Fundsmith, an investment management firm based in London, has released its second-quarter 2026 investor letter for its “Fundsmith Equity Fund.” A copy of the letter can be downloaded here. The Fund returned -2.9% in the first half of 2026, underperforming the MSCI World Index by 14.1 percentage points, driven by challenges from a momentum-driven market dominated by passive index funds and AI-related exuberance. The letter discusses the rise of passive investing, noting that index funds now resemble active funds, concentrating heavily in a few sectors and stocks. Due to increased market volatility and a 51% portfolio turnover in the first half of the year, the firm plans to adopt a more active approach, incorporating momentum while maintaining its core mantra: buy good companies, don’t overpay, and do little. In addition, please check the Firm’s top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, Fundsmith Equity Fund highlighted Intuit Inc. (NASDAQ:INTU). Intuit Inc. (NASDAQ:INTU) is a financial software company that provides financial management, payments and capital, compliance, and marketing solutions. On July 31, 2026, Intuit Inc. (NASDAQ:INTU) closed at $316.07 per share, reflecting a market capitalization of $86.46 billion. Intuit Inc. (NASDAQ:INTU) posted a one-month return of 16.14%, while its shares lost 59.73% over the past 52 weeks.
Fundsmith Equity Fund stated the following regarding Intuit Inc. (NASDAQ:INTU) in its Q2 2026 investor update:
“Intuit – Although we only recently repurchased Intuit Inc. (NASDAQ:INTU) we were sensitive to the way in which they have reacted to the poor Mailchimp acquisition as this is why we sold the shares in the first place. The fact that they have now taken to giving results ex Mailchimp both shows how bad the acquisition was but also worries us about a continuing state of denial.”
Intuit Inc. (NASDAQ:INTU) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 92 hedge fund portfolios held Intuit Inc. (NASDAQ:INTU) at the end of the first quarter which was 91 in the previous quarter. 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 Jensen Quality Growth Equity Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.
Disclosure: None. This article is originally published at Insider Monkey.
