Vulcan Value Partners released its Q4 2025 investor letter, with positive results across all strategies. Despite overvalued markets, the firm improved price-to-value ratios while achieving positive returns. The firm remains cautious of AI disruptions mirroring the late 1990s dot-com bubble, sticking to its investment discipline for safety and long-term gains.

Vulcan Value Partners highlighted CarMax, Inc. (NYSE: KMX) in its Q4 2025 investor letter, adding the stock to its All-Cap Strategy. CarMax, Inc. (NYSE: KMX) is a used vehicle retailer headquartered in Richmond, Virginia, with promising one-month returns and a market capitalization of $5.826 billion.

CarMax, Inc. (NYSE: KMX) is the largest used car retailer in the U.S. Vulcan Value Partners believes the company has faced challenges due to macro, competitive, and operational factors. Despite short-term bumps, the firm sees CarMax as a good business with favorable long-term prospects, encouraged by operational changes and a normalizing market.

54 hedge fund portfolios held CarMax, Inc. (NYSE: KMX) by the end of Q3 2025. The company reported a 6.9% decline in sales due to lower volume in fiscal Q3 2026. While acknowledging CarMax’s potential, some AI stocks offer greater upside potential with less downside risk.

For more insights on CarMax, Inc. (NYSE: KMX) and other hedge fund investor letters from Q4 2025, visit Insider Monkey’s webpage. Check out the best and worst Dow stocks for the next 12 months and 10 unstoppable stocks that could double your money for further investment analysis.

Read more at Yahoo Finance: Should You Hold CarMax (KMX)?