Hotchkis & Wiley, an investment management company, released its first-quarter 2026 investor letter for the “Hotchkis & Wiley Mid-Cap Value Fund.” A copy of the letter can be downloaded here. In the first quarter, geopolitical instability and AI-focused investments were the key market drivers. The energy sector significantly benefited from the Brent crude oil surge due to U.S.-Israel strikes on Iran. The Hotchkis & Wiley Mid-Cap Value Fund outperformed the Russell Midcap Value Index, mainly due to strong stock selection in energy, which returned 79% compared to 37% for the index. The Fund delivered a return of 6.74% in Q1 Vs. 3.68% return for the index. While stock selection in technology, healthcare, and consumer discretionary negatively impacted overall performance. The firm remains focused on its disciplined and long-term investment approach. In addition, please check the Fund’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Hotchkis & Wiley Mid-Cap Value Fund highlighted Kosmos Energy Ltd. (NYSE:KOS) as a material performance contributor. Headquartered in Dallas, Texas, Kosmos Energy Ltd. (NYSE:KOS) is a deepwater oil and gas exploration and production company. On April 23, 2026, Kosmos Energy Ltd. (NYSE:KOS) closed at $2.87 per share. One-month return of Kosmos Energy Ltd. (NYSE:KOS) was -1.37%, and its shares gained 66.86% over the past 52 weeks. Kosmos Energy Ltd. (NYSE:KOS) has a market capitalization of $1.7 billion.
Hotchkis & Wiley Mid-Cap Value Fund stated the following regarding Kosmos Energy Ltd. (NYSE:KOS) in its Q1 2026 investor letter:
“Kosmos Energy Ltd. (NYSE:KOS) is an independent E&P focused on offshore operations in the U.S. Gulf of Mexico, Ghana, and Equatorial Guinea, with development potential in the Mauritania/Senegal LNG project. We own Kosmos for its competitive advantage in offshore expertise, with the stock trading at a discount to the value of existing production. Kosmos outperformed in the first quarter as spot Brent crude oil neared $127 following the Strait of Hormuz closure. The company’s offshore producing assets in the Gulf of Mexico, Ghana, and Equatorial Guinea benefited from the geopolitical risk premium on oil prices, while higher global LNG prices increased revenue from the recently-commissioned Greater Tortue Ahmeyim project.”
Kosmos Energy Ltd. (NYSE:KOS) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 21 hedge fund portfolios held Kosmos Energy Ltd. (NYSE:KOS) at the end of the fourth quarter, up from 20 in the previous quarter. While we acknowledge the risk and potential of Kosmos Energy Ltd. (NYSE:KOS) 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 Kosmos Energy Ltd. (NYSE:KOS) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Kosmos Energy Ltd. (NYSE:KOS) and shared the list of best oil and gas penny stocks to buy. 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.
