ClearBridge Investments, a global equity manager, recently published first-quarter 2026 commentary for its “Clearbridge Dividend Strategy”. A copy of the letter can be downloaded here. The market has witnessed two significant developments over the past three months: the war in Iran and the growing displacements of software engineers and the software industry. Amid this context, the strategy outperformed the S&P 500 Index, which dropped by 4.3%. This outperformance was attributed to a strategic underweight in information technology, which fell by 9.2% during the quarter, and an overweight in energy, which rose by 38.2%. The strategy focused on investing in high-quality industrial companies and alternative asset managers, while also sharpening energy investments on its top convictions. The firm anticipates that a slowdown in the global economy, driven by higher inflation and interest rates, will pose challenges to the market in 2026. The strategy continues to pursue broader diversification while navigating the challenges of war and AI disruption. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Clearbridge Dividend Strategy highlighted stocks like Oracle Corporation (NYSE:ORCL). Oracle Corporation (NYSE:ORCL) is a leading global provider of products and services that enable enterprise information technology environments across multiple industries. On April 7, 2026, Oracle Corporation (NYSE: ORCL) closed at $143.17 per share. One-month return of Oracle Corporation (NYSE:ORCL) was -12.23%, and its shares gained 2.49% over the past 52 weeks. Oracle Corporation (NYSE:ORCL) has a market capitalization of $411.76 billion.
Clearbridge Dividend Strategy stated the following regarding Oracle Corporation (NYSE:ORCL) in its Q1 2026 investor letter:
“In IT, we exited Oracle Corporation (NYSE:ORCL) and trimmed Broadcom. Our five-year investment in Oracle proved highly profitable as the company transitioned its business model from licensing to software-as-a service (SAAS). In the last year, Oracle went all-in on building data centers for AI customers, pushing its backlog north of $500 billion. In 2025, the stock surged as Oracle announced eye-popping AI contracts; we took advantage of that surge to begin exiting the position. More recently, investors have begun to question the return profile of these projects, given the hundreds of billions of dollars in required capital investment and their overdependence on one, single customer: OpenAI. Aligning with OpenAI seemed like a no-brainer two years ago when it was the clear leader in AI, but with Google’s Gemini and Anthropic’s Claude catching up to ChatGPT, Oracle’s concentrated bet on one player now seems questionable. We sold our remaining Oracle shares in the first quarter of 2026.”
Oracle Corporation (NYSE:ORCL) ranks 40 on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 111 hedge fund portfolios held Oracle Corporation (NYSE:ORCL) at the end of the fourth quarter, compared to 122 in the previous quarter. While we acknowledge the risk and potential of Oracle Corporation (NYSE:ORCL) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Oracle Corporation (NYSE:ORCL) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Oracle Corporation (NYSE:ORCL) and shared the list of best American stocks to buy for the next 5 years. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
