| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
Fiduciary Management views the current AI-driven market rally as speculative excess comparable to the dot-com bubble. Semiconductor stocks posted their best quarter ever with the Philadelphia Stock Exchange Semiconductor Index gaining 88%, while valuations reached all-time highs over four standard deviations above historical averages. The five largest hyperscalers are projected to spend over $725 billion on AI capex in 2026, yet ROI analysis suggests only Amazon would generate positive returns under zero operating cost assumptions. Meanwhile, Quality Compounders fell 1% year-to-date, creating a historic valuation gap. The manager is actively avoiding AI infrastructure stocks and instead positioning in overlooked businesses with durable competitive advantages, high returns on capital, and conservative balance sheets trading at meaningful discounts. Portfolio companies like FTI Consulting, Capital One, and Fluidra are positioned to benefit from AI on the cost side through productivity gains rather than selling into the investment cycle. The manager expects this setup to generate strong returns over a 3-5 year horizon as the AI bubble deflates and traditional businesses compound quietly, similar to the post-dot-com period when their small cap strategy outperformed the Nasdaq by over 127 percentage points.
The market is experiencing AI-driven speculative excess comparable to the dot-com bubble, with semiconductor and AI infrastructure valuations at extreme levels and circular capital dynamics that cannot be sustained. Manager is actively avoiding these areas and instead positioning in overlooked quality businesses with durable competitive advantages, high returns on capital, and conservative balance sheets trading at meaningful discounts to intrinsic value. These companies stand to benefit from AI on the cost side through productivity gains rather than selling into the investment cycle, creating an asymmetric risk/reward profile regardless of whether AI delivers on its promises.
Manager expects the long-term setup for portfolios to be very bright on a 3-5 year time horizon, not in spite of the current AI mania but partly because of it. The valuation gap between AI stocks and traditional businesses creates compelling opportunities. If AI productivity benefits materialize, portfolio companies positioned on the cost side will capture their share of benefits while being priced with modest expectations. If AI benefits are overblown, AI infrastructure stocks face severe earnings disappointments while portfolio holdings with low valuations should remain resilient. Manager draws parallel to post-dot-com period when overlooked traditional businesses compounded quietly while bubble deflated.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jul 11 2026 | 2026 Q2 | COF, FCN, FRD.MC | AI Bubble, Banking, Consulting, Quality, semiconductors, small caps, Valuation gap, value |
FCN COF FRD.MC |
FMI is avoiding the AI bubble and buying overlooked quality businesses at compelling valuations. Semiconductor and AI infrastructure stocks have reached dot-com-level excess with unsustainable ROI dynamics, while traditional businesses with durable advantages trade at historic discounts. Portfolio positioned to benefit from AI productivity gains on the cost side, creating asymmetric upside regardless of whether AI delivers on its promises. |
| Apr 12 2026 | 2026 Q1 | BKNG, CARR, FBHS, FERG, FLU.MC, HAYW, HURN, HWDN.L, LPX, MAS | AI, Consulting, defense, energy, Geopolitical, Housing, Quality, value |
HURN BKNG IMCD.AS |
FMI navigates Q1 2026 market volatility from the Iran war through contrarian value investing in quality businesses at discounted valuations. Despite energy and defense outperformance hurting their housing-focused positioning, they identify compelling opportunities in consulting and travel companies facing overblown AI concerns, maintaining conviction in their time-tested investment process. |
| Jan 11 2026 | 2025 Q4 | ACN, CAT, HAYW, JPM, MSFT, NVDA, SMIN.L, UNP | AI, Bubble, capital intensity, Quality, small caps, technology, value | - | FMI maintains quality-focused discipline amid AI-driven speculation and junk rally. Firm questions sustainability of hyperscaler capital spending despite AI stocks driving 78% of S&P 500 returns. Quality businesses trading at discounts create attractive long-term opportunities. Portfolio emphasizes strong balance sheets, competitive advantages, and reasonable valuations while avoiding speculative excess. |
| Oct 14 2025 | 2025 Q3 | BDX, GRG.L, OMF | AI, Concentration, Defensive, Quality, Speculation, Valuations | GRG LN | FMI sees dangerous bubble conditions with record valuations, AI spending excess, and unprecedented market concentration amid weakening economic fundamentals. The firm maintains defensive positioning in quality businesses trading at discounts, believing the disconnect between soaring markets and deteriorating consumer confidence cannot persist. They expect volatility to create better opportunities for patient value investors. |
| Jun 30 2025 | 2025 Q2 | BDX, GRG.L, OMF | AI, international, Quality, small cap, Speculation, Valuations, value |
NSIT MAS OMF BDX GRG.L |
FMI sees bubble-like market conditions with record valuations and AI speculation reminiscent of past overbuilds. Economic fundamentals show weakness while investor exuberance reaches extremes. The firm maintains defensive positioning in quality businesses at attractive valuations, emphasizing downside protection while preparing to capitalize on opportunities if markets correct from current stretched levels. |
| Apr 14 2025 | 2025 Q1 | AHT.L, ALLE, D05.SI, EDEN.PA, FCFS, LLOY.L, SW.PA | defense, Europe, financials, tariffs, technology, value |
FCFS ALLE SW.PA |
FMI sees market excess unwinding with U.S. stocks pressured while international markets surge on European defense spending. The firm maintains value discipline, holding durable businesses at discount valuations amid elevated market risks. Trade policy uncertainty and technology valuation concerns create challenging backdrop, but FMI welcomes volatility as opportunity for active stock selection. |
| Dec 31 2024 | 2024 Q4 | ACGL, BKNG, BME.L, FERG, G, ICLR, ROG.SW, RXL.PA, SONY, SW.PA, UL, WEIR.L | healthcare, insurance, international, large cap, Travel, value |
ICLR ACGL |
FMI International Equity posted -7.41% in Q4 but achieved 2.72% YTD returns through concentrated large-cap international investing. The fund added ICON at cyclical trough valuations while exiting Arch Capital after strong performance. Portfolio maintains focus on durable franchises trading below intrinsic value with strong recurring revenue and quality management teams. |
| Sep 30 2024 | 2024 Q3 | BARN.SW, BKNG, BME.L, FERG.L, GRG.L, PHIA.AS, ROG.SW, RXL.PA, SIE.DE, SONY, SW.PA, UL | Automation, consumer, Europe, healthcare, large cap, value |
SIE.DE BARN.SW |
FMI International delivered 9.9% Q3 returns through disciplined value investing in quality European franchises. Added Siemens for its automation leadership and growth prospects at discounted valuations. Exited Barry Callebaut due to restructuring complexity. Portfolio maintains 33 concentrated holdings with strong active share, targeting durable businesses trading below intrinsic value. |
| Jun 30 2024 | 2024 Q2 | AMZN, BJ, BKNG, BME.L, D05.SI, DLTR, FERG.L, GOOGL, HSIC, KMX, MAS, META, MSFT, MU, NVDA, PHG, RHI, RYAAY, SKX, UL | AI, healthcare, international, Japan, Quality, small caps, Speculation, value |
HSIC DGX RYAAY |
FMI maintains quality-focused value approach amid extreme market speculation and AI bubble concerns. Sees opportunity in small cap quality companies trading at 20-year relative lows. Key holdings include healthcare distributors and European airlines facing temporary headwinds. Expects current speculative cycle to end with value investing returning to outperformance given historical precedent. |
| Apr 15 2024 | 2024 Q1 | 4403.T, 6841.T, ACGL, ATR, BECN, BRK.B, CSL, DCI, FBIN, GTES, MU, NVT, PHG, RHI, SAFRY, SCHW, SMIN.L, SN.L, SONY, SSD, WEIR.L | Construction, discount, international, Quality, small caps, Valuations, value |
GTES SCHW WEIR.L |
FMI sees a fundamental disconnect with S&P 500 at extreme valuations while Small Cap and International markets trade at deep discounts. The firm maintains concentrated, quality-focused portfolios with strong balance sheets and 3-5 year investment horizons. Despite macro headwinds including recession risks and elevated debt levels, FMI remains optimistic about opportunities in undervalued segments. |
| Jan 14 2024 | 2023 Q4 | 005930.KS, ACGL, ARW, BJ, CARR, DG, DGE.L, G, HEI, KMX, MAS, MU, RHI, RYAAY, SAP, SCHW, SKX, SLB, SSD, UL | Concentration, Debt, international, Quality, technology, Travel, value |
BJ CARR DGE.L |
FMI's International Strategy delivered strong 2023 returns by focusing on quality businesses at discount valuations while U.S. markets reached extreme concentration and historical valuation peaks. With record global debt levels and approaching refinancing walls creating systemic risks, the firm's disciplined value approach in international markets positions portfolios for potential outperformance as mean reversion pressures emerge. |
| Oct 21 2023 | 2023 Q3 | 005930.KS, BARN.SW, BJ, BKNG, CCEP, CDW, DG, DLTR, FBIN, HLI, IPG, LGIH, MU, OMC, SLB, SNN.L, SYY, VVV, ZION | China, Concentration, defensives, international, small caps, value |
VVV SYY CCEP |
FMI sees value opportunities amid extreme U.S. market concentration, with top S&P 500 stocks trading at 47% premiums. The firm added defensive positions while avoiding speculative growth stocks. China's property bubble collapse and European weakness create headwinds, but attractive valuations in small caps and international markets offer compelling long-term opportunities for disciplined value investors. |
| Jun 30 2023 | 2023 Q2 | AAPL, AMZN, BECN, BJ, BME.L, CDW, DG, FERG.L, G, GOOGL, KMX, MAS, MSFT, NTRS, NVDA, RHI, ROG.SW, SSD, SW.PA, TRTN | AI, Concentration, growth, international, small caps, technology, valuation, value |
ARHI CDW ROG.SW |
FMI sees current AI-driven market concentration as unsustainable speculation, creating compelling value opportunities in small caps and international markets. With profitable small caps at 40-year discounts to large caps and European stocks at all-time discounts to U.S. markets, the firm maintains conviction that normalizing interest rates will restore fundamental analysis advantages over passive momentum investing. |
| Mar 31 2023 | 2023 Q1 | BJ, BKNG, BMEB.PA, CSL, DG, FBIN, GOOGL, HOWG.L, NSIT, PLXS, PRI, RXL.PA, SCHW, SKX, SLB, SONY, SW.PA, ULVR.L, UNH, ZION | Banking, growth, Housing, international, Quality, Travel, value |
ZBRA SCHW AAPL|MSFT|NFLX|NVDA|UNH AEO|ASH|ASUR|AZZ|DCO|FA|FBIN|GHM|LEU|NSP|RRR|UTZ BKNG |
FMI added to banking positions during Q1 crisis volatility while expressing concern about growth stock speculation. The firm sees attractive housing opportunities despite near-term pressures, citing structural undersupply and demographic tailwinds. Travel recovery continues benefiting holdings like Booking Holdings. FMI maintains value discipline, focusing on quality businesses with strong balance sheets during market dislocations. |
| Oct 25 2022 | 2022 Q3 | AKZA NA, BME LN, HWDN LN, SW FP | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q2 |
AIManager views AI as a speculative bubble with valuations at extreme levels and circular capital dynamics. Hyperscalers are spending over $725 billion on capex in 2026, but ROI math is challenging with most requiring $2-5 trillion in incremental revenue to justify investments. Manager is actively avoiding AI infrastructure stocks and instead positioning in companies that could benefit from AI on the cost side rather than revenue side. |
Semiconductors Data Centers Cloud Hyperscalers Capex |
SemiconductorsSemiconductor stocks experienced their best quarter ever with the Philadelphia Stock Exchange Semiconductor Index gaining 88% in Q2 and 102% YTD. Valuations are at all-time highs, over four standard deviations above historical averages. Manager views this as speculative excess with minimal room for error and extraordinarily high investor expectations. |
Chips Memory Valuations Bubble | |
ValueManager is finding compelling opportunities in traditional businesses overlooked during the AI frenzy. The valuation gap between AI stocks and everything else now rivals dot-com bubble levels. Portfolio companies have durable competitive advantages, high returns on capital, strong management, and conservative balance sheets trading at meaningful discounts to intrinsic value. |
Valuation Gap Quality Discount Intrinsic Value | |
QualityQuality Compounders tracked by Goldman Sachs fell 1% YTD while AI themes skyrocketed, creating a historic performance gap. Manager views this as an opportunity, owning businesses with durable competitive advantages, high returns on invested capital, strong management, and conservative balance sheets that are being priced as if none of that is true. |
Compounders Returns on Capital Competitive Advantages Balance Sheets | |
Small CapsRussell 2000 gained 21.49% in Q2, the best quarterly return since 2020. Manager references historical outperformance during the post-dot-com period when the FMI Common Stock Fund outperformed the Nasdaq Composite by over 127 percentage points cumulatively over five years as overlooked traditional businesses compounded quietly. |
Russell 2000 Outperformance Traditional Businesses | |
| 2026 Q1 |
DefenseDefense companies have outperformed broader market indices over the long term, benefiting from Russia's invasion of Ukraine in 2022 and the broadening Middle East conflict. The Iran war has become a major catalyst for defense spending, meaningfully altering spending trajectories for European defense and several other countries. |
Defense Spending Geopolitical Military Government Conflict |
OilThe Iran war has caused the blockage of the Strait of Hormuz, creating the largest supply disruption in global oil market history. Oil has eclipsed $100 per barrel with fears of significant further increases if the conflict continues, acting as a de facto tax on consumers and creating business headwinds. |
Energy Geopolitical Supply Chain Commodities Inflation | |
AIBoth Huron Consulting and Booking Holdings have sold off on artificial intelligence concerns, which FMI believes are overblown and misunderstood. FMI views AI as a revenue opportunity for consulting firms and believes AI tools are more likely to integrate existing capabilities rather than recreate them. |
Technology Disruption Consulting Travel Innovation | |
Home ImprovementFMI has overweight exposure to building materials, housing and construction, particularly the housing repair and remodel market. The median age of US housing stock continues to climb to 42 years, creating maintenance needs, while over 50% of homeowners have mortgage rates below 4%, creating a lock-in effect favoring renovation over selling. |
Housing Construction Demographics Rates Renovation | |
| 2025 Q4 |
AIFMI views AI as creating a speculative bubble with unsustainable capital spending and circular funding dynamics. They see tremendous long-term potential but question whether enormous capital expenditures will generate attractive returns, comparing current dynamics to the dot-com crash. The firm actively avoids AI infrastructure investments due to valuation concerns and structural issues. |
Artificial Intelligence Technology Valuations Bubble Infrastructure |
QualityFMI emphasizes their focus on quality businesses with sustainable competitive advantages, strong balance sheets, and returns above cost of capital. They note quality has underperformed in the current market environment but maintain confidence in their quality-focused approach for long-term outperformance. Quality value investing remains their core strategy despite recent headwinds. |
Value Investing Balance Sheet Competitive Advantage Returns Strategy | |
Small CapsThe firm notes small cap active managers have struggled during the current market rally, with low-quality companies dominating performance since April 2025. Companies that lose money, have low ROE, or lack sales have outperformed significantly. FMI sees this as a temporary anomaly that creates opportunities for their quality-focused small cap approach. |
Russell 2000 Active Management Performance Opportunity Underperformance | |
ValueFMI advocates for Quality Value investing, which combines cheap stocks with high quality metrics. Despite recent underperformance versus other value styles, they demonstrate Quality Value's superior long-term track record and downside protection. The firm believes current market conditions favor low-quality over high-quality investments, creating a temporary headwind for their approach. |
Quality Value Valuation Long Term Outperformance Downside Protection | |
| 2025 Q3 |
AIFMI expresses skepticism about the massive AI capital expenditure cycle, comparing it to the fiber optic overbuild of 2000. While acknowledging AI's long-term potential, they question whether the colossal spending will generate attractive returns, noting that AI monetization remains limited despite nearly $400 billion in annual capex from five mega cap tech companies. |
Artificial Intelligence Capex Technology Datacenter Monetization |
ValuationsThe firm highlights that current stock market valuations are among the most expensive in U.S. history, with eight traditional valuation metrics hitting record highs. They note the fundamental disconnect between record high stock markets and weakening global economic conditions, emphasizing their focus on quality businesses trading at discounts to benchmarks. |
Expensive Record Metrics Disconnect Quality | |
Risk AppetiteFMI observes classic speculative excess with record ETF inflows, technology sector gathering record weekly inflows, and U.S. household equity exposure climbing to all-time highs. They note the abundance of exuberance and high complacency, with investors displaying classic herd behavior and FOMO driving investment decisions. |
Speculation Inflows Exuberance Complacency FOMO | |
| 2025 Q2 |
AIWhile AI has tremendous long-term potential and could be revolutionary, FMI is skeptical about the colossal capital expenditure being deployed. They compare it to the fiber optic overbuild in 2000, where massive overbuilding led to overcapacity. Five mega cap tech companies are on pace to spend nearly $400 billion in capex, yet AI monetization remains limited with AI-native revenues believed to be less than $20 billion total. |
Artificial Intelligence Capex Datacenter Technology Overbuilding |
ValuationsFMI describes current markets as one of the most expensive in U.S. history, with eight traditional valuation metrics hitting the highest level on record over the last 125 years. They note that small cap, international, and value stocks trade at a sizeable discount to U.S. large cap growth, providing opportunities for quality businesses with strong balance sheets. |
Expensive Record Discount Quality Balance Sheet | |
Risk AppetiteThe letter describes abundant exuberance and high complacency in markets, with speculative excess evident across multiple areas. Global equity ETFs added a record $152 billion of inflows over 3 weeks, and U.S. households' exposure to public equities has climbed to a new all-time high, well above prior stock market peaks, indicating classic herd behavior. |
Speculation Exuberance Complacency Inflows Herd Behavior | |
| 2025 Q1 |
ValueFMI emphasizes value investing approach, noting they are encouraged to see value stocks outperforming growth stocks in both the U.S. and abroad in 2025. They take comfort holding portfolios of durable businesses trading at discount valuations. |
Discount Undervalued Outperformance Durable Quality |
Defense SpendingDefense was the top performing theme in Europe in Q1, up 69.7%. Germany announced defense and infrastructure spending that could exceed €1 trillion over the coming decade, with the EU proposing a €800 billion ReArm Europe plan. |
Military European Government Spending Geopolitical | |
Trade PolicyTrump's whipsaw approach to trade policies has created a difficult environment for companies to navigate. The risk of stagflation increases with widespread tariffs and could make for a challenging economic backdrop. |
Tariffs Protectionism Stagflation Uncertainty Policy | |
| 2024 Q4 |
CRO & CDMOICON is a global contract research organization providing outsourced clinical trial services to pharmaceutical and biotech clients. Following its merger with PRA Health Sciences in 2021, ICON is positioned as a high-quality contender with competitive differentiation. The firm has commercial relationships with 17 of the top 20 pharma companies and benefits from increasing trial complexity and sponsor efficiency needs. |
Clinical Trials Outsourcing Pharmaceuticals Biotech Drug Development |
| 2024 Q3 |
AutomationSiemens Digital Industries represents the strongest and most integrated automation portfolio globally. Management targets 5-7% annual organic revenue growth and high-single digit annual EPS growth through a cycle. The automation business has strong positions in growing markets with high barriers to entry. |
Industrial Digital Manufacturing Technology Growth |
| 2024 Q2 |
AIThe manager expresses skepticism about the AI bubble, noting that Sequoia Capital warns of speculative frenzies. While acknowledging AI's vast possibilities, they highlight the massive spending ($180 billion annually) with little revenue to show ($3.4 billion for OpenAI). They question whether companies will see adequate returns on their AI investments. |
Data Centers Semiconductors Cloud Nvidia Speculation |
ValueThe manager emphasizes their commitment to value investing despite current underperformance, noting value's 100+ year track record. They see the current environment where growth dominates as making them more excited about value's future prospects. Small cap quality companies now trade near the lowest level relative to large caps in over 20 years. |
Quality Small Caps Undervaluation Long-term Fundamentals | |
QualityThe focus on quality has paid off in recent years as M&A activity shrunk the number of quality small cap companies. The Russell 2000 now has over 40% of constituents losing money, making quality companies increasingly scarce. Quality companies with high return on capital employed win over the long-term despite periodic underperformance. |
Small Caps Profitability Returns Scarcity Long-term | |
| 2024 Q1 |
ValueFMI emphasizes investing in advantaged companies trading at discounts to intrinsic value for temporary reasons. All portfolios trade at sizeable discounts to core benchmarks while owning well-run, durable businesses. The firm targets companies with attractive risk/reward profiles through full cycles. |
Discount Intrinsic Risk-reward Durable Quality |
Small CapsSmall/SMID Cap stocks have lagged in recent years, making relative valuations more appealing. US Small Cap continues to trade at meaningful discount with relative valuations around two standard deviations below historical levels. The setup appears favorable for small cap investing. |
Undervalued Relative Discount Lagging Favorable | |
ConstructionFMI has built positions in companies exposed to housing and construction materials across portfolios, including Simpson Manufacturing, Fortune Brands, Beacon Roofing, nVent Electric, Carlisle, Carrier Global, Ferguson, Eaton, and Masco. These came under pressure due to cyclical concerns and rising interest rates. |
Housing Materials Cyclical Infrastructure Building | |
QualityFMI maintains focus on business quality, avoiding money-losing businesses which comprise roughly 40% of Russell 2000 constituents. The firm seeks companies with robust balance sheets, solid through-cycle growth prospects, and strong return profiles as pre-requisites for investment. |
Balance-sheet Profitable Through-cycle Returns Durable | |
| 2023 Q4 |
ValueFMI emphasizes value investing discipline amid elevated U.S. market valuations. The firm focuses on quality businesses trading at discount valuations with solid management teams and balance sheets, particularly in international markets where valuations are more reasonable than U.S. Large Cap. |
Discount Quality Valuations Margin of Safety Undervalued |
TravelThe firm has exposure to travel-related holdings including airlines and hospitality companies. They leaned into travel exposures when they declined in 2022, taking advantage of temporary dislocations within these segments that helped drive 2023 performance. |
Airlines Hospitality Recovery Dislocations Tourism | |
| 2023 Q3 |
ValueFMI emphasizes value investing opportunities across geographies, noting that global value stocks are trading at historically wide discounts to growth. The firm sees attractive relative values outside mega-cap companies, with their portfolios trading at significant discounts to benchmarks while investing in above-average businesses with strong balance sheets. |
Value Discount Growth Benchmarks Balance Sheets |
ChinaChina faces significant challenges with its property sector bubble finally popping, representing 25% of GDP and 70% of household wealth. Property sales are down 40% from 2021 peak, housing starts fell 60%, and prices dropped 33%. Additional headwinds include poor demographics, declining working-age population, slowing productivity growth, and rising tensions with the West. |
Property Demographics GDP Bubble Productivity | |
DefensivesDespite weakening economic backdrop, cyclical stocks have outperformed defensives over the past year. FMI sees attractive valuations among defensive stocks that have been left behind, adding new defensive positions including Valvoline, Sysco, and Coca-Cola Europacific Partners for their stability, growth potential, and pricing power. |
Cyclicals Stability Pricing Power Valuations Growth | |
| 2023 Q2 |
AIGenerative AI has lit the technology sector ablaze and has potential to be a game-changer, but is in early stages of adoption with overblown commercial revenue projections. The manager notes heavy technology investment in entertainment rather than productivity-enhancing applications, questioning whether AI will change the productivity trajectory. |
Generative AI Technology Productivity Revenue |
ValueValue investing has nearly 100 years of success but is currently in one of the worst periods on record due to suppressed interest rates, QE, and passive investing. The manager expresses great confidence that value will win out due to human nature and market cycles, with valuation premium for growth versus value near 50-year highs. |
Value Investing Growth Premium Market Cycles Valuation | |
Small CapsProfitable US Small Cap stocks are trading close to the largest discount to US Large Cap stocks in over 40 years. Quality has been hard to come by in Small Cap space with extensive M&A activity by private equity thinning out the opportunity set, requiring disciplined stock picking. |
Small Cap Valuation Discount Quality Stock Picking | |
| 2023 Q1 |
BankingThe firm discusses the global banking crisis including failures of Silicon Valley Bank, Signature Bank, and Silvergate Capital, along with Credit Suisse's rescue. They maintain positions in Zions Bancorporation and Charles Schwab despite volatility, believing both have sticky deposit bases and conservative balance sheets. The crisis highlights banking sector fragility and will likely lead to lower profitability and multiples going forward. |
Banking Credit Deposits Liquidity Risk |
GrowthThe firm expresses concern about the resurgence of growth and momentum investing, noting speculative fever in technology stocks. They highlight issues with adjusted earnings quality, particularly stock-based compensation that can exceed 20% of sales. The Nasdaq is up 17% year-to-date while ARK Innovation ETF gained 29%, representing a return to the growth trade that dominated the last decade. |
Growth Momentum Speculation Valuations Technology | |
HousingDespite near-term pressures from rising rates and inflation, the firm sees attractive long-term opportunities in housing-related investments. They cite structural undersupply since the Global Financial Crisis, aging housing stock, and demographic tailwinds from millennials entering homebuying age. The repair and remodel market is particularly attractive given homeowner balance sheet strength and locked-in low mortgage rates. |
Housing Construction Demographics Supply Repair | |
TravelThe firm highlights Booking Holdings as benefiting from travel recovery, particularly in Europe which represents over 70% of sales. Travel continues to recover with Booking taking market share from competitors. They view the current valuation of approximately 17 times normalized 2024 earnings as punitive given the long runway for growth as the industry fully recovers from COVID and Ukraine war impacts. |
Travel Recovery Europe Market Share Valuation |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 11, 2026 | Fund Letters | FMI International Equity | FCN | FTI Consulting Inc. | Consulting Services | Research & Consulting Services | Bull | New York Stock Exchange | AI-Resistant, business transformation, Consulting, Crisis Management, Economic Consulting, Equity, Forensic Consulting, Share Buybacks, small-cap, turnaround, Value | Login |
| Jul 11, 2026 | Fund Letters | FMI International Equity | COF | Capital One Financial Corp | Credit Services | Consumer Finance | Bull | New York Stock Exchange | AI Beneficiary, banking, cloud infrastructure, consumer finance, credit cards, Equity, financials, large-cap, M&A Synergies, Payment Networks, Share Buybacks, Value | Login |
| Jul 11, 2026 | Fund Letters | FMI International Equity | FRD.MC | Fluidra S.A. | Other | Building Products | Bull | Bolsas y Mercados Españoles (Madrid) | aftermarket, Building Products, Cyclical Recovery, Equity, Industrials, International, pool equipment, Pricing power, recurring revenue, Residential, Spain, Value | Login |
| Apr 12, 2026 | Fund Letters | FMI International Equity | HURN | Huron Consulting Group Inc. | Consulting Services | Research & Consulting Services | Bull | NASDAQ | AI, Consulting, Education, healthcare, M&A, margin expansion, recurring revenue, share repurchases | Login |
| Apr 12, 2026 | Fund Letters | FMI International Equity | BKNG | Booking Holdings Inc. | Travel Services | Internet & Direct Marketing Retail | Bull | NASDAQ | AI, asset-light, digital marketing, Free Cash Flow, network effects, Online Travel, Payments, Two-Sided Marketplace | Login |
| Apr 12, 2026 | Fund Letters | FMI International Equity | IMCD.AS | IMCD N.V. | Specialty Chemicals | Specialty Chemicals | Bull | Euronext Stock Exchange | Cyclical Recovery, Distribution, life sciences, M&A, multiple expansion, Scale Advantages, specialty chemicals, value-added services | Login |
| Oct 14, 2025 | Fund Letters | Jonathan T. Bloom | GRG LN | Greggs PLC | Consumer Discretionary | Restaurants | Bull | NYSE | Brand, cash flow, expansion, Food, growth, Margins, retail, valuation | Login |
| Sep 30, 2025 | Fund Letters | FMI International Equity | OMF | OneMain Holdings Inc. | Financials | Consumer Finance | Bull | NYSE | Auto finance, consumer finance, credit cards, dividend, Nonprime, operating leverage, Personal Lending, Share Buybacks, turnaround, Value | Login |
| Sep 30, 2025 | Fund Letters | FMI International Equity | BDX | Becton Dickinson & Co. | Health Care | Health Care Equipment | Bull | NYSE | business separation, Consumables, defensive, Healthcare Equipment, Healthcare Utilization, Manufacturing Scale, margin expansion, Medical devices, oligopoly, recurring revenue | Login |
| Sep 30, 2025 | Fund Letters | FMI International Equity | GRG.L | Greggs PLC | Consumer Discretionary | Restaurants | Bull | LSE | brand loyalty, Cash Flow Inflection, Food-on-the-go, market share, Restaurants, store expansion, Supply Chain Investment, UK retail, Value, vertically integrated | Login |
| Jun 30, 2025 | Fund Letters | Jonathan T. Bloom | NSIT | Insight Enterprises Inc. | Information Technology | Electronics & Computer Distribution | Bull | NASDAQ | buybacks, cloud, IT services, Modernization, scale | Login |
| Jun 30, 2025 | Fund Letters | Jonathan T. Bloom | MAS | Masco Corp. | Industrials | Building Products & Equipment | Bull | NYSE | brands, Free Cash Flow, Remodeling, ROIC, valuation | Login |
| Mar 31, 2025 | Fund Letters | FMI International Equity | FCFS | FirstCash Holdings, Inc. | Consumer Discretionary | Specialized Consumer Services | Bull | NASDAQ | Collateralized loans, consolidation, Counter-cyclical, defensive, Mexico, Pawn, regulatory barriers, Value | Login |
| Mar 31, 2025 | Fund Letters | FMI International Equity | ALLE | Allegion Public Limited Co. | Industrials | Building Products | Bull | NYSE | aftermarket, brands, Cyclical, Electronic Products, Moat, oligopoly, Security Hardware, Value | Login |
| Mar 31, 2025 | Fund Letters | FMI International Equity | SW.PA | Sodexo S.A. | Consumer Discretionary | Hotels, Restaurants & Leisure | Bull | Euronext Paris | Catering, Diversified, Europe, Facilities Management, family-controlled, North America | Login |
| Dec 31, 2024 | Fund Letters | FMI International Equity | ICLR | ICON PLC | Health Care | Life Sciences Tools & Services | Bull | NASDAQ | Biotech, Clinical trials, Cro, Cyclical, drug development, healthcare, Merger Integration, Pharmaceutical Services, Value | Login |
| Dec 31, 2024 | Fund Letters | FMI International Equity | ACGL | Arch Capital Group Ltd. | Financials | Property & Casualty Insurance | Neutral | NASDAQ | capital allocation, Cycle Management, Insurance, Mortgage Insurance, P&C insurance, profit-taking, Reinsurance, specialty insurance | Login |
| Sep 30, 2024 | Fund Letters | FMI International Equity | SIE.DE | Siemens AG | Industrials | Industrial Conglomerates | Bull | XETRA | conglomerate, Digital Industries, discounted valuation, Equity, European, Industrial automation, transformation | Login |
| Sep 30, 2024 | Fund Letters | FMI International Equity | BARN.SW | Barry Callebaut AG | Consumer Staples | Food Products | Neutral | SIX Swiss Exchange | Chocolate Manufacturing, consumer staples, defensive, Equity, exit, Food Ingredients, restructuring, Swiss | Login |
| Jun 30, 2024 | Fund Letters | FMI International Equity | HSIC | Henry Schein Inc. | Health Care Equipment & Services | Health Care Distributors | Bull | NASDAQ | Aging demographics, Cyber Recovery, defensive, Dental, Healthcare Distribution, market leader, medical equipment, Software | Login |
| Jun 30, 2024 | Fund Letters | FMI International Equity | DGX | Quest Diagnostics Inc. | Health Care Equipment & Services | Health Care Services | Bull | NYSE | Aging demographics, Cost advantage, defensive, diagnostics, Healthcare services, Laboratory Testing, market share, Reimbursement | Login |
| Jun 30, 2024 | Fund Letters | FMI International Equity | RYAAY | Ryanair Holdings PLC | Transportation | Airlines | Bull | NASDAQ | Airlines, Capacity growth, Cost advantage, Cyclical Recovery, Europe, Fleet Management, Low-Cost Carrier, market share | Login |
| Mar 31, 2024 | Fund Letters | FMI International Equity | GTES | Gates Industrial Corp. PLC | Capital Goods | Industrial Machinery | Bull | NYSE | Automotive Aftermarket, Cyclical Recovery, industrial machinery, manufacturing, Power Transmission, Replacement Parts, Value | Login |
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| TICKER | COMMENTARY |
|---|---|
| COF | Capital One is one of the largest banks and card issuers in the U.S. Our investment thesis centers on Capital One's acquisition of Discover. Meaningful value creation could come from cost synergies and converting a portion of Capital One's card portfolio to Discover's network. Importantly, these synergies require no additional capital or credit risk and should increase returns while reducing earnings cyclicality relative to Capital One on a standalone basis. Over the longer term, there is a potentially game-changing opportunity to build a more competitive network to challenge Visa and Mastercard. Capital One is also uniquely positioned to benefit from AI: the bank operates on a modern, fully cloud-based technology infrastructure, a rarity in the industry. AI could drive value across marketing efficiency, credit underwriting, fraud detection, and customer service. We forecast accelerated earnings growth and higher returns versus history. We think that the stock should re-rate as investors appreciate Capital One's transformation. Finally, we have a favorable view of the management team led by founder Richard Fairbank and expect that capital allocation will be skewed toward share repurchases given the discounted valuation and overcapitalized balance sheet. |
| FCN | FTI Consulting is a leading global consulting firm specializing in crisis management and business transformation, with more than 8,100 employees across 32 countries and territories. The company operates through five segments: Corporate Finance and Restructuring, Forensic and Litigation Consulting, Economic Consulting, Strategic Communications, and Technology. Roughly 64% of revenue is domestic, with the remaining 36% generated internationally. FTI's competitive advantages are well-established: a strong track record, respected brand, broad capabilities, and deep subject-matter expertise across its segments. Together, these qualities underpin a durable consulting franchise with a track record of organic growth. Against that backdrop, two headwinds have weighed on the shares and created our entry point. First, a rare defection by a group of Economic Consulting employees in early 2025 caused financial disruption and reputational damage. Second, broader concerns about AI displacing the consulting model have pressured FTI's valuation. We view both risks as largely misunderstood or already resolved. The defection appears to be an isolated incident that the company has effectively put behind it. On AI, FTI's niche as a specialist consultant delivering mission-critical work (most often for clients in the middle of a crisis) insulates it far more than most other consulting models. We believe management's target of at least mid-single-digit organic EBITDA growth is achievable. Capital allocation has been sound, highlighted by a mid-teens reduction in shares outstanding in 2025, with buybacks continuing into 2026 as the stock remains depressed. We see the valuation as compelling within an otherwise expensive small-cap market. |
| FRD.MC | Fluidra is a global pool equipment manufacturer and distributor focused primarily on the residential pool market. Its product portfolio spans pumps, automation, sanitization, heaters, filters, lighting, water features, cleaners, pool chemicals, and more. Roughly 70% of revenue is tied to the existing installed base of pools, most of which is repair and replacement, making the business resilient to economic cycles. Fluidra also benefits from strong pricing power: purchase decisions are typically made by pool service professionals rather than end consumers, and these professionals tend to be price-insensitive and brand-loyal, gravitating toward established industry leaders. The result is a business with high margins and strong returns on invested capital. The pool industry saw an outsized surge in demand in the early years of COVID, followed by a sharp reversal as end-market activity weakened and the distribution channel worked through elevated inventory. That destocking cycle has largely run its course, though demand for new pool construction and remodels remains soft. Over time, we expect the more discretionary segments of the business to recover. In the interim, Fluidra should continue to grow through price increases and volume gains within the installed base and expand earnings through cost reduction efforts. The company has a solid balance sheet, is led by a capable management team, and trades at an attractive valuation. |
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