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 UnitedHealth Group Incorporated (NYSE:UNH). UnitedHealth Group Incorporated (NYSE:UNH) is a multinational health benefits company based in Eden Prairie, Minnesota. On May 28, 2026, UnitedHealth Group Incorporated (NYSE:UNH) stock closed at $382.53 per share. One-month return of UnitedHealth Group Incorporated (NYSE:UNH) was 3.73%, and its shares lost 26.70% over the past 52 weeks. UnitedHealth Group Incorporated (NYSE:UNH) has a market capitalization of $347.39 billion.
Auxier Asset Management stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its Q1 2026 investor letter:
“UnitedHealth Group Incorporated (NYSE:UNH) has been a major laggard for the past quarter and year. However, since CEO Stephen Hemsley’s return last May operating performance has been improving. We made over a fivefold return under his previous tenure from 2006-2017 and are confident that he can navigate a successful turnaround going forward. The recent medical cost ratio (MCR) of 83.9% is the lowest in two years and combined with a 2.48% CMS rate increase this spring has been a big boost. The lower amount spent on patient medical claims follows the company’s late 2025 shift to focus on higher margin patients over aggressive membership growth. Total membership has fallen by about 700,000 since the end of 2025. Management cited their higher margins as the reason for raising their full year adjusted earnings per share guidance to over $18.25, up from their previous guidance of $17.75 in January and consensus estimates of $17.86. Going forward, management also announced at least $1.5 billion in spending on artificial intelligence technology in 2026. This technology will be focused on areas like helping members understand their coverage and automating some administrative tasks and claims processing.”
UnitedHealth Group Incorporated (NYSE:UNH) is in 14th position on our list of 40 Most Popular Stocks Among Hedge Funds. According to our database, 130 hedge fund portfolios held UnitedHealth Group Incorporated (NYSE:UNH) at the end of the first quarter, compared to 145 in the previous quarter. In Q1 2026, UnitedHealth Group Incorporated (NYSE:UNH) reported revenues of nearly $111.7 billion, representing a 2% increase from Q1 2025. While we acknowledge the risk and potential of UnitedHealth Group Incorporated (NYSE:UNH) 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 UnitedHealth Group Incorporated (NYSE:UNH) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered UnitedHealth Group Incorporated (NYSE:UNH) and shared the list of best stocks for a couch potato portfolio. 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.
