TCW funds, an investment management company, released its “TCW Relative Value Mid Cap Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equities finished the year on a positive note, with the S&P 500 Total Return (USD) increasing by 2.65% and achieving a remarkable 17.9% in 2025. The AI sector continued to thrive following Trump’s tariff announcements. While there are concerning indicators that echo the Dot-Com bubble, the underlying companies appear to be defying odds with technological advancements, strong financials, and reasonable valuations. Looking ahead, the firm anticipates the equity market will remain highly sensitive to policy changes and earnings reports, with valuations staying near historically high levels. Class I shares of the fund returned 4.54% in Q4, outperforming the Russell Midcap® Value Index benchmark, which returned 1.42%. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, TCW Relative Value Mid Cap Fund highlighted Dollar Tree, Inc. (NASDAQ:DLTR) as one of its leading contributors. Dollar Tree, Inc. (NASDAQ:DLTR) operates a multi-point chain of discount stores. On April 6, 2026, Dollar Tree, Inc. (NASDAQ:DLTR) stock closed at $111.09 per share. One-month return of Dollar Tree, Inc. (NASDAQ:DLTR) was -4.90%, and its shares gained 59.38% over the past 52 weeks. Dollar Tree, Inc. (NASDAQ:DLTR) has a market capitalization of $22.09 billion.
TCW Relative Value Mid Cap Fund stated the following regarding Dollar Tree, Inc. (NASDAQ:DLTR) in its fourth quarter 2025 investor letter:
Portfolio stock selection was slightly positive (+373 bps) in the quarter. The best performing stocks in the quarter were Dollar Tree, Inc. (NASDAQ:DLTR) (DLTR; 4.08%**), Teva Pharmaceutical (TEVA; 2.17%**), and C.H. Robinson (CHRW; 3.41%**). Dollar Tree’s shares surged through the quarter as margin expansion benefited from lower freight costs and favorable product mix. The company reported strong third quarter earnings with the company’s multi-price point strategy continuing to resonate with customers, supporting both sales and profitability despite headwinds from tariffs.
Dollar Tree, Inc. (NASDAQ:DLTR) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 47 hedge fund portfolios held Dollar Tree, Inc. (NASDAQ:DLTR) at the end of the fourth quarter, compared 49 in the previous quarter. While we acknowledge the risk and potential of Dollar Tree, Inc. (NASDAQ:DLTR) 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 Dollar Tree, Inc. (NASDAQ:DLTR) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Dollar Tree, Inc. (NASDAQ:DLTR) and shared the list of stocks Jim Cramer discussed. 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.
