| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Brennan Asset Management maintains a cautious stance on expensive markets while focusing on undervalued international opportunities with specific catalysts. The broader market trades at a CAPE of 41, the second most expensive in history, while AI excitement appears excessive. The manager continues finding better value internationally than domestically. Key holdings include Metro Bank, which is transforming into a commercial mortgage bank and will benefit from exiting the MREL regime, eliminating £63 million in annual interest costs. The bank trades at 75% of tangible book value with potential for 3x returns by 2028. PTSB's sales process continues with expected resolution by Q1 2026. Warner Brothers Discovery faces competing bids from Netflix and Paramount in an ongoing acquisition battle. DCC represents a focused energy distribution play following divestitures of non-core businesses. The manager increased positions in Metro Bank and CODI preferreds while participating in GLIBA's rights offering. Despite individual stock opportunities, the overall investment environment remains challenging with limited domestic appeal.
Focus on undervalued international opportunities with multiple catalysts while avoiding expensive domestic markets trading at historically high valuations.
Manager expects continued challenging market environment with expensive valuations and limited domestic opportunities. Focus remains on international value opportunities with multiple catalysts. Several holdings are in process of being monetized, and proceeds will be redeployed cautiously. The overall investing opportunity set is viewed as less appealing on a macro level.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 18 2026 | 2025 Q4 | CODI, DCC.L, GLIBA, MTRO.L, NFLX, PTSB.IR, WBD | AI, Banking, energy, international, Media, special situations, value |
MTRO LN PTSB ID WBD CODI DCC LN |
Manager experimented with AI tools for presentation creation, finding initial promise but significant limitations in execution. The experience highlighted both benefits and constraints of current… |
| Jul 20 2025 | 2025 Q2 | CHTR, CODI, MTRO LN, PTSB LN, TIGO | cash flow, dividends, risk management, stability, total return | - | The commentary emphasizes dividend-paying companies with consistent growth and financial strength. Management views dividends as a tangible component of total return and risk mitigation. The… |
| May 1 2025 | 2025 Q1 | CODI, GTX, LBRDA, PTSB LN | - | - | - |
| Jan 26 2025 | 2024 Q4 | ARCO, CABP LN, CHTR, CODI, LILAK, MEGACPO MM, PTSB LN, TIGO | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has become a dominant theme across major equity indices, with Nvidia leading the S&P 500, ASML dominating MSCI EAFE, and TSMC leading emerging markets. The fund benefited from AI-related dynamics, particularly through Samsung's memory products experiencing substantial price increases due to DRAM shortages driven by AI demand. |
Semiconductors Memory DRAM Technology Nvidia |
BankingFocus on Metro Bank's transformation into commercial and specialty mortgage bank, with MREL exit providing significant cost savings. PTSB sales process ongoing with potential strategic and private equity bidders. Both banks offer attractive risk-reward profiles despite challenging UK and Irish economic environments. |
Commercial Banking Mortgage Transformation Capital Returns Europe | |
EnergyCanadian energy sector positioned to benefit from regulatory reform and government cooperation with Alberta. US military action in Venezuela aimed at accessing oil sector, with administration asking US energy companies to invest $100 billion in Venezuelan infrastructure. |
Oil Gas Regulatory Reform Alberta Venezuela | |
MediaWarner Bros Discovery was the top contributor as multiple parties submitted acquisition offers, with Netflix acquiring the Streaming and Studios business while Global Networks spins to shareholders. Paramount Skydance made a $30 per share offer for the entire company, creating a bidding war that unlocked shareholder value. |
Streaming M&A Content Entertainment Bidding | |
ValueBlue Tower focuses on value investing with international diversification. The manager notes that the valuation spread between cheap and expensive stocks is one of the greatest in market history, creating a favorable environment for their value-oriented approach. |
Value International Cheap Expensive Valuation | |
| 2025 Q2 |
DividendsDividend-paying companies lagged non-dividend-paying companies by more than 50%. On average, portfolio holdings raised their dividends 9% over 2025, in line with their earnings growth. The top three dividend raisers were Amphenol (55%), Cintas (15%), and Verisk Analytics (15%). |
Dividend Growth Income Yield Distribution Payout |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 18, 2026 | Fund Letters | Patrick Brennan | MTRO LN | Metro Bank Holdings plc | Financials | Diversified Banks | Bull | New York Stock Exchange | banking, capital returns, MREL, restructuring, tangible book | Login |
| Jan 18, 2026 | Fund Letters | Patrick Brennan | PTSB ID | Permanent TSB Group Holdings plc | Financials | Diversified Banks | Bull | Euronext Stock Exchange | banking, Capital, Ireland, M&A, Optionality | Login |
| Jan 18, 2026 | Fund Letters | Patrick Brennan | WBD | Warner Bros Discovery Inc. | Communication Services | Movies & Entertainment | Bull | NASDAQ | arbitrage, M&A, media, Regulatory risk, Streaming | Login |
| Jan 18, 2026 | Fund Letters | Patrick Brennan | CODI | Compass Diversified Holdings | Financials | Conglomerates | Bull | New York Stock Exchange | balance sheet, conglomerate, deleveraging, Fraud Recovery, Preferreds | Login |
| Jan 18, 2026 | Fund Letters | Patrick Brennan | DCC LN | DCC plc | Energy | Energy Distribution | Bull | New York Stock Exchange | buybacks, Energy Distribution, Propane, Sum-of-parts, valuation | Login |
| TICKER | COMMENTARY |
|---|---|
| CODI | CODI reiterated that it believed the company was the victim of deliberate, systematic fraud by the founder of subsidiary firm Lugano and that this fraud bypassed reasonable internal controls. CODI suggested that recovery could be ~$140 million, including ~$70 million of tax refunds. CODI also noted that it would be judicious on capital spending and expressed an openness to sell multiple subsidiaries to accelerate the deleveraging process. Currently, the preferred securities trade at just under 80% of par value and yield ~10%. We estimate that there could be ~ $1 billion+ of equity sitting in front of the preferreds, providing substantial cushion. |
| DCC.L | DCC is a former conglomerate that is in the process of selling non-core businesses to focus on its core propane energy distribution business. DCC's core energy business has performed well historically, and the business has multiple organic and inorganic opportunities. The company has been using proceeds from the various divestitures to repurchase stock and could ultimately purchase ~25% of outstanding shares once the various sales are completed. DCC expects medium-term growth of 9%+. We estimate that the core energy business is trading for ~6.6x FY 2026 EBITDA, a discount to more leveraged peers. |
| GLIBA | 95 percent of GLIBA right holders exercised their basic rights, and therefore our overallocation was relatively modest. The rights offering increased our weighting to the name at a highly attractive price that allows considerable upside to GLIBA's Alaska cable properties alone. At Liberty Media's analyst day this past November, Dr. Malone sounded bullish on GLIBA and expressed confidence that this company could evolve into the next Liberty Media vehicle. GLIBA has likely identified a couple of targets, but it is a crapshoot on when any acquisition closes. |
| MTRO.L | Metro Bank reported continued progress on its transformation into a commercial and specialty mortgage focused bank, reiterated its annual/long-term guidance and noted that it expected to exit the MREL regime. £525 million of 12% senior bonds (~£63 million annualized interest cost) will soon be called and not replaced. MTRO's 2027 guidance calls for mid-to-high teen returns on tangible equity and this guidance looked achievable prior to the MREL exit. We believe the bank might be able to commence capital returns in the back half of this year. MTRO currently trades at ~75% of tangible book value. We think the bank could conceivably have earnings potential of ~0.40 per share by 2028 or ~3x current prices. |
| NFLX | Netflix has built a durable economic moat around its vertically-integrated, globally-scaled streaming business. As the first company to establish a global subscription media platform within the $500 billion TV market, Netflix is now reaping the benefits of its early leadership. With more than 300 million members, Netflix enjoys the lowest content cost per subscriber in the industry. |
| PTSB.IR | There has been lots of noise/speculation in the Irish press regarding PTSB's current sales process, but there is no substantive update. We continue to believe that Austrian bank BAWAG and/or a couple of private equity firms will submit bids and we are hopeful that another strategic bidder will emerge. There should be some update on the sales process and on the much-discussed risk weightings by the end of the first quarter, but it is possible that this will slip into the second quarter. |
| WBD | Warner Bros Discovery (WBD) was the top contributor during the quarter. The U.S.-headquartered media company's stock price surged as multiple parties submitted offers to acquire all or part of the business. Following several rounds of bidding, WBD announced an agreement to sell its Streaming and Studios business to Netflix, while spinning the Global Networks business to shareholders. Paramount Skydance subsequently made a direct $30 per share offer to shareholders for the entire company. We are pleased with the steps the WBD board has taken thus far to unlock shareholder value. We will continue to closely monitor developments as this bidding war unfolds. |
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