| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 9.2% | -0.3% | -0.4% |
| 2025 |
|---|
| 2.9% |
Southeastern's Partners Fund returned 2.93% in 2025, underperforming the S&P 500's 17.88% as momentum-driven markets favored growth over value. The fund's low-60s P/V ratio and 9.5% cash position reflect defensive positioning for late-cycle conditions. Key contributors included HF Sinclair, Mattel, and Regeneron, while detractors included Kraft Heinz, PayPal, and PVH. The manager emphasizes portfolio quality improvements through targeted moves, including significant share buybacks at holdings like Mattel ($600M) and MGM (40% over five years). Portfolio positioning mirrors 1999 with 45% weighting in defensive sectors and cash, contrasting with riskier 2007/2021 allocations. Holdings show materially lower leverage than previous cycles, with bond spreads half the levels of 2007/2021. Management increased position limits from 6.5% to 8% for enhanced engagement. The firm expects 2026 opportunities as excessive speculation in AI, crypto, and IPOs unwinds, favoring their portfolio of FCF-generating companies with strong management partners.
Southeastern maintains a concentrated portfolio of undervalued, quality companies with strong management teams, positioned defensively for late-cycle market conditions while expecting superior returns when speculation unwinds.
Manager expects 2026 to offer compelling opportunities as market cycle turns and excessive speculation unwinds. Positioned for outperformance when tide goes out on current fads. Confident in portfolio of undervalued, FCF-generating companies run by great management partners.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 14 2026 | 2025 Q4 | ACI, AMG, ANGI, AVTR, CNX, DINO, DIS, EXO.MI, FDX, H, IAC, KHC, MAT, MGM, PCH, PVH, PYPL, REGN, RTX, RYN | Buybacks, Cash, Defensive, Leverage, Quality, value |
KHC DINO MAT REGN IAC MGM PYPL PVH ANGI |
Fund focuses on undervalued companies trading below intrinsic value with P/V ratio in low-60s%. Manager emphasizes buying quality companies at discounts and waiting for market… |
| Oct 15 2025 | 2025 Q3 | ACI, BIO, CNX, EXO NA, FDX, FIS, IAC, KHC, MAT, PCH, PVH, REGN, RYN | Capital Allocation, free cash flow, Market cycles, Quality Companies, Value Investing |
CNX MAT KHC IAC MGM FDX ACI RYN PCH REGN BIO |
Longleaf reiterates its focus on long-term value and high free cash flow per share growth amid market froth driven by AI hype and mega-cap valuations.… |
| Jul 22 2025 | 2025 Q2 | DINO, FDX, KHC, MGM, REGN | dislocation, fundamentals, Margin Of Safety, Speculation, valuation | - | The letter emphasizes broad market mispricing driven by speculation, indexing, and short-term earnings obsession. Management argues that quality businesses are trading at steep discounts to… |
| Apr 12 2025 | 2025 Q1 | ACI, BIO, CNX, FDX, IAC, MAT, PVH, PYPL, RTX | - | - | - |
| Jan 16 2025 | 2024 Q4 | CNX, DINO, FIS, IAC, K, LBRDK/A, MGM, PYPL, RTX, WBD | - | - | - |
| Oct 16 2024 | 2024 Q3 | CNX, FDX, K, MGM, PYPL | - | - | - |
| Jul 23 2024 | 2024 Q2 | BIO, CNH, FDX, LBRDK, MAT | - | - | - |
| May 7 2024 | 2024 Q1 | CNX, FDX, FIS, LBRDA, WBD | - | - | - |
| Jan 17 2024 | 2023 Q4 | FDX, FFX GR, GE, H, LUMEN SS, LYV, MAT, MGM, PVH, WBD | - | - | - |
| Dec 10 2023 | 2023 Q3 | CNX, GE, IAC, MAT, WBD, WMG | - | - | - |
| Jul 19 2023 | 2023 Q2 | IAC, LYV, WBD | - | - | - |
| Apr 20 2023 | 2023 Q1 | DIS, FDX, GE, LUMEN, MGM, PVH | - | - | - |
| Sep 2 2023 | 2022 Q4 | AMG, CNHI, CNX, DEI, GE, IAC, LUMEN SS, PVH, WBD | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
BuybacksShare repurchases in 2024 and 2025 hit consecutive records as companies raced to meet Tokyo Stock Exchange capital efficiency mandates. Buybacks were a primary driver of the market's 20% climb in the first half of FY2025. |
Share Repurchases Capital Efficiency TSE Mandates Shareholder Returns Records |
MediaWarner Bros Discovery was the top contributor as multiple parties submitted acquisition offers, with Netflix acquiring the Streaming and Studios business while Global Networks spins to shareholders. Paramount Skydance made a $30 per share offer for the entire company, creating a bidding war that unlocked shareholder value. |
Streaming M&A Content Entertainment Bidding | |
ValueManager emphasizes investing in controlled companies trading at significant discounts to NAV, with European holding companies showing discounts of 30-68%. The strategy focuses on securities mispricing where real value exists, contrasting with overvalued technology stocks. |
Discounts NAV Mispricing Undervalued Controlled | |
| 2025 Q3 |
QualityThe portfolio has shifted toward higher quality businesses with better profitability, lower leverage, and less volatile earnings. Quality stocks underperformed significantly in 2025, creating attractive entry points for value investors. The manager maintains price discipline while seeking quality companies trading at discounts to intrinsic value. |
Quality Profitability Leverage Earnings |
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 |
Dislocation |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | BIO | Bio-Rad Laboratories, Inc. | Health Care | Life Sciences Tools & Services | Bull | NYSE | buybacks, life sciences, Margins, net cash, Optionality, recovery, Sartorius | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | KHC | The Kraft Heinz Company | Consumer Staples | Packaged Foods | Bull | NASDAQ | management, Packagedfoods, Split, turnaround, valuation | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | DINO | HF Sinclair Corporation | Energy | Oil & Gas Refining & Marketing | Bull | New York Stock Exchange | infrastructure, Insiderbuying, refining, Spreads, valuation | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | MAT | Mattel, Inc. | Consumer Discretionary | Leisure Products | Bull | NASDAQ | brands, buybacks, Intellectualproperty, Margins, Toys | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | REGN | Regeneron Pharmaceuticals, Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, buybacks, Immunology, pipeline, valuation | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | IAC | IAC Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | buybacks, Holdingcompany, Simplification, spinoff, valuation | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | CNX | CNX Resources Corporation | Energy | Oil & Gas Exploration & Production | Bull | NYSE | buybacks, deleveraging, Free Cash Flow, Integration, natural gas, Utica, valuation | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | MGM | MGM Resorts International | Consumer Discretionary | Casinos & Gaming | Bull | New York Stock Exchange | Assetrecycling, buybacks, cashflow, Gaming, Vegas | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | MAT | Mattel, Inc. | Consumer Discretionary | Leisure Products | Bull | NASDAQ | buybacks, Content-pipeline, EPS growth, Licensing, Margins, tariffs, Toys | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | PYPL | PayPal Holdings, Inc. | Financials | Transaction & Payment Processing Services | Bull | NASDAQ | buybacks, Freecashflow, Margins, Networks, Payments | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | KHC | The Kraft Heinz Company | Consumer Staples | Packaged Foods & Meats | Bull | NASDAQ | Branded-foods, capital allocation, Catalysts, EBITDA, multiple expansion, Portfolio-separation, valuation | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | PVH | PVH Corp. | Consumer Discretionary | Apparel Retail | Bull | New York Stock Exchange | Apparel, brands, buybacks, Margins, turnaround | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | IAC | IAC Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | asset monetization, buybacks, Catalysts, discount, spin-off, Sum-of-parts | Login |
| Jan 14, 2026 | Fund Letters | Ross Glotzbach | ANGI | Angi Inc. | Communication Services | Interactive Media & Services | Bull | NASDAQ | Execution, marketplace, turnaround, valuation | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | MGM | MGM Resorts International | Consumer Discretionary | Casinos & Gaming | Bull | NYSE | asset monetization, balance sheet, Casinos, FCF, Las Vegas, Online betting | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | FDX | FedEx Corporation | Industrials | Air Freight & Logistics | Bull | NYSE | efficiency, Margins, Pricing, restructuring, SOTP, spin-off, Volumes | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | ACI | Albertsons Companies, Inc. | Consumer Staples | Food Retail | Bull | NYSE | buybacks, Competition, deleveraging, FCF, grocery, Real Estate, resilience | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | RYN | Rayonier Inc. | Real Estate | Specialized REITs (Timber) | Bull | NYSE | asset sales, buybacks, Housing, merger, NAV, REIT, Timber | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | PCH | PotlatchDeltic Corporation | Real Estate | Specialized REITs (Timber) | Bull | NASDAQ | Hbu, Mills, Optimization, REIT, synergy, Timber, valuation | Login |
| Oct 15, 2025 | Fund Letters | Ross Glotzbach | REGN | Regeneron Pharmaceuticals, Inc. | Health Care | Biotechnology | Bull | NASDAQ | Biotech, buybacks, Catalysts, EPS growth, Franchises, net cash, pipeline | Login |
| TICKER | COMMENTARY |
|---|---|
| AMG | Affiliated Managers Group contributed positively with 7.13% ending weight and 1.27% contribution. |
| ANGI | One specific simplification move IAC made this year was the spinoff of Angi, the home services marketplace. We purchased more Angi shares post-spin at a depressed price and then sold our position as evidence of their multi-year turnaround heading down the right path caused the stock to reach our appraisal. |
| AVTR | We added a partial position of Avantor to the portfolio in the second half of the year after (and then while) the company had some self-inflicted ups and downs. It is probable that the worst is in the past for Avantor after a leadership change and guidance reset, but we felt it best to exit and book a loss before year end. |
| CNX | CNX Resources Corporation was our top contributor for the quarter. Natural gas prices rose into the end of the quarter. The gain was largely weather-driven and with $5/mcf levels viewed as unsustainable in our long-term projections—CNX benefited in the short-term from a favorable near-term pricing backdrop. At the same time, the company continued to execute consistently, delivering on production targets, generating strong free cash flow, and returning capital through a disciplined and accretive share repurchase program, which together supported multiple expansion. |
| DINO | Energy infrastructure company HF Sinclair was a contributor for the year. We timed our purchases well last year and earlier this year on oil price weakness and worse than expected refining spreads. More normalized refining spreads came into view as the year went on, and the company's non-refining assets (which are over half of our appraisal) did well. The P/V gap closed, the previously strong insider buying stopped and the value per share growth was limited, so we moved on at a profit. |
| DIS | We sold our long-term holding in Disney, reflecting our view that consumer discretionary spending could remain under pressure if cost-of-living conditions stay tight, especially at a time when the company is spending significantly on Parks and Resorts. |
| EXO.MI | Decline in prices of holdings and widened discount to NAV. We have favoured Exor despite/because of the recent downturn in Ferrari shares, given the strong see-through publicly listed element of over 85% of the portfolio, allied to strong capital management. |
| FDX | As strong as the banks were, parcel delivery companies were even stronger, with FedEx Corp (FDX) at +23% pacing the Fund for the quarter. FedEx delivered a sizable beat-and-raise quarterly performance, and higher contracted rates appear to be sticking, even as fuel prices have declined. |
| H | The shares of Hyatt Hotels Corporation, a global hospitality company that focuses on serving high-end travelers, performed well in the most recent quarter due to solid quarterly results and the market's realization that its valuation multiple was too low relative to its growth rate and peers. We remain optimistic about the prospects for Hyatt because the company offers industry-leading 6% to 7% net unit growth at a two to four multiple point valuation discount relative to industry peers. |
| IAC | Digital holding company IAC has signaled its plans to dispose of all assets besides People Inc. and an approximate 25% stake in MGM. Chairman Barry Diller is focused on closing the valuation disconnect as no value has been ascribed by the markets to IAC's assets beyond MGM for too long. Share repurchase and increasing the stake in MGM are the main capital allocation options, and the company is already acting on both. |
| KHC | Global food and beverage producer Kraft was a detractor for 2025. The market is overly focused on the lack of near term growth in North America and not focusing enough on the value-creating potential of the company's upcoming split into two businesses: the higher-growth Global Taste Elevation Co. which contains the Heinz brand and should garner a teens EBITDA multiple, and the stable remaining company comprised largely of North American grocery products. |
| MAT | Children's toy, media, and consumer products creator Mattel was a contributor for the quarter and the year. The company is in its strongest position in over 10 years, and there are multiple ways to win. Over 80% of Mattel's value comes from growing power brands like Hot Wheels, Barbie, and UNO. Mattel has a strong balance sheet which allowed material stock repurchases of $600 million in 2025, and we believe additional share repurchase will come at these discounted prices in 2026. |
| MGM | Casino operator MGM Resorts had a relatively weaker 2025 in Las Vegas due to difficult comparisons after multiple years of strength. A significant turnaround at BetMGM plus strong performances at non-Las Vegas regional properties and Macau helped steady the consolidated business throughout the year. Management has corrected some pricing mistakes while making moves to narrow their focus. |
| PVH | Branded apparel company PVH was a detractor for the quarter and the year. The company's shares experienced considerable price fluctuations, while our appraisal stayed flattish, which was disappointing. This is a company that will likely always have more quarterly earnings volatility than others. The good news is that the long-run earnings per share power remains intact at over $10 per share. |
| PYPL | By looking at their Rnancials, FactSet, PayPal, Adobe, and Salesforce seem to be doing Rne. The market, however, is reading subdued revenue growth as a sign of increased competition on their core oSerings. These companies' outlooks look more di'cult than their past. |
| REGN | Performance was driven by strength in large-cap longs, specifically Regeneron |
| RTX | RTX Corporation (RTX) - formerly known as Raytheon Technologies Corporation, is a major American multinational aerospace and defense company headquartered in Arlington, Virginia. It is one of the largest aerospace and defense manufacturers globally, serving commercial, military, and government customers across more than 180 countries. RTX benefits from a very large backlog of commercial and defense orders, which provides multiyear revenue visibility and supports long-term planning. Backlog levels have grown significantly, reflecting robust demand across segments and helping underpin future sales. As global air travel continues recovering toward pre-pandemic levels, demand for new aircraft and maintenance, repair and overhaul (MRO) services is increasing. Commercial aftermarket sales—parts, service contracts, and support—have been a strong driver of organic growth due to rising airline utilization. RTX's Raytheon segment benefits from rising defense budgets in the U.S. and allied countries. Growth is underpinned by demand for integrated air and missile defense systems (e.g., Patriot), counter-drone technologies, and other advanced defense programs driven by geopolitical tensions. International orders are a growing portion of the defense backlog. The entire Defense Prime complex is currently re-rating as countries around the world are committing to spend more on defense initiatives and we like RTX for the above reasons and add that the company's three distinct business segments—Pratt & Whitney (engines), Collins Defense and Aerospace (avionics and systems), and Raytheon (defense systems)—provide revenue balance across commercial and government markets. This diversification helps mitigate cyclical downturns in any single area. Valuation has increased, but we believe the defensive narrative is still early, allowing for a reasonable balance between risk and reward. |
| RYN | Rayonier, one of the largest owners of timberlands in the U.S. completing the divestiture of its New Zealand venture, paying a special dividend, and announcing a merger with industry peer PotlatchDeltic. Once completed, the combined company will benefit from additional efficiencies within its timber segment, in Fund Management's opinion, as well as more scale in its real estate and resources portfolio that includes substantial sub-surface rights in the Smackover Formation. |
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| No Recent Buys Data | |||||
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