a. Updated Performance vs. the S&P 500
Performance since inception:
Year-to-date performance:
b. Portfolio Change
I have started a 1.9% position in On Running. I am trying to preserve the cash position and really did not have much to deposit to offset this usage. I was able to deposit a small amount of money today, but the cash position still fell by 1.4%. I've decided it's a concession I want to make.
I don't have a ton of time to work through the investment case today, so I'll keep this quick. They are the best performer in their category. They are a market share taker with a fantastic founder-led team that has miles to go in terms of opening stores and building brand awareness.
Sentiment right now for apparel is awful. Macro for these players is not good, and that's exactly when I want to start positions here. I want to own the structural market share gainer to offset the natural cyclical flows of this sector. I want to own the name that will take a lot more land when times are bad. On Running is the highest-quality name in the space and it's at April 2025 lows. Their approach to innovation is both bold, yet meticulous and data-driven. They're rapidly and successfully expanding into new markets, new sports, new concepts and new athlete partnerships.
The company trades for just 28x forward EPS with a 33% EPS CAGR from 2024-2027 the current expectation. They beat and raise seemingly every single quarter, which probably means the CAGR will turn out to be faster.
For a more detailed understanding of why I want to own this name, the last two quarterly reviews can be found below.
c. Updated Holdings
