L
ongleaf Partners' Small-Cap Fund, managed by Southeastern Asset Management, released its Q4 2024 investor letter. The fund returned -1.58% in the fourth quarter, underperforming the Russell 3000's 2.63%. For the year, the fund returned 9.69%, lagging behind the benchmark's 23.81%. Longleaf Partners highlighted Anywhere Real Estate Inc. (NYSE:HOUS) as a top detractor for the year and a material detractor for the quarter. The company faced significant challenges, including the National Association of Realtors' settlement affecting buy-side commissions and weak existing home sales. Interest rates also impacted the stock price, with the Federal Reserve's rate hikes in the fourth quarter hurting Longleaf Partners' remaining position. Despite confidence in management, led by CEO Ryan Schneider, the investment was deemed disappointing due to excessive leverage in a challenging housing environment. Anywhere Real Estate Inc. (NYSE:HOUS) is not among our list of 30 Most Popular Stocks Among Hedge Funds, with 28 hedge fund portfolios holding it at the end of Q4, down from 26 in the previous quarter. Longleaf Partners' conviction lies in AI stocks offering greater promise for higher returns within a shorter timeframe.