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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Vulcan Value Partners - All Cap 2026 Q3 Investor Letter | Buyside Digest

Back to Fund Profile (Vulcan Value Partners - All Cap)

Primary Source Intelligence • Q3 2026 Letter Analysis

Vulcan Value Partners - All Cap Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Vulcan Value Partners - All Cap. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD+7.5%

YTD+1.3%

Annualized+9.8%

Positioning StanceBULLISH

Market CapAll Cap

GeographyUS

Digest Analysis

Quick Take

"Capitalizing on broad market overvaluation by acquiring competitively entrenched software and semiconductor leaders like Skyworks and ServiceNow at historically deep discounts to intrinsic value while divesting holdings that approached fair value."

Executive Summary

During the third quarter of 2026, the Vulcan Value Partners All Cap Composite delivered a net return of 7.5%, outperforming the Russell 3000 Value Index return of 2.3% and the Russell 3000 Index return of 1.4%. Year-to-date, the strategy has generated a net return of 1.3% net of fees compared to 19.2% for the Russell 3000 Value Index. The strategy maintained its disciplined, concentrated approach, with typical core position sizes targeting approximately 5% across high-quality businesses, keeping price-to-value ratios at historically low levels without employing leverage. From a macro perspective, the manager highlights an environment characterized by rapidly rising interest rates where very few asset classes represent genuine bargains and broad capitalization-weighted indices remain at best not cheap. Against this backdrop, the firm observes rare market conditions where high-quality compounding businesses trade at massive discounts to intrinsic value typically seen only during systemic crises like the Global Financial Crisis or COVID-19 pandemic. Portfolio themes center on mission-critical enterprise software and specialized RF semiconductors. Portfolio activity during the quarter included initiating a new position in Skyworks Solutions while completely exiting Qorvo to capture 100% equity upside from their pending business combination. The strategy also fully liquidated IQVIA Holdings after its share price rebounded closer to estimated intrinsic value. Top performance contributors included ServiceNow, Veeva Systems, Microsoft, and SAP SE, all benefiting from accelerating cloud adoption, strong enterprise retention, and durable operating cash flows.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

85%

CautiousHigh

High Conviction (85%)

Portfolio construction targets a concentrated core allocation of approximately 5% per position in exceptional compounders, with the investment team adding personal capital alongside clients. Decisions to hold through volatility in names like ServiceNow and Microsoft reflect deep research conviction without hedged language.

Growth Outlook

65%

BearishBullish

Bullish (65%)

The manager views broader capitalization-weighted indices as at best not cheap and cautions that very few asset classes present bargains amid rapidly rising interest rates. However, they see extraordinary forward return prospects specifically within their portfolio holdings, which trade at rare crisis-level discounts.

Risk Appetite

80%

DefensiveAggressive

Aggressive (80%)

Capital is positioned fully in high-conviction equities without hedging or leverage, aggressively adding capital into businesses trading at significant margins of safety. The manager actively recycled proceeds from fully valued holdings directly into discounted equities.

Capital Deployment

75%

De-riskingDeploying

Deploying (75%)

The manager actively deployed capital by establishing a new holding in Skyworks Solutions and redeploying proceeds from fully valued positions like IQVIA into deeper value opportunities, while team members personally contributed additional capital.

Forward Guidance

75%

CautiousExpansionary

Expansionary (75%)

Management explicitly states an active deployment bias, advising investors to follow their personal lead by adding capital to their strategies. They continue to initiate and add to positions trading at steep discounts to appraised intrinsic worth.

Language Signal

70%

BearishBullish

Bullish (70%)

Directional language is distinctly constructive around portfolio holdings, emphasizing compounding values, historic discounts, and durable moats. This is balanced by restrained commentary regarding aggregate equity indices and broader macro headwinds.

Perceived Risk

60%

Low RiskElevated

Moderate Risk (60%)

Macroeconomic risks are prominent, specifically rapidly rising interest rates, persistent inflation, and elevated equity market valuations across broad indices. These pressures are accounted for directly in conservative intrinsic value underwriting.

Opportunity Density

65%

ScarceAbundant

Abundant (65%)

While bargains across broad asset classes are scarce due to interest rate pressures, the manager identifies an exceptionally rich cluster of opportunities within high-quality software and semiconductor businesses that were sold off in sympathy with broader sectors.

Time Horizon

80%

Short-TermLong-Term

Decade+ (80%)

The investment strategy operates with an explicit multi-year holding horizon of five years or longer, looking through temporary macroeconomic headwinds and quarterly noise to allow business intrinsic value to compound.