Here’s Why This Strategy Decided to Exit Charles River Laboratories (CRL)

Riverwater Partners, an investment management company, disclosed in its Q2 2026 investor letter the reasons for exiting Charles River Laboratories International, Inc. (NYSE:CRL) from its Sustainable Value Strategy. The decision was driven primarily by stock selection, with the notable absence of SanDisk (SNDK), which saw a substantial 720% year-to-date increase and contributed around 6% of the Russell 2500 Value Index's 2026 return.

Technology emerged as the strategy's largest overweight at 17%, partially due to a significant reduction in technology allocation in the benchmark index. Riverwater Sustainable Value Strategy maintained a focus on disciplined, quality-focused investing, emphasizing that quality investments tend to outperform over the long term. The firm sold Charles River Laboratories International, Inc. to reinvest in Stevanato Group, expressing caution regarding the potential long-term impact of the FDA's New Approach Methodologies on the company's animal testing business in preclinical drug discovery.

Despite this exit, Charles River Laboratories International, Inc. remains a stock that Riverwater Sustainable Value Strategy believes could offer attractive upside potential, particularly in the context of undervalued AI stocks and onshoring trends.