| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Brasada Capital Management sees a significant rotation opportunity away from the Magnificent 7 stocks that have dominated markets for years. The firm believes 2026 will mark the peak of this concentration, with Small Caps, Mid Caps, and International stocks already showing outperformance year-to-date. They have actively reduced exposure to software stocks due to AI disruption risks while adding positions in niche opportunities like Postal Realty Trust, a small-cap REIT consolidating US Post Office properties, and OMAB, a Mexican airport operator positioned to benefit from nearshoring trends. Geopolitical risks from the Iran conflict temporarily disrupted energy markets, sending oil prices toward $120 per barrel, but a ceasefire has reduced immediate economic threats. The firm expects the midterm election cycle to create market volatility but notes historical patterns of strong performance in the 12 months following midterms. With over $40 trillion benchmarked to large-cap indices, they anticipate significant capital rotation as performance broadens beyond mega-cap technology stocks.
Brasada Capital Management believes the market is poised for greater participation beyond the largest stocks, with Small Caps, Mid Caps, and International stocks positioned to outperform after years of underperformance relative to the Magnificent 7.
The firm expects better investment returns outside the Magnificent 7 over the next 10 years and believes 2026 will most likely mark the peak of their dominance. They anticipate continued outperformance from Small Caps, Mid Caps, and International stocks. The ceasefire with Iran appears to have taken the worst case economic scenario off the table for now.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 20 2026 | 2026 Q1 | OMAB, PSTL | AI, Airports, energy, geopolitics, Mexico, REITs, small caps |
PSTL OMAB |
Brasada Capital sees a major rotation from Magnificent 7 dominance to broader market participation, with small caps and international stocks already outperforming in 2026. They've exited AI-threatened software positions while adding niche plays like Postal Realty Trust and Mexican airport operator OMAB positioned for nearshoring trends. |
| Jan 9 2026 | 2025 Q4 | - | AI, Concentration, Fed, policy, tariffs, technology, Valuations, volatility | - | Brasada navigated 2025's policy-driven volatility with mid to high single-digit returns while avoiding concentration in AI despite market enthusiasm. Unprecedented seven-stock market leadership creates risk, but Fed cuts, corporate investment, and improving fundamentals support 2026 outlook. Elevated valuations and election year patterns suggest choppier progress ahead. |
| Oct 22 2025 | 2025 Q3 | AMD, AMZN, AVGO, FERG, GOOGL, META, MSFT, NVDA, ORCL | AI, Bubble, Data centers, Distribution, Fed policy, semiconductors, tariffs |
FERG AVGO FERG AVGO |
Brasada Capital selectively participates in AI infrastructure boom while avoiding debt-fueled speculation. Core holdings Ferguson and Broadcom benefit from infrastructure tailwinds and AI positioning respectively. Manager favors hyperscalers with fortress balance sheets over leveraged new entrants, acknowledging bubble characteristics but expecting continued momentum through 2026 for quality players with real cash flows. |
| Jul 1 2025 | 2025 Q2 | UBER, WST | Fundamental, Pharmaceuticals, risk, technology, Trade Policy, value, volatility |
WST UBER |
Market volatility in Q2 2025 created opportunities despite trade policy confusion and geopolitical tensions. Brasada distinguishes between risk and volatility, using sell-offs to acquire quality businesses like West Pharmaceutical Services and Uber Technologies at discounts. The firm maintains that fundamental analysis and patient capital deployment during market turbulence generates superior long-term returns. |
| Apr 7 2025 | 2025 Q1 | AMZN, BA, BRK-B, GE, GM, HEI, NKE, PFE | aerospace, Cash Management, Market Volatility, Quality, tariffs, Trade Policy | HEI | Brasada navigated extreme Q1 2025 volatility driven by Trump tariff uncertainty by holding elevated cash while maintaining conviction in quality holdings like aerospace leader Heico. The firm views current market stress as opportunity rather than threat, planning opportunistic deployment of excess cash into attractive long-term positions rather than reactive selling. |
| Jan 7 2024 | 2024 Q4 | - | Business Confidence, Fed policy, inflation, M&A, small cap, Valuations | - | Brasada sees opportunities in smaller companies and income securities despite expensive overall market valuations. Business confidence has surged post-election, setting up potential M&A boom that should benefit their small-cap expertise. Key risks include historical inflation recurrence patterns and expensive valuations after two strong consecutive years. Positioned in income-producing securities while awaiting capital rotation from money markets. |
| Oct 8 2024 | 2024 Q3 | CPT | dividends, Fed policy, interest rates, real estate, REITs, value | CPT | Brasada is positioned for declining interest rates, particularly through Camden Property Trust which was purchased at attractive valuations during peak apartment oversupply. With construction starts declining and rent growth expected from 2026-2028, Camden has delivered 30% returns year-to-date with further upside anticipated as fundamentals improve over the next two to three years. |
| Jul 10 2024 | 2024 Q2 | AMD, AMZN, CCCS, COST, CPRT, GWRE, IBM, INTC, META, MSFT, NFLX, NVDA, PGR, TSLA | Concentration, insurance, Monopoly, software, technology, value | CCCS | Extreme market concentration with Nvidia driving 5% of S&P 500 returns masks broader weakness. Manager avoids AI hype, focusing on quality businesses like CCC Intelligent Solutions, which dominates auto insurance claims processing. Rising vehicle complexity and insurance losses create strong tailwinds. Attractive valuations exist outside mega-cap concentration, creating opportunities for active stock picking. |
| May 2 2024 | 2024 Q1 | - | AI, Election, Fed policy, Geopolitical, inflation, technology | - | Brasada Capital takes a cautiously bullish stance for 2024, building on lessons from 2023's market resilience. Despite persistent services inflation and geopolitical risks, the firm sees tailwinds from monetary lag effects, strong balance sheets, AI spending, and election dynamics. Portfolio positioned in secular growth areas including enterprise IT, defense, and life sciences. |
| Aug 1 2024 | 2023 Q4 | - | Bonds, Concentration, Federal Reserve, inflation, interest rates, Soft Landing | - | The Federal Reserve achieved a rare soft landing, taming inflation without recession while markets rallied on prospects of 2024 rate cuts. However, dangerous concentration in the S&P 500's top stocks mirrors 1973 and 1999 patterns. Brasada reduced cash levels and added bonds for the first time in fifteen years, seeing opportunities beyond mega-cap concentration. |
| Apr 18 2023 | 2023 Q1 | CP, GOOGL, KSU, ROL, RTO.L | Concentration, Mergers, Pest Control, Railroads, technology, value |
RTO.L ACP.WA GOOGL |
Brasada outperformed in Q1 2023 by focusing on company fundamentals over macro confusion. Added pest control leader Rentokil Initial and railroad consolidation play Canadian Pacific while selling Google due to AI competition risks. Maintains cash reserves for volatile market opportunities while targeting recession-resistant companies with strong management and high-return growth prospects. |
| Jul 20 2022 | 2022 Q2 | AZTA, CDRE, POOL | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
AIProgress on AI continues to increase at a rapid rate. The firm is trying to avoid investments that could be negatively impacted by AI. Portfolio turnover has been above average as they have selectively exited long-held positions, namely software stocks, where AI poses a genuine threat to the underlying business model. |
Software Disruption Technology Business Models |
Small CapsSmall Caps have generally underperformed the S&P 500 for a long time, but the firm has noticed a change in 2026. Year to date, they have witnessed small caps outperform both the Magnificent 7 and the S&P 500, and they think there is a good chance that this trend can continue for a while. |
Outperformance Rotation Market Cap | |
OilThe war with Iran and closure of the Strait of Hormuz sent Brent crude surging toward $120 per barrel. Higher energy prices are deeply inflationary, crowd out spending elsewhere, and squeeze corporate margins. Iran's strike on Qatar's LNG facility has taken roughly 17% of Qatar's LNG export capacity offline potentially for years. |
Geopolitics Iran Energy Prices Inflation | |
OnshoringMonterrey and the broader North/Central industrial corridor is where the bulk of near shoring appears to be happening. The core bet is that these regions will continue to share in manufacturing investment and supply chain reconfiguration. AB Volvo increased its planned investment in a new Nuevo Leon truck plant to $1B with production scheduled to start in 2026. |
Mexico Manufacturing Supply Chain Investment | |
| 2025 Q4 |
AICapital spending on AI has been immense but highly concentrated among firms with scale and balance sheets. Much of 2025's market performance was driven by companies at the center of artificial intelligence investment. Corporate investment in AI remains high going into 2026. |
Artificial Intelligence Capital Spending Technology Investment Corporate |
Trade PolicyThe uncertain and chaotic implementation of the U.S.'s highest tariffs in 93 years resulted in a 19% market correction in just six weeks. Policy uncertainty around tariffs created significant market volatility before recovery occurred. |
Tariffs Policy Uncertainty Market Correction Implementation | |
Risk AppetiteAnimal spirits were returning with business confidence surging and capital spending intentions improving. The Federal Reserve's accommodative stance and election clarity supported risk appetite, though concentration risk has reached unprecedented levels. |
Business Confidence Animal Spirits Federal Reserve Concentration Risk | |
| 2025 Q3 |
AICorporate investment in AI has been the primary market driver, with capital expenditure extending beyond GPUs to entire infrastructure stack. The nature of investment is shifting from disciplined cash-flow funded race to debt-fueled arms race, with OpenAI orchestrating buildout on their terms through circular financing models. |
OpenAI Infrastructure Capex Debt Circular financing |
SemiconductorsThe real fight in AI is between Nvidia and Broadcom, with Broadcom positioned as #2 winner over next decade. Custom AI chips (ASICs) revenue rose 225% in 2024 to $8.6B and expected to grow 170%+ to $24B this year, while networking solutions pressure proprietary approaches. |
NVIDIA Broadcom ASICs Custom chips Networking | |
Data CentersMassive long-term contracts like Oracle's reported $300 billion deal over five years for compute capacity linked to Stargate project requiring 4.5 GW of power. Data center buildouts also help pull through demand for commercial plumbing/HVAC/pipes/valves/fittings. |
Oracle Stargate Power Infrastructure Compute | |
Industrial DistributionFerguson is the largest scaled specialty distributor for North American plumbing/HVAC/waterworks with revenue split 51% residential, 49% non-residential. Multi-year tailwinds persist in waterworks, commercial, civil infrastructure, and industrial segments with consistent pricing power and M&A growth. |
Ferguson Plumbing HVAC Waterworks Distribution | |
| 2025 Q2 |
VolatilityManager emphasizes that true investment risk is not market volatility but permanent loss of capital. Market volatility creates opportunities for fundamental investors to acquire great assets at discounts when prices fall below intrinsic value. The distinction between risk and volatility is crucial for long-term investment success. |
Risk Opportunity Fundamental Mispricing Temperament |
Trade PolicyThe administration's new trade policy with steep and unpredictable tariffs caught markets by surprise, causing significant volatility. The rollout was confusing and disorderly, creating prolonged uncertainty that poses greater threats than the direct financial costs of tariffs themselves. |
Tariffs Uncertainty Policy Business Paralysis | |
GLP1West Pharmaceutical Services benefits from participation in the burgeoning GLP-1 market through both elastomer components and contract manufacturing, representing a significant multi-year tailwind for the company's growth prospects. |
Components Manufacturing Growth Tailwind Multi-year | |
| 2025 Q1 |
Trade PolicyThe Trump Administration is implementing aggressive tariff policies to rebalance trade flows and bring manufacturing jobs back to the US. Countries like Vietnam and Cambodia are already offering to reduce their tariffs on US imports in exchange for reduced US tariffs, while China has raised their tariffs in retaliation. The outcome remains unpredictable with potential for either economic benefit if countries reduce tariffs or recession if trade war escalates. |
Tariffs Trade War Manufacturing China Retaliation |
AerospaceHeico represents a significant aerospace investment opportunity as the largest seller of FAA-approved aircraft replacement parts. The company sells over 20,000 PMA parts at 30% discounts to original equipment manufacturers, with potential expansion into US Military sales. Global air travel recovery and continued acquisitions drive long-term growth prospects. |
Aircraft Parts PMA Airlines Military Acquisitions | |
Risk AppetiteThe fund is holding more cash than normal due to market uncertainty and elevated valuations after abnormally strong returns in recent years. Management emphasizes opportunistic upgrading of portfolios during market volatility rather than reactionary wholesale changes or market timing attempts. |
Cash Holdings Volatility Opportunistic Market Timing Positioning | |
| 2024 Q4 |
Small CapsManager emphasizes expertise in smaller companies which have lagged larger counterparts by one of the worst ten-year periods in history. Reduced regulation and increased M&A activity should help smaller company stocks, where the firm has expertise. |
Small Cap M&A Regulation |
Capital MarketsMergers and acquisitions activity, along with initial public offerings, is set to explode under reduced regulation. This ability for companies to more freely reorganize and transact helps put a bid under equity prices. |
M&A IPO Regulation Capital Markets | |
InflationHeadline inflation now rests at 2.8% down from over 9% in 2022. However, historical analysis shows that once an economy experiences inflation over 6%, chances of a second wave are 9 in 10, creating risks with further Fed rate cuts expected. |
Inflation Fed Rates | |
| 2024 Q3 |
RatesThe Fed has begun cutting rates after hiking from 0 to 550 basis points in 16 months. Market expects additional 150 basis points of cuts by end of 2025. Lower rates should benefit companies that struggled with higher rates including commercial construction, home sales, auto sales, and leveraged companies. |
Interest Rates Fed Policy Rate Cuts Monetary Policy Credit |
Residential REITsREITs experienced extreme volatility with 2021 being second best year ever and 2022 second worst. Higher rates hurt REITs through increased borrowing costs and lower property valuations. With rates declining, the sector is expected to recover lost ground as fundamentals improve. |
REITs Apartments Real Estate Property Values Rental Income | |
| 2024 Q2 |
AIManager discusses AI as the current investment fad, comparing it to previous technology bubbles. Notes that while ChatGPT demonstrated AI utility, markets tend to get ahead of themselves in bidding up potential winners. Emphasizes that early winners in technology revolutions are rarely the same winners a decade later. |
ChatGPT Technology Bubble Revolution Hype |
Auto InsuranceDetailed analysis of CCC Intelligent Solutions' dominant position in automotive insurance ecosystem. CCCS processes 80%+ of US auto claims and connects repair shops, parts suppliers, and insurance carriers. Combined loss ratios over 100% create need for digitization solutions that CCCS provides. |
Claims Repair Digitization Ecosystem Processing | |
SaaSCCCS represents a high-quality SaaS business model with high returns on capital, durable growth, non-cyclical revenue, and high customer retention. The company has a long reinvestment runway and benefits from network effects between insurers and repair shops. |
Software Subscription Recurring Network Platform | |
| 2024 Q1 |
AITransformer AI models, more commonly known as Generative AI (GenAI), could revolutionize productivity and further fuel corporate profitability. Corporations are already spending enormous amounts of capital to leverage this technology and portfolios are well positioned to benefit. |
Generative AI Productivity Corporate Profitability Technology Spending |
InflationRecent data points have shown that inflation is not declining as fast as expected. Inflation in the services sector has been the key driver of a higher consumer price index (CPI). If this does not dissipate it will continue to pressure corporate profit margins and prevent the Fed from cutting rates. |
Services Inflation CPI Corporate Margins Fed Policy | |
| 2023 Q4 |
RatesThe Federal Reserve executed an aggressive tightening cycle with eleven rate hikes from March 2022 through July 2023, raising fed funds rates dramatically. The market is now pricing in rate cuts for 2024 as inflation has fallen from over 9% to just over 3%, and the Fed has signaled they are done hiking for now. |
Federal Reserve Interest Rates Monetary Policy Inflation Rate Cuts |
InflationInflation broke out to forty-year highs, prompting the Fed's historic tightening response. Headline inflation has since fallen from a cycle high of over 9% in summer 2022 to just over 3% in the latest reading, contributing to market optimism about potential rate cuts. |
CPI Price Levels Federal Reserve Monetary Policy Economic Indicators | |
| 2023 Q1 |
RailroadsCanadian Pacific's merger with Kansas City Southern creates the only single-line railway connecting Canada to Mexico, expected to shift 64,000 truckloads from road to rail. This represents the first Class 1 Railroad merger since 1999 and will be the last major railroad merger due to regulatory constraints. |
Transportation Mergers Infrastructure Cross-border Efficiency |
Pest ControlRentokil Initial became the world's largest pest control company after acquiring Terminix, creating significant consolidation opportunities in a fragmented industry. The business is recession-resistant with stable customer demand and potential for operational improvements at the acquired Terminix operations. |
Consolidation Recession-resistant Market-share Synergies Fragmented |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 20, 2026 | Fund Letters | Brasada Focused Equity Strategy | PSTL | Postal Realty Trust | REIT - Office | Specialized REITs | Bull | NASDAQ | consolidation, dividend, infrastructure, Logistics, Niche, Post Offices, Real Estate, REIT, small-cap, USPS | Login |
| Apr 20, 2026 | Fund Letters | Brasada Focused Equity Strategy | OMAB | Grupo Aeroportuario del Centro Norte | Airports & Air Services | Airport Services | Bull | NASDAQ | Airports, Business Travel, Cargo, Concessions, infrastructure, International, manufacturing, Mexico, Monterrey, Nearshoring | Login |
| Oct 22, 2025 | Fund Letters | Jonathan Reichek | FERG | Ferguson plc | Industrials | Trading Companies & Distributors | Bull | NYSE | cashflow, Distribution, HVAC, infrastructure, M&A, Margins, Plumbing | Login |
| Oct 22, 2025 | Fund Letters | Jonathan Reichek | FERG | Ferguson plc | Industrials | Trading Companies & Distributors | Bull | NYSE | cashflow, Distribution, HVAC, infrastructure, M&A, Margins, Plumbing | Login |
| Oct 22, 2025 | Fund Letters | Jonathan Reichek | AVGO | Broadcom Inc. | Information Technology | Semiconductors | Bull | NASDAQ | AI, dividends, growth, Margins, Networking, semiconductors, Software | Login |
| Oct 22, 2025 | Fund Letters | Jonathan Reichek | AVGO | Broadcom Inc. | Information Technology | Semiconductors | Bull | NASDAQ | AI, dividends, growth, Margins, Networking, semiconductors, Software | Login |
| Jul 1, 2025 | Fund Letters | Brasada Focused Equity Strategy | WST | West Pharmaceutical Services | Health Care | Health Care Equipment | Bull | NYSE | biologics, contract manufacturing, drug delivery, Equity, GLP-1, Healthcare Equipment, Medical devices, pharmaceuticals, Value | Login |
| Jul 1, 2025 | Fund Letters | Brasada Focused Equity Strategy | UBER | Uber Technologies | Communication Services | Interactive Media & Services | Bull | NYSE | autonomous vehicles, Equity, food delivery, growth, marketplace, network effects, Ridesharing, technology platform, Transportation | Login |
| Apr 7, 2025 | Fund Letters | Brasada Focused Equity Strategy | HEI | Heico Corporation | Industrials | Aerospace & Defense | Bull | NYSE | Acquisitions, Aerospace, Aircraft Components, Berkshire Investment, Cost advantage, Defense, FAA Approved, market leader, Military Opportunity, PMA Parts, Replacement Parts, Travel Recovery | Login |
| Oct 8, 2024 | Fund Letters | Brasada Focused Equity Strategy | CPT | Camden Property Trust | Real Estate | Residential REITs | Bull | NYSE | Apartments, demographic trends, dividend yield, Interest Rate Sensitive, Multifamily, Real Estate, REIT, Rent growth, Rental Housing, Residential, Supply Shortage, Value | Login |
| Jul 10, 2024 | Fund Letters | Brasada Focused Equity Strategy | CCCS | CCC Intelligent Solutions | Software & Services | Application Software | Bull | NASDAQ | Adas, Automation, Automotive Insurance, Claims Processing, Data Analytics, Digitization, machine learning, Monopoly, network effects, SaaS, switching costs, Vehicle Electrification | Login |
| Apr 30, 2023 | Fund Letters | Brasada Focused Equity Strategy | RTO.L | Rentokil Initial | Commercial & Professional Services | Environmental & Facilities Services | Bull | London Stock Exchange | acquisition, defensive, market consolidation, Operational Turnaround, pest control, Recession-resistant, synergies, UK, Value | Login |
| Apr 30, 2023 | Fund Letters | Brasada Focused Equity Strategy | ACP.WA | Canadian Pacific Railway | Transportation | Railroads | Bull | Toronto Stock Exchange | Canada, infrastructure, merger, Mexico, Modal Shift, Monopolistic, Precision Scheduled Railroading, railroad, Transportation | Login |
| Apr 30, 2023 | Fund Letters | Brasada Focused Equity Strategy | GOOGL | Alphabet Inc. | Communication Services | Interactive Media & Services | Neutral | NASDAQ | AI competition, cost structure, digital advertising, Mature Growth, Regulatory risk, search engine, technology | Login |
| TICKER | COMMENTARY |
|---|---|
| PSTL | Postal Realty Trust is a small cap REIT that owns US Post Offices. They currently own just under 1,900 locations across the U.S. with an annualized base rent of $81M. They are the first and only public REIT focused on USPS leased properties. We believe this is a classic niche consolidation play. The portfolio is 99.8% occupied with an average of 4-year lease terms and 3% rent escalators. PSTL is a founder-led REIT that we believe holds genuine niche expertise. We think the stock is attractive as it's trading under 15x Funds From Operations and has a 5% dividend yield. |
| OMAB | OMAB is one of three publicly traded airport operators in Mexico. They operate 13 international airports under long-dated concessions (50-year term into 2048). The core bet is that these regions will continue to share in manufacturing investment and supply chain reconfiguration, which may translate into durable business travel and cargo activity. OMAB also launched 13 new domestic and 5 new international routes. There was also notable growth in retail (+20%), restaurants (+22%) and VIP lounges (+30%) in 2025. The stock trades for about 15X earnings and has a dividend yield of 3.8% |
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