Diamond Hill Capital, a First Eagle Investment Management company, issued its Q1 2026 investor letter for its “large cap strategy.” A copy of the letter is available to download here. The strategy fell 2.39% (net of fees), lagging the Russell 1000 Value Index’s 2.10%. Performance was positively impacted by stock selection in the industrial and consumer discretionary sector, along with an underweight in communications services. While stock selection in the information technology, financial and healthcare sectors was the biggest drag on relative performance. The war in Iran is creating uncertainty in the markets. However, it effectively supported the portfolio’s focus on oil-sensitive E&P companies. Technology companies are under pressure in the first quarter amid concerns about the potential negative effects of AI on their businesses, but their competitive advantages remain stronger than their current valuations suggest. Despite these challenges, the market is beginning to expand towards more attractive opportunities, especially in defensive and cyclical sectors that do not benefit from AI. Also, check out the Fund’s top five holdings to learn your best picks in 2026.
In its Q1 2026 investor letter, Diamond Hill Capital Large Cap Strategy highlighted Carrier Global Corporation (NYSE:CARR) as a newly added position. Carrier Global Corporation (NYSE:CARR) is an intelligent climate and energy solutions provider operating across the heating, ventilation and air conditioning (HVAC) and refrigeration segments. On May 22, 2026, Carrier Global Corporation (NYSE:CARR) closed at $63.14 per share. Carrier Global Corporation (NYSE:CARR)’s monthly performance was 1.99% and its stock lost 11.05% in the last 52 weeks. Carrier Global Corporation (NYSE:CARR) has a market capitalization of $52.44 billion.
Diamond Hill Capital Large Cap Strategy stated the following regarding Carrier Global Corporation (NYSE:CARR) in its Q1 2026 investor letter:
“Following its March 2020 spinoff of United Technologies, a residential and commercial HVAC provider Global Carrier Corporation (NYSE:CARR) is now a focused, high-quality company that we believe is in an excellent position to continue to gain market share and improve margins over the long term. However, a cyclical slowdown in residential markets has impacted near-term results, creating an opportunity to initiate a position at a significant discount to our intrinsic value estimate.”
Carrier Global Corporation (NYSE:CARR) isn’t on our list of the 40 most popular stocks among hedge funds heading into 2026. According to our database, 59 hedge fund portfolios held Carrier Global Corporation (NYSE:CARR) at the end of the fourth quarter, up from 48 in the prior quarter. In the first quarter of 2026, Carrier Global Corporation (NYSE:CARR) reported sales of $5.3 billion, adjusted operating profit of $594 million, and adjusted EPS of $0.57. While we recognize the potential of Carrier Global Corporation (NYSE:CARR) as an investment, we believe certain AI stocks offer greater growth potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that’s also benefiting significantly from Trump-era tariffs and the offshoring trend, check out our free report on best short-term AI stock.