FPA Source Capital Q3 Letter Weighs CarMax Setbacks Against Citigroup Gains

Overview

• In its Q3 2025 letter, FPA reported Source Capital’s net asset value rose 4.59% in the quarter and 13.76% over the past 12 months.
• FPA labeled CarMax a disappointment after 2025 execution missteps, citing withdrawn 2030 unit targets, overbought inventory and market-share losses, while noting shares trade near 12x forward earnings and about 1.1x tangible book.
• Governance and market signals around CarMax included two independent director purchases in early October and an expanded buyback, with Insider Monkey noting a Dec. 5 close at $38.82, a one‑month gain of 16.75%, a 52‑week decline of 55.48%, and 54 hedge fund holders unchanged from Q2.
• FPA credited Citigroup’s improved return on tangible equity and U.S. regulatory changes that lifted banks’ normalized ROTE for driving strong 12‑month share performance from a low starting valuation.
• Insider Monkey’s snapshot for Citigroup showed a Dec. 5 close at $108.88, a one‑month gain of 7.28%, a 52‑week decline of 51.52%, and hedge fund ownership rising to 107 portfolios from 102 in Q2.