Longleaf Partners, managed by Southeastern Asset Management, released its Q3 2025 “Partners Fund” investor letter. The letter can be downloaded here. The fund returned -0.33% in the third quarter, compared to a return of 8.12% for the S&P 500 and 5.33% for the Russell 1000 Value. The company is not happy with the portfolio’s flat performance, 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, he anticipates the Fund’s ~10x FCF multiple could rise into the mid-teens as management implements strategies to improve margins and increase share buybacks. For more information on the fund’s best picks in 2025, check out its top five holdings.
In its Q3 2025 investor letter, Longleaf Partners Fund highlighted stocks like The Kraft Heinz Company (NASDAQ:KHC). The Kraft Heinz Company (NASDAQ:KHC) manufactures and markets food and beverage products. The Kraft Heinz Company (NASDAQ:KHC)’s monthly performance was -3.13% and its shares lost 27.36% of its value in the last 52 weeks. On October 23, 2025, shares of The Kraft Heinz Company (NASDAQ:KHC) closed at $25.41 per share, with a market capitalization of $29.857 million.
Longleaf Partners Fund stated the following regarding The Kraft Heinz Company (NASDAQ:KHC) in its Q3 2025 investor letter:
“The Kraft Heinz Company (NASDAQ:KHC): The market is too focused on legacy headwinds and missing the value creation potential of the company’s upcoming split into two businesses: the higher-growth unit Flavor Elevation, which should earn a teensy EBITDA multiple, and the remaining stable company, which may trade at the same total multiple Kraft currently trades. This would result in a combined share price of over $40 per share.”
The Kraft Heinz Company (NASDAQ:KHC) isn’t on our list of the 30 most popular stocks among hedge funds. According to our database, 45 hedge fund portfolios owned The Kraft Heinz Company (NASDAQ:KHC) at the end of the second quarter, compared to 46 in the previous quarter. While we recognize the potential of The Kraft Heinz Company (NASDAQ:KHC) 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.