| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Peapack Private sees 2026 beginning promisingly despite legitimate concerns. The firm highlights four key drivers supporting risk assets: continued monetary easing from FOMC composition changes, stimulative fiscal policy through tax cuts and government spending, deregulatory initiatives benefiting multiple sectors, and massive AI infrastructure investment by hyperscalers projected to exceed $600 billion by 2027. However, significant risks threaten this optimistic scenario. Labor market softness shows unemployment rising to 4.6% with job creation averaging only 22,000 monthly. S&P 500 valuations at 22 times forward earnings match Internet bubble levels, creating vulnerability if 12.1% earnings growth expectations disappoint. AI over-investment concerns mount with 95% of organizations getting zero return on AI investments despite $1.5 trillion in global spending projected for 2025. Geopolitical uncertainty from unpredictable trade policies adds systemic risk. The firm recommends maintaining US equity exposure while favoring small caps and international markets for better valuations, extending bond duration to capitalize on dovish policy, and exercising caution in expensive technology sectors.
Despite elevated valuations and emerging risks, the alignment of accommodative monetary policy, stimulative fiscal policy, massive AI infrastructure investment, and strong corporate earnings growth creates a supportive environment for risk assets in 2026.
2026 begins on a promising note with favorable policy backdrop, AI investment acceleration, and robust corporate profit growth providing fundamental support for risk assets. However, legitimate risks include labor market softness, elevated valuations, AI over-investment concerns, and geopolitical uncertainty that could challenge the economic good-news narrative.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 26 2026 | 2025 Q4 | AMZN, GOOGL, META, MSFT, ORCL | AI, Economic Growth, geopolitics, Labor Market, monetary policy, technology, Valuations | - | Hyperscalers are dramatically increasing AI capital expenditure from $400 billion in 2025 to over $600 billion by 2027. AI investment is driving 30% of GDP growth but faces risks from over-investment with 95% of organizations getting zero return on AI investments currently. S&P 500 trades at 22 times forward earnings, matching Internet bubble levels and 1.5 standard deviations above 30-year average. Elevated valuations reflect low interest rates and optimistic 12.1% earnings growth expectations for 2026. Unemployment rose to 4.6%, highest in four years, with job creation averaging only 22,000 monthly over past three months. Companies are retaining staff but not hiring, with particular weakness among recent college graduates at 5.8% unemployment. Trump Administration is remaking world order with radically reset trade relations, strained alliances replaced by unilateralism, and commercial interests prioritized over strategic interests. This creates heightened uncertainty where unpredictability is seen as virtue. |
| Sep 30 2025 | 2025 Q3 | - | Artificial Intelligence, fiscal stimulus, Inflation Risk, productivity, small caps | - | The letter characterizes markets as a cornucopia of liquidity, fiscal stimulus, and AI-driven capital expenditure, supporting broad asset gains and elevated profit margins. While large-cap AI leaders dominate returns, relative valuations in small caps and international equities appear compelling. Investors are advised to balance participation in secular AI growth with awareness of inflation, leverage, and policy risks. |
| Jun 30 2025 | 2025 Q2 | - | Artificial Intelligence, earnings growth, liquidity, Soft Landing, Valuation risk | - | The outlook highlights strong equity performance driven by AI-related capital spending, supportive monetary policy, and abundant liquidity conditions. While earnings growth has supported elevated valuations, the letter cautions that markets are pricing in a near-perfect soft-landing scenario. Investors are encouraged to remain diversified and valuation-aware amid concentrated gains in mega-cap technology. |
| Mar 31 2025 | 2025 Q1 | - | credit spreads, Policy Uncertainty, Quality stocks, Recession Risk, Stagflation | - | The letter argues that rising policy uncertaintyparticularly around tariffs, immigration, and fiscal directionhas disrupted the American exceptionalism narrative and increased recession risk. Slowing growth expectations, widening credit spreads, and downward earnings revisions point toward a potential stagflationary backdrop. In this environment, the firm emphasizes diversification, higher-quality bonds, durable dividend-paying equities, and disciplined asset allocation over aggressive tactical shifts. |
| Dec 31 2024 | 2024 Q4 | - | earnings growth, inflation, Soft Landing, Treasury Yields, Valuation risk | - | The letter frames the current environment as a Goldilocks soft-landing scenario, with moderating inflation, steady employment, and above-trend GDP growth supporting risk assets. However, elevated equity valuationsparticularly in large-cap technologysuggest much of the good news is already priced in, leaving markets vulnerable to earnings disappointments or policy shocks. While bonds offer more attractive yields than in prior years, uncertainty around fiscal policy, tariffs, and inflation persistence tempers the outlook. |
| Sep 30 2024 | 2024 Q3 | - | earnings growth, inflation, interest rates, Profit Margins, yield curve | - | The letter centers on the Federal Reserves pivot to rate cuts amid moderating inflation and a gradually softening labor market, framing the environment as a delicate soft-landing attempt. While economic growth remains resilient, forward indicators suggest deceleration, creating tension between earnings optimism and macro risk. Elevated equity valuations, especially in large-cap technology, leave markets sensitive to profit margin pressure and policy missteps. |
| Jun 30 2024 | 2024 Q2 | - | Artificial Intelligence, credit spreads, earnings growth, interest rates, Market Concentration | - | The letter highlights extreme investor enthusiasm around AI, with capital heavily concentrated in a handful of megacap technology stocks driving index returns. It warns that narrow market breadth and historically high index concentration resemble prior speculative periods, increasing downside risk if earnings expectations disappoint. Elevated forward multiples and compressed credit spreads suggest markets are pricing a Goldilocks outcome despite emerging macroeconomic softening. |
| Mar 31 2024 | 2024 Q1 | - | Equity Valuation, inflation, interest rates, Investor Sentiment, yield curve | - | Current markets reflect elevated Investor Sentiment and rich Equity Valuation amid persistent Inflation and uncertain Interest Rates. The inverted Yield Curve and slowing macro indicators suggest caution despite resilient headline growth. |
| Dec 31 2023 | 2023 Q4 | - | earnings growth, Equity Valuation, inflation, interest rates, Profit Margins | - | The investment backdrop is defined by shifting Interest Rates and moderating Inflation, both of which shape Equity Valuation and forward Earnings Growth expectations. Elevated Profit Margins and narrow market leadership increase sensitivity to economic deceleration and policy shifts. |
| Sep 30 2023 | 2023 Q3 | - | Equity Valuation, High Quality Bonds, Quantitative Tightening, Soft Landing, Yield Curve Inversion | - | The letter questions the durability of the soft-landing narrative as higher interest rates, sticky inflation, and quantitative tightening begin to pressure economic momentum. While labor markets remain resilient and inflation has moderated, leading indicators such as yield curve inversion and declining small business optimism suggest deceleration ahead. With equities trading at roughly 1819x forward earnings and bond yields at multi-year highs, the firm advocates caution, neutral equity weightings, and an emphasis on high-quality companies and intermediate-term bonds :contentReference[oaicite:0]{index=0}. |
| Jun 30 2023 | 2023 Q2 | - | Artificial Intelligence, Earnings Compression, Market Concentration, Treasury Yields, Valuation Sensitivity | - | The letter examines the surge in AI enthusiasm, highlighting extreme market concentration where MegaCap technology stocks drove the majority of S&P 500 gains :contentReference[oaicite:2]{index=2}. While skeptical of speculative excess, the firm acknowledges durable beneficiaries in semiconductor equipment and productivity-enhancing technologies, while remaining valuation sensitive. Elevated Treasury yields, now in the top quartile of the past 16 years, create compelling income opportunities for high-quality fixed income investors. |
| Mar 31 2023 | 2023 Q1 | - | Banking Stress, Economic Slowdown, Investment Grade Bonds, Quality Investing, Sticky Inflation | - | The outlook frames the Silicon Valley Bank and Signature Bank failures as unsettling but not systemic, noting markets remained resilient despite financial sector volatility :contentReference[oaicite:1]{index=1}. Persistent inflation, sticky labor markets, and elevated profit margins keep the Federal Reserve restrictive, while equity valuations remain above long-term averages. The firm favors high-quality equities with strong balance sheets and short-to-intermediate investment grade bonds as economic growth slows. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
GeopoliticsTrump Administration is remaking world order with radically reset trade relations, strained alliances replaced by unilateralism, and commercial interests prioritized over strategic interests. This creates heightened uncertainty where unpredictability is seen as virtue. |
Trade Policy Unilateralism Uncertainty Alliances Diplomacy | |
Labor MarketUnemployment rose to 4.6%, highest in four years, with job creation averaging only 22,000 monthly over past three months. Companies are retaining staff but not hiring, with particular weakness among recent college graduates at 5.8% unemployment. |
Unemployment Job Creation Hiring Wages Employment | |
ValuationsEquity valuations remain elevated with the S&P 500 trading near 23x forward earnings, well above its long-term average of 15.6x. High valuations may increase market sensitivity to earnings disappointments and tend to constrain longer-term returns, reinforcing the importance of selectivity. |
Multiples Premium Earnings Risk Selectivity | |
| 2025 Q3 |
Abundance |
|
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation | |
SmallCaps |
||
| 2025 Q2 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
LiquidityManager extensively discusses liquidity challenges in African frontier markets, explaining how tight ownership structures and limited foreign participation restrict trading volumes. Notes that liquidity varies cyclically and structurally, with potential improvement expected as bull market develops and more investor categories participate. |
Trading Volumes Participation Structural Cyclical | |
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2025 Q1 |
DiversificationThe Fund remains purposefully diversified despite market leadership being narrow and focused on AI. This discipline reflects commitment to effective risk management and appropriate diversification, which weighed on relative performance but positions the Fund well for various market scenarios. |
Risk Management Portfolio Construction Concentration |
Policy Uncertainty |
||
Stagflation |
||
| 2024 Q4 |
RatesFed cut rates by 25bps on December 10 while describing growth as moderate and inflation as still somewhat elevated. Markets took message as cut now, likely pause soon. The opportunity set was less about calling one Fed meeting and more about trading the path via rates and FX. |
Fed Easing Policy Duration Curve |
Soft Landing |
||
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2024 Q3 |
Monetary Policy |
|
Soft Landing |
||
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2024 Q2 |
AIAI has been integrated into RGA's research process through tools like NotebookLM, Gems in Gemini, and Claude Code. The firm views AI as a force multiplier for human judgment rather than a replacement, emphasizing the Kasparov Law principle. They believe the market narrative around AI displacement is swinging to unhelpful extremes, creating investment opportunities. |
Machine Learning Automation Software Productivity Innovation |
ConcentrationFive companies now represent roughly 30% of the S&P 500's market cap. The top 10 exceed 40%—the highest concentration in 50 years. Nearly $340 billion flowed into U.S. deals, yet it was packed into the fewest deals of the decade, with nearly half the capital concentrated in a few dozen deals over $500 million. |
Market Capital Risk Deals Venture | |
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2024 Q1 |
Resilience2025 tested the fund's thesis severely with a bankruptcy, major customer losses, and cyber-attacks, yet delivered 17.45% net returns. The manager emphasizes that edge comes from exploiting inefficiency rather than avoiding adversity, demonstrating portfolio resilience through active management. |
Adversity Active Management Drawdowns Volatility |
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2023 Q4 |
SoftLanding |
|
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2023 Q3 |
RatesFed cut rates by 25bps on December 10 while describing growth as moderate and inflation as still somewhat elevated. Markets took message as cut now, likely pause soon. The opportunity set was less about calling one Fed meeting and more about trading the path via rates and FX. |
Fed Easing Policy Duration Curve |
Soft Landing |
||
ValuationAI-related companies continue to command premium valuations while other sectors remain reasonably priced. This valuation divide continues to guide investment activity, with the fund remaining wary of companies trading at exceedingly high valuations that imply exceptional multi-year earnings growth. |
Premium Divide Discipline Stretched Reasonable | |
| 2023 Q2 |
Artificial Intelligence |
|
Narrow Breadth |
||
Yield Opportunity |
||
| 2023 Q1 |
Bank Stress |
|
InflationInflation has continued to be a persistent feature in Japan and has prompted changes in both corporate and consumer behavior. Importantly, inflation has fed through to corporate earnings and equity performance. Companies that have successfully passed on higher costs to consumers have benefited from improved operating margins. |
Inflation Corporate Earnings Operating Margins Consumer Behavior Cost Pass-through | |
Quality Bias |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
|---|---|
| AMZN | One company we own that we think has unique positioning to benefit from both the infrastructure and application layers is Amazon. Amazon's logistical prowess is one of the foremost moats in business today and it can and will be enhanced with AI. The company will do this in multiple ways, with better orchestration of its logistics assets and underlying cargo, as well as the buildout of more capable, sophisticated and robust robotics. Amazon is singularly well positioned to dominate the coordination layer, with AI's help, across its entire logistics network. |
| GOOGL | In the third quarter, Google, Kairos Power, and the Tennessee Valley Authority announced a major collaboration centered on a novel power purchase agreement. Google followed this announcement with another significant step forward. On October 27, Google and NextEra Energy announced plans to restart the Duane Arnold Energy Center. |
| META | On January 9, Meta Platforms unveiled a new agreement with Vistra—the largest generator of competitive electricity in the United States—as well as with TerraPower and Oklo. The announcement builds on Meta's agreement last year with Constellation Energy and positions the company to become one of the largest corporate purchasers of nuclear-generated electricity in the United States. |
| MSFT | MSFT was a detractor in 4Q25 following its fiscal first-quarter 2026 earnings report released on October 29. While results were better than expected operationally, investor reaction was driven by guidance and capital expenditure intensity rather than headline performance. Revenue grew 17% year-over-year, exceeding consensus expectations, and Azure revenue increased 39% year-over-year, also ahead of estimates. However, management guided to a sequential deceleration in Azure growth in fiscal Q2, signaling some moderation after a period of exceptional demand. |
| ORCL | Investor enthusiasm for Oracle's stock in calendar year 2025 was initially driven by several multi-billion-dollar contracts it signed with leading AI companies, including OpenAI and Meta. However, in Q4 sentiment for ORCL's growth prospects shifted to skepticism, as investors began to scrutinize the return profile of the substantial capital investments required to support the approximately $500 billion of contracts signed by Oracle. Given the widening range of potential outcomes associated with Oracle's elevated capital needs, we reduced our position in ORCL during Q4. |
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