Greenlight Capital Exits Brighthouse Financial Stake, Citing 'Challenging Situation' Resolution
NEW YORK – Greenlight Capital, the investment firm led by David Einhorn, has exited its long-held position in Brighthouse Financial, Inc. (NASDAQ: BHF), according to the firm's fourth-quarter 2025 investor letter released this week. The move comes after the annuity and life insurance provider reached a sale agreement for a non-core business segment, a development Greenlight described as allowing the company to "exit a challenging situation."
Greenlight's strategy, which combines bottom-up stock picking with macroeconomic hedging, generated a net return of 8.5% for the quarter, outperforming the S&P 500's 2.7% gain. For the full year 2025, the partnership returned 9.0% net, though it lagged the index's 17.9% surge. Since its 1996 inception, Greenlight has returned $6.1 billion to investors after fees.
Brighthouse Financial, once a standout in Greenlight's long portfolio, has seen mixed performance. Its shares gained 4.04% over the past year but dipped 0.57% in the last month of the quarter, closing at $64.20 on January 29, 2026. The company's market capitalization stands at approximately $3.67 billion. Notably, hedge fund interest has waned slightly, with 39 funds holding the stock at the end of Q3 2025, down from 45 in the prior quarter, according to Insider Monkey data.
In the letter, Greenlight indicated that while Brighthouse presented value, the firm sees superior risk-reward profiles elsewhere. "The sale agreement resolves a persistent overhang," the letter noted, "freeing capital for opportunities we believe offer greater upside with less embedded risk, particularly in the evolving AI sector." The commentary reflects a broader shift among value-oriented funds grappling with a market increasingly driven by technological disruption.
Analyst & Investor Commentary:
"It's a pragmatic exit," said Michael Thorne, a financial services analyst at Crestwood Advisors. "Brighthouse has been streamlining its operations for years. This sale removes a complexity, but the core annuity business still faces a tough interest rate environment. Greenlight is likely recycling capital into areas with clearer catalysts."
"Another classic value trap," remarked Sarah Chen, portfolio manager at Volt Capital, her tone sharper. "This is why these old-school funds keep underperforming. They cling to 'cheap' insurers and retailers while the market rewards innovation. Exiting now is an admission they waited too long. The capital should have been deployed into structural growth themes years ago."
"I held BHF alongside Greenlight for the dividend and book value," shared retiree and individual investor Robert Gibson. "The sale is probably a positive long-term, but the stock hasn't gone anywhere. It's frustrating. I'm holding for now, but I understand their need to move on."
The investor letter also directed readers to Greenlight's other portfolio insights and top holdings for 2025. Disclosure statements confirmed the article's original publication by Insider Monkey.