Auxier Asset Management, an investment advisory firm, released its first quarter 2026 investor letter. A copy of the letter is available to download here. Following a robust start to the year, the market was impacted by the Strait of Hormuz crisis. Concerns over AI disruption, excessive stock-based compensation, and high valuations caused the technology sector to decline, making it the worst-performing S&P 500 sector for the quarter. The conflict in Iran pushed energy prices higher, making the energy sector the top performer. Value stocks outperformed growth stocks, with the Russell 1000 Value Index rising 2.10%, while the Russell 1000 Growth Index fell 9.78%. Despite strong earnings, many software companies experienced declines of 30%-37% in Q1. Auxier Focus Fund’s Investor Class posted a 1.73% gain in the first quarter of 2026, with stocks up 2.00%. Meanwhile, the S&P 500 cap-weighted index decreased by 4.33%, and the equal-weighted index increased by 0.67%. The Fund’s focus remains on identifying businesses and managements that demonstrate a strong culture with heart and soul. In addition, please check the firm’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Auxier Asset Management highlighted stocks like Intuit Inc. (NASDAQ:INTU). Intuit Inc. (NASDAQ:INTU) is a financial software company offering products and services for financial management, payments, capital, compliance, and marketing. On May 28, 2026, Intuit Inc. (NASDAQ:INTU) closed at $313.00 per share. One-month return of Intuit Inc. (NASDAQ:INTU) was -21.56%, and its shares lost 58.46% over the past 52 weeks. Intuit Inc. (NASDAQ:INTU) has a market capitalization of $85.62 billion.
Auxier Asset Management stated the following regarding Intuit Inc. (NASDAQ:INTU) in its Q1 2026 investor letter:
“The Software as a Service (SaaS) industry was one of the hardest hit areas of the market during the first quarter as investors have increasingly become uncertain over AI’s potential for disruption that could commoditize the industry and compress profit margins. Forbes reported that the software sector’s price-to-earnings ratio fell to 20 times during the first quarter compared to around 35 at the end of 2025, the lowest level since 2014. Companies like Intuit Inc. (NASDAQ:INTU), Adobe, Salesforce and FICO saw their shares fall 30%-37% during the first quarter despite reporting strong earnings. Investors fear that AI agents could replace much of the work currently performed by software companies for a fraction of the cost. Intuit has been working to counter the fears by heavily investing in their AI agent platform, bringing it to all their existing products. Intuit instills confidence that taxes and business operations will comply with laws and regulations. AI models training only on public general data have a history of hallucinating false information and presenting it as fact which could be incredibly costly when dealing with important financial information. Proprietary data and the promise of security is something that we see as an advantage for long-standing SaaS companies that could help them better compete with growing AI players. It is amazing to see the P/E compression of these stocks since Covid.”
Intuit Inc. (NASDAQ:INTU) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 92 hedge fund portfolios held Intuit Inc. (NASDAQ:INTU) at the end of the first quarter, compared to 91 in the previous quarter. In the third quarter of fiscal 2026, Intuit Inc. (NASDAQ:INTU) reported revenue of $8.6 billion, reflecting a 10% year-over-year growth. While we acknowledge the risk and potential of Intuit Inc. (NASDAQ:INTU) 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 Intuit Inc. (NASDAQ:INTU) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Intuit Inc. (NASDAQ:INTU) and shared the list of strong buy stocks to buy and hold for the next 5 years. In addition, please check out our hedge fund investor letters Q1 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.
