Longleaf Partners, managed by Southeastern Asset Management, released its “Small-Cap Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Longleaf experienced several environments throughout its experience in small-cap investing. This year, the underlying developments in the Fund’s holdings were more promising than the actual stock price returns when compared to the target of inflation plus 10% and the unusual performance of the Russell 2000. In Q4 2025, the Fund returned 1.13% compared to 2.40% for the Russell 3000 Index and 2.19% for the Russell 2000 Index. The Fund’s yearly return was 7.56% compared to 17.15% and 12.81% return for the indexes, respectively. In 2025, Southeastern demonstrated strong performance by protecting investments during market volatility, emphasizing the value of owning solid, free cash flow-generating companies over speculative fads. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Longleaf Partners Small-Cap Fund highlighted stocks such as Graham Holdings Company (NYSE:GHC). Graham Holdings Company (NYSE:GHC) is a diversified holding company that operates across various segments, like education, television broadcasting, and healthcare. The one-month return of Graham Holdings Company (NYSE:GHC) was -6.58%, and its shares gained 9.76% of their value over the last 52 weeks. On February 24, 2026, Graham Holdings Company (NYSE:GHC) stock closed at $1,067.83 per share, with a market capitalization of $4.658 billion.
Longleaf Partners Small-Cap Fund stated the following regarding Graham Holdings Company (NYSE:GHC) in its fourth quarter 2025 investor letter:
“Graham Holdings Company (NYSE:GHC) – Diversified conglomerate GHC performed strongly throughout the year. The company’s Kaplan education segment has multiple subparts that are finally back to growth in aggregate after a multi-year turnaround has borne fruit. It is encouraging that broadcast television M&A has increased this year, which could give GHC a unique opportunity to grow and realize its value in this segment. The healthcare segment continued its strong growth and looks to be navigating a leadership change well. Overall, GHC remains on offense with its strong net cash balance sheet and overfunded pension. Our P/V Podcast with CEO Tim O’Shaughnessy from earlier this year remains a good listen if you would like to learn more on the company.”
Graham Holdings Company (NYSE:GHC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held Graham Holdings Company (NYSE:GHC) at the end of the fourth quarter, up from 23 in the previous quarter. While we acknowledge the potential of Graham Holdings Company (NYSE:GHC) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
