Browse the world's most comprehensive database of hedge fund investor letters, sorted by recent quarter. Access primary source research from leading institutional managers.
| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
|---|---|---|---|---|---|---|---|
Buyside Digest is not affiliated with, and does not endorse, FMI All Cap Equity. This analysis is provided for institutional research purposes only and is not investment advice.
"FMI is positioned for AI bubble deflation. While semiconductor and AI infrastructure stocks trade at historic extremes after the best quarter ever, the manager owns quality businesses at meaningful discounts that will benefit from AI productivity gains on the cost side, not unsustainable capex revenue."
Fiduciary Management believes the market spent Q2 2026 pricing in an AI future that has not materialized while creating compelling value in overlooked quality businesses. Global markets surged on AI momentum, with semiconductors posting their best quarter ever and valuations reaching over four standard deviations above historical averages. The five largest hyperscalers are projected to spend over $725 billion on AI capex in 2026, yet only Amazon would generate positive returns under zero operating cost assumptions. The manager views this as circular, unsustainable spending reminiscent of the dot-com bubble. FMI's portfolios underperformed as expected but are positioned in businesses with durable competitive advantages, high returns on capital, and conservative balance sheets trading at meaningful discounts. These companies stand to benefit from AI on the cost side through productivity gains rather than selling into the AI investment cycle. The valuation gap between AI infrastructure and everything else now rivals dot-com peak levels. The manager sees compelling risk/reward on a 3-5 year horizon, with portfolio holdings offering adequate margin of safety whether AI productivity materializes or the bubble deflates.
Sign in or create a free account to unlock full commentary, extracted equity pitches, and direct outbound manager source links with your 3 quarterly credits.
