Investment management company Vulcan Value Partners recently released its third-quarter 2026 investor letter. The letter can be downloaded here . The portfolio reported a strong quarter, with all strategies except Small Cap reporting positive absolute results, with Small Cap down about 1%. In the quarter, the Large Cap Composite (Net) returned 7.4%, the Small Cap Composite (Net) returned -1.2%, the Focus Composite (Net) returned 8.9%, the Focus Plus Composite (Net) returned 8.8%, and the All-Cap Composite (Net) returned 7.5%. The firm emphasized its focus on long-term intrinsic value, noting that portfolio price-to-value ratios remain historically low and that it believes this is an attractive time to invest. The firm remains optimistic about its holdings' long-term value growth, competitive advantages, and ability to compound cash flows. Also, check the Fund's top five holdings to see its best picks for 2026.
In its Q3 2026 investor letter, Vulcan Value Partners highlighted SAP SE (NYSE: SAP ). Headquartered in Walldorf, Germany, SAP SE (NYSE:SAP) is a global enterprise software company that provides cloud application suites, enterprise resource planning (ERP) systems, and business intelligence software solutions. On October 23, 2026, SAP SE (NYSE:SAP) closed at $238.14, with a $280.46 billion market capitalization. The stock posted a 0.73% YTD decline, trading within a 52-week range of $144.97 to $274.15.
Vulcan Value Partners stated the following regarding SAP SE (NYSE:SAP) in its Q3 2026 investor letter:
"SAP SE(NYSE:SAP) is the global leader in enterprise resource planning (ERP) software, which serves as the operating system for many of the world's largest companies. SAP's ERP solutions often have decades of embedded data, business processes, and software customizations. It is extremely rare for companies to switch ERP vendors due to the cost, time, and disruption risk that switching creates. SAP's second quarter results were very strong, with total revenue up 11% and EBIT up 6%. Cloud revenue grew 24% and their current cloud backlog growth accelerated to 26% year over year. Our value continues to compound and shares remain materially discounted."
SAPSE (NYSE: SAP) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026 . According to our database, 35 hedge fund portfolios held SAPSE (NYSE: SAP) at the end of the second quarter, compared to 33 in the previous quarter. While we acknowledge the risk and potential of SAP SE (NYSE:SAP) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SAP SE (NYSE:SAP) and that has 10,000% upside potential, check out our report about this cheapest AI stock .
In another article , we discussed SAP SE (NYSE:SAP) and shared Lindsell Train Global Equity Fund's views on the company. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.
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This article is originally published at Insider Monkey .
