Do You Believe in the Value Creation Ability of Knife River (KNF)?

Diamond Hill Capital, an investment management company, released its “Small-Mid Cap Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q2, the market surged uniformly for the rest of the quarter following a sharp decline in April due to President Trump’s “Liberation Day” tariffs announcement. The portfolio returned 5.60% (gross) and 5.37% (net) compared to an 8.59% return for the Russell 2500 Index. For more information on the fund’s top picks in 2025, please check its top five holdings.

In its second-quarter 2025 investor letter, Diamond Hill Small-Mid Cap Fund highlighted stocks such as River Corporation (NYSE:KNF). Knife River Corporation (NYSE:KNF) is an aggregates-based construction materials and contracting services provider based in Bismarck, North Dakota.  The one-month return of Knife River Corporation (NYSE:KNF) was 11.10%, and its shares gained 19.38% of their value over the last 52 weeks. On August 15, 2025, Knife River Corporation (NYSE:KNF) stock closed at $89.99 per share, with a market capitalization of $5.099 billion.

Diamond Hill Small-Mid Cap Fund stated the following regarding Knife River Corporation (NYSE:KNF) in its second quarter 2025 investor letter:

“Despite markets’ relatively sharp bounce following April’s downward volatility, we were able to initiate several new positions in the quarter at what we consider compelling valuations: Generac Holdings, Alaska Air Group, Knife River Corporation (NYSE:KNF), Taseko Mines, Century Communities and FTI Consulting.

Knife River provides aggregates-led construction materials and contracting services. As the market has softened amid near-term concerns about the macroeconomic environment, shares of Knife River were pressured in sympathy. However, we believe this overlooks Knife River’s resilience in the core heavy building materials business. Further, the company’s focus on aggregates-led growth and margin expansion could drive meaningful value creation over the course of our investment horizon.”

In another article, we covered Knife River Corporation (NYSE:KNF) and shared the list of stocks expected to beat the market by 20 percentage points this year. In addition, please check out our hedge fund investor letters Q2 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.