Harris Oakmark recently released its second-quarter 2026 investor letter for the “Oakmark Equity and Income Fund”. A copy of the letter can be downloaded here. Oakmark Equity and Income Fund aims to maximize returns while preserving and enhancing capital. The portfolio consists of US equities and fixed-income securities. The allocation was 60.1% in equities, 38.9% in fixed income, and 1.0% cash. The Fund (Investor Class) underperformed the 60% S&P 500 / 40% Bloomberg U.S. Aggregate Bond Index in the quarter and has outperformed since its inception. The equity portion of the portfolio generated 6.84% compared to 15.20% for the S&P 500 Index. The fixed income portfolio returned 1.13% compared to the Bloomberg U.S. Aggregate Bond Index’s 0.67% return. Investors continued to favor companies perceived to be direct beneficiaries of AI spending in a narrow leadership environment. In this landscape, the firm remains focused on owning undervalued companies rather than chasing the market’s most popular themes. In addition, you can check the Fund’s top five holdings to determine its best picks for 2026.
In its Q2 2026 investor letter, Oakmark Equity and Income Fund highlighted Elevance Health, Inc. (NYSE:ELV) as a newly added position. Elevance Health, Inc. (NYSE:ELV) is a US-based health benefits company. On July 14, 2026, Elevance Health, Inc. (NYSE:ELV) closed at $425.17 per share, reflecting a market capitalization of $92.33 billion. Elevance Health, Inc. (NYSE:ELV) posted a one-month return of 6.88%, while its shares gained 26.46% over the past 52 weeks.
Oakmark Equity and Income Fund stated the following regarding Elevance Health, Inc. (NYSE:ELV) in its Q2 2026 investor update:
“Elevance Health, Inc. (NYSE:ELV) is one of the nation’s largest managed care organizations, serving over 45 million members across employer-sponsored and individual health insurance, Medicare, and Medicaid. We believe the company’s current profits understate its normalized earnings power, as mismatches between reimbursement rates and medical cost trends have pushed margins in the government business lines below target levels for Elevance and its peers. We believe this will prove transitory and that changes to pricing and/or plan designs will help realign margins closer to their historical ranges over time. While we acknowledge that a return to “normal” profitability will likely take a few years, we note that the stock is trading at a discount to the broader market multiple even on today’s depressed earnings base. With its scale advantages, diversification across end markets, and track record of disciplined underwriting and capital allocation, we believe that over time, the market will once again recognize Elevance as a high-quality franchise.”
Elevance Health, Inc. (NYSE:ELV) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 87 hedge fund portfolios held Elevance Health, Inc. (NYSE:ELV) at the end of the first quarter, up from 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 the list of best value stocks to buy. In addition, please check out our hedge fund investor letters Q2 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.
