Investor Summary
Fund Strategy
FUND PERFORMANCE AS OF 31st December 2025
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | 0.068 | 0.039 |
| 2025 |
|---|
| 3.9% |
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | 0.068 | 0.039 |
| 2025 |
|---|
| 3.9% |
Laughing Water Capital returned 6.8% in Q4 2025 and 3.9% for the full year, underperforming major indices as market factors favoring size, growth, and momentum worked against their value-oriented small cap approach. Manager Matthew Sweeney maintains conviction in focusing on off-the-beaten-path investments in quality businesses during periods of uncertainty, expecting dual benefits from earnings improvement and multiple expansion over time. Key positions include Lifecore Biomedical, a CDMO benefiting from capacity shortages and Trump administration onshoring policies; Liquidia Corp, whose Yutrepia drug is gaining market share against incumbents; and NextNav, positioned for FCC approval of terrestrial GPS backup systems. Despite factor headwinds, fundamental performance across portfolio companies remained strong, with management teams executing on capacity utilization, customer wins, and cost reduction initiatives. The manager acknowledges current market dynamics favor different investment styles but expects eventual recognition of fundamental value creation, maintaining patient capital approach while exploring process improvements without compromising core philosophy.
Focus on off-the-beaten-path investments in good businesses led by good people during times of near-term uncertainty that can be fixed with time, benefiting from dual forces of earnings power improvement and multiple expansion as management partners execute and market perception improves.
Manager expects fundamental performance to drive returns as businesses execute on improving earnings power, with several large positions showing clear improvement despite minimal stock performance in 2025. Anticipates eventual market recognition of fundamentals and potential factor rotation toward value strategies.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 13 2026 | 2025 Q4 | LFCR, LQDA, NN, PAR, SES.TO, THRY, UTHR, VTY.L, WCN | Biotechnology, contrarian, defense, Factor Investing, small caps, value |
LFCR LQDA NN SES CN VTY LN |
Manager discusses two biotech investments: Lifecore Biomedical, a CDMO with excess capacity in a supply-constrained market, and Liquidia Corp, which has FDA approval for Yutrepia… |
| Oct 16 2025 | 2025 Q3 | CLAR, LFCR, NN, PAR, THRY, VTY LN | fundamentals, mispricing, Patience, small caps, Value Investing |
CLAR US LFCR US NN US PAR US THRY US VTY LN |
Laughing Water emphasizes patience and logic amid a market obsessed with AI and quantitative trading. The fund highlights long-term value creation across holdings such as… |
| Jul 21 2025 | 2025 Q2 | CTLP, LFCR, NN, PAR, SES CN, THRY, VTY LN | Buybacks, deep value, hidden assets, mispricing, small caps |
CLAR SES CN LFCR NN PAR VTY LN THRY |
The letter emphasizes deep value investing focused on misunderstood businesses and hidden asset value. Management highlights inefficiencies created by quantitative screening and accounting distortions. Long-term… |
| Apr 24 2025 | 2025 Q1 | CTLP, HGV, LFCR, NN NA, PAR, PLYA, THRY, VTY LN, XPOF | - | - | - |
| Jan 16 2025 | 2024 Q4 | CDMO, CTLP, LFCR, NN, PAR, THRY, VTY LN | - | - | - |
| Jul 17 2022 | 2024 Q2 | APG, CDMO, CTLP, HGV, LFCR, LMB, NN, THRY, VTY LN, XPOF | - | - | - |
| May 3 2024 | 2024 Q1 | CDMO, LFCR, NN, PAR, TACT, THRY | - | - | - |
| Jan 25 2024 | 2023 Q4 | APG, CDMO, ENZ, HGV, LFCR, LMB, NN, THRY, VNDA, VTY LN | - | - | - |
| Oct 19 2023 | 2023 Q3 | CDMO, HGV, LFCR, THRY | - | - | - |
| Jul 17 2023 | 2023 Q2 | APG, CDMO, HGV, LFCR, TACT, THRY, VTY LN | - | - | - |
| Oct 5 2023 | 2023 Q1 | LFCR | - | - | - |
| Jan 31 2023 | 2022 Q4 | AIM CN, APG, CDMO, HGV, LDE GR, THRY, VTY LN | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
DefenseThe team initiated a position in Curtiss-Wright, believing the company is entering a period where multiple near-term growth drivers are converging, including rising defense budgets, commercial aerospace production ramps, nuclear power plant life extensions and new builds, and submarine production. |
Defense Budgets Aerospace Nuclear Submarines |
Small CapsSmall caps getting strong start in 2026 supported by easing monetary conditions and constructive fiscal backdrop. Small caps more sensitive to economic cyclicality which is overdue for expansion. Expected to grow at better pace than large caps in 2026 after long period of underperformance. |
Value Growth Cyclical Monetary Policy Fiscal Policy | |
TechnologyHoldings span social media, online search, cloud computing and e-commerce including select Magnificent 7 positions. They also own semiconductor companies at reasonable valuations, including picks and shovels businesses like Applied Materials with strong competitive positions and long track records of value creation. |
Technology Semiconductors Cloud Social Media E-commerce | |
Waste ManagementSecure Waste Infrastructure operates alongside oil fields in Western Canada with stable cash flows, high economic EBITDA margins above 30%, and management aggressively repurchasing shares at attractive valuations. |
Oil Services Canada Cash Flow Buybacks Cyclical | |
| 2025 Q3 |
ValueThe manager continues to find attractive value opportunities despite expensive markets, purchasing undervalued companies like Centene, GlaxoSmithKline, Carrefour and PayPal trading at low multiples with strong fundamentals. |
Undervalued Low Multiples Contrarian Opportunistic |
| 2025 Q2 |
ValueThe manager continues to find attractive value opportunities despite expensive markets, purchasing undervalued companies like Centene, GlaxoSmithKline, Carrefour and PayPal trading at low multiples with strong fundamentals. |
Undervalued Low Multiples Contrarian Opportunistic |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | PAR US | PAR Technology Corp. | Information Technology | Application Software | Bull | NYSE | enterprise, growth, Margins, pipeline, Restaurants, SaaS, Software | Login |
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | THRY US | Thryv Holdings, Inc. | Communication Services | Application Software | Bull | NASDAQ | growth, Margins, SaaS, SMB, Software, turnaround, valuation | Login |
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | VTY LN | Vistry Group plc | Consumer Discretionary | Homebuilding | Bull | NYSE | Affordable, construction, growth, Housing, insider buying, Policy, UK, valuation | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | CLAR | Clarus Corp. | Consumer Discretionary | Leisure Products | Bull | NASDAQ | brands, Options, Outdoor, restructuring, sale | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | SES CN | SECURE Waste Infrastructure Corp. | Industrials | Environmental & Facilities Services | Bull | Toronto Stock Exchange | buybacks, infrastructure, Margins, rerating, waste | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | LFCR | Lifecore Biomedical Inc. | Health Care | Pharmaceuticals | Bull | NASDAQ | acquisition, CDMO, Injectables, Reshoring, tariffs | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | NN | NextNav Inc. | Information Technology | Communications Equipment | Bull | NASDAQ | Gps, Nationalsecurity, Optionality, Regulation, Spectrum | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | PAR | PAR Technology Corp. | Information Technology | Application Software | Bull | New York Stock Exchange | Operatingleverage, pipeline, POS, Restaurants, SaaS | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | VTY LN | Vistry Group PLC | Consumer Discretionary | Homebuilding | Bull | New York Stock Exchange | Bookvalue, Grants, Housing, Partnerships, recovery | Login |
| Jul 21, 2025 | Fund Letters | Matthew Sweeney | THRY | Thryv Holdings Inc. | Information Technology | Application Software | Bull | NASDAQ | Optimism, SaaS, SMB, Transition, valuation | Login |
| Jan 13, 2026 | Fund Letters | Matthew Sweeney | LFCR | Lifecore Biomedical, Inc. | Health Care | Life Sciences Tools & Services | Bull | NASDAQ | Capacity, CDMO, Injectables, Margins, Utilization | Login |
| Jan 13, 2026 | Fund Letters | Matthew Sweeney | LQDA | Liquidia Corporation | Health Care | Biotechnology | Bull | NASDAQ | Adoption, Approvals, Biotech, litigation, Pah | Login |
| Jan 13, 2026 | Fund Letters | Matthew Sweeney | NN | NextNav Inc. | Communication Services | Wireless Telecommunications | Bull | NASDAQ | Gps, Nationalsecurity, Optionality, Regulation, Spectrum | Login |
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | CLAR US | Clarus Corporation | Consumer Discretionary | Sporting Goods | Bull | NASDAQ | Insiders, M&A, Margins, retail, Sporting goods, turnaround, Value | Login |
| Jan 13, 2026 | Fund Letters | Matthew Sweeney | SES CN | Secure Waste Infrastructure Corp. | Industrials | Environmental Services | Bull | New York Stock Exchange | buybacks, cashflow, energy, mispricing, waste | Login |
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | LFCR US | Lifecore Biomedical, Inc. | Health Care | Biotechnology & Life Sciences Tools | Bull | NASDAQ | Biotech, CDMO, GLP-1, growth, manufacturing, pharma, Regulation, U.s. | Login |
| Jan 13, 2026 | Fund Letters | Matthew Sweeney | VTY LN | Vistry Group PLC | Consumer Discretionary | Homebuilding | Bull | New York Stock Exchange | buybacks, homebuilding, Housing, recovery, valuation | Login |
| Oct 16, 2025 | Fund Letters | Matthew Sweeney | NN US | NextNav, Inc. | Information Technology | Telecommunications | Bull | NASDAQ | 5G, Fcc, Gps, growth, Regulation, Spectrum, Telecom, U.s. | Login |
| TICKER | COMMENTARY |
|---|---|
| LFCR | Lifecore, also discussed above, appreciated ~10% on the year despite fantastic execution toward the only thing that matters: increasing capacity utilization. Importantly for us, it seems as if the necessary elements of earnings power improvement and a re-rating are already in place. On slide 11 of the company's investor presentation, the company lays out a bridge for how they expect to fill their capacity in the years to come. This slide was first presented at the company's Investor Day in November of 2024, and has not yet been updated. In this bridge, the 'New Business' piece for the Mid-Term and Long-Term are approximately $11M and $34M respectively. The $34M of Long-Term new business represents approximately 11% of total capacity. However, on the company's Q3'25 earnings call, when commenting on a business win from a commercial tech transfer from a large multinational pharmaceutical company, management indicated that they expect that this new customer will be a top 5 customer, and use 'material capacity within the facility... between 5% and 10%.' In mid-December, the company announced another commercial tech transfer from a different large multinational pharmaceutical company, which was also described as a potential 'top 5 customer.' Further, back in August the company announced they won a late-stage GLP-1 product, which they indicated could/should be commercialized by 2029-2030. This product could also conceivably be a top 5 customer. |
| LQDA | Liquidia was first introduced anonymously in the YE'24 letter to LPs. At the time, the company was a pre-approval biopharmaceutical company that was mired in patent lawsuits filed by an incumbent (United Therapeutics - UTHR) that was seeking to defend their market position versus an upstart that seems to have a superior product. Since that time, Liquidia's drug – Yutrepia – has been approved for treatment of pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD). Early sales of Yutrepia have crushed expectations as patients – and prescribers - seem to prefer Yutrepia vs. the incumbent due to superior delivery and tolerability. Between appreciation and adding to the position as the company reached important milestones, LQDA has grown into a top position. |
| NN | NextNav is our wireless spectrum / terrestrial backup to GPS investment. Shares were more or less flat for the year, which of course did not help our performance. The factors here are completely unattractive, and completely irrelevant. The only things that will matter for the success of the investment are getting FCC approval for NextNav's plan, and what the re-purposed spectrum would be worth. |
| PAR | Software has always been a hyper-competitive industry teeming with well-funded start-ups. Consider PAR Technology's niche in restaurant point-of-sale (POS). Despite facing over 6,000 global competitors—including countless "free" alternatives requiring no subscription—PAR consistently wins mandates from Tier-1 restaurant chains. A prime example is their newly announced deal with Papa John's, which abandoned its in-house software to migrate to PAR. This dynamic runs 180° counter to the prevailing market narrative. AI will undoubtedly turn up the heat on this already intense global competition, but it will also accelerate PAR's product velocity, broaden its capabilities, and vastly expand its TAM. Ultimately, the endgame for incumbents is unlikely to be the race to zero gross margins that so many software skeptics are predicting. |
| SES.TO | Secure is our waste management business that operates primarily alongside the oil fields in Western Canada, which was first introduced in our H1'25 letter. This is a stable business whose cash flows are largely tied to oil production, which does not swing violently as oil drilling can. The accounting here is wonky as part of the business is a pass-through pipeline, which hides the fact that economic EBITDA margins are north of 30%, while those relying on a quantitative screen would incorrectly conclude that margins are closer to 4%. In my view, the connection to oil and misleading accounting helps to explain the mis-pricing, although the fact that solid waste companies currently trade at their biggest discount to the S&P in over ten years likely also contributes. |
| THRY | Finally, we realized a meaningful loss in Thryv Holdings Inc. (THRY). Despite my initial view that the company offered a 'hidden gem' SaaS business tucked within a legacy Yellow Pages wrapper, operating results did not develop as I expected. When we bought in Q1 2025, the SaaS segment had produced multiple quarters at or near Rule of 40 metrics and management laid out a credible cross-sell path to meaningfully grow mid-term recurring revenue. The thesis broke in Q3 2025 when seasoned net revenue retention fell 900 bps to 94%, exposing higher churn—especially among migrated Yellow Pages customers—while new product development was substantially delayed. With the growth plan reset and confidence in execution gone, we sold the position and will monitor from the sidelines. |
| UTHR | Biopharma Eli Lilly, biotech stocks Incyte and United Therapeutics, and life sciences giant Danaher all contributed positively to strong Q4 performance. |
| VTY.L | Vistry is our U.K. asset light 'Partnerships' homebuilder. This is a recession resilient business that is actively repurchasing stock. The stock returned ~12% on the year, as unfortunately Vistry spent much of the last 12 months crawling out of the doghouse after being punished for accounting misstatements attached to the run-off of its legacy traditional Housebuilding business. The fact that funding for low-income housing in the U.K. was also in need of a refresh during this period did not help either, nor did the fact that the entire U.K. housing sector is trading at depressed levels. |
| WCN | Our lone position in Utilities, Waste Connections, Inc. (WCN), was flat for the quarter but the stability of the company's earnings and cash flows provided the downside capture we've come to expect. |
| 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 | |||