Overview
- Diamond Hill reported in its Q1 2026 investor letter that the Large Cap Strategy fell 2.39% net of fees, trailing the Russell 1000 Value Index which returned 2.10%.
- The firm disclosed on May 26 that it eliminated its position in International Paper because the company’s fundamentals fell short of expectations and proceeds would be used for more attractive opportunities.
- Diamond Hill said Abbott’s shares weakened after lower-than-expected Q4 results and guidance tied largely to headwinds in its nutrition business, and the stock has seen a steep 52-week decline.
- Managers said stock selection helped performance in industrials and consumer discretionary while picks in information technology, financials, and health care were the largest detractors for the quarter.
- The letter explains that short-term investor concern about AI and a late-February U.S.–Iran flare-up have shifted opportunities away from AI beneficiaries and toward defensive sectors, cyclicals, and oil-sensitive exploration and production stocks.