| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
The Carillon Eagle Growth & Income Fund delivered positive performance in Q4 2025, with the S&P 500 returning 2.7% for the quarter and 17.9% for the year. Top contributors included AstraZeneca, which exceeded earnings expectations and announced favorable drug pricing agreements, and Lam Research, which benefited from improving semiconductor capital spending sentiment and confirmed growth projections. Goldman Sachs contributed through strong capital markets activity including M&A and IPO growth. The fund faced headwinds from Oracle due to AI spending concerns, Eaton from high investor expectations, and Microsoft from software licensing slowdowns. Looking ahead to 2026, the managers see more tailwinds than headwinds, citing projected 16% S&P 500 earnings growth, potential Fed rate cuts, and fiscal stimulus from the One Big Beautiful Bill Act. Key risks include elevated market valuations at 22x forward earnings, AI bubble concerns, and policy uncertainty. The AI super-cycle continues providing support while broadening across industries, though volatility is expected to persist.
The fund maintains a constructive outlook for 2026 equity returns driven by strong earnings growth projections of 16%, accommodative monetary policy expectations, and broadening AI investment impact across industries.
As we enter 2026, we see more tangible tailwinds than headwinds and believe another year of positive equity returns is achievable. Earnings remain the core pillar with Bloomberg projecting S&P 500 EPS growth of 16% in 2026. The macroeconomic backdrop remains constructive with inflation continuing to slow, the labor market cooling without collapsing, and corporate profitability remaining resilient.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 19 2026 | 2025 Q4 | ADI, AVGO, AZN, DUK, ETN, GS, HD, JPM, KO, LRCX, MCD, MSFT, ORCL, PG, PNC, RTX, TMUS | AI, Capital markets, earnings, growth, large cap, semiconductors, technology | - | AI-related investment remains robust and has the potential to broaden its impact across industries. The AI super-cycle continues to provide powerful support, yet it carries risks. Investor willingness to underwrite aggressive AI spending has cooled somewhat, and the debate over whether we are in an AI bubble has increased. Lam Research benefitted from improving sentiment regarding the importance of its products within the semiconductor capital spending market. As a leading provider of equipment tied to memory requirements for AI, Lam Research could have a long and healthy path to growth. Analog Devices pushed toward new all-time highs after solid earnings gave investors confidence that the analog cycle is now beyond its bottom. Earnings growth was the clear engine of the market's advance in 2025. Forward S&P 500 earnings are projected to rise 16% in 2026 over 2025. Bloomberg projects S&P 500 EPS growth of 16% in 2026, up from 15% in 2025 with 7 of 11 sectors expected to deliver double-digit gains. Goldman Sachs Group's shares contributed to fourth-quarter performance due to positive financial results, coupled with increased optimism regarding capital markets activity heading into 2026. Goldman Sachs maintains one of the strongest global merger and acquisition advisory and trading, with increased activity in M&A, initial public offerings, and debt issuance activity directly boosting its financial performance. |
| Oct 19 2025 | 2025 Q3 | ABBV, ABT, ACN, AVGO, CARR, GLW, KOF, LRCX, MDLZ, ORCL | AI, Cloud, Data centers, interest rates, semiconductors | - | AI infrastructure spending drove performance across technology and semiconductor holdings. Broadcom, Oracle, and Lam Research benefited from growing data center demand and AI-driven contracts. The fund reduced exposure after strong gains, mindful of potential macro risks from rate policy and tariffs. |
| Jul 27 2025 | 2025 Q2 | ABLV, AVGO, BBY, CV, ETN, JPM, ORCL, TMUS, UNH | Balance Sheets, earnings growth, inflation, selectivity, valuation | ETN | The fund commentary focuses on earnings growth and quality balance sheets amid narrow market leadership. Management remains constructive but cautious given valuation and inflation risks. Stock selection is emphasized over macro calls. |
| Mar 31 2025 | 2025 Q1 | ABBV, ABT, AVGO, CVX, ETN, HPE, IBM, MSFT, ORCL, TMUS | - | - | |
| Jan 17 2025 | 2024 Q4 | AVGO, BBY, BKRP, EMN, GS, JPM, MDLZ, PLD, TGT, WSM | - | - | |
| Jun 30 2024 | 2024 Q2 | ADI, AVGO, AZN, HD, MDT, ORCL, PLD, PPG, TGT, TXN | - | - | |
| Mar 31 2024 | 2024 Q1 | AMGN, AMT, AVGO, ETN, JPM, MCD, MDLZ, MRK, MSFT, UNH | - | - | |
| Dec 31 2023 | 2023 Q4 | AVGO, AZN, BLK, CVX, FDX, GPC, MSFT, NOC, PNC | - | - | |
| Sep 30 2023 | 2023 Q3 | ABBV, ADP, CVX, ETN, MCD, MRK, NEE, RTX, TEL, UNH | - | - | |
| Jun 30 2023 | 2023 Q2 | ABBV, AVGO, CCI, CVX, ETN, JPM, MRK, MSFT, TGT, WEC | - | - |
| 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 |
Capital MarketsExchanges operate as essential high-margin toll roads for the economy with immense operating leverage. They benefit from trading volume flowing directly to profits with minimal extra cost and have natural inflation hedging through transaction values. |
Exchanges Nasdaq CBOE Trading Fees Market Data | |
EarningsEarnings are central to the manager's optimism with consensus expectations pointing to meaningful acceleration in small-cap earnings in 2026, with growth projected in the low-to-mid teens and exceeding that of large-cap companies. This anticipated rebound reflects easier year-over-year comparisons, improving operating leverage, and broadening demand across cyclical and value-oriented sectors. |
Earnings Growth Operating Leverage Cyclical Sectors Consensus Estimates Earnings Revisions | |
SemiconductorsRGA initiated a position in Lattice Semiconductor, viewing it as an under-appreciated AI winner with immediate gains and longer-term optionality. Lattice's focus on efficiency and advantages in low-power, small footprint FPGAs position it favorably for AI servers, particularly as the only Post-Quantum Cryptography secure chips on the market. |
FPGAs Security Efficiency AI Infrastructure Programmable | |
| 2025 Q3 |
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 |
RatesFederal Reserve resumed rate-cutting cycle with first cut since December 2024, signaling resumption of easing. Expected three cuts of 25bps between now and first quarter 2026 as Fed responds to signs of weakness in US labor market. |
Fed Monetary Policy Labor Market Easing Liquidity | |
SemiconductorsRGA initiated a position in Lattice Semiconductor, viewing it as an under-appreciated AI winner with immediate gains and longer-term optionality. Lattice's focus on efficiency and advantages in low-power, small footprint FPGAs position it favorably for AI servers, particularly as the only Post-Quantum Cryptography secure chips on the market. |
FPGAs Security Efficiency AI Infrastructure Programmable | |
| 2025 Q2 |
Growth |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 27, 2025 | Fund Letters | David Blount | ETN | Eaton Corporation plc | Industrials | Electrical Components & Equipment | Bull | NYSE | CapEx, datacenters, Electrification, Industrials, infrastructure, Power | Login |
| TICKER | COMMENTARY |
|---|---|
| ADI | Best economics in analog: 70%+ gross margins, 45–50% EBIT target, rising ROIC. Premium positioning: 4X average selling prices, mission-critical sockets, extreme switching costs. Hybrid manufacturing edge: ~5% capex vs. peers 15%+ → superior free cash flow + resilience. Maxim synergies: power + systems mix shift, margin accelerator. Secular and cyclical tailwinds: industrial automation, EV electrification (wireless battery management system), AI data center power & test, 100% ADI alpha hit rate~39% annualized returns in past upcycles and we believe 2Q25 marked the restart; pricing + margin inflection underway. |
| AVGO | The primary contributors to its performance were our exposures to Broadcom |
| AZN | World-class pharmaceutical and medical products manufacturer |
| ETN | Eaton's shares pulled back in August following strong performance through July. Like many companies in the industrials complex, Eaton's results did not exceed very high investor expectations. Moving into 2026, we anticipate accelerated growth for the company that is tied to strong trends in data center, aerospace, and defense markets. |
| GS | Energy (MEG takeover, CNQ), Precious metals (a basket of producers, primarily silver) and Financials (Goldman Sachs/Fairfax Financial) all provided solid contributions within the quarter. With the exception of MEG, all remain large holdings, and in some cases, we have further added to our positions. |
| HD | Conversely, our biggest detractors this quarter were DR Horton (DHI), Lennar Corp (LEN), Home Depot (HD). |
| JPM | JPMorgan (JPM) has identified 42 AI-related stocks in the S&P 500, which today represent 45% of the index's market cap. They estimate that these stocks have accounted for 78% of S&P 500 returns, 66% of earnings growth, and 71% of capital spending growth since ChatGPT launched in November 2022. As it relates to the impact on the U.S. economy, JPM estimates tech sector capital spending contributed 40%-45% of U.S. GDP growth through the first 9 months of the year, up from less than 5% during the same period in 2023. |
| KO | The Coca-Cola Company represents 9.3% of company owned with cost basis of $1,299 million and market value of $27,964 million, providing $816 million in 2025 dividends. |
| LRCX | we believe it is well positioned to become an approved vendor for Lam Research (a supplier of wafer-fabrication equipment) as well |
| MCD | We also rotated our positioning in the restaurant space by eliminating McDonald's and adding Darden Restaurants and Starbucks. |
| 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. |
| PG | The multiples of technology stocks should be quite a bit lower than the multiples of stocks like Coke and Gillette |
| PNC | We initiated a preferred perpetual security in this bank holding company due to its robust capital position. |
| RTX | The top three contributors to this outperformance came from RTX (US Defense) |
| TMUS | T-MOBILE US INC detracted -0.32% from relative performance |
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