Investment management company Vulcan Value Partners recently released its first-quarter 2026 investor letter. A copy of the letter can be downloaded here. The firm focuses on improving long-term returns and lowering risk, rather than short-term results. In the quarter, the Large Cap Composite (Net) returned -14.1%, the Small Cap Composite (Net) returned -6.8%, the Focus Composite (Net) returned -19.1%, the Focus Plus Composite (Net) returned -19.1% as well as the All-Cap Composite (Net) returned -13.5%. Throughout 2025 and escalating to the first quarter of 2026, the market is experiencing heightened volatility related to AI’s potential, leading to mispricing of some strong companies. The current market turbulence presents opportunities for long-term investors willing to accept short-term volatility in stable-valued companies and improve the margin of safety. The letter identified businesses into three groups with perceived /real AI disruption risk: Software, Alternative Asset Managers, and indirectly impacted businesses. The firm highlights that its investment strategy aims to leverage this volatility to reduce risk and increase returns in the long term. In addition, please check the Firm’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Vulcan Value Partners highlighted TPG Inc. (NASDAQ:TPG). TPG Inc. (NASDAQ:TPG) is a US-based alternative asset management company. On April 22, 2026, TPG Inc. (NASDAQ:TPG) closed at $45.58 per share. One-month return of TPG Inc. (NASDAQ:TPG) was 13.16%, and its shares lost 2.42% over the past 52 weeks. TPG Inc. (NASDAQ:TPG) has a market capitalization of $17.51 billion.
Vulcan Value Partners stated the following regarding TPG Inc. (NASDAQ:TPG) in its Q1 2026 investor letter:
“We bought TPG Inc. (NASDAQ:TPG) in the first quarter of last year during a similar market overreaction caused by the tariff tantrums. In this year’s first quarter, TPG is down due to AI disruption fears around its software investments. As was the case last year, we believe that the market is overreacting again. TPG’s software exposure is approximately $34 billion and represents approximately 11% of its total assets under management. TPG has been investing in software for years and has a very strong track record. Their flagship buyout fund, TPG VII, which was started in 2015, invested in several software companies. They sold all of their holdings by the end of 2021 at very good valuations.
Subsequent funds have had the benefit of learnings from those successful exits. The investment period for these newer funds has had the unique benefit of occurring during the period that AI was becoming more visible. We believe that TPG will have some losers, but in the aggregate, the growth in value creation from the winners is going to more than offset the laggards…” (Click here to read the full text)
TPG Inc. (NASDAQ:TPG) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 29 hedge fund portfolios held TPG Inc. (NASDAQ:TPG) at the end of the fourth quarter, compared to 31 in the previous quarter. While we acknowledge the risk and potential of TPG Inc. (NASDAQ:TPG) 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 TPG Inc. (NASDAQ:TPG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered TPG Inc. (NASDAQ:TPG) and shared a list of value stocks with highest dividends. 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.
