Overview
- Longleaf Partners reported in its mid-July investor letter that the Partners Fund returned 3.87% in Q2 2026 and materially underperformed the S&P 500 and Russell 1000 Value.
- The firm singled out an underweight to Information Technology and the market’s preference for richly valued names as the main drivers of the relative gap.
- Longleaf reaffirmed its stock-picking process that uses median, unweighted multiples and prioritizes growth in free cash flow per share as the path to eventual multiple expansion.
- The letter highlighted several company-level developments that support the portfolio thesis, including Fortune Brands' Fiberon strategic review and new CEO hire Jesse Singh, Avantor's new management and 2H26 free-cash-flow guidance, People Inc.'s bid and stronger convention revenues for MGM, and signs of private-equity interest and operational improvement at Magnum.
- Longleaf described recent pullbacks in holdings such as CNX and Albertsons as buyable opportunities based on steady share repurchases, improving free-cash-flow prospects, and management actions that could close the gap between price and intrinsic value.