Hotchkis & Wiley, an investment management company, released its second-quarter 2026 investor letter for the “Hotchkis & Wiley Mid-Cap Value Fund.” A copy of the letter can be downloaded here. Equity markets posted strong returns in the second quarter of 2026, with the Russell Midcap Index rising 13.8% and the Russell Midcap Value Index returning 13.4%, despite concerns about inflation, a hawkish Federal Reserve, and rising oil prices due to the Iran conflict. Narrow market leadership was evident, particularly semiconductor stocks and other stocks in the AI sector, which saw returns exceeding 100%. The Firm favors quality businesses with attractive valuations, believing that fears regarding AI’s impact are overstated. The Hotchkis & Wiley Mid-Cap Value Fund lagged the Russell Midcap Value Index, achieving a 4.74% return in the second quarter, primarily due to underperformance in technology and energy sectors, while stock selection in healthcare contributed positively. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, Hotchkis & Wiley Mid-Cap Value Fund highlighted Humana Inc. (NYSE:HUM). Humana Inc. (NYSE:HUM), an American insurance company that provides medical and specialty insurance products, delivered strong performance during the quarter. On August 03, 2026, Humana Inc. (NYSE:HUM) closed at $374.50 per share. The one-month return of Humana Inc. (NYSE:HUM) was -5.10%, and its shares gained 47.17% over the past 52 weeks. Humana Inc. (NYSE:HUM) has a market capitalization of $44.97 billion.
Hotchkis & Wiley Mid-Cap Value Fund stated the following regarding Humana Inc. (NYSE:HUM) in its Q2 2026 investor letter:
“Humana Inc. (NYSE:HUM) is one of the largest pure Medicare Advantage (MA) health insurer in the United States. Performance over the quarter was strong following news that the US agreed to increase 2027 payments for private MA plans above its initial proposal earlier in the year. The company’s stock has been undervalued due to higher utilization by enrollees and uncertainty regarding reimbursement rates. We view these issues as temporary because the company reprices its business every year, which could lead to a recovery in margins.”
Humana Inc. (NYSE:HUM) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 61 hedge fund portfolios held Humana Inc. (NYSE:HUM) at the end of the first quarter, up from 53 in the previous quarter. While we acknowledge the risk and potential of Humana Inc. (NYSE:HUM) 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 Humana Inc. (NYSE:HUM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Humana Inc. (NYSE:HUM) and shared Diamond Hill Capital Large Cap Strategy’s insight 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.
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Disclosure: None. This article is originally published at Insider Monkey.
