Investment management company Vulcan Value Partners recently released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. All the strategies of Vulcan Value Partners delivered positive results in the year. The Large Cap Composite (Net) returned -1.5% in Q4 and 7.9% YTD, the Small Cap Composite (Net) gained 3.2% in Q4 and 9.5% YTD, The Focus Composite (Net) retuned 0.1% in Q4 and 7.1% YTD, Focus Plus Composite (Net) returned 0.1% in Q4 and 6.2% YTD and the All-Cap Composite (Net) returned 1.3% in Q4 and 10.7% YTD. Despite overvalued markets, the firm improved its price-to-value ratios while still achieving positive returns, prioritizing safety and long-term gains over short-term performance. This situation echoes the late 1990s dot-com bubble, where hype and high valuations led to a crash, and today’s AI disruptions seem to mirror that pattern, with investors risking overpaying for promising businesses. The firm is addressing such situations by sticking to its investment discipline. For more information on the firm’s best picks in 2025, please check its top five holdings. In addition, please check the firm’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Vulcan Value Partners highlighted Fiserv, Inc. (NASDAQ:FISV) as a notable detractor within its Large Cap and All-Cap Strategies. Fiserv, Inc. (NASDAQ:FISV) is a leading financial technology company that provides payment and fintech services. The one-month return of Fiserv, Inc. (NASDAQ:FISV) was -0.15%, and its shares lost 67.73% of their value over the last 52 weeks. On January 22, 2026, Fiserv, Inc. (NASDAQ:FISV) stock closed at $67.40 per share, with a market capitalization of $36.638 billion.
Vulcan Value Partners stated the following regarding Fiserv, Inc. (NASDAQ:FISV) in its fourth quarter 2025 investor letter:
“Fiserv, Inc. (NASDAQ:FISV) was a material detractor in the quarter. This is a company that we have discussed extensively over the past few years as we owned it successfully from 2023 until we sold it in 1Q 2025. After we sold it very close to our estimate of fair value, the stock price began to decline as the Company revised its guidance downwards and said initiatives were taking longer than expected to come to market. Following this substantial decline in share price, we began acquiring a new position in September. On the 3Q 2025 earnings call, the new CEO and CFO revised its guidance down again and by a wide margin. They explained that the team uncovered aggressive tactics used to boost short term revenue at the expense of long-term customer relationships and, therefore, earnings. As such, management explained that it would be temporarily backing off of the steady organic revenue compounding, earnings margin expansion, and free cash flow generation that investors had grown accustomed to in order to reinvest in the business and reposition Fiserv for higher quality, long-term growth through entrenched customer relationships. While this news was unexpected, we agree that this course of action is in the best interests of the business and long-term shareholders. Despite all of these disruptions, Fiserv still expects to grow revenues throughout its reinvestment period and generate substantial free cash flow. Fiserv remains a strong business with high recurring revenues and essential offerings across its end markets. We took advantage of the share price declines following the 3Q 2025 earnings call by adding to our position. We are excited to own Fiserv at these levels.”
Fiserv, Inc. (NASDAQ:FISV) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 83 hedge fund portfolios held Fiserv, Inc. (NASDAQ:FISV) at the end of the third quarter, which was 94 in the previous quarter. While we acknowledge the risk and potential of Fiserv, Inc. (NASDAQ:FISV) 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 Fiserv, Inc. (NASDAQ:FISV) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Fiserv, Inc. (NASDAQ:FISV) and shared Oakmark Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2025 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.
