Longleaf Partners, owned by Southeastern Asset Management, has released its 2026 first quarter investor report. A copy of the book is available for download here. The fund returned -4.46% for the quarter, compared to the S&P 500’s -4.33% and the Russell 1000 Value Index’s return of 2.10%. The year started much like the second half of 2025, with stocks rising and being punished cautiously. February was marked by an unusual movement of the whole sector influenced by the results of the observed AI. Problems arose from the Iran War and increased private debt risk. The Fund initially underperformed the market, but performance improved as conditions worsened. The fund ended the quarter with a P/V in the mid-50s%, which bodes well for promising future returns. In addition, please check the top five funds of the Fund to know their best choices in 2026.
In its investor letter for the first quarter of 2026, Longleaf Partners Fund highlighted stocks like Mattel, Inc. (NASDAQ:MAT). Mattel, Inc. (NASDAQ:MAT) is an international toy and entertainment company that manufactures and sells toys, games, and other products. On May 15, 2026, Mattel, Inc. (NASDAQ:MAT) closed at $15.15 per share. One month return for Mattel, Inc. (NASDAQ:MAT) was 1.61%, and its shares have lost 24.25% in the last 52 weeks. Mattel, Inc. (NASDAQ:MAT) has a market capitalization of $4.40 billion.
Longleaf Partners Fund says the following about Mattel, Inc. (NASDAQ:MAT) in its Q1 2026 investor letter:
“Mattel, Inc. (NASDAQ:MAT) – Creator of children’s toys, media, and consumer products Mattel was a bullish quarter. The stock fell due to $150 million (15% of EBITDA) in increased spending on programs including mobile games, Brick Shop (competing with Mattel on LEGO), and targeting consumer advertising. CEO Ynon Kreiz cited a one-year return on this divestment, but the market remains in bullish mode and the price has fallen in line with the 2026 earnings per share guidance reduction. This was combined with 4Q results that missed expectations, especially in the US. On a positive note, the company has committed to $1.5 billion in share repurchases over the next 3 years, which equates to 33% of shares outstanding at today’s value. 2026 was supposed to show the true power of FCF at Mattel powered by IP programs including two new movies (Masters of the Universe and Matchbox), the launch of a new mobile game, and a licensing push with Toy Story 5 and KPop Demon Hunters. Unfortunately, this has been delayed, and we are focused on what we can do to improve the situation.”
Mattel, Inc. (NASDAQ:MAT) is not on our list of the 40 Most Popular Stocks Among Hedge Funds Entering 2026. According to our database, 36 hedge fund portfolios hold Mattel, Inc. (NASDAQ:MAT) at the end of the fourth quarter, up from 34 in the previous quarter. While we acknowledge the power of Mattel, Inc. (NASDAQ:MAT) as an investment, we believe certain AI stocks offer great potential and carry little downside risk. If you’re looking for an extremely overlooked AI stock that will benefit greatly from the Trump-era costs and sea trend, check out our free report best short term AI stock.
In another article, we covered Mattel, Inc. (NASDAQ:MAT) and share a list of the best M&A-targeted stocks to buy. In addition, please check our hedge fund investor letters page Q1 2026 for other investor letters from hedge funds and other leading investors.
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Disclosure: None. This article was originally published on Insider Monkey.
