Oakmark Select Fund Adds Gartner to Portfolio Despite First-Quarter Setback

Oakmark Funds, the investment complex advised by Harris Associates, outlined a new position in Gartner, Inc. in its first-quarter 2026 letter to shareholders of the Oakmark Select Fund. The update details both the fund’s recent performance and the reasons behind the purchase of shares in the technology research company, offering a snapshot of how managers are positioning the concentrated portfolio after a challenging start to the year.

The Oakmark Select Fund, a non-diversified vehicle that targets capital appreciation through stakes in mid- and large-capitalization U.S. businesses, fell 7.99 percent during the three months ended 31 March 2026. Over the same period, the S&P 500 Index declined 4.33 percent. Managers attributed the shortfall largely to weakness in health care and financial holdings, while energy names were the only sector-level contributors. In the letter, they reiterated a long-standing view that market prices are often driven more by crowd psychology and short-term swings than by underlying corporate fundamentals, a perspective that guides their disciplined, patient approach to portfolio construction.

The report highlights several portfolio changes, most notably the introduction of Gartner, Inc. (NYSE: IT). Founded in 1979, Gartner supplies research, data and advisory services that help corporate leaders make business and technology decisions. Oakmark describes Gartner as the pre-eminent brand in information-technology research, citing its scale, long track record of organic growth and strong free-cash-flow generation. According to the fund managers, those attributes have historically provided significant competitive advantages and customer loyalty.

Market sentiment toward Gartner deteriorated sharply over the past year. The company’s shares closed at $149.10 on 14 April 2026, implying a market capitalization of roughly $10.5 billion. That price represents a 62.94 percent slide over the previous 52 weeks and a one-month decline of 5.70 percent. Oakmark argues that the sell-off stems from investor concern that advances in artificial intelligence could disrupt Gartner’s advisory model. The fund’s managers believe those worries are overstated and view the pullback as an opportunity to buy “a well-managed company at a bargain price.”

In their assessment, Gartner remains positioned to accelerate organic revenue growth thanks to sustained high engagement from existing clients and what they view as a large untapped market among prospective customers. Management’s emphasis on free-cash-flow conversion is also noted as a positive factor supporting long-term value creation.

Gartner’s most recent public filing shows fourth-quarter 2025 revenue of $1.8 billion, an increase of 2 percent compared with the same quarter a year earlier. The company is not currently listed among the 40 most widely held equities by hedge funds heading into 2026, yet ownership in that community is rising. Data indicate 50 hedge fund portfolios held the stock at the end of the fourth quarter of 2025, up from 42 in the preceding quarter.

While Oakmark emphasizes Gartner’s competitive strengths, the investor letter acknowledges that other market participants see greater upside and lower downside risk in select artificial-intelligence names. That viewpoint reflects a broader debate about where the most attractive risk-adjusted returns lie in the evolving technology landscape.

The fund’s commentary on broader market conditions reiterates a core philosophy: long-term value is ultimately grounded in business fundamentals, even when short-term price action diverges from intrinsic worth. Managers cite past periods in which patience and discipline were rewarded, arguing that the current environment should eventually prove no different.

For shareholders reviewing the quarter’s results, several key performance drivers stand out. Energy holdings delivered positive returns as commodity prices provided a tailwind, contrasting with the negative impact from health care and financial exposures. The fund did not specify individual gainers or detractors within those sectors, but the overall attribution underscores the influence of sector allocation in a concentrated strategy.

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Oakmark also reminded investors that a full list of the fund’s five largest positions is available for review, consistent with its policy of providing transparency around holdings. Because the portfolio is intentionally focused, each new position—such as the stake in Gartner—can materially affect future performance, whether positively or negatively.

The decision to purchase Gartner shares aligns with a pattern of adding companies that managers regard as temporarily misunderstood by the market. Historically, the fund has sought out businesses with durable franchises, strong cash generation and management teams committed to shareholder value. Oakmark’s letter states that Gartner meets each of those criteria despite recent volatility in the share price.

Gartner’s operating model centers on subscriptions that provide clients with research reports, peer networking opportunities and direct analyst access. The company serves a global customer base across multiple industries, and its insights often inform technology budgeting and strategic planning. According to public filings with the U.S. Securities and Exchange Commission, subscription revenue represents the largest portion of total sales, supporting recurring cash flow and visibility into future results.

Looking ahead, Oakmark’s managers plan to monitor Gartner’s ability to reignite growth while maintaining profitability. They will also watch how artificial-intelligence tools influence client demand and competitive dynamics within the research and advisory segment. Although the fund believes the current share price underestimates Gartner’s long-term prospects, management concedes that doubts about technological disruption could persist, potentially leading to continued volatility.

The first-quarter letter closes by reiterating confidence in the fund’s holdings as a group, emphasizing that valuations across the portfolio remain attractive relative to the managers’ estimates of intrinsic value. Despite the year-to-date decline, Oakmark asserts that frameworks focused on free cash flow, competitive positioning and disciplined capital allocation provide a sturdy foundation for future returns.

Investors in the Oakmark Select Fund will receive the next detailed update after the second quarter of 2026, when managers are expected to review portfolio performance, discuss any additional changes in holdings and comment on prevailing market conditions.