Longleaf Partners, managed by Southeastern Asset Management, released its “Partners Fund” third-quarter 2025 investor letter. The letter can be downloaded here. The fund returned -0.33% in the third quarter, compared to the S&P 500’s 8.12 % return and the Russell 1000 Value’s 5.33% return. The firm is not happy with the flat performance of the portfolio, emphasizing its investments in real assets and brands that generate growing free cash flow (FCF) per share. Despite facing market pressures from speculation and government uncertainty, it anticipates that the Fund’s ~10x FCF multiple could rise to the mid-teens as management implements strategies to improve margins and increase share repurchases. For more information on the fund’s best picks in 2025, please check its top five holdings.
In its third-quarter 2025 investor letter, Longleaf Partners Fund highlighted stocks such as The Kraft Heinz Company (NASDAQ:KHC). The Kraft Heinz Company (NASDAQ:KHC) manufactures and markets food and beverage products. The one-month return of The Kraft Heinz Company (NASDAQ:KHC) was -3.13%, and its shares lost 27.36% of their value over the last 52 weeks. On October 23, 2025, The Kraft Heinz Company (NASDAQ:KHC) stock closed at $25.41 per share, with a market capitalization of $29.857 billion.
Longleaf Partners Fund stated the following regarding The Kraft Heinz Company (NASDAQ:KHC) in its third quarter 2025 investor letter:
“The Kraft Heinz Company (NASDAQ:KHC): The market is too focused on legacy headwinds and is missing the value-creating potential of the company’s upcoming split into two businesses: the higher-growth Flavor Elevation unit, which should garner a teens EBITDA multiple, and the stable remaining company, which can trade at the same multiple total Kraft currently trades today. This would result in a combined stock price over $40 per share.”
The Kraft Heinz Company (NASDAQ:KHC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 45 hedge fund portfolios held The Kraft Heinz Company (NASDAQ:KHC) at the end of the second quarter, compared to 46 in the previous quarter. While we acknowledge the potential of The Kraft Heinz Company (NASDAQ:KHC) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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