| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 6.8% | 3.1% | 26.2% |
| 2025 |
|---|
| 26.2% |
Cambiar International Equity Fund delivered strong absolute returns in 2025 but underperformed the MSCI EAFE benchmark due to elevated cash positions and challenged stock selection in Consumer Staples and Energy. The fund maintains a constructive outlook for international equities based on valuation asymmetry, with many international companies trading at attractive valuations while U.S. markets are richly priced. European stimulus in defense and infrastructure spending after years of underinvestment should provide earnings tailwinds. Key portfolio moves included selling Taiwan Semiconductor after 400% gains since 2020 due to elevated valuations, while adding positions like Smurfit Westrock for self-help merger synergies. Consumer Staples holdings Diageo and Kerry Group disappointed but now trade at low valuations on low expectations. The fund anticipates reducing cash from 5-6% to 2-3% levels and expects more selective gains in 2026. Portfolio construction remains focused on identifying high-quality businesses with strong balance sheets and competitive advantages at attractive prices, using their Quality, Price, Discipline framework while guarding against popular market narratives.
International equities offer superior value proposition relative to richly priced U.S. markets, with attractive valuations providing re-rating opportunity and European stimulus creating earnings tailwinds for high-quality businesses.
The outlook can best be described as cautiously optimistic, with risk/reward within businesses remaining attractive while stress-testing assumptions to guard against thesis drift. Gains are anticipated to be more selective in nature for 2026 compared to the everything rally of 2025.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 26 2026 | 2025 Q4 | DEO, KYGA.L, LSEG.L, SW, TSM | AI, Currency, Europe, financials, international, semiconductors, staples, value | SW | International equities offer attractive valuations relative to richly priced U.S. markets, with many international companies trading at relatively attractive valuations that should allow for continued… |
| 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 |
EuropeThe firm is expanding European relationships and published research on European shareholder activism. They view Europe as an attractive alternative to expensive American markets and are building manager relationships in the region. |
Activism Shareholder Valuation Diversification Research | |
ValueManager emphasizes investing in controlled companies trading at significant discounts to NAV, with European holding companies showing discounts of 30-68%. The strategy focuses on securities mispricing where real value exists, contrasting with overvalued technology stocks. |
Discounts NAV Mispricing Undervalued Controlled |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 26, 2026 | Fund Letters | Brian M. Barish | SW | Smurfit Westrock plc | Materials | Paper & Packaging | Bull | New York Stock Exchange | Corrugated, Margins, Merger Synergies, Packaging, Self Help | Login |
| TICKER | COMMENTARY |
|---|---|
| DEO | Examples include Tidewater, Valaris, Constellation Brands, Diageo and Trex. We have discussed TDW and VAL previously, as well as STZ and DEO here. |
| KYGA.L | Kerry Group posted disappointing returns during the year, hampered by mixed sales trends and earnings shortfalls. These high-quality businesses are now trading at low valuations on low expectations – a potentially attractive setup. |
| LSEG.L | LSEG's shares were -20%. They are therefore illustrative of companies that have held back the Strategy's returns this year. Consistent with much of the rest of the portfolio, operating results remain solid. The company will almost certainly report double-digit growth in earnings for 2025, and the company has met or exceeded investors' expectations for the year. The challenges have not so much been financial but hypothetical – focussed on AI's potential to change competitive dynamics in their industry. LSEG is at 6.1% FCF yield. We have added to the Strategy's investments this year. |
| SW | The investment case for Smurfit Westrock is largely a self-help story, following the merger of the two companies (Smurfi Kappa and Westrock). We believe the best practices in place at Smurfit can be successfully deployed within Westrock, providing an uplift to aggregate margins and profits. We also anticipate a healthier demand environment for the corrugated markets in which the company operates. |
| TSM | TSMC was a top contributor during the quarter, driven by robust demand for advanced semiconductor manufacturing and improved gross margins as AI continues to grow strong and the non-AI segment showed signs of recovery. Management raised its revenue growth guidance to the mid-30% range, and given continued strength in demand, AI-related growth targets are expected to move above the current mid-40% level. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
|---|---|---|---|---|---|---|
| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
|---|---|---|---|
| No industry data available | |||
