| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 11.2% | 8.2% | 39.1% |
| 2025 |
|---|
| 39.1% |
The Smead International Value Fund returned 8.23% in Q4 2025 and 39.09% for the full year, outperforming the MSCI EAFE Index. The managers frame their investment approach through the lens of transitioning from mythos to logos, arguing that European markets are moving from story-driven investing to analytical value-based decision making. European banks have been standout performers as they adopt more disciplined capital allocation, implementing cost reductions, buybacks, and consolidation while earning their cost of capital. The fund sees opportunity in energy markets where the mythos of unlimited American drilling capacity contrasts with the logos of constrained global supply, particularly as OPEC production increases have been muted and only Saudi Arabia can meaningfully increase output. Bank holdings including BAWAG Group, UniCredit, and Bankinter drove strong performance, while commodity exposure through Pandora faced headwinds from silver price volatility. The concentrated portfolio approach targets maximum long-term returns through analytical evaluation of capital structures and return profiles rather than momentum-driven narratives.
European markets are undergoing a fundamental transition from mythos-driven decision making to logos-based analytical frameworks, creating attractive value opportunities in banks and energy companies as capital allocation becomes more disciplined and returns-focused.
The managers expect the transition from mythos to logos to continue, with more analytical and logical frameworks ultimately prevailing in investment markets. They believe this transition will take time for culture to change but are optimistic about opportunities ahead in 2026.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 21 2026 | 2025 Q4 | BARC.L, BAWG.VI, BKT.MC, CVE.TO, GLEN.L, OXY, PNDORA.CO, ROG.SW, SCR.TO, TGA.JO, TVE.TO, UCG.MI, WFG.TO | banks, energy, Europe, oil, value | - | The fund employs a concentrated value approach focused on maximizing long-term returns. The managers contrast momentum investing (driven by stories and mythos) with value investing… |
| Oct 19 2025 | 2025 Q3 | BMPS IM, MEG CN | Banking, Consolidation, energy, M&A, value |
CVE SCR MEG UCG |
The fund benefited from M&A activity among Canadian energy producers like Cenovus and Strathcona and continued scale benefits in European banking led by Unicredit. Managers… |
| Jul 15 2025 | 2025 Q2 | - | Capital Allocation, countercyclical, energy, Leadership, Return on Capital | - | The letter focuses on capital allocation skill as a differentiator, particularly in energy markets. Management highlights counter-cyclical investing and return-on-capital discipline over commodity price forecasting.… |
| Apr 14 2025 | 2025 Q1 | GLEN LN, MET CN | - | - | - |
| Jan 14 2025 | 2024 Q4 | 7270 JT, UCG IM, VOW3 GR | - | - | - |
| Oct 15 2024 | 2024 Q3 | - | - | - | - |
| Jul 15 2024 | 2024 Q2 | - | - | - | - |
| Apr 30 2024 | 2024 Q1 | - | - | - | - |
| Jan 16 2024 | 2023 Q4 | - | - | - | - |
| Oct 16 2023 | 2023 Q3 | FRO, TGA LN, WHC AU | - | - | - |
| Jul 15 2023 | 2023 Q2 | - | - | - | - |
| Mar 31 2023 | 2023 Q1 | - | - | - | - |
| Oct 25 2022 | 2022 Q3 | - | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
EuropeThe firm is expanding European relationships and published research on European shareholder activism. They view Europe as an attractive alternative to expensive American markets and are building manager relationships in the region. |
Activism Shareholder Valuation Diversification Research |
OilOil markets disrupted by closure of Straits of Hormuz affecting 20% of global production. Prices surged from $70 to $119.50 before retreating to $90. Market may be tighter than commonly believed despite IEA projections of surplus. Oil represents cheapest major asset class globally, trading at near-record lows relative to gold. |
Crude Brent WTI Hormuz Supply | |
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 |
BankingEuropean banking sector produced strong outperformance led by Bank of Ireland, Lloyds Banking Group, and CaixaBank. Sector returns supported by interest rate stabilization and yield curve steepening. The market is transitioning toward improving organic loan growth after fifteen years of stagnant credit activity. |
Regional Banks Money Center Banks European Banks |
EnergyBHE operates regulated utilities serving 5.4 million customers and natural gas pipelines. The business faces significant investment needs driven by AI computing demand and wildfire risk mitigation, particularly in the Western U.S. |
Regulated Utilities Natural Gas Renewable Energy Grid Infrastructure | |
M&A |
||
| 2025 Q2 |
CapitalAllocation |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Oct 19, 2025 | Fund Letters | Cole Smead | CVE | Cenovus Energy Inc. | Energy | Oil & Gas Exploration & Production | Bull | - | capital allocation, energy, merger, oil, synergies, Value | Login |
| Oct 19, 2025 | Fund Letters | Cole Smead | SCR | Strathcona Resources Ltd. | Financials | Oil & Gas Exploration & Production | Bull | - | acquisition, Canada, growth, merger, oil, synergies | Login |
| Oct 19, 2025 | Fund Letters | Cole Smead | MEG | MEG Energy Corp. | Industrials | Oil & Gas Exploration & Production | Bull | - | Canada, energy, M&A, oil, synergies, value investing | Login |
| Oct 19, 2025 | Fund Letters | Cole Smead | UCG | Unicredit S.p.A. | Financials | Banks | Bull | - | banking, consolidation, Digitalization, dividends, efficiency, Europe | Login |
| TICKER | COMMENTARY |
|---|---|
| BARC.L | Our bank holdings have been outstanding performers throughout the year, and even at their current valuations, we believe they continue to look attractive. |
| BAWG.VI | Our best-performing stocks in the quarter were BAWAG Group (BG AV), Tamarack Valley (TVE CN), and Barclays (BARC LN). For the 2025 full year the best-performing stocks were BAWAG Group (BG AV), UniCredit (UCG IM), and Bankinter (BKT SM). |
| BKT.MC | For the 2025 full year the best-performing stocks were BAWAG Group (BG AV), UniCredit (UCG IM), and Bankinter (BKT SM). |
| CVE.TO | Our biggest detractors were Pandora (PNDORA DC), Cenovus Energy (CVE CN), and Occidental warrants (OXY/WS US). |
| GLEN.L | Glencore also contributed as commodity markets remained firm. |
| OXY | We also hold equity method investments, principally Kraft Heinz and Occidental. We recorded a pre-tax impairment loss of approximately $5.7 billion on our investment in Occidental common stock in the fourth quarter of 2025. |
| PNDORA.CO | Pandora has navigated the recent surge in silver prices effectively. Nevertheless, as silver constitutes its primary input cost, the sharp rise in the commodity has exerted temporary pressure on margins. |
| ROG.SW | Top gainers among the Fund's holdings included Roche (+27%) |
| TGA.JO | The largest detractors were Pandora (PNDORA DC), West Fraser Timber (WFG CN), and Thungela Resources (TGA SJ). |
| TVE.TO | It's rare for us to initiate a new position and have it make a significant run almost immediately, but fortunately, that's what happened with Tamarack Valley, and we are encouraged by their continued progress. |
| UCG.MI | For the 2025 full year the best-performing stocks were BAWAG Group (BG AV), UniCredit (UCG IM), and Bankinter (BKT SM). |
| WFG.TO | The largest detractors were Pandora (PNDORA DC), West Fraser Timber (WFG CN), and Thungela Resources (TGA SJ). |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
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| Industry | Prev Quarter % | Current Quarter % | Change |
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