| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | -6.3% | -6.3% |
Wedgewood Partners posted a -6.3% return in Q1 2026, underperforming the S&P 500's -4.3% decline amid geopolitical volatility from the Iran-Strait of Hormuz conflict. The portfolio benefited from strong AI-driven performance at Taiwan Semiconductor Manufacturing (+25% revenue growth), Alphabet (+17% search revenue growth), and continued industrial recovery at Old Dominion Freight Line. However, technology stocks faced pressure as markets discounted AI-enabled companies ahead of major IPOs from OpenAI, Anthropic, and SpaceX expected in 2026. Microsoft, Meta, and other AI infrastructure investors were penalized despite strong fundamentals and productivity gains from elevated capex spending. The Middle East war drove oil prices from $67 to $100 per barrel, creating inflationary pressures and market volatility. Portfolio activity included selling PayPal, adding Toll Brothers and Progressive, and increasing Amazon while trimming Taiwan Semiconductor due to position size limits. The firm maintains conviction in AI infrastructure investments and expects the geopolitical disruption to be temporary, lasting quarters rather than years.
Wedgewood Partners maintains a concentrated portfolio of high-quality large-cap growth companies positioned to benefit from secular trends including AI infrastructure development, semiconductor demand growth, and industrial recovery, while navigating near-term geopolitical risks from Middle East conflicts.
The manager expects the Middle East conflict to represent a short-term disruption lasting a few quarters rather than a multi-year headwind. They anticipate continued strong performance from AI infrastructure investments and believe major technology companies' elevated capex spending is justified by productivity gains and margin expansion. The firm expects industrial activity to rebound as U.S. manufacturing expansion continues.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 6 2026 | 2026 Q1 | AMZN, BKNG, CB, CDW, CPRT, GOOGL, META, MSFT, MSI, ODFL, ORLY, PGR, PYPL, TOL, TSCO, TSM, UNH, V | AI, energy, geopolitics, growth, large cap, oil, semiconductors, technology |
TSM ODFL MSI CB ORLY MSFT BKNG META GOOGL V |
Wedgewood's concentrated large-cap growth portfolio declined 6.3% in Q1 2026 as geopolitical tensions from the Iran conflict pressured markets despite strong AI-driven fundamentals at core holdings like Taiwan Semiconductor and Alphabet. The firm maintains conviction in AI infrastructure investments while navigating temporary Middle East disruptions and preparing for major tech IPOs that could provide valuation clarity. |
| Jan 14 2026 | 2025 Q4 | AAPL, AMZN, BKNG, CB, CDW, CPRT, EW, GOOGL, META, MSI, ODFL, ORLY, POOL, PYPL, SPGI, TSCO, TSM, UNH, URI, V | AI, growth, large cap, Portfolio Management, Quality, technology, valuation |
AMZN CB GOOG TSM AAPL ODFL EW META MSI URI TSCO PYPL |
Wedgewood Partners endured their worst relative performance since 1993, with quality growth stocks underperforming in a speculative AI-driven market. The manager warns of bubble-like valuations exceeding tech bubble levels but remains confident their superior portfolio fundamentals and attractive relative valuations position them well for a potential reversal in 2026 when quality may reassert itself. |
| Oct 14 2025 | 2025 Q3 | AAPL, AMD, AMZN, AVGO, BKNG, CDNS, CDW, CPRT, GOOGL, META, MSFT, NVDA, ODFL, ORCL, ORLY, PGR, PYPL, SNPS, TSM, URI | AI, Capex, Data centers, growth, large cap, semiconductors, technology |
GOOGL US PYPL US META US MSFT US |
Wedgewood delivered 5.9% in Q3, led by AI infrastructure holdings like Alphabet and TSMC. However, the manager warns that unprecedented AI spending forecasts may transform tech companies into capital-intensive businesses, creating future cyclicality as depreciation expenses weigh on earnings. Despite strong AI performance, they've been trimming positions due to sustainability concerns about trillion-dollar infrastructure spending plans. |
| Jul 14 2025 | 2025 Q2 | AAPL, BKNG, CDW, CPRT, EW, GOOGL, IDXX, META, MSFT, MSI, ORLY, TSCO, TSM, UNH, URI, V, ZTS | AI, Bull Market, growth, healthcare, large cap, tariffs, technology, Valuations | - | Wedgewood delivered 7.1% in Q2 but lagged the tech-heavy market rally. Strong AI beneficiaries like Meta and Microsoft drove performance while UnitedHealth was sold after execution issues. The manager initiated Zoetis, capitalizing on pet care trends at attractive valuations. With 76% of market sectors trading below average multiples, opportunities exist beyond the narrow, stretched technology rally. |
| Apr 14 2025 | 2025 Q1 | AAPL, CPRT, GOOGL, META, MSFT, ODFL, ORLY, POOL, PYPL, SPGI, TSCO, TSM, UNH, URI, V | China, growth, infrastructure, large cap, payments, tariffs, technology, volatility |
V ORLY URI |
Wedgewood Partners navigated tariff-driven volatility in Q1 2025, delivering -6.3% returns while adding United Rentals to capitalize on infrastructure spending tailwinds. Despite market pressure on growth stocks, core holdings like Visa demonstrated strong fundamentals. The firm maintains conviction in large-cap growth companies with secular drivers, positioning for recovery as tariff uncertainty resolves. |
| Jan 15 2025 | 2024 Q4 | AAPL, BKNG, CDW, EW, GOOGL, META, MSFT, MSI, NVDA, ODFL, ORLY, POOL, SPGI, TPG, TSCO, TSM, UNH, V | AI, growth, interest rates, large cap, semiconductors, technology, Valuations | - | Wedgewood delivered 29.1% returns in 2024 led by Taiwan Semiconductor and AI themes, but warns of stretched valuations and bubble-like sentiment heading into 2025. The firm sold Texas Pacific Land after index-driven gains and is positioned defensively, waiting for better prices while concerned about bond market risks and federal debt pressures. |
| Oct 16 2024 | 2024 Q3 | AAPL, BRK-B, CDW, CPRT, EW, GOOGL, META, MSFT, MSI, PYPL, UNH | Fed policy, growth, healthcare, large cap, technology, value |
PYPL META UNH MSI |
Wedgewood delivered 5.8% Q3 returns led by PayPal, Meta, and UnitedHealth. The fund targets high-quality businesses with competitive moats at attractive valuations, focusing on AI monetization, e-commerce expansion, and healthcare transformation. Fed rate cuts provide tailwinds while corporate profits remain at record highs. Portfolio positioning emphasizes secular growth themes with defensive characteristics. |
| Jul 15 2024 | 2024 Q2 | AAPL, BKNG, CDW, GOOGL, META, MSI, ODFL, POOL, PYPL, TSM, V | AI, Cloud, Concentration, growth, large cap, semiconductors, technology | - | Wedgewood's concentrated technology portfolio delivered strong Q2 performance led by AI beneficiaries Taiwan Semiconductor, Alphabet, and Apple. Apple Intelligence rollout should drive iPhone upgrades while TSMC benefits from AI chip manufacturing monopoly. However, manager warns of AI investment bubble with $500 billion capital hole and extreme benchmark concentration creating systemic risks. |
| Apr 15 2024 | 2024 Q1 | AAPL, AMZN, BKNG, CDW, CPRT, EW, GOOGL, META, MSFT, NVDA, POOL, PYPL, SPGI, TPG, TSCO, TSLA, TSM, UNH, V | AI, growth, large cap, payments, technology, Travel, value | PYPL | Wedgewood delivered 11.5% in Q1 2024, led by AI beneficiaries Meta and Taiwan Semiconductor. The concentrated large-cap growth strategy focuses on technology leaders while adding to undervalued PayPal. Despite Fed uncertainty, the manager sees economic resilience and continued AI adoption driving secular growth across core holdings. |
| Jan 13 2024 | 2023 Q4 | AAPL, CDW, CPRT, EW, GOOGL, META, MSFT, MSI, ODFL, ORLY, PYPL, TPG, TSCO, TSM, UNH, V | AI, Cloud, Fed policy, growth, large cap, semiconductors, technology | - | Wedgewood delivered 29.2% returns in 2023, driven by AI leaders Meta Platforms, Taiwan Semiconductor, and Microsoft. The manager trimmed winners while adding to undervalued positions like PayPal and Edwards Lifesciences. With the Fed likely pivoting to cuts in 2024, the focus remains on superior businesses successfully monetizing AI technologies for sustainable competitive advantages. |
| Dec 10 2023 | 2023 Q3 | AAPL, BKNG, CDW, EW, GOOGL, META, MSI, ODFL, ORLY, PYPL, TPG, TSM | AI, Auto Aftermarket, Fed policy, growth, interest rates, large cap, technology, Travel | AVGO|BYD|CRWD|MELI|MSFT|NFLX|NVDA|NVO|ORLY|SPOT | Wedgewood delivered -2.4% in Q3, led by Alphabet's search acceleration and travel recovery at Booking Holdings. Added O'Reilly Automotive on auto aftermarket tailwinds from higher financing costs. Fed's higher-for-longer policy creates unprecedented Treasury stress with mortgage rates at 8%. Portfolio's quality focus on companies with pricing power and competitive moats provides resilience amid macro headwinds. |
| Jul 14 2023 | 2023 Q2 | AAPL, BKNG, CDW, CPRT, GOOGL, META, MSFT, PYPL, TPG, TSCO | AI, Buybacks, Cloud, Ecosystem, growth, large cap, Mobile, technology |
ADI|BDX|FI|FND|HAS|META|MSFT|MSI|ORCL|TMO AAPL GOOGL CPRT AAPL|MSFT|NFLX|NVDA|UNH PYPL TPG CDW TSCO |
Wedgewood delivered 8.1% Q2 returns led by Meta, Apple, and Alphabet, all benefiting from AI investments and ecosystem advantages. The team trimmed Meta at maximum weight and added to PayPal on valuation. They remain concentrated in high-quality large-cap technology companies with sustainable moats, though acknowledge elevated sector multiples require selectivity. |
| Apr 20 2023 | 2023 Q1 | AAPL, BKNG, FRC, GOOGL, META, PGR, POOL, SPGI, TPG, TSM, UNH | Banking, Credit Crisis, Federal Reserve, growth, large cap, technology | FRC | Wedgewood delivered 9.8% in Q1 2023, led by technology holdings while First Republic Bank collapsed due to deposit runs. The Federal Reserve's extreme rate hikes broke the banking system by creating massive unrealized losses on mortgage securities. The manager expects forced Fed easing and better investment opportunities ahead while avoiding banks until regulatory structures change. |
| Jan 19 2023 | 2022 Q4 | AAPL, CDW, EW, GOOG, META, MSI, PYPL, TPL, TSCO, V | - | - | |
| Oct 10 2022 | 2022 Q3 | AAPL, CPRT, EW, FB2A, GOOG, MSI, PYPL, TPL, TSM, V | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
AIAI infrastructure spending continues driving growth at Microsoft, Meta, and Alphabet despite market concerns about elevated capex. Companies are demonstrating strong productivity gains and margin expansion from AI investments. The market is discounting AI-enabled companies ahead of major IPOs from OpenAI, Anthropic, and other AI firms expected in 2026. |
Infrastructure Capex Productivity Cloud Software |
SemiconductorsTaiwan Semiconductor Manufacturing delivered strong performance with 25% revenue growth and guidance for 30% growth in 2026. Demand for AI compute accelerators continues ramping unabated. The company increasingly works directly with cloud service providers on custom silicon development. |
AI Compute Custom Silicon Cloud Foundries | |
OilThe Strait of Hormuz conflict has driven oil prices from $67 to $100 per barrel. Iran's blockade strategy is proving economically powerful as the IRGC demands sovereignty and tolling rights. The war represents a significant geopolitical risk with potential for prolonged supply disruptions. |
Geopolitics Supply Iran Shipping Energy | |
| 2025 Q4 |
ConcentrationU.S. equity market concentration has reached extreme levels with the ten largest S&P 500 constituents accounting for over 40% of index weight. This concentration creates challenges for risk management and alpha generation in actively managed portfolios. The concentration is driven by both expanding valuations and growing earnings share of mega-cap technology companies. |
Market Structure Index Weight Risk Management Alpha Generation Mega Cap |
RiskConcentrated markets create uneven beta distributions and increased correlation among smaller stocks, making portfolios more sensitive to estimation error during market stress. The ten largest companies now contribute more than 50% of S&P 500 volatility and have aggregate volatility 1.5 times that of the overall index. |
Beta Distribution Volatility Correlation Market Stress Risk Models | |
AIBreakthroughs in artificial intelligence have helped drive strong performance in mega-cap stocks, contributing to increased market concentration. AI is identified as one of the key technological drivers behind the outperformance of the largest companies in recent years. |
Technology Performance Mega Cap Innovation | |
| 2025 Q3 |
AIAI infrastructure spending is reaching unprecedented levels with forecasts of trillions in necessary investment. The manager expresses concern about the sustainability of current AI spending plans and the transformation of capex-light tech companies into capital-intensive businesses. They worry about the cyclical nature this will create as depreciation expenses weigh on future earnings. |
Data Centers Cloud Semiconductors Infrastructure Capex |
Data CentersMassive data center buildouts are straining power grids and requiring enormous capital investments. Companies like Meta are building 70 football-field sized facilities consuming as much power as major cities. The manager highlights power as the key bottleneck for future AI growth. |
Power Infrastructure Grid Energy Capacity | |
SemiconductorsThe semiconductor supply chain is described as a modern miracle with critical dependencies on single sources globally. Taiwan Semiconductor Manufacturing produces over 90% of advanced chips, creating significant concentration risk. The manager discusses the fragility of this interconnected system. |
Taiwan Manufacturing Supply Chain Technology Foundries | |
| 2025 Q2 |
AIMeta Platforms has been a consistent beneficiary of artificial intelligence over the past several years, investing aggressively in deep learning recommendation systems that help power its products. Meta's AI investments, combined with its massive scale, allow the Company to quickly spin up new products across its digital advertising real estate to reinforce its competitive positioning. Microsoft showed key acceleration in its Azure cloud infrastructure business, driven by demand for AI-compute capacity. |
Deep Learning Recommendation Systems Azure AI Compute Digital Advertising |
Pet CareZoetis is the global leader in animal healthcare, with business skewing heavily toward pets in the U.S. The pet industry continues to be driven by increasing pet ownership, changing attitudes toward quality of care, and personification of pets as family members. Pet ownership trends accelerated during COVID-19, with 7% more households owning dogs and 15% more owning cats over four years. |
Animal Healthcare Pet Ownership Veterinary Pet Personification COVID Impact | |
SemiconductorsTaiwan Semiconductor Manufacturing was a top performance contributor for the quarter and the best portfolio performer since September 2022 panic-selling lows. The company benefits from strong demand for semiconductor manufacturing capacity, particularly related to AI and technology infrastructure needs. |
Foundries Manufacturing Technology Infrastructure AI Demand | |
TravelBooking Holdings contributed to performance as travel spending across the Company's core ex-U.S. markets, particularly Europe, remained healthy. The Company continues to take share in alternative accommodations and is on track to expand margins after years of reinvestment. |
Alternative Accommodations Europe Market Share Margin Expansion | |
| 2025 Q1 |
Trade PolicyThe Trump administration's tariff policy has created significant market volatility, with reciprocal tariff rates initially announced at 10% across-the-board and 145% on Chinese exports. The administration issued a 90-day pause to negotiate lower rates, with critical technology exclusions for computers, smartphones and chip-making equipment representing nearly 25% of Chinese imports. |
Tariffs China Reciprocal Technology Inflation |
Infrastructure SpendingUnited Rentals benefits from secular demand for heavy industrial equipment driven by America's aging infrastructure needs. Massive federal funding is already in place to support more than GDP-plus growth for the industrial rental equipment industry, with demand measured in decades rather than quarters. |
Construction Equipment Federal Secular Rental | |
PaymentsVisa continues to demonstrate strong growth with +10% revenue and +14% adjusted earnings per share growth, handling $13.4 trillion in volume on 240 billion transactions. Large untapped addressable markets persist, particularly in cash and checks totaling $11 trillion, with expanding opportunities in peer-to-peer and business payments. |
Digital Volume Cross-border Network Addressable | |
| 2024 Q4 |
AIWedgewood views AI as evolutionary rather than revolutionary, noting that companies like Alphabet and Meta have been using machine learning for over a decade. They emphasize that AI has been hiding in plain sight, with their portfolio companies already generating substantial returns from AI-related investments in R&D and capex. |
Machine Learning TensorFlow GPUs Cloud Computing Data Analytics |
SemiconductorsTaiwan Semiconductor Manufacturing was a top contributor, benefiting from dramatically accelerated earnings growth as wafer fabrication volumes soared in 2024. The company maintains a near-monopoly in fabricating AI accelerators and continues investing tens of billions in future capacity for hyperscale demand. |
Foundries AI Accelerators Wafer Fabrication Hyperscale Capacity Expansion | |
Capital MarketsS&P Global is positioned to benefit from declining interest rates and increased capital formation activity. The company's ratings business generates roughly half of profits and benefits from corporate debt refinancing cycles, with a wall of debt refinancings expected in coming years. |
Credit Ratings Bond Issuance Refinancing Interest Rates Debt Markets | |
| 2024 Q3 |
AIMeta has been a consistent beneficiary of artificial intelligence over the past several years, investing aggressively behind deep learning recommendation systems. Meta's AI investments, combined with its massive scale, allow the Company to quickly spin up new products across its digital advertising real estate. Apple is well situated to develop a suite of compelling, consumer-friendly AI services given its proprietary semiconductor development and the compute-intensive nature of AI applications. |
Deep Learning Recommendation Systems Generative AI AI Hardware |
E-commercePayPal continues to trade at levels considered quite cheap given their strong positioning in the long-term secular expansion of global e-commerce. The Company serves over 35 million online merchants and has a large, online merchant acceptance base that is a rare and crucial component to profitably monetizing payment volumes. |
Digital Payments Online Merchants Payment Volumes Merchant Acceptance | |
Managed CareUnitedHealth has been able to adjust pricing in its Healthcare segment to keep up with medical cost inflation while working with its Optum units to deliver more value-based care. Value-based care is a sensible, long-term growth opportunity that differentiates them from the vast majority of healthcare providers, particularly as it relates to Medicare patients. |
Value-Based Care Medical Cost Inflation Medicare Healthcare Pricing | |
| 2024 Q2 |
AIApple unveiled Apple Intelligence at WWDC, rebranding AI as Apple Intelligence. The company has been developing AI capabilities for years through custom silicon and neural processing units. Apple's vertically integrated approach positions it well for AI applications, though the rollout will be modest initially. |
Apple Intelligence Neural Processing Custom Silicon Machine Learning Generative AI |
SemiconductorsTaiwan Semiconductor Manufacturing benefited from strong demand for AI chips and rollout of leading-edge N3 manufacturing node. The company has monopoly market share for manufacturing AI chips like GPUs and aggressive capital investment in equipment provides competitive advantage. |
AI Chips Manufacturing Foundries Capital Equipment N3 Node | |
CloudAlphabet's cloud infrastructure business grew 28% and is at nearly $40 billion revenue run-rate. The company has differentiated AI service offerings and has priced services competitively to take share from AWS and Azure. |
Infrastructure Revenue Growth Market Share Competitive Pricing AI Services | |
| 2024 Q1 |
AIArtificial intelligence continues to drive significant performance with portfolio holdings including Alphabet, Apple, Meta Platforms, Microsoft and Taiwan Semiconductor Manufacturing benefiting from the secular AI tailwind. Meta Platforms and Taiwan Semiconductor were 2024 performance leaders on this front. |
Artificial Intelligence Technology Semiconductors Software Innovation |
PaymentsPayPal represents a significant opportunity as the company navigates post-COVID normalization while maintaining strong fundamentals with 23% earnings per share growth and 13% total payment volume growth in 2023. The digital payments market continues growing with room for multiple players to succeed. |
Digital Payments FinTech E-commerce Financial Services Transaction Processing | |
TravelBooking Holdings shows healthy end markets with 16% bookings growth and 22% adjusted operating income growth, though facing tough comparisons. Consumers maintain significant wallet share for travel compared to pre-COVID levels, supporting continued growth in the travel ecosystem. |
Online Travel Hospitality Consumer Spending Leisure Recovery | |
| 2023 Q4 |
AIAI has been a multi-year phenomenon driving growth and profitability across portfolio companies. Meta Platforms has built one of the world's fastest supercomputers and uses AI for advertising optimization and content curation. Alphabet has spent $150 billion on R&D over five years, with 80% of advertising customers using AI-enabled tools. Apple has developed custom neural processing units enabling FaceID and other AI features across 200+ million devices annually. |
Machine Learning Neural Networks Recommendation Systems Supercomputing Custom Silicon |
SemiconductorsTaiwan Semiconductor Manufacturing has dominant market share in leading-edge semiconductor fabrication capacity key to manufacturing AI accelerators. The company began shipping chips using its industry-leading N3 node, with capacity filled by Apple, NVIDIA and Intel. As high-performance computing builds momentum, TSMC will be a key supplier for many years to come. |
Foundries Leading Edge AI Accelerators EUV Manufacturing Custom Silicon | |
CloudMicrosoft reported 28% growth in Azure and other cloud services, leading to 25% growth in operating income. The company has a commanding hold on productivity software with almost 50% operating margins, and AI features could help solidify that lead. Cloud-scale service providers are driving the majority of recent GPU spending for generative AI applications. |
Azure Productivity Software Cloud Services Operating Leverage AI Infrastructure | |
| 2023 Q3 |
Auto AftermarketO'Reilly Automotive represents the aftermarket auto parts industry which benefits from higher car financing costs forcing owners to keep cars longer, increasing maintenance needs. The industry remains fragmented with growth opportunities, particularly in the do-it-for-me segment where O'Reilly excels through its distribution network. |
Auto Parts Distribution DIFM Market Share Maintenance |
AIAlphabet has been at the vanguard of artificial intelligence for over a decade, spending $150 billion on R&D over five years. Over 80% of advertising customers use AI-enabled tools for Google Search and YouTube campaigns, positioning the company well despite fears of AI disruption to search. |
Search Advertising R&D Tools Revenue | |
TravelBooking Holdings reported continued healthy travel demand with accelerating trends into July. The alt-accommodations segment grew 11% in room nights, approaching parity with Airbnb while maintaining superior operating margins. Consumer travel budgets remain pent-up from the pandemic, particularly outside the US. |
Demand Alt-accommodations Margins Recovery International | |
RatesThe Fed's pivot to higher rates for longer has created unprecedented Treasury yield surges, with the 10-year set for a third consecutive year of negative returns. Mortgage rates have cracked 8%, the highest in 23 years, while bonds are experiencing a historic bear market with a 38-month drawdown. |
Fed Treasury Mortgage Bear Market Yields | |
| 2023 Q2 |
AIMeta has been at the forefront of investing in valuable artificial intelligence IP, particularly with ranking and recommendation systems across its products. Despite the recent Gen-AI frenzy, Meta has been researching generative-AI tools for years. Alphabet and Google have been pioneers in AI development, creating important software and hardware specifications that developers rely on today. |
Artificial Intelligence Machine Learning Generative AI Recommendation Systems AI Infrastructure |
CloudMicrosoft's Azure and other cloud services grew 31% during the quarter, while Alphabet's Cloud division turned a small profit on roughly $30 billion revenue run-rate. The Company's internal engineering prowess should continue to drive longer hardware useful life and better profitability for this unit over time. |
Cloud Computing Azure Google Cloud Cloud Infrastructure SaaS | |
BuybacksApple has returned a staggering $763.5 billion in capital to shareholders, largely through share buybacks. Since initiating buybacks in 2012, the share count has reduced from over 26 billion shares to just under 16 billion shares. This sizable reduction has been material in the accretion in earnings per share over the past ten years. |
Share Repurchases Capital Return Share Count Reduction EPS Accretion Shareholder Returns | |
E-commerceApple's App Store ecosystem facilitated $1.1 trillion in billings and sales worldwide in 2022, with over 90% originating from transactions outside the App Store. The ecosystem includes mobile commerce through apps on iPhone and iPad, representing a groundbreaking shift in how business is conducted digitally. |
Mobile Commerce App Store Digital Transactions M-commerce Digital Ecosystem | |
| 2023 Q1 |
Credit StressThe banking crisis that began with Silicon Valley Bank and Signature Bank failures created a deposit run on First Republic Bank, despite its strong lending track record. The crisis highlighted the vulnerability of banks with high uninsured deposit ratios and the systemic risks in the banking sector. |
Banking Deposits Credit Systemic Risk Liquidity |
RatesThe Federal Reserve's rapid rate increases from near zero to 4.83% in twelve months created massive unrealized losses on mortgage-backed securities and destabilized bank funding. The extreme tightening broke the MBS market and forced banks into a liquidity crisis. |
Federal Reserve Interest Rates Monetary Policy MBS Duration | |
AIMicrosoft's AI investments created investor concerns about potential competition to Alphabet's search business. However, Alphabet has been investing in AI hardware and software for over a decade, and the manager views AI competition concerns as overblown. |
Artificial Intelligence Search Competition Technology | |
TravelBooking Holdings reported accelerating travel trends with room night bookings up over 25% compared to 2019. Multiple years of pent-up travel demand as pandemic restrictions ease, with populations returning to spending on travel well beyond pre-Covid levels. |
Tourism Recovery Pent-up Demand Hospitality | |
SemiconductorsTaiwan Semiconductor Manufacturing grew revenues 27% despite near-term customer weakness. The company is well-positioned for long-term growth as leading-edge capacity is absorbed by high-performance computing applications from companies like Apple, Alphabet, and Amazon. |
Foundries High Performance Computing Leading Edge Capacity |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | ADI|BDX|FI|FND|HAS|META|MSFT|MSI|ORCL|TMO | Meta Platforms | Communication Services | Interactive Media & Services | Bull | NASDAQ | AI infrastructure, Artificial Intelligence, digital advertising, growth, revenue acceleration, social media, technology, user engagement | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | AAPL | Apple | Information Technology | Technology Hardware, Storage & Peripherals | Bull | NASDAQ | App Store, asset-light, Ecosystem, high-margin, Mobile Economy, Returns on Capital, services, Smartphones | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | GOOGL | Alphabet | Communication Services | Interactive Media & Services | Bull | NASDAQ | Artificial Intelligence, Automation, Cloud computing, digital advertising, engineering, profitability, Revenue Growth, search engine | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | CPRT | Copart | Industrials | Commercial Services & Supplies | Bull | NASDAQ | Auto auctions, Automotive Complexity, competitive moat, Insurance, market share, Returns on Capital, Total Loss, Vehicle Salvage | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | AAPL|MSFT|NFLX|NVDA|UNH | Microsoft | Information Technology | Software | Bull | NASDAQ | Azure, Cloud computing, Digital transformation, double-digit growth, Enterprise software, Office365, productivity software, SaaS | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | PYPL | PayPal | Information Technology | IT Services | Bull | NASDAQ | Branded Payments, digital payments, double-digit growth, e-commerce, financial technology, Payment Volume, Scalable Business, valuation multiple | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | TPG | Texas Pacific Land Corp | Energy | Oil, Gas & Consumable Fuels | Bull | NYSE | capital expenditures, Delaware Basin, energy infrastructure, land holdings, Oil and Gas Royalties, Permian Basin, Resource Scarcity, Water Rights | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | CDW | CDW Corporation | Information Technology | Electronic Equipment, Instruments & Components | Bull | NASDAQ | Cheap Multiple, Digital transformation, IT Complexity, IT services, Omni-office, Returns on Capital, technology distribution, Work From Home | Login |
| Jul 1, 2023 | Fund Letters | Wedgewood Partners | TSCO | Tractor Supply Company | Consumer Discretionary | Specialty Retail | Bull | NASDAQ | Core Position, Execution, Inflation Moderation, margin expansion, Relative value, Rural Lifestyle, Specialty retail, store remodeling | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | TSM | Taiwan Semiconductor Manufacturing Company | Semiconductors | Semiconductors & Semiconductor Equipment | Bull | New York Stock Exchange | AI, Cloud Service Providers, custom silicon, Foundry, growth, Leading-Edge Nodes, semiconductors, Taiwan | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | ODFL | Old Dominion Freight Line | Trucking | Trucking | Bull | NASDAQ | Capacity Management, Cyclical, Freight, Industrial Recovery, Ltl, manufacturing, Transportation, Trucking | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | MSI | Motorola Solutions | Communication Equipment | Communications Equipment | Bull | New York Stock Exchange | Command Center Software, Communications Equipment, Government, Land Mobile Radio, LMR, Mission-Critical, Public safety, Unmanned Aerial | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | CB | Chubb | Insurance - Property & Casualty | Property & Casualty Insurance | Bull | New York Stock Exchange | combined ratio, Digital, International, productivity, Property & Casualty Insurance, Small and Middle-Market, underwriting | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | ORLY | O'Reilly Automotive | Auto Parts | Specialty Retail | Bull | NASDAQ | Automotive Aftermarket, comparable sales, defensive, Non-Discretionary, Pricing power, Professional Business, Specialty retail | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | MSFT | Microsoft | Software - Infrastructure | Systems Software | Bull | NASDAQ | AI, backlog, capital allocation, Cloud computing, commercial bookings, OpenAI, Productivity Suite, Systems Software | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | BKNG | Booking Holdings | Travel Services | Hotels, Restaurants & Leisure | Bull | NASDAQ | air travel, Consumer AI, Middle East, Online Travel, Revenue Growth, Travel Booking, travel demand | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | META | Meta Platforms | Internet Content & Information | Interactive Media & Services | Bull | NASDAQ | advertising, AI infrastructure, Interactive Media, Productivity Gains, Revenue Growth, social media, valuation discount | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | GOOGL | Alphabet | Internet Content & Information | Interactive Media & Services | Bull | NASDAQ | advertising, AI, capital allocation, Google Cloud, Interactive Media, margin expansion, operating leverage, Search | Login |
| Apr 6, 2026 | Fund Letters | Wedgewood Partners | V | Visa | Credit Services | Data Processing & Outsourced Services | Bull | New York Stock Exchange | consumer spending, Data Processing, duopoly, Payment Networks, Payments, Regulatory risk, value-added services | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | AMZN | Amazon.com, Inc. | Consumer Discretionary | Broadline Retail | Bull | NASDAQ | advertising, cloud, ecommerce, Margins, valuation | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | CB | Chubb Limited | Financials | Property & Casualty Insurance | Bull | New York Stock Exchange | compounding, Insurance, premiums, profitability, underwriting | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | GOOG | Alphabet Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | advertising, AI, cloud, scale, Search | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | TSM | Taiwan Semiconductor Manufacturing Company Ltd. | Information Technology | Semiconductors | Bull | New York Stock Exchange | AI, Foundry, HPC, Pricing, semiconductors | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | AAPL | Apple Inc. | Information Technology | Technology Hardware, Storage & Peripherals | Bull | NASDAQ | Ecosystem, Hardware, Margins, services, Upgrades | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | ODFL | Old Dominion Freight Line, Inc. | Industrials | Cargo Ground Transportation | Bull | NASDAQ | Cyclicality, efficiency, Freight, Logistics, Pricing | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | EW | Edwards Lifesciences Corp. | Health Care | Health Care Equipment | Bull | New York Stock Exchange | Cardiology, growth, innovation, Margins, Medical devices | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | META | Meta Platforms Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | advertising, AI, Data, Engagement, social media | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | MSI | Motorola Solutions Inc. | Information Technology | Communications Equipment | Bull | New York Stock Exchange | Communications, growth, Public safety, Software, valuation | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | URI | United Rentals Inc. | Industrials | Trading Companies & Distributors | Bull | New York Stock Exchange | construction, Cyclicality, infrastructure, Rentals, scale | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | TSCO | Tractor Supply Company | Consumer Discretionary | Specialty Retail | Bull | NASDAQ | Loyalty, Margins, recovery, retail, Rural | Login |
| Jan 14, 2026 | Fund Letters | David A. Rolfe | PYPL | PayPal Holdings Inc. | Financials | Transaction & Payment Processing Services | Bear | NASDAQ | Competition, Execution, Margins, Payments, Volumes | Login |
| Oct 14, 2025 | Fund Letters | David A. Rolfe | GOOGL US | Alphabet Inc | Communication Services | Interactive Media & Services | Bull | NASDAQ | advertising, AI, cashflow, cloud, growth, infrastructure, Search, technology | Login |
| Oct 14, 2025 | Fund Letters | David A. Rolfe | PYPL US | PayPal Holdings Inc | Financials | Financial Technology | Bull | NASDAQ | ecommerce, Fintech, growth, Payments, stablecoin, valuation, Venmo | Login |
| Oct 14, 2025 | Fund Letters | David A. Rolfe | META US | Meta Platforms Inc | Communication Services | Social Media & Networking | Bull | NASDAQ | AI, cashflow, datacenter, infrastructure, innovation, social media, Software | Login |
| Oct 14, 2025 | Fund Letters | David A. Rolfe | MSFT US | Microsoft Corp | Information Technology | Systems Software | Bull | NASDAQ | AI, CapEx, cashflow, cloud, data centers, growth, Software | Login |
| Oct 1, 2024 | Fund Letters | Wedgewood Partners | PYPL | PayPal Holdings | Information Technology | Data Processing & Outsourced Services | Bull | NASDAQ | digital payments, e-commerce, Fintech, Merchant Services, Payment Platform, Transaction Processing, Venmo | Login |
| Oct 1, 2024 | Fund Letters | Wedgewood Partners | META | Meta Platforms | Communication Services | Interactive Media & Services | Bull | NASDAQ | Artificial Intelligence, digital advertising, Family of Apps, machine learning, Recommendation Systems, social media, technology platform | Login |
| Oct 1, 2024 | Fund Letters | Wedgewood Partners | UNH | UnitedHealth Group | Health Care | Managed Health Care | Bull | NYSE | health insurance, healthcare, managed care, Medicare, Optum, Preventative Care, value-based care | Login |
| Oct 1, 2024 | Fund Letters | Wedgewood Partners | MSI | Motorola Solutions | Information Technology | Communications Equipment | Bull | NYSE | Communications Equipment, Emergency Communications, Government, infrastructure, Land Mobile Radio, Mission-Critical, Public safety | Login |
| Apr 1, 2024 | Fund Letters | Wedgewood Partners | PYPL | PayPal Holdings Inc | Information Technology | Data Processing & Outsourced Services | Bull | NASDAQ | Braintree, cost-cutting, digital payments, e-commerce, Fintech, Margin recovery, market share, payment processing, Post-COVID Normalization, SaaS, Share Buybacks, turnaround, Value, Venmo | Login |
| Apr 1, 2023 | Fund Letters | Wedgewood Partners | FRC | First Republic Bank | Financials | Regional Banks | Bear | NYSE | Banking Crisis, Bear, conservative lending, Deposit Run, regional banks, wealth management | Login |
| Oct 1, 2023 | Fund Letters | Wedgewood Partners | AVGO|BYD|CRWD|MELI|MSFT|NFLX|NVDA|NVO|ORLY|SPOT | O'Reilly Automotive | Consumer Discretionary | Automotive Retail | Bull | NASDAQ | Automotive Aftermarket, DIFM, distribution network, DIY, market share, retailer, ROIC, Share Buybacks | Login |
| - | Fund Letters | Wedgewood Partners | V | Visa Inc. | Information Technology | Data Processing & Outsourced Services | Bull | NYSE | Cross-Border, digital payments, Fintech, growth, network effects, Payments, Transaction Processing | Login |
| - | Fund Letters | Wedgewood Partners | ORLY | O'Reilly Automotive Inc. | Consumer Discretionary | Automotive Retail | Bull | NASDAQ | Automotive Aftermarket, market share, Professional Customers, retail, Returns on Capital, Value, West Coast | Login |
| - | Fund Letters | Wedgewood Partners | URI | United Rentals Inc. | Industrials | Trading Companies & Distributors | Bull | NYSE | consolidation, construction, Equipment Rental, Industrial, infrastructure, market share, network effects, secular growth | Login |
| TICKER | COMMENTARY |
|---|---|
| TSM | Taiwan Semiconductor Manufacturing Company was a top contributor to portfolio performance in the first quarter. Revenues grew +25%, and the Company guided to accelerating revenue growth to +30% in 2026 as demand for compute accelerators for AI applications continues to ramp unabated. In addition, the Company recently reported that March revenue was up +45% year over year, +31% month over month, and +35% year to date. The semiconductor customer base has evolved to the point that the Company increasingly works directly with non-traditional end customers, particularly cloud service providers, to develop custom silicon. This helps the Company better match supply with demand, so despite strong revenue growth, the Company has kept capital expenditures relatively in line with revenue growth. In addition, the Company is raising prices as utilization rates at leading-edge nodes continue to climb. We trimmed positions because our holdings exceeded 10% of portfolios. Taiwan Semiconductor Manufacturing Company remains a top holding. |
| GOOGL | Alphabet grew its core search revenue by +17% and continues to accelerate as users spend more time on Google properties, driven by the Company's AI offerings (AI Mode and AI Overviews). At the same time, Google advertisers are adopting more AI-enabled tools to improve ad relevance and accuracy. These AI gains are unlocking significant productivity and driving margin expansion across both core Google services and the $70 billion run-rate Google Cloud business. Given this massive operating leverage, an accelerating revenue profile, and a historic ability to generate high returns on invested capital, we believe their elevated capex spending plans this year are fully justified. We continue to hold Alphabet as a top weighting. |
| CB | Chubb contributed to performance during the quarter, growing core operating income by +25% on +8% growth in net premiums (FX-neutral) and achieving a record-low combined ratio. Despite a soft industry backdrop, particularly in property, Chubb grew new business by +17% in its core small and middle-market segment, and international global retail premiums were up by +13%, driven by distribution through large local financial intermediaries and a direct-to-consumer digital buildout. Underwriting has benefited from a quiet year on the "mega-cat" front, but the Company has also performed well during previous periods of higher mega-cat activity and is focused on driving margins by controlling overhead through several productivity initiatives. We expect Chubb to grow earnings per share and tangible book value per share at double-digit rates this year. |
| ODFL | Old Dominion Freight Line also contributed to the quarter's performance. As in the fourth quarter of 2025, investors have grown more optimistic about a rebound in industrial activity, a core source of demand for Old Dominion's fleet, as U.S. manufacturing data suggests a nascent expansion is underway after more than three years of contraction. As usual, the Company has managed its capacity exceptionally well during this downturn, keeping costs under control and charging prices that reflect the longstanding, dependable service it provides its customers. Compared with peers, Old Dominion maintains a significant buffer of spare capacity, which helps capture more of the economics during an expansion. The Company has significant pent-up earnings growth ahead, which should attract new investors. |
| MSFT | Microsoft was a leading detractor from performance in the first quarter. Despite revenue growth of +15%, operating income growth above 20%, and a backlog that more than doubled (to over $600 billion), the stock's multiple contracted to multi-year lows. Much of the initial negativity during the quarter centered on Microsoft's capital expenditures, which grew +65%. As we have shown in recent letters, Microsoft's incremental capital expenditures have yielded excellent returns over the past few years. So, while revenue "only" grew +15% compared to 65% capex growth, the more-than-doubling of the Company's backlog and the tripling of its commercial bookings are reasonable demand markers that suggest returns on invested capital from this capex cycle are likely to remain strong. Further, Microsoft is the largest shareholder in OpenAI, with a stake worth well over $100 billion based on recent fundraises, a fraction of Microsoft's $2.75 trillion market cap but close to 10X more than the Company's initial investments. Microsoft's capital allocation discipline and track record are sorely underestimated. Lastly, the market began discounting nearly all "seat-based" software stocks on the perception that they could be undermined by emerging AI workflows and competition. Rather, we believe investors are fading large-cap tech to make room for the mega IPOs later this year, particularly OpenAI, Anthropic, and SpaceX (which includes xAI). As these companies provide more disclosure and the market digests this impending glut of issuance, the long-term, complementary, and mission-critical (sticky) nature of Microsoft's productivity suite will become more evident. |
| PYPL | During the quarter, we bought Toll Brothers and Progressive, sold PayPal, increased Amazon, and trimmed Taiwan Semiconductor Manufacturing twice. |
| TOL | During the quarter, we bought Toll Brothers and Progressive, sold PayPal, increased Amazon, and trimmed Taiwan Semiconductor Manufacturing twice. |
| PGR | During the quarter, we bought Toll Brothers and Progressive, sold PayPal, increased Amazon, and trimmed Taiwan Semiconductor Manufacturing twice. |
| AMZN | During the quarter, we bought Toll Brothers and Progressive, sold PayPal, increased Amazon, and trimmed Taiwan Semiconductor Manufacturing twice. |
| MSI | Motorola Solutions contributed positively to performance, with organic revenue up 7% and orders growing in the double digits for the third consecutive quarter. The Company's core Land Mobile Radio (LMR) business offers a unique value proposition to its customers, particularly local governments and public safety agencies. LMR technology is well suited for inclement weather and harsh conditions because its antennas generate a high-powered signal, unlike competing modes of communication (e.g., cellular and satellite), which rely on clusters of low-power deployments and are more susceptible to degradation when power or network backhaul becomes unavailable due to power failures or deteriorating weather. In fact, Motorola devices can communicate radio-to-radio without a network if necessary. In addition, Motorola's command center software and new unmanned aerial communication platform (Silvus) are value-added services that public-safety customers are increasingly adopting to do more with the same personnel. We continue to hold Motorola as a core position in portfolios, having added to it in the fourth quarter of 2025. |
| ORLY | O'Reilly Automotive helped performance this quarter, as earnings per share grew by +13%, driven by a +6% increase in same-store sales (comps), marking the Company's 33rd consecutive year of positive comp growth. The primary driver of O'Reilly's quarterly comp performance was its professional business, which grew by over +10%. This was partially aided by tariff-driven inflation, which the Company successfully passed through to customers. Weather did not play a significant role, making this quarter a clear indicator of the Company's underlying fundamentals. Despite higher gas prices late in the first quarter potentially dampening consumer sentiment, we expect O'Reilly to continue posting solid comp and earnings growth, as the vast majority of its revenues are non-discretionary. |
| BKNG | Booking Holdings detracted from overall performance during the quarter. Earnings per share grew +17%, with revenues up +16%, as travel demand remained strong late into 2025 and into early 2026. Most of the stock's weakness stemmed from investors labeling it an "AI loser" and, later in the quarter, the outbreak of war in the Middle East. Consumer AI, as a disruptive force in existing commerce, is proving to be much more difficult than markets expect. We view these AI tools and distribution channels as incremental rather than as drivers of the "zero-sum" dynamics that markets have been craving. As for the Middle East, for now, it represents a short-term disruption to travelers, particularly air travelers, given credible risks to international airline fuel supplies. However, we expect this will not be a multi-year headwind - more like a few quarters. |
| META | Meta Platforms detracted from performance despite reporting fourth-quarter 2025 revenue growth of +24% and guiding to accelerating revenue growth of +30%, its fastest since 2021. The market began punishing stocks, such as Meta's, that are spending heavily on capex to fund AI-related infrastructure, regardless of the tremendous productivity gains they have exhibited - with headcount up just +6% on +24% revenue growth. The market further pressured the stock after oil prices spiked at the beginning of March. The assumption was that disposable income would be cannibalized at the pump, pressuring broader retail activity and related ad budgets. The forward earnings multiple on Meta has fallen to levels more consistent with much slower growth than the Company has guided to. After trimming Meta several times over the past few years, we are more likely to add to positions based on the strong Company-specific benefits that their long-term AI investments are yielding, given a valuation that is at a substantial discount compared to growth stocks and recent history. |
| V | Visa reported strong revenue and earnings-per-share growth of +15%, driven by solid consumer spending and the continued expansion of "value-added" services. Despite this fundamental strength, the market pressured shares, ostensibly due to potential regulatory and legislative headwinds. The White House recently backed a legislative amendment that could introduce incremental competition into the Mastercard/Visa duopoly in the United States. While a legal framework for competition is undoubtedly an incremental risk, we view the technological and practical execution of actual competition as far less of a threat. Furthermore, attempts to attach the amendment to recent legislation have failed, making it far from certain that this new competitive framework will see the light of day. |
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