Third Avenue Management, a New York City-based investment firm, published its fourth-quarter 2025 investor letter for the “Third Avenue Small-Cap Value Fund. ” A copy of the letter is available for download here. In the quarter, the Fund returned 4.62%, outperforming the MSCI USA Small-Cap Value Index (the “Index”), which gained 3.13%. For the year 2025, the Fund delivered a 14.04% return, surpassing the 10.80% return of the index. The Fund primarily invests in publicly traded companies with boards of directors, sometimes controlled by individuals or families, and management teams that operate independently from the Fund. Reviewing 2025, the firm is pleased with the Fund’s performance, operational success, and shareholder value creation, and is optimistic about 2026. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Third Avenue Small-Cap Value Fund highlighted stocks like Cintas Corporation (NASDAQ:CTAS). Cintas Corporation (NASDAQ:CTAS) is a business services company that provides corporate identity uniforms and related business services. On March 10, 2026, Cintas Corporation (NASDAQ:CTAS) stock closed at $196.28 per share. One-month return of Cintas Corporation (NASDAQ:CTAS) was -2.04%, and its shares gained 2.12% over the past 52 weeks. Cintas Corporation (NASDAQ:CTAS) has a market capitalization of $78.88 billion.
Third Avenue Small-Cap Value Fund stated the following regarding Cintas Corporation (NASDAQ:CTAS) in its fourth quarter 2025 investor letter:
“Regarding Unifirst’s competitive positioning, the company often competes directly against Cintas Corporation (NASDAQ:CTAS), a company with revenue four times that of Unifirst and a valuation ten times larger than Unifirst. Cintas’ huge valuation premium derives from far higher profitability, which, in turn, derives from superior scale, efficiency, and route density, areas where Unifirst has continued to leave investors disappointed.
Further, it is fair to say that we too have been disappointed by Unifirst’s progress towards operational improvement. Our December shareholder vote and public press release in support of shareholder-proposed changes to Unifirst’s board composition was a reflection of that viewpoint. Our view remains that governance changes would likely improve the probabilities of favorable outcomes for all shareholders.
Cintas’ most recent takeover offer of $275 per Unifirst share represents a very large premium to Unifirst’s pre-offer trading price, as well as its current trading price. With regard to the latter, the huge spread between the offer price and the current trading price is a clear expression of doubt that Unifirst’s board will engage with Cintas in an earnest and sincere manner. Cintas’s most recent offer does represent a full price driven by Cintas’ unique ability to create large-scale synergistic value through a combination with Unifirst and Cintas’ willingness to share that synergistic value with Unifirst shareholders in the form of a full acquisition valuation. Having spoken to Unifirst management several times regarding the company’s rationale for rebuffing Cintas’ earlier offers, we were left with a strong feeling that their objections to engaging fully were hinged upon obstacles that were likely surmountable. On this last point, we were impressed by the adjustments Cintas made in its latest approach that specifically addressed deal risks flagged by Unifirst in Cintas’ previous approaches, further eroding Unifirst’s grounds for recalcitrance…” (Click here to read the full text)
Cintas Corporation (NASDAQ:CTAS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 66 hedge fund portfolios held Cintas Corporation (NASDAQ:CTAS) at the end of the fourth quarter, up from 61 in the previous quarter. While we acknowledge the risk and potential of Cintas Corporation (NASDAQ:CTAS) 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 Cintas Corporation (NASDAQ:CTAS) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Cintas Corporation (NASDAQ:CTAS) and shared a list of best performing long term stocks to invest in. 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.
