| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Eagle Point Capital maintains a concentrated portfolio of 6-10 businesses that satisfy timeless human desires and possess physical infrastructure advantages. The firm's investment philosophy centers on cockroach-like businesses that are hardy and almost impossible to kill, contrasting with panda-like technology companies that struggle to adapt to environmental changes. Key holdings include McKesson, which has delivered pharmaceuticals for nearly 200 years, AutoZone and Dollar General for convenience, and British American Tobacco and Philip Morris for enduring nicotine consumption patterns. The managers emphasize businesses with consolidated industries, fragmented customer bases, mission-critical services, and low price-to-value ratios. They avoid technology-dependent companies, citing Chegg's 99% decline after ChatGPT disruption as a cautionary tale. The strategy focuses on physical infrastructure that changes slower than digital alternatives, with examples including Brookfield's hydroelectric facilities and pipeline networks. Eagle Point expects continued volatility and unpredictability but believes their durable business focus will enable long-term compounding regardless of future environmental changes.
Eagle Point Capital invests in cockroach-like businesses with enduring competitive advantages, physical infrastructure, and mission-critical services that satisfy timeless human desires, avoiding technology-dependent companies in favor of durable businesses that can weather rapid change.
Eagle Point expresses confidence that by prioritizing durability over novelty and focusing on timeless human desires and mission-critical physical infrastructure, the firm will continue to survive and compound through whatever environment the next nine years may bring.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 8 2026 | 2026 Q1 | AZO, BN, BTI, CHGG, DG, INTC, MCK, NVDA, PM, TSM, WOSG.L | Concentration, durability, long-term, Physical Infrastructure, Quality, value | MCK | Eagle Point Capital concentrates in cockroach-like businesses with enduring competitive advantages and physical infrastructure, avoiding technology-dependent pandas. Holdings like McKesson, AutoZone, and tobacco companies satisfy timeless human needs through mission-critical services. The firm prioritizes durability over novelty, believing physical infrastructure changes slower than digital alternatives, enabling long-term compounding through unpredictable environments. |
| Oct 1 2025 | 2025 Q3 | BTI, CHTR, COST, LULU, SPOT, TSLA | dividends, free cash flow, Mean reversion, risk management, Tobacco, value | BTI LN | Eagle Point Capital advocates buying businesses at low absolute valuations with 10-15% free cash flow yields, providing attractive base returns and downside protection. They contrast this with high-valuation investing risks, exemplified by Lululemon and Charter Communications losses. British American Tobacco demonstrates their approach: purchasing quality businesses at pessimistic valuations with strong cash generation and distribution capabilities. |
| Apr 1 2025 | 2025 Q1 | - | contrarian, Independent Thinking, long-term, Quality, value | - | Eagle Point Capital advocates strategic mediocrity through concentrated value investing in simple, predictable businesses with strong competitive positions. Their contrarian approach emphasizes independent thinking over social proof, targeting reasonable valuations with margin of safety. The firm deliberately avoids speculative technology and moonshot stocks, preferring consistent performers that can deliver mid-teens returns through economic cycles. |
| Oct 1 2024 | 2024 Q3 | NVDA | Concentration, long-term, Quality, selectivity, value | - | Eagle Point Capital maintains disciplined concentration in 6-10 high-quality businesses with competitive advantages and strong balance sheets. They prioritize avoiding bad investments over chasing every opportunity, deliberately missing AI/Nvidia as outside their value-focused approach. Intrinsic value is rising faster than stock prices, positioning the portfolio well for future outperformance through patient, selective investing. |
| Mar 30 2024 | 2024 Q1 | AZO, DG, DPZ, DVA, MCK, META | contrarian, long-term, Quality, uncertainty, value | - | Eagle Point Capital runs a concentrated value strategy buying cockroach-like businesses with pricing power during periods of market uncertainty. The fund owns 6-10 quality companies at 10% position sizes, using temporary problems and pessimism to purchase at attractive valuations. Recent success with Dollar General exemplifies their approach of buying wonderful companies facing temporary challenges. |
| Sep 30 2023 | 2023 Q3 | - | Checklist, concentrated, fundamentals, long-term, Quality, value | - | Eagle Point Capital runs a concentrated value strategy owning 6-10 high-quality businesses with competitive moats, purchased at discounted prices. Their systematic 10-point checklist filters for predictable, profitable companies with strong balance sheets and aligned management. The managers embrace volatility as opportunity, expecting periodic market declines and using them to acquire exceptional businesses at attractive valuations for long-term compounding. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
ResilienceEagle Point focuses on cockroach-like businesses that are hardy and almost impossible to kill, prioritizing durability over novelty. They seek businesses with timeless human desires, physical infrastructure advantages, and mission-critical services that can weather technological change. The strategy emphasizes businesses that satisfy enduring needs rather than those dependent on rapidly changing technology. |
Physical Infrastructure Mission Critical Durability Competitive Advantage Moat |
| 2025 Q3 |
ValueEagle Point Capital emphasizes buying businesses at low absolute valuations, preferably with 10-15% free cash flow yields. They believe low valuations provide attractive base returns, low bars for positive surprises, and soft price floors that reduce risk while providing asymmetric returns. |
Free Cash Flow Valuation Margin of Safety Mean Reversion Risk Management |
DividendsThe firm focuses on companies that distribute meaningful portions of their free cash flow through dividends and buybacks. They view high dividend yields as creating demand for stocks and providing downside protection through yield-seeking investors. |
Dividend Yield Cash Distribution Shareholder Returns Income Yield | |
TobaccoBritish American Tobacco serves as a key example of their investment approach, purchased at a 16% free cash flow yield with a 10% dividend yield. Despite secular volume declines, tobacco companies benefit from pricing power, brand loyalty, and regulatory barriers to competition. |
Pricing Power Brand Loyalty Regulatory Moat Secular Decline Cash Generation | |
| 2025 Q1 |
ValueEagle Point Capital emphasizes buying businesses at reasonable prices with margin of safety, focusing on low valuations rather than popularity. They seek businesses trading at low valuations that are likely to rise rather than fall, targeting low to mid teens business returns with conservative assumptions. |
Valuation Margin of safety Conservative Undervalued Price |
QualityThe firm targets simple, predictable, and profitable businesses with modest but persistent growth, strong competitive positions, resilient balance sheets, and ability to raise prices over time. They prefer cockroach-like businesses that are hardy and almost impossible to kill. |
Predictable Profitable Competitive advantage Balance sheet Resilient | |
| 2024 Q3 |
ValueEagle Point focuses on profitable companies with high insider ownership, aligned incentives, high ROEs, durable competitive advantages, fortress balance sheets, and below-average valuations. They seek businesses priced for reasonable value rather than perfection, emphasizing margin of safety in each investment. |
Value ROE Balance Sheet Margin of Safety Undervalued |
QualityThe firm targets cockroach-like businesses that are very hardy and almost impossible to kill, with demonstrated and enduring competitive advantages. They prefer companies in replication mode where their future resembles their past and are not overly reliant on factors outside of their control. |
Quality Competitive Advantage Durability Resilience Moats | |
| 2024 Q1 |
QualityEagle Point focuses on cockroach-like businesses with strong competitive positions that can survive virtually any environment. They prefer companies with pricing power like AutoZone that can raise prices without losing volume. The fund seeks businesses with durable cash flow and strengthening competitive positions. |
Pricing Power Competitive Moats Durable Resilient Defensive |
ValueThe managers embrace uncertainty to find low valuations that create asymmetric investment opportunities. They follow Ben Graham's principle that margin of safety renders forecasts unnecessary. When pessimism drives valuations to reflect worst-case scenarios, stocks become heads I win, tails I don't lose much investments. |
Margin of Safety Undervalued Asymmetric Contrarian Bargains | |
| 2023 Q3 |
QualityEagle Point emphasizes investing in simple, predictable, and profitable businesses with demonstrated competitive advantages. They focus on companies with high returns on incremental invested capital, resilient balance sheets, and rational capital allocation approaches. The fund seeks businesses in replication mode whose future will resemble their successful past. |
Competitive Advantage Capital Allocation Predictable Profitable Resilient |
ValueThe fund requires a margin of safety in every investment, buying businesses for less than their intrinsic value. They emphasize avoiding businesses priced for perfection and leaving room for inevitable errors. The goal is to avoid losing money even when wrong about an investment thesis. |
Margin of Safety Intrinsic Value Undervalued Benjamin Graham |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 8, 2026 | Fund Letters | Eagle Point Capital LLC | MCK | McKesson Corporation | Medical Distribution | Health Care Distributors | Bull | New York Stock Exchange | Consolidated Industry, defensive, Healthcare services, Mission-Critical, Moat, Pharmaceutical Distribution, Physical Infrastructure, Technology Consumer | Login |
| Oct 1, 2025 | Fund Letters | Matt Franz | BTI LN | British American Tobacco plc | Consumer Staples | Tobacco | Bull | NYSE | cash flow, Defensives, dividends, Pricing power, Regulation, tobacco, Value | Login |
| TICKER | COMMENTARY |
|---|---|
| BTI | Humans have been consuming nicotine for over 10,000 years and gambling for at least 3,000. That bodes well for British American Tobacco, Philip Morris, and Brightstar Lottery. |
| PM | Humans have been consuming nicotine for over 10,000 years and gambling for at least 3,000. That bodes well for British American Tobacco, Philip Morris, and Brightstar Lottery. |
| WOSG.L | Humans have been wearing jewelry as a status symbol for at least as long, which benefits Watches of Switzerland. |
| AZO | AutoZone and Dollar General deliver convenience, which never goes out of style. |
| DG | AutoZone and Dollar General deliver convenience, which never goes out of style. |
| MCK | McKesson, the oldest company in our portfolio, is a great illustration. McKesson began delivering pharmaceuticals by horse and buggy in 1833, almost 200 years ago. The world has changed a lot since then, but what hasn't is the need to get pharmaceuticals from point A to point B safely, securely, and efficiently. That is a societal need that will never change. |
| BN | Unique and irreplaceable assets, like Brookfield's 235 hydroelectric facilities, 30 port terminals, and 14,300 miles of natural gas pipelines, are great too. |
| NVDA | If McKesson is a cockroach, adapting to the tumult and technological change of the last two hundred years, then Nvidia and TSMC may be pandas. They're beloved by investors because they dominate the cutting edge of their industries. But the technology in their fields is changing rapidly. |
| TSM | If McKesson is a cockroach, adapting to the tumult and technological change of the last two hundred years, then Nvidia and TSMC may be pandas. They're beloved by investors because they dominate the cutting edge of their industries. But the technology in their fields is changing rapidly. |
| INTC | History is littered with companies, like Intel, that looked dominant but could not adapt as their environment changed. |
| CHGG | Chegg is a panda with a cautionary tale. The company spent a decade building a database of 120 million answers to textbook questions and sold access to students for $20 per month. ChatGPT's release in late 2022 disrupted Chegg's business model overnight. It gave students instant, unlimited, and customized homework help for free. Students, notoriously tech forward and price sensitive, immediately cancelled their Chegg subscriptions en masse. Three years later Chegg's stock has lost 99% of its value. |
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