PORTFOLIO MANAGER'S DISCUSSION & ANALYSIS – HICKORY FUND

JUNE 30, 2010

Portfolio Manager:  Wallace R. Weitz

The Hickory Fund declined -4.0% in the second calendar quarter, compared to a -11.4% decline for the S&P 500. For the calendar year-to-date, the Fund returned +11.4% compared to a -6.6% decline for the S&P 500. Two stocks generated outsized contributions during the quarter, one positive and one negative. Coinstar rose 32% as the company’s Redbox division continued to expand profitably and take market share from brick and mortar DVD retailers. After a strong run, Liberty Media – Interactive pulled back sharply during the quarter (-31%) on fears of a renewed slowdown in consumer spending. The stock trades at a significant discount to our value estimate and remains the Fund’s largest holding. Hickory’s other consumer stocks posted mixed results, as declines at Energizer Holdings (-20%), Mohawk Industries (-16%) and Live Nation (-28%) more than offset gains at Liberty Media – Capital (+15%) and AutoZone (+12%).

We established large positions in two new stocks this quarter. SandRidge Energy is an Oklahoma City-based natural gas and oil company. SandRidge is focused on traditional, conventional reservoirs with predictable production profiles and shallow decline rates. The pending acquisition of Arena Resources will increase the company’s exposure to oil, tighten its geographic focus, and strengthen its balance sheet. SandRidge trades at less than $6 per share, and we think the stock is worth at least $10, perhaps substantially more if natural gas prices surprise to the upside. Hewitt Associates is a leading provider of human resources outsourcing and consulting services. The company has an extremely strong brand and an impressive, loyal client list. Hewitt’s core business generates high operating margins and free cash flows. Part of our thesis is that the struggling business process outsourcing segment will gradually improve in the coming years. Hewitt trades at roughly 11 times our earnings estimates, and we think business value is in the mid-$50’s per share.

In other activity, we sold The Buckle and Corporate Executive Board at healthy gains as both stocks approached our estimates of business value. We also trimmed the Fund’s positions in Liberty Media – Capital and Coinstar after the stocks posted 76% and 55% year-to-date returns, respectively. In contrast, we added to the Fund’s holdings in Omnicare and Energizer Holdings on weakness. Finally, we established small new positions in Vulcan Materials, eHealth, HSN and FLIR Systems, mostly late in the quarter. The Fund’s residual cash position was 22% of net assets at quarter end, as strong inflows slightly outweighed substantial net buying activity.

The Hickory Fund invests in a subset of our best smaller company ideas. All of Hickory’s stock investments are in companies with market caps under $10 billion, and half of those companies have market caps of less than $2.5 billion. In the table below we have included comparative returns for the Russell 2500 and the Russell 2500 Value, two indices that represent small and medium sized companies (colloquially known as “smid cap” in industry jargon). As a reminder, we do not and will not manage our funds to any specific benchmark. Even so, investors may find the supplemental information useful in evaluating the Fund’s longer-term results.

These performance numbers reflect the deduction of the Fund’s annual operating expenses which as stated in its most recent Prospectus are 1.33% of the Fund’s net assets. The returns assume redemption at the end of each period. This information represents past performance and past performance does not guarantee future results. The investment return and the principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than the performance data quoted above. Performance data current to the most recent month-end may be obtained at www.weitzfunds.com/performance/monthly.asp.

* All performance numbers assume reinvestment of dividends.

# Index performance is hypothetical and is for illustrative purposes only.

^(a) The S&P 500 is an unmanaged index consisting of 500 companies generally representative of the market for the stocks of large-size U.S. companies.

^(b) The Russell 2500 is an unmanaged index of small to mid-capitalization common stocks. It consists of the 2,500 smallest companies in the Russell 3000 index, which consists of the 3,000 largest U.S. companies based on market capitalization.

^(c) The Russell 2500 Value is an unmanaged index of small to mid-capitalization common stocks. It consists of those Russell 2500 companies with lower price-to-book ratios and lower forecasted growth values.

Investors should consider carefully the investment objectives, risks, and charges and expenses of the Fund before investing. The Fund’s Prospectus contains this and other information about the Fund and should be read carefully before investing. Portfolio composition is subject to change at any time and references to specific securities, industries, and sectors referenced in this letter are not recommendations to purchase or sell any particular security. Current and future portfolio holdings are subject to risk. See the Schedule of Investments in Securities included in the Fund’s quarterly report for the percent of assets of the Fund invested in particular industries or sectors.

Weitz Securities, Inc. is the distributor of the Weitz Funds.