ClearBridge Investments, an investment management company, released its “ClearBridge Select Strategy” Q4 2025 investor letter. A copy of the letter can be downloaded here. In the fourth quarter of 2025, U.S. equities demonstrated a resilient yet volatile performance, with major indices close to near all-time highs while significant shifts occurred later. Momentum-driven themes, particularly those related to artificial intelligence (AI), technology, and cryptocurrencies, persisted into the early part of the quarter but subsequently reversed. This reversal led to increased volatility and greater stock-level dispersion. As volatility rose, investors began prioritizing companies with robust fundamentals, innovative growth potential, and strong operational execution. The S&P 500 Index posted a return of 2.7% for the quarter, while the Russell 3000 Index gained 2.4%. Growth stocks trailed their value counterparts, as the enthusiasm surrounding AI softened and concerns emerged regarding the return on AI-related investments. The strategy lagged behind the benchmark in the quarter due to a shift towards quality, with a preference for larger-cap companies, with notable weaknesses in the health care and technology sectors. In addition, please check the Strategy’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, ClearBridge Select Strategy highlighted stocks like Copart, Inc. (NASDAQ:CPRT). Copart, Inc. (NASDAQ:CPRT) is an online auction and vehicle remarketing services company. On April 2, 2026, Copart, Inc. (NASDAQ:CPRT) stock closed at $33.40 per share. One-month return of Copart, Inc. (NASDAQ:CPRT) was -11.50%, and its shares lost 38.73% over the past 52 weeks. Copart, Inc. (NASDAQ:CPRT) has a market capitalization of about $32.17 billion.
ClearBridge Select Strategy stated the following regarding Copart, Inc. (NASDAQ:CPRT) in its fourth quarter 2025 investor letter:
“Auto salvage and auction provider Copart, Inc. (NASDAQ:CPRT) fell as volumes at its key insurance customers declined slightly in the second half of the year due to the number of uninsured drivers increasing after several years of massive insurance premium inflation. We believe this is a temporary and self-correcting situation rather than a secular issue and, with Copart having over $5 billion of net cash and a very attractive valuation, we are continuing to hold shares.”
Copart, Inc. (NASDAQ:CPRT) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 68 hedge fund portfolios held Copart, Inc. (NASDAQ:CPRT) at the end of the fourth quarter, up from 59 in the previous quarter. While we acknowledge the risk and potential of Copart, Inc. (NASDAQ:CPRT) 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 Copart, Inc. (NASDAQ:CPRT) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Copart, Inc. (NASDAQ:CPRT) and shared Madison Large Cap Fund’s views on the company. 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.
