Webinars [[{“value”:”Original broadcast details
Date: Thursday, April 16, 2026
Executive Summary
Strong earnings growth offset by valuation compression1Q26 delivered excellent earnings growth across the U.S. portfolio but was more than offset by valuation compression. Over 92% of the portfolio increased NTM EPS, yet we underperformed the S&P 500 by 2.4 percentage points because over 75% of the portfolio suffered ~15% multiple compression. If valuations had remained unchanged, returns would have been 11 percentage points higher.
Sector allocation was a modest headwindWe were underweight the best performing sectors in the quarter. However, most of the best sectors this quarter have been underperforming sectors since our inception. Overall, sector allocation was a 1-2 percentage point headwind to U.S. returns.
Similar dynamics across Global and International portfolios Both Global and International portfolios exhibited the same pattern. Earning growth was good for most of the portfolio offset by valuation compression. Additionally, sector allocation was a minor headwind.
Our portfolio positioning looks attractive across all our productsIn the U.S., our CS composite had an 11.3x NTM P/E, down 7% from year-end. This represents a compelling valuation given our portfolio’s 10.9% compound annual growth history. Additionally, our portfolio maintains lower economic sensitivity. Like the U.S., our Global and International portfolios reflect a similar combination of discounted valuation and quality growth.
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