MANAGEMENT DISCUSSION & ANALYSIS – VALUE FUND

MARCH 31, 2009

Co-Portfolio Managers:  Wallace R. Weitz
Bradley P. Hinton

The Value Fund declined -9.3% in the first quarter, compared to a -11.0% return for the S&P 500. Financial stocks continued to dominate the headlines, with the S&P 500 Financials Index declining nearly 30% for the quarter. Our results with financial companies were less one-sided. Redwood Trust was actually the Fund’s largest positive contributor. We added to our position when the company offered new shares at $11.25 in January. Redwood’s stock closed the quarter up 36% from that level. Three other financial companies detracted from the Fund’s results. Berkshire Hathaway finished the quarter down -12%, after declining nearly -30% intra-quarter on what we think are overblown short-term concerns. American Express dropped -26% as it became more evident that the U.S. economy would not rebound quickly. Our modest position in Wells Fargo also hurt results after the stock fell -51% (note: both Wells and Amex have risen sharply since quarter-end, highlighting the volatility in these stocks). We currently have very little exposure to financials outside of those four companies, which we think are clear survivors. In other areas, Liberty Media – Capital (+48%) and Liberty Media – Entertainment (+14%) bounced back from depressed levels and posted healthy quarterly gains.

For the fiscal year ended March 31, 2009, the Value Fund declined -38.6%, roughly in-line with the S&P 500’s -38.1% decline. Very broad-based stock weakness drove the Fund’s poor results. While there were few places to hide, our financial and consumer-related companies were particularly hard hit. We have written in prior quarters about Berkshire Hathaway (-37%), Liberty Media – Interactive (-82%), American Express (-67%), Redwood Trust (-51%) and Liberty Global (-56%). In addition, several of our large-cap holdings did not provide the ballast we expected. The underlying businesses held up better than the stocks at companies such as Microsoft (-34%), UnitedHealth Group (-39%), Comcast (-31%) and even much-maligned Dell (-52%). Among the few bright spots were Apollo Group and Covidien, both of which we sold at healthy gains. Long-term care pharmacy service provider Omnicare rose 35%, and Wal-Mart held its own as more consumers took advantage of its value proposition.

We added small (for now) positions in several larger company stocks during the quarter. These companies run the gamut from railroad Burlington Northern Santa Fe to technology giant Google (the "death star" to its competitors) to consumer staple stalwarts Procter & Gamble and Diageo. All generate loads of free cash flow, maintain solid balance sheets and enjoy strong long-term business outlooks. We modestly increased our holdings of energy companies ConocoPhillips and XTO Energy and, as mentioned above, we added to Redwood Trust at $11.25 in January. We also trimmed several large holdings as stocks rallied both early and late in the quarter. UnitedHealth Group and Washington Post fell from the top ten holdings, replaced by Microsoft and Liberty Global. Finally, we shaved our still-large holdings of WellPoint and Telephone and Data Systems.

The Value Fund continues to tilt toward our best larger company ideas, with more than 60% of the Fund’s stock investments in companies with market caps greater than $10 billion. The Fund also remains relatively concentrated, with the ten largest holdings representing 51% of net assets. As we sold shares into the late March market rally, the Fund’s residual cash position drifted up to 12.5% of net assets at quarter end.

These performance numbers reflect the deduction of the Fund’s annual operating expenses which as stated in its most recent Prospectus are 1.16% of the Fund’s net assets. 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 higher or lower 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 (except for the 15 and 20 year Nasdaq numbers for which reinvestment of dividend information was not available).

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

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.