Diamond Hill Capital, a First Eagle Investment Management company, issued its Q2 2026 investor letter for its “Large Cap Strategy”. A copy of the letter is available to download here. The Strategy returned 3.42% net of fees, trailing the Russell 1000 Value Index’s 13.87% gain. Performance benefited from stock selection in consumer staples, materials and consumer discretionary, along with an underweight in utilities. However, stock selection in information technology, health care and industrials detracted from relative performance. AI remained the dominant market theme, driving an 81% gain in technology, while energy declined after the Iran war ended and oil prices fell. The Strategy’s limited exposure to companies benefiting from AI-related capital spending caused most of its underperformance, while software holdings remained pressured by concerns about AI disruption. Despite elevated market valuations, the team continues to find attractive opportunities through bottom-up research and expects active management to support better-than-market returns. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its second-quarter 2026 investor letter, Diamond Hill Capital Large Cap Strategy highlighted Elevance Health, Inc. (NYSE:ELV). Elevance Health, Inc. (NYSE:ELV) is a US-based health benefits company, which the strategy initiated a position during the quarter. On July 31, 2026, Elevance Health, Inc. (NYSE:ELV) closed at $375.84 per share, reflecting a market capitalization of $81.54 billion. Elevance Health, Inc. (NYSE:ELV) posted a one-month return of -10.03%, while its shares gained 32.82% over the past 52 weeks.
Diamond Hill Capital Large Cap Strategy stated the following regarding Elevance Health, Inc. (NYSE:ELV) in its Q2 2026 investor letter:
“Elevance Health, Inc. (NYSE:ELV) is one of the largest health insurers in the US. Along with the rest of the insurance industry, the company’s margins have been pressured due to rising medical costs and lower government reimbursement. Despite these headwinds, we believe the long-term earnings power of the business is positive.”
Elevance Health, Inc. (NYSE:ELV) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 87 hedge fund portfolios held Elevance Health, Inc. (NYSE:ELV) at the end of the first quarter which was 78 in the previous quarter. While we acknowledge the risk and potential of Elevance Health, Inc. (NYSE:ELV) 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 Elevance Health, Inc. (NYSE:ELV) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Elevance Health, Inc. (NYSE:ELV) and shared Harris Oakmarks’ 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.
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.
