Here's L1 Capital International Fund's Comment on HCA Healthcare (HCA)

L1 Capital, an investment management firm, released its “L1 Capital International Fund” (unhedged) second quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund returned 4.5% (net of fees) in the June quarter compared to the MSCI World Net Total Return Index’s (in AUD) 6.0% return. The Fund returned 22.1% (net of fees) for the year ended June 30, 2025, compared to 18.5% for the benchmark. During the quarter, the Information Technology and Communication Services sectors outperformed others, driven by the Magnificent 7. Please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, L1 Capital International Fund highlighted stocks such as HCA Healthcare, Inc. (NYSE:HCA). HCA Healthcare, Inc. (NYSE:HCA) owns and operates hospitals and related healthcare entities. The one-month return of HCA Healthcare, Inc. (NYSE:HCA) was -3.79%, and its shares gained 12.26% of their value over the last 52 weeks. On July 16, 2025, HCA Healthcare, Inc. (NYSE:HCA) stock closed at $362.58 per share, with a market capitalization of $87.227 billion.

L1 Capital International Fund stated the following regarding HCA Healthcare, Inc. (NYSE:HCA) in its second quarter 2025 investor letter:

"HCA Healthcare, Inc. (NYSE:HCA) is the leading for-profit hospital operator and outpatient services provider in the U.S. In our December 2024 Quarterly Report we outlined our thoughts on why we considered the 25% fall in the share price due to healthcare policy concerns was excessive, and that the share price had fallen to a level where base case risk adjusted returns were compelling and downside risks were manageable, and that we had been using the share price weakness to increase our investment in this very high-quality business. Over the first half of 2025 healthcare policy has become clearer and is less negative for HCA than the market had feared. HCA’s share price has subsequently increased materially, and we have sold part of our investment, again to actively manage risk adjusted returns. HCA remains a top ten Fund holding at the end of the June 2025 quarter."

HCA Healthcare, Inc. (NYSE:HCA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 74 hedge fund portfolios held HCA Healthcare, Inc. (NYSE:HCA) at the end of the first quarter, which was 81 in the previous quarter. While we acknowledge the potential of HCA 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.

In another article, we covered HCA Healthcare, Inc. (NYSE:HCA) and shared the list of undervalued S&P 500 stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.