Should You Hold Oil-Dri (ODC)?

Diamond Hill Capital, an investment management company, released its “Small Cap Strategy” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. The fourth quarter posted another period of favorable gains for equity markets, with the Russell 2000 Index returning 2.19%, roughly in line with the Russell 1000 Index’s 2.41% gain. Health care (+18.6%) emerged as the best-performing sector in the Russell 2000 Index. Heightened uncertainty and geopolitical risks contributed to a mixed market environment in 2025 and Q4, yet the Russell 2000 Index still posted a 12.81% gain for the year. Heading into 2026, the firm continues to focus on resilient businesses that can sustain earnings in a volatile landscape. The Strategy returned 4.88% (net of fees) in the quarter compared to the Russell 2000 Index’s 2.19% gain. Please review the Strategy’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Diamond Hill Small Cap Strategy highlighted stocks like Oil-Dri Corporation of America (NYSE:ODC). Oil-Dri Corporation of America (NYSE:ODC) is a US-based manufacturer of sorbent products. On February 4, 2026, Oil-Dri Corporation of America (NYSE:ODC) stock closed at $62.24 per share. Oil-Dri Corporation of America (NYSE:ODC) delivered a 22.54% return in the past month, and its shares are up 44.78% over the past twelve months. Oil-Dri Corporation of America (NYSE:ODC) has a market capitalization of $907.257 million.

Diamond Hill Small Cap Strategy stated the following regarding Oil-Dri Corporation of America (NYSE:ODC) in its fourth quarter 2025 investor letter:

"Oil-Dri Corporation of America (NYSE:ODC), a leading provider of branded and private-label cat litter as well as other sorbent materials, reported solid but more normalized results against a backdrop of more difficult comparisons. No change to our long-term view — this is a business that continues to execute very well, owns tangible assets with a proven expertise in creating value in a specialized niche, and has several structural growth drivers going forward."

Oil-Dri Corporation of America (NYSE:ODC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 16 hedge fund portfolios held Oil-Dri Corporation of America (NYSE:ODC) at the end of the third quarter, up from 14 in the previous quarter. While we acknowledge the potential of Oil-Dri Corporation of America (NYSE:ODC) 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 addition, please check out our hedge fund investor letters Q4 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.