Longleaf Partners' Small-Cap Fund disclosed its fourth-quarter 2025 results, revealing that Park Hotels & Resorts (PK) negatively affected its portfolio. The report highlighted the difficult macroeconomic climate as a primary factor, particularly impacting hotel companies focused on leisure travel. Despite these challenges, the fund emphasized its commitment to identifying robust, cash-generating businesses over speculative ventures, a strategy that proved beneficial during periods of market volatility in 2025.

Park Hotels & Resorts, a prominent real estate investment trust in the lodging sector, experienced a downturn in its stock performance. As of February 24, 2026, PK shares were valued at $11.27, reflecting a 5.03% gain over the previous month but an 8.67% loss over the past year. The company's market capitalization stood at $2.253 billion.

The investment firm noted that Park Hotels & Resorts' decline was attributed to investor concerns regarding the broader economic environment's effect on leisure-oriented hotel operations. A significant asset, the Hilton Hawaiian Village, continued to recover from a 2024 labor dispute and reduced visitor numbers from Japan due to the yen's depreciation. In response, Park Hotels & Resorts strategically divested non-core assets at favorable prices and engaged in share buybacks.

Ultimately, Longleaf Partners decided to exit its position in Park Hotels & Resorts during the year. This move was a combination of reallocating capital to more promising opportunities and the inability to achieve a desired allocation weight within the fund's holdings.

Despite its struggles, Park Hotels & Resorts reported a RevPAR (revenue per available room) of approximately $182 in the fourth quarter of 2025, marking a modest 1% increase year-over-year, or nearly 3% when excluding the Royal Palm property. While recognizing PK's potential, Longleaf Partners suggested that certain artificial intelligence (AI) stocks offered superior upside potential with reduced risk, especially those poised to benefit from Trump-era tariffs and domestic manufacturing trends. At the close of the fourth quarter, 29 hedge funds held positions in Park Hotels & Resorts, an increase from 26 in the preceding quarter.