Soumya Eswaran
3 min read
In This Article:
Hotchkis & Wiley, an investment management company, released its “Hotchkis & Wiley Mid-Cap Value Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The Hotchkis & Wiley Mid-Cap Value Fund returned -5.63% in the first quarter, underperforming the Russell Midcap Value Index’s -2.11% return. US mid-cap stocks surged post-Presidential elections due to potential benefits of deregulation, lower corporate taxes, and accelerated growth. However, Q1 2025 saw a decline due to tariffs, high inflation, and weak macroeconomic factors, causing the Russell Midcap Index to decline by -3.4% and the Russell Midcap Value Index by -2.1% vs. a decline of -7.1% for the Russell Midcap Growth Index. For more information on the fund’s best picks in 2025, please check its top five holdings.
In its first-quarter 2025 investor letter, Hotchkis & Wiley Mid-Cap Value Fund highlighted stocks such as Fluor Corporation (NYSE:FLR). Fluor Corporation (NYSE:FLR) is an engineering, procurement, and construction (EPC) company. The one-month return of Fluor Corporation (NYSE:FLR) was 16.57%, and its shares lost 1.31% of their value over the last 52 weeks. On May 16, 2025, Fluor Corporation (NYSE:FLR) stock closed at $38.48 per share with a market capitalization of $6.336 billion.
Hotchkis & Wiley Mid-Cap Value Fund stated the following regarding Fluor Corporation (NYSE:FLR) in its Q1 2025 investor letter:
"Fluor Corporation (NYSE:FLR) is one of the largest contractors in the US. Fluor reported a disappointing 4Q24 with revenue and margins weak as the company deals with unusually low utilization driven by volatility in its businesses. Initial guidance for 2025 revenue and margin were also below consensus estimates driven by weakness at Energy Solutions partly offset by growth at Urban Solutions that is expected to be back-half weighted. Unlike many competitors that specialize in elements of project delivery, most of Fluor’s revenue comes from projects where it provides full Engineering, Procurement, and Construction services. Fluor also has significant fabrication capabilities including a joint venture that operates the world’s largest fabrication facility. In addition, Fluor also owns a substantial stake in NuScale (tk: SMR)."
A close-up of an engineer surveying a large-scale construction project.
Fluor Corporation (NYSE:FLR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 48 hedge fund portfolios held Fluor Corporation (NYSE:FLR) at the end of the fourth quarter, compared to 39 in the third quarter. While we acknowledge the potential of Fluor Corporation (NYSE:FLR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.
