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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 declined 2.39% (net of fees), trailing the Russell 1000 Value Index’s 2.10%. The performance was positively affected by stock selection in industrials and consumer discretionary, along with an underweight in communication services. While stock selection in information technology, financials, and health care was the largest detractor from relative performance. The war in Iran is creating uncertainty in markets. However, it effectively supported the portfolio’s focus on oil-sensitive exploration and production companies. Technology companies are under pressure in Q1 amid concerns about AI's potential negative effects on their businesses, but their competitive advantages remain stronger than their current valuations suggest. Despite these challenges, the market is beginning to expand into more attractive opportunities, especially in defensive sectors and cyclicals that do not benefit from AI. In addition, please check the Fund’s top five holdings to know its best picks in 2026.

In its first-quarter 2026 investor letter, Diamond Hill Capital Large Cap Strategy highlighted Texas Instruments Incorporated (NASDAQ:TXN). Texas Instruments Incorporated (NASDAQ:TXN) is a semiconductor manufacturer that provides chips and solutions for electronics designers and manufacturers. On May 22, 2026, Texas Instruments Incorporated (NASDAQ:TXN) closed at $309.21 per share. One-month return of Texas Instruments Incorporated (NASDAQ:TXN) was 14.73%, and its shares gained 75.39% over the past 52 weeks. Texas Instruments Incorporated (NASDAQ:TXN) has a market capitalization of $281.41 billion.

Diamond Hill Capital Large Cap Strategy stated the following regarding Texas Instruments Incorporated (NASDAQ:TXN) in its Q1 2026 investor letter:

"Semiconductor and processor producer Texas Instruments Incorporated (NASDAQ:TXN) saw shares rise after issuing Q1 guidance that exceeded market expectations and indicated a recovery in demand following a protracted industry downturn."

Texas Instruments Incorporated (NASDAQ:TXN) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 78 hedge fund portfolios held Texas Instruments Incorporated (NASDAQ:TXN) at the end of the fourth quarter, up from 72 in the previous quarter. Texas Instruments Incorporated (NASDAQ:TXN) announced a revenue of $4.8 billion for the first quarter of 2026, marking a sequential growth of 9% and a year-over-year increase of 19%. While we acknowledge the potential of Texas Instruments Incorporated (NASDAQ:TXN) 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 Texas Instruments Incorporated (NASDAQ:TXN) and shared the list of top stock picks from dividend stock portfolio for retirement. In addition, please check out our hedge fund investor letters Q1 2026 page for more investor letters from hedge funds and other leading investors.

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