Heartland Advisors, an investment management company, released its second-quarter 2026 investor letter for “Heartland Value Fund”. A copy of the letter can be downloaded here. The AI trend continues to drive the market in the quarter. Small-cap stocks continue to outperform, with the Russell 2000® Index rising 21.49% in the quarter. The Heartland Value Fund gained 17.05% in the quarter, compared with the 17.19% return for the Russell 2000® Value Index. In addition, you can check the Fund’s top 5 holdings to determine its best picks for 2026.
In its Q2 2026 investor letter, Heartland Value Fund highlighted Sonic Automotive, Inc. (NYSE:SAH). Sonic Automotive, Inc. (NYSE:SAH) is a leading US-based automotive retailer. On July 14, 2026, Sonic Automotive, Inc. (NYSE:SAH) closed at $92.38 per share, reflecting a market capitalization of $2.92 billion. Sonic Automotive, Inc. (NYSE:SAH) posted a one-month return of 20.54%, while its shares gained 10.57% over the past 52 weeks.
Heartland Value Fund stated the following regarding Sonic Automotive, Inc. (NYSE:SAH) in its Q2 2026 investor update:
“UTL demonstrates that there are plenty of attractively priced, small-cap companies outside of Technology. So does Sonic Automotive, Inc. (NYSE:SAH), one of the largest auto dealership groups with locations in major markets in the West, Southwest, and Southeast.
We first purchased SAH for the Strategy in 2014. But we exited the position two years later due to extraordinary costs Sonic was incurring to launch a used car business. Still, we continued to monitor their progress for the subsequent 9 years and repurchased shares earlier this year.
Sonic’s EchoPark used-car operation has reached profitability and has grown into a nationwide retailer specializing in stress-free, haggle-less sales. By streamlining inventory and focusing on 1-4 year-old autos, SAH can often price its vehicles $3,000 below competitors. Customers seem to like this approach, as Echo continues to grow nationwide. We believe SAH’s used-car strategy is ideally suited for the current economic climate, where higher gas prices and interest rates are putting pressure on consumers. According to our research, earnings per share for Sonic should reach $8 in 2027, compared with an estimated $7 this year…” (Click here to read the full text)
Sonic Automotive, Inc. (NYSE:SAH) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 24 hedge fund portfolios held Sonic Automotive, Inc. (NYSE:SAH) at the end of the first quarter, compared to 27 in the previous quarter. In Q1 2026, Sonic Automotive, Inc. (NYSE:SAH) reported total revenues of $3.7 billion, marking a 1% growth from the previous year. While we acknowledge the risk and potential of Sonic Automotive, Inc. (NYSE:SAH) 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 Sonic Automotive, Inc. (NYSE:SAH) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In addition, please check out our hedge fund investor letters Q2 2026 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.
