Bretton Capital Management, an investment management company, released the “Bretton Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Bretton Fund returned 1.44% in Q4 2025 compared to 2.66% for the S&P 500 Index. In 2025, the Fund returned 11.58% compared to 17.88% for the Index. Although the market fluctuates daily between excitement and concern regarding a potential bubble in artificial intelligence, the firm views the overall market as not in bubble territory at this stage but is modestly elevated. Given the Fund’s long-term perspective, it is acceptable to reduce more speculative elements of the AI boom, which might resemble a bubble, even if this leads to a temporary lag during strong market phases. The Fund is focusing on areas of value that will provide good returns over the long term. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Bretton Fund highlighted stocks such as AutoZone, Inc. (NYSE:AZO). AutoZone, Inc. (NYSE:AZO) is a retailer of automotive replacement parts and accessories. The one-month return of AutoZone, Inc. (NYSE:AZO) was -2.24%, and its shares gained 2.29% of their value over the last 52 weeks. On March 3, 2026, AutoZone, Inc. (NYSE:AZO) stock closed at $3,637.17 per share, with a market capitalization of $60.496 billion.
Bretton Fund stated the following regarding AutoZone, Inc. (NYSE:AZO) in its fourth quarter 2025 investor letter:
“The largest detractor was AutoZone, Inc. (NYSE:AZO), which reported disappointing margins from higher product costs, taking 1.5% from the fund. AutoZone has had a tough time navigating the tariff minefield, its earnings per share slipping 1% and the stock returning a modest 6%. The auto parts retail market is relatively consolidated, and the industry has always been able to pass through price increases, so we believe this is a short-term issue as it will take time for higher retail prices to flow through their income statement.”
AutoZone, Inc. (NYSE:AZO) is not on our list of 40 Most Popular Stocks Among Hedge Funds. According to our database, 74 hedge fund portfolios held AutoZone, Inc. (NYSE:AZO) at the end of the fourth quarter, compared to 60 in the previous quarter. In the first quarter of fiscal 2026, AutoZone, Inc. (NYSE:AZO) reported revenue of $4.6 billion marking an increase of 8.2% compared to Q1 of 2025. While we acknowledge the potential of AutoZone, Inc. (NYSE:AZO) 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.
