Artisan Partners, an investment management company, released its fourth-quarter 2025 investor letter for “Artisan Value Fund”. A copy of the letter can be downloaded here. The Fund seeks to invest in undervalued companies with strong financial condition and attractive business economics. US equities ended a record year with robust fourth-quarter gains. AI remains the main theme of the market, and large-cap stocks led the rally in the fourth quarter. Against this backdrop, the portfolio outperformed the Russell 1000® Value Index in Q4 and returned 4.60% compared to 3.81% for the Index. In 2025, it returned 14.28% vs. 15.91% for the index. Over three, five, and ten years, the portfolio outperformed the index, reflecting its effective investment discipline. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Artisan Value Fund highlighted stocks like Union Pacific Corporation (NYSE:UNP). Union Pacific Corporation (NYSE:UNP) is a railroad holding company that operates through its subsidiary Union Pacific Railroad Company. On March 13, 2026, Union Pacific Corporation (NYSE:UNP) stock closed at $242.44 per share. One-month return of Union Pacific Corporation (NYSE:UNP) was -7.00%, and its shares gained 1.93% over the past 52 weeks. Union Pacific Corporation (NYSE:UNP) has a market capitalization of $143.86 billion.
Artisan Value Fund stated the following regarding Union Pacific Corporation (NYSE:UNP) in its fourth quarter 2025 investor letter:
“We added two new names in Q4: Airbnb and Union Pacific Corporation (NYSE:UNP). Our only sale was Fiserv. UNP is the largest freight railroad in the US. Transports are cyclical and generally of lower quality due to capital intensity and less pricing power in downturns when excess capacity exists. As a result, there are very few business models in the space which possess a wide moat. UNP is unique in that despite its cyclicality and capital intensity, the business has pricing power and scale, allowing it to sustain high margins even in downturns. UNP owns one of the most valuable transport assets globally, with an irreplaceable, east–west rail network spanning 52,000 miles. UNP’s stock has lagged due to a prolonged freight recession, weak intermodal volumes amid depressed trucking rates and investor skepticism around near-term volume growth. Uncertainty around the timing, concessions and ultimate benefits of the proposed Norfolk Southern merger has also capped sentiment. The main evolution in the industry in the last 20 years is the operational shift to precision scheduled railroading (PSR). The key theme of PSR is “efficiency,” which is created by operating fewer, longer and heavier trains on a simplified network to increase asset utilization by decreasing dwell time and increasing speed. PSR has structurally improved efficiency, asset utilization and operating ratios, positioning UNP as arguably the highest quality business in rail. UNP generates attractive economics with mid-teens returns on invested capital, steady capex and strong free cash flow. The balance sheet is resilient, and even post-merger, leverage is expected to remain manageable, with ample cash flow to de-lever while maintaining dividends. Shares trade below historical earnings multiples, despite improving operations and a potential generational merger opportunity.”
