered on a novel power purchase agreement. Google followed this announcement with another significant step forward. On October 27, Google and NextEra Energy announced plans to restart the Duane Arnold Energy Center. |
| HCA | HCA Healthcare (the operator of 186 hospitals and around 2,400 ambulatory sites) reported pleasing results and management upgraded its full year's earnings guidance by 4.8% at the EPS level. With it buying back more shares, and after making some other tweaks, our valuation increased by 5%. But, with a share price increase of 9.7% over the quarter, the premium widened. |
| HIG | Shares of property and casualty insurer Hartford Insurance Group were sold as its stock prices reached our estimates of intrinsic value. |
| LH | Shares of leading diagnostic lab Labcorp declined amid investor concern surrounding lower-than-expected guidance, driven by delays in acquisition closings and weakness in its development pipeline, leading to a restructuring of that business. However, we maintain our conviction in the company's competitive advantages in the diagnostic space, as the company's scale allows it to be a low-cost provider with better-than-average margins. |
| MU | Core gains were led by investments in the Technology sector including Micron |
| NDAQ | The outperformance came from: Nasdaq. The top contributors to this outperformance came from Nasdaq |
| SOLV | Medical products and health care IT services company Solventum was spun off from 3M in April 2024. We believe the company will likely show improved growth and margins as a standalone company, as the business has previously been challenged by years of underinvestment and market share losses. Solventum's new management team is focused on improving revenue growth, and we expect to see more fully optimized research and development and improved sales mix from new products moving forward. |
| SYY | Sysco shares dropped after management's conservative outlook for fiscal year 2026 due to continued macro uncertainties and uneven demand in the 'food-away-from-home' sector. |
| WIX | Wix.com Ltd. is a leading provider of cloud-based web-development platform for micro-businesses. Shares of Wix declined 41.5% during the fourth quarter and ended the year down 51.9% due to a quarterly earnings report that emphasized greater-than-expected investment behind their new acquisition, the vibe-coding startup, Base44. |
| ZTS | ZTS: $6B authorized August 2024; $1.5B used as of September 2025 |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
|---|---|---|---|---|---|---|
| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
|---|---|---|---|
| No industry data available | |||
