| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 37.4% | - | 10.9% |
| 2025 | 2024 |
|---|---|
| 10.9% | 32.4% |
Smoak Capital returned 10.9% net in 2025, underperforming the S&P 500's 17.9% return due to minimal AI exposure and defensive positioning amid elevated valuations. The manager emphasizes value investing with a growth component, particularly targeting small and micro-cap opportunities in international markets. Top performer PHI Group, a helicopter operator trading at 3x EV/EBITDA versus peers at 8x, exemplifies the strategy. Tobila Systems, a Japanese fraud prevention company, represents the core thesis with its B2B segment growing 50%+ annually while trading at 4.5x EV/FCF. Japanese accounting standards obscure the company's superior cash generation from upfront license payments. Medical Facilities continues asset sales and buybacks at attractive valuations. The fund hired its first employee and closed to new investors. Since inception in 2018, the fund has generated 37.4% annualized returns versus 14.9% for the S&P 500, turning $100,000 into over $1 million. The manager maintains conviction in long-term outperformance through patient, process-oriented investing.
Focus on undervalued small and micro-cap companies with growth potential, particularly in international markets where accounting standards may obscure true earnings power and cash generation capabilities.
Manager expresses confidence that portfolio returns will continue to exceed the broader market over the long-term with patience, focus, and a process-oriented mindset.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Feb 16 2026 | 2025 Q4 | 4441.T, DR.TO | cybersecurity, Defensive, growth, Japan, small caps, value |
4441 JP DR CN |
Manager emphasizes value-minded investing approach with preference for undervalued stocks with margin of safety. Discusses gravitating towards defensive names due to elevated market valuations and… |
| Aug 15 2025 | 2025 Q2 | FILA IM, IGR LN | Buybacks, Capital Allocation, international, Japan, valuation gaps | IGR LN | The letter emphasizes a growing opportunity set outside the U.S., driven by valuation gaps, currency movements, and improving capital allocation abroad. Management highlights Japan in… |
| Feb 10 2025 | 2024 Q4 | AZEUS SP, FILA IM, FTLF, QEPC | - | - | - |
| Jul 30 2024 | 2024 Q2 | AZEUS SP, FTLF, LNF CN | - | - | - |
| Jan 28 2024 | 2023 Q4 | CITZ, FTLF, GWOX, HMM/A CN, XPEL | - | - | - |
| Jul 30 2023 | 2023 Q2 | - | - | - | - |
| Dec 31 2022 | 2022 Q4 | - | - | - | - |
| Dec 31 2021 | 2021 Q4 | - | - | - | - |
| Dec 31 2020 | 2020 Q4 | - | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
CybersecurityCybersecurity companies are using AI in core algorithms to better identify anomalies and block malicious traffic. CrowdStrike is seeing reacceleration in growth with new Falcon Flex offering, while Netskope continues gaining SASE market share with strong competitive win rates. |
Security AI Detection Enterprise Cloud Protection |
JapanJapan offers tremendous value opportunities with one-third of companies trading below book value. Corporate governance reforms, record shareholder returns, and structural changes like unwinding cross-holdings are unlocking value. The investment opportunity is in early innings and could last several years. |
Corporate Governance Value Reforms Shareholder Returns Cross Holdings | |
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 Q2 |
InternationalHigh-quality international businesses trade at fractions of US multiples, with the manager positioning clients to take advantage of this divergence. Despite US equity market dominating investor mindshare, the rest of the world returned 32.6% in dollar terms in 2025 versus SPY's 17.7%. |
Discount Opportunity Outperformance Quality Positioning |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Aug 15, 2025 | Fund Letters | Daniel Smoak | IGR LN | IG Design Group plc | Consumer Discretionary | Commercial Services & Supplies | Bull | New York Stock Exchange | deep value, Gift Packaging, Liquidation, net cash, restructuring, turnaround | Login |
| Feb 16, 2026 | Fund Letters | Daniel Smoak | 4441 JP | Tobila Systems Inc. | Information Technology | Application Software | Bull | New York Stock Exchange | Fraud prevention, Free Cash Flow, Japan, Ltv/Cac, SaaS, undervalued | Login |
| Feb 16, 2026 | Fund Letters | Daniel Smoak | DR CN | Medical Facilities Corporation | Health Care | Health Care Facilities | Bull | New York Stock Exchange | asset sales, buybacks, Hospitals, shareholder yield, undervalued | Login |
| TICKER | COMMENTARY |
|---|---|
| 4441.T | Tobila Systems is a Japanese company focused on fraud and spam call prevention. Tobila has successfully developed a new B2B growth engine that will accelerate revenue, profit, and free cash flow growth going forward yet amazingly trades at 4.5x EV/FCF with its B2B segment growing revenue over 50% per year. Japanese GAAP greatly understates the earnings power of the business due to long-term spam filtering license terms. Investors focused on reported earnings likely do not appreciate the transformation and cash generation of the B2B segment, which shows no signs of slowing. |
| DR.TO | Around three years ago, activist investors stepped in at Medical Facilities, as the prior management's acquisition strategy wasn't working. Jason Redman was appointed CEO with a mandate to divest non-core assets and then the four core surgical hospitals – two of which are best-in-class facilities whose value was buried within a broader hospital conglomerate. Jason and his team have now divested of all their non-core assets and sold two of their four surgical hospitals – with the sale of the final two most likely to happen in the near term. |
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