Diamond Hill Capital, a First Eagle Investment Management company, issued its Q1 2026 investor letter for its “Select Strategy”. A copy of the letter can be downloaded here. The Strategy declined 0.52% (net of fees), surpassing the Russell 3000 Index’s 3.96%. The performance was driven by stock selection and overweight exposure in industrials, along with an underweight in information technology. Geopolitical developments and changing expectations regarding artificial intelligence (AI) are impacting market dynamics this quarter. The firm is assessing the heightened uncertainty from the situation in the Middle East while also seeking attractive investment opportunities in large-cap, high-quality, cash-generative, and defensive businesses. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.
In its first-quarter 2026 investor letter, Diamond Hill Select Strategy highlighted Regal Rexnord Corporation (NYSE:RRX). Regal Rexnord Corporation (NYSE:RRX) is a leading industrial company that offers sustainable power solutions, transmission, and control motion products. On June 8, 2026, Regal Rexnord Corporation (NYSE:RRX) closed at $210.28 per share. One-month return of Regal Rexnord Corporation (NYSE:RRX) was 0.24%, and its shares gained 46.08% over the past 52 weeks. Regal Rexnord Corporation (NYSE:RRX) has a market capitalization of $13.61 billion.
Diamond Hill Select Strategy stated the following regarding Regal Rexnord Corporation (NYSE:RRX) in its Q1 2026 investor letter:
“Regal Rexnord Corporation (NYSE:RRX), a manufacturer of electrical products for industrial equipment, outperformed in Q1 as the company reported strong orders for a new data center product, which should support solid revenue growth in 2027. Additionally, merger synergies and continuous improvement efforts continue to drive better-than-expected organic growth and margin expansion. While leverage remains somewhat elevated and could leave the company vulnerable to near-term macroeconomic weakness, we continue to view the stock as attractive at current prices.”
Regal Rexnord Corporation (NYSE:RRX) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 51 hedge fund portfolios held Regal Rexnord Corporation (NYSE:RRX) at the end of the first quarter, up from 40 in the previous quarter. Regal Rexnord Corporation (NYSE:RRX) Q1 2026 sales increase 4.3% and 1.6% on an organic basis compared to Q1 2025. While we acknowledge the risk and potential of Regal Rexnord Corporation (NYSE:RRX) 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 Regal Rexnord Corporation (NYSE:RRX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Regal Rexnord Corporation (NYSE:RRX) and shared the list of best AI energy stocks to buy in 2026. 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.
