Third Avenue Management, a New York City-based investment firm, published its fourth-quarter 2025 investor letter for the “Third Avenue Small-Cap Value Fund. ” A copy of the letter is available for download here. In the quarter, the Fund returned 4.62%, outperforming the MSCI USA Small-Cap Value Index (the “Index”), which gained 3.13%. For the year 2025, the Fund delivered a 14.04% return, surpassing the 10.80% return of the index. The Fund primarily invests in publicly traded companies with boards of directors, sometimes controlled by individuals or families, and management teams that operate independently from the Fund. Reviewing 2025, the firm is pleased with the Fund’s performance, operational success, and shareholder value creation, and is optimistic about 2026. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.
In its fourth-quarter 2025 investor letter, Third Avenue Small-Cap Value Fund highlighted stocks like UniFirst Corporation (NYSE:UNF). UniFirst Corporation (NYSE:UNF) is a US-based leading provider of workplace uniforms and protective workwear clothing. On March 10, 2026, UniFirst Corporation (NYSE:UNF) stock closed at $257.91 per share. One-month return of UniFirst Corporation (NYSE:UNF) was 9.71%, and its shares gained 26.84% over the past 52 weeks. UniFirst Corporation (NYSE:UNF) has a market capitalization of $4.663 billion.
Third Avenue Small-Cap Value Fund stated the following regarding UniFirst Corporation (NYSE:UNF) in its fourth quarter 2025 investor letter:
“This brings us to the ongoing case of Fund holding, UniFirst Corporation (NYSE:UNF). UniFirst is a national uniform and laundry services business headquartered in Massachusetts. Today, governance of the company is controlled by Unifirst’s founding family through a dual-class share structure, though the family owns a distinct minority of the shares and we are now two generations removed from the founder. We do not believe it is controversial to say that operating performance of the company has been mediocre, and shareholders have little, if any, return to show for their ownership during the last five or six years. Simply put, there are two primary means by which Unifirst can materially increase shareholder value. One option, which has ostensibly been the preference of management and the board, is for the company to invest internally to improve Enterprise Resource Planning systems (“ERP” systems) and to invest in business development hiring and its competitive positioning. To this end, the company has, in recent years, laid out a series of operational goals that look very ambitious but have generally been slow in arriving, raising many questions around operational execution. Regarding Unifirst’s competitive positioning, the company often competes directly against Cintas Corporation (“Cintas”), a company with revenue four times that of Unifirst and a valuation ten times larger than Unifirst. Cintas’ huge valuation premium derives from far higher profitability, which, in turn, derives from superior scale, efficiency, and route density, areas where Unifirst has continued to leave investors disappointed.
