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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
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Buyside Digest is not affiliated with, and does not endorse, Vulcan Value Partners - Focus. This analysis is provided for institutional research purposes only and is not investment advice.
"Vulcan Value Partners added four high-quality large-cap positions in Q3 2023 including Diageo, Marriott, Texas Instruments, and UnitedHealth Group, all previously owned companies with sustainable competitive advantages. Despite negative quarterly returns, the Focus strategy delivered 31.2% year-to-date performance."
Vulcan Value Partners reported negative returns across all five strategies in Q3 2023, with the Focus strategy declining 1.9% but maintaining strong year-to-date performance of 31.2%. The firm added four new large-cap positions: Diageo, Marriott International, Texas Instruments, and UnitedHealth Group, all companies previously owned that meet their criteria for sustainable competitive advantages. Diageo benefits from the premiumization trend in spirits, while Marriott's asset-light model generates strong returns through franchise fees. Texas Instruments dominates analog semiconductors with mission-critical products and high barriers to entry. UnitedHealth combines the largest health insurance business with rapidly growing Optum healthcare services. The firm exited Lam Research after its stock price appreciation narrowed the margin of safety. Small-cap holdings MillerKnoll and Ituran contributed positively, while ISS and SmartRent detracted. Vulcan reopened their Small Cap and All Cap strategies due to attractive price-to-value ratios and available capacity, maintaining their disciplined approach to long-term value creation.
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