Artisan Partners, an investment management company, released its fourth-quarter 2025 investor letter for “Artisan Mid Cap Value Fund”.  A copy of the letter can be downloaded here. The Fund seeks to invest in undervalued companies with solid financial health and compelling business economics. US equities continued to advance in the fourth quarter of 2025, despite volatility. At the start of the quarter, a government shutdown unsettled investors and delayed key economic data, raising questions about the Federal Reserve’s easing timeline. However, as the quarter progressed, risk appetite increased, and clarity around monetary policy improved, leading the Fed to implement rate cuts and end quantitative tightening. This suggests a continued easing of financial conditions into 2026. While AI remained a key focus, markets diversified in November, with value and non-AI stocks leading. This could indicate a shift in market leadership moving forward. Mid-cap stocks lagged large caps in Q4, particularly on the growth side, as the Russell Midcap® Growth Index declined 3.7% while mid-cap value posted a modest gain and outperformed the growth index for the quarter and full year. In the quarter, the fund’s Investor Class fund ARTQX returned 1.53%, Advisor Class fund APDQX posted a return of 1.54%, and Institutional Class fund APHQX returned 1.63%, compared to a 1.42% return for the Russell Midcap Value Index. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Artisan Mid Cap Value Fund highlighted stocks like Prosperity Bancshares, Inc. (NYSE:PB). Prosperity Bancshares, Inc. (NYSE:PB) is a bank holding company for the Prosperity Bank that offers financial products and services to businesses and consumers. On March 31, 2026, Prosperity Bancshares, Inc. (NYSE:PB) closed at $67.18 per share. One-month return of Prosperity Bancshares, Inc. (NYSE:PB) was -2.53%, and its shares lost 4.96% over the past 52 weeks. Prosperity Bancshares, Inc. (NYSE:PB) has a market capitalization of $6.90 billion.

Artisan Mid Cap Value Fund stated the following regarding Prosperity Bancshares, Inc. (NYSE:PB) in its fourth quarter 2025 investor letter:

"We were fairly active in Q4, adding four stocks to the portfolio. Our largest new purchase was Houston-headquartered Prosperity Bancshares, Inc. (NYSE:PB), the fifth-largest bank in Texas. We have followed the bank for almost 20 years, and it’s been run by CEO David Zalman for that entire time. Mr. Zalman is fanatical about expense management, credit quality and deposit gathering. The bank over time is a “consolidator of choice” for local Texas bank CEOs who want to retire and roll their equity into Prosperity. As one of its largest shareholders, Mr. Zalman runs Prosperity like a true owner-operator. As such, he is perfectly content doing nothing for a few years and waiting for acquisition opportunities to come to him. Despite having strong credit quality and being well capitalized, the stock has significantly trailed its peers over the past few years and is now trading near the bottom of its long-run valuation range on various valuations measures. Given its cheap valuation and strong balance sheet, the reward to risk appears favorable for this high-quality regional bank."

Prosperity Bancshares, Inc. (NYSE:PB) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 28 hedge fund portfolios held Prosperity Bancshares, Inc. (NYSE:PB) at the end of the fourth quarter, up from 26 in the previous quarter. While we acknowledge the potential of Prosperity Bancshares, Inc. (NYSE:PB) 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.

In another article, we covered Prosperity Bancshares, Inc. (NYSE:PB) and shared a bullish thesis on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years.

Disclosure: None. This article is originally published at Insider Monkey.