Hotchkis & Wileyan investment management company, released its first-quarter 2026 investor letter for the “Hotchkis & Wiley Large Cap Fundamental Value Fund.” A copy of the letter can be downloaded here. In Q1 2026, the S&P 500 Index declined by -4.4%, driven by geopolitical uncertainty and AI investment themes. Brent crude oil surged over 100% due to U.S.-Israel strikes on Iran, benefiting the energy sector, which outperformed significantly. Value stocks surpassed growth, with the Russell 1000 Value Index gaining +2.1% compared to -9.8% for the Growth Index. However, the Hotchkis & Wiley Large Cap Fundamental Value Fund lagged, returning 0.36% vs. 2.10% for the Russell 1000 Value Index, driven by its overweight exposure in software and health insurers. However, the energy holdings, which returned +49%, were the portfolio’s top performers. 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 Large Cap Fundamental Value Fund highlighted stocks like Salesforce, Inc. (NYSE:CRM). Salesforce, Inc. (NYSE:CRM) is a cloud computing company that offers Customer Relationship Management (CRM) technology that brings companies and customers together. On April 27, 2026, Salesforce, Inc. (NYSE:CRM) closed at $180.18 per share. One-month return of Salesforce, Inc. (NYSE:CRM) was -2.04%, and its shares lost 31.70% over the past 52 weeks. Salesforce, Inc. (NYSE:CRM) has a market capitalization of $149.56 billion.
Hotchkis & Wiley Large Cap Fundamental Value Fund stated the following regarding Salesforce, Inc. (NYSE:CRM) in its Q1 2026 investor letter:
“Salesforce, Inc. (NYSE:CRM) is among the top five largest global software companies, with a broad portfolio that includes Sales, Service, Marketing & Commerce Clouds, Slack, MuleSoft, Tableau, and the Data & AI Cloud. Its products are deeply embedded across a large enterprise customer base, creating a long runway for growth through seat expansions, cross selling, and pricing, and supporting strong revenue growth for many years. Combined with sticky recurring revenue, high gross margins, and limited capital reinvestment needs, this creates a resilient business model with meaningful downside mitigation. Salesforce posted a good Q4 that matched growth expectations, however, market concerns that AI agents could displace traditional software have continued to pressure the stock, leaving the shares trading at an attractive valuation for an established franchise.”
