Longleaf Partners, managed by Southeastern Asset Management, released its “Small-Cap Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund returned -1.58% in the fourth quarter, compared to the Russell 3000’s 2.63% return. For the year, the fund returned 9.69% compared to 23.81% return for the benchmark. For more information on the fund’s best picks in 2024, please check its top five holdings.

In its fourth quarter 2024 investor letter, Longleaf Partners Small-Cap Fund emphasized stocks such as Oscar Health, Inc. (NYSE:OSCR). Oscar Health, Inc. (NYSE:OSCR) is a US based healthcare technology company. The one-month return of Oscar Health, Inc. (NYSE:OSCR) was -2.16%, and its shares gained 3.08% of their value over the last 52 weeks. On March 4, 2025, Oscar Health, Inc. (NYSE:OSCR) stock closed at $15.41 per share with a market capitalization of $3.861 billion.

Longleaf Partners Small-Cap Fund stated the following regarding Oscar Health, Inc. (NYSE:OSCR) in its Q4 2024 investor letter:

"Oscar Health, Inc. (NYSE:OSCR) – Health insurance and software company Oscar was a top detractor for the quarter while remaining a top contributor for the year. The company delivered another strong quarter operationally, achieving over 60% year-over-year revenue and membership growth, while advancing toward its publicly stated goal of 5% operating income margins. Despite the operational progress, the Trump presidential win weighed on the stock price in the quarter due to added uncertainty around the future of the enhanced ACA subsidies set to expire at the end of 2025 and broader implications for the ACA itself. Oscar still has underappreciated non-earning assets in various regions at different stages of ramp-up, transitioning from investment mode in some areas to higher-margin operations in others. We view this as a long-term positive, highlighting the embedded long-term growth potential at Oscar. While election-related news contributed to stock volatility in the second half of the year, we capitalized on the volatility by strategically trimming and adding to our position. It was powerful to see both co-founder Josh Kushner and CEO Mark Bertolini (via his foundation) each purchase more than $10 million worth of stock in the wake of the election selloff."

A close up of a patient and a healthcare professional engaging in conversation, showing the company's commitment to patient care.

Oscar Health, Inc. (NYSE:OSCR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 43 hedge fund portfolios held Oscar Health, Inc. (NYSE:OSCR) at the end of the fourth quarter which was 45 in the previous quarter. Oscar Health, Inc.'s (NYSE:OSCR) 2024 revenue increased 57% year-over-year to $9.2 billion. While we acknowledge the potential of Oscar Health, Inc. (NYSE:OSCR) 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 cheapest AI stock.

In another article, we discussed Oscar Health, Inc. (NYSE:OSCR) and shared the list of best health insurance stocks to buy in 2025. Oscar Health, Inc. (NYSE:OSCR) boosted Longleaf Partners Small-Cap Fund's performance last quarter with strong results. In addition, please check out our hedge fund investor letters Q4 2024 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.