| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 11.1% | 2.0% | 17.9% |
| 2025 | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| 17.9% | -2.1% | 27.4% | -17.2% | 31.0% | 12.1% |
Lyrical Asset Management delivered strong performance in 2025, with their U.S. Value Equity strategy generating 17.9% net returns, matching the S&P 500 without owning any Magnificent Seven stocks and outperforming the S&P 500 Value by 470 basis points. International strategies performed exceptionally well, with 35.5% absolute returns and 430 basis points of outperformance versus MSCI EAFE. The firm's core thesis centers on finding an uncommon combination of value and growth, with their portfolio currently trading at a historically wide 78% discount to the S&P 500 while generating 10.6% EPS growth compared to 6.6% for the broader market. Key contributors included travel-related holdings like Expedia and AerCap, while payment processors faced headwinds despite strong earnings growth. The firm highlights valuation concerns in mega-cap stocks, noting the S&P 500's 32% P/E premium to equal-weighted despite similar earnings growth over the past decade.
Lyrical's investment approach focuses on an uncommon combination of value and growth, seeking companies trading at significant discounts to the market while maintaining strong earnings growth profiles.
The firm appears optimistic about their value strategy given the wide valuation spreads and strong earnings growth profile of their portfolio companies relative to the broader market.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 15 2026 | 2025 Q4 | AAPL, AER, AMG, AMZN, EBAY, EXPE, FFIV, FLEX, GOOGL, HCA, JCI, META, MSFT, NRG, NTAP, NVDA, SNX, TSLA, UBER, URI | EPS Growth, growth, international, Performance, valuation, value | - | Lyrical emphasizes their uncommon combination of value and growth, with their portfolio trading at a 78% discount to the S&P 500 while generating 10.6% EPS… |
| Oct 14 2025 | 2025 Q3 | - | Discipline, dispersion, earnings, valuation, value | - | The letter emphasizes an uncommon combination of deep value and durable earnings growth, driven by disciplined stock selection rather than index exposure. Lyrical highlights historically… |
| Aug 25 2025 | 2025 Q2 | CPAY, FLEX, GPN | cash flows, fundamentals, Mean reversion, valuation dispersion, value | - | The letter emphasizes valuation-driven investing amid elevated market concentration and speculative excess. Management argues that high-quality businesses with durable cash flows are trading at meaningful… |
| Apr 1 2025 | 2025 Q1 | - | - | - | - |
| Feb 12 2025 | 2024 Q4 | 005930 KS, TEP FP | - | - | - |
| Feb 15 2024 | 2023 Q4 | - | - | - | - |
| Feb 2 2023 | 2022 Q4 | - | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
TravelIndia's burgeoning travel sector exemplified by MakeMyTrip benefits from rising household incomes and expanding middle class. India opened more than 70 new airports last year and airlines have massive order books for new jets. The transformation of Mumbai's airport terminal from chaos to capacity constraints demonstrates the rapid growth in India's traveling class. |
Online Travel Airports Airlines Tourism Infrastructure |
ValueBlue Tower focuses on value investing with international diversification. The manager notes that the valuation spread between cheap and expensive stocks is one of the greatest in market history, creating a favorable environment for their value-oriented approach. |
Value International Cheap Expensive Valuation | |
| 2025 Q3 |
ValueThe portfolio trades at significant discounts to the broad market, with P/E ratios 40-42% below the S&P 500. The manager believes many steady-growing companies are overlooked by markets focused on AI winners, creating opportunities in businesses with lower assumed margins and productivity that could benefit from AI adoption. |
Discount Multiples Undervalued Overlooked Opportunity |
| 2025 Q2 |
ValueThe portfolio trades at significant discounts to the broad market, with P/E ratios 40-42% below the S&P 500. The manager believes many steady-growing companies are overlooked by markets focused on AI winners, creating opportunities in businesses with lower assumed margins and productivity that could benefit from AI adoption. |
Discount Multiples Undervalued Overlooked Opportunity |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
|---|---|
| AAPL | The largest 10 companies, by market capitalization, had reached 40.7% of the S&P 500 by the end of 2025, up from roughly 30% at the end of 2021. At the top of this list are Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), Broadcom (AVGO), Meta (META), and Tesla (TSLA). Apple: Market capitalization near $4 trillion. A double requires creating a company larger than the size of Walmart, JPMorgan, and Pfizer combined. |
| AER | Airline leasing business AerCap contributed 1.4% to the Fund's returns |
| AMG | Affiliated Managers Group contributed 1.27% with 7.13% ending weight. |
| AMZN | We added to our holdings in Amazon.com Inc. |
| EBAY | For the 2025 full year the best-performing stocks were eBay (EBAY), Amgen Inc (AMGN), and American Express (AXP). |
| EXPE | Expedia, which was a recent purchase, also posted strong results and raised the outlook going forward. We added to our exposure to Expedia and continue to hold both stocks in the Fund. |
| FFIV | F5 Inc. is a global provider of application delivery, security, and performance solutions that help enterprises run and protect applications across hybrid and multi-cloud environments. Shares fell after the company disclosed that state-backed hackers from China had breached its networks and gained access to certain files from the company's BIG-IP application services. While the direct impact of the breach has been limited – no sensitive customer data was leaked and F5's operations were not impacted – management expects a modest impact to new bookings in the near term as customers are currently focused on evaluating the security posture of existing IT assets rather than buying new products. In response to the breach, F5 offered weak guidance for next quarter, and consensus earnings expectations have declined 7% for 2026 relative to pre-breach levels. While the breach may have a near-term impact on profit growth, our research suggests that the impact of security breaches at similar IT vendors have been short-lived and have very rarely led to impairment of long-term earnings power. Also, F5's strong free cash flow, net cash balance sheet, and high switching costs should help protect the company from any near-term impacts to bookings that may occur this year. We believe F5 should be able to grow revenue in the high-single-digits for many years given the strong tailwinds the company is seeing related to data center modernization and application traffic growth and limited competition in its core markets. Now trading at about 10x our estimate of next year's normal operating profit, F5's shares offer a very attractive risk/reward outlook, in our opinion. |
| FLEX | Flex is a global manufacturing and supply chain solutions provider with exposure to high-margin AI and cloud data center infrastructure, particularly power and cooling systems. We began harvesting our position this quarter as its market capitalization has grown beyond our small-cap mandate. We continue to view management favorably for its focus on optimizing product mix toward higher margin, fast-growing segments such as data centers and power. |
| GOOGL | I'm willing to go bankrupt rather than lose this race. Larry Page, co-founder of Google |
| HCA | HCA Healthcare (the operator of 186 hospitals and around 2,400 ambulatory sites) reported pleasing results and management upgraded its full year's earnings guidance by 4.8% at the EPS level. With it buying back more shares, and after making some other tweaks, our valuation increased by 5%. But, with a share price increase of 9.7% over the quarter, the premium widened. |
| JCI | We exited Johnson Controls, where we have seen strong datacentre sales, but where the residential segment has been impacted by oversupply, with de-stocking expected to continue into 2026 before normalising again. |
| META | Meta was cited as a larger position that contributed little despite what I thought was positive operating progress, representing opportunity cost in the portfolio. |
| MSFT | OpenAI's well-documented 'circular' funding with its business partners (NVIDIA, Microsoft, among others) is additional cause for concern. |
| NVDA | Nvidia sits at the top of the S&P 500 as the designer in the AI ecosystem. |
| SNX | TD Synnex (SNX) is the world's largest IT distributor. The company was formed by the merger of Tech Data and Synnex in 2021 – we first bought TD in 2010 (it was taken private in 2020) and SNX in 2012. SNX evolved with the times selling increasing amounts of software, security, cloud and now AI products. SNX trades at roughly 10x forward earnings, towards the low end of its historical range. The business continues to evolve but the basics are roughly the same as they were ten years ago. If anything, the business has gotten incrementally better – higher margins, higher returns on capital, more scale, consolidation among the large players and more international opportunity. |
| TSLA | The largest 10 companies, by market capitalization, had reached 40.7% of the S&P 500 by the end of 2025, up from roughly 30% at the end of 2021. At the top of this list are Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), Broadcom (AVGO), Meta (META), and Tesla (TSLA). |
| UBER | Another key Fund performance detractor in the quarter was Uber Technologies Inc. (UBER) reflecting increasing market concerns about autonomous vehicles and the potential impact the technology may have on future growth. |
| URI | Cadence, Linde, United Rentals, and Progressive rounded out the top-five detractors in the quarter. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
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| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
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| No industry data available | |||
