Earnings and Economic Resilience
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Tariffs and trade uncertainty have dominated headlines, which has resulted in a chorus of calls for an economic slowdown and declining U.S. corporate earnings.
So far, that hasn’t happened.
A snapshot of mid-summer economic data suggests the U.S. and global economy are proving more resilient than many anticipated—and that resilience is helping underpin stronger-than-expected corporate earnings and a rallying stock market.
A lion’s share of the companies we own are reporting earnings that have come in ahead—sometimes well ahead—of expectations. Q2 results across our Core holdings suggest that the economic backdrop is not only holding up, but in some cases fueling stronger-than-anticipated profit growth.
Below, we provide a table highlighting several of our portfolio companies, their Q2 2025 earnings estimates versus actual results, and the percentage difference between the two. You can clearly see a vast majority of our companies are outperforming.
The message from both the economic data and corporate results of the companies we own is clear:
This can change quickly, and it continues to be an environment where we must stay (sometimes overly) vigilant. But for now, our approach of finding companies with strong, accelerating earnings is holding up well.
If you have any questions about this month’s letter or your portfolio, please do not hesitate to reach out.
Notes and Disclaimers
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Past performance does not guarantee future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment or investment strategy will be profitable. Changes in investment strategies, contributions or withdrawals, and economic and market conditions will materially alter the performance of your account. All investing involves risk of loss including the possible loss of all amounts invested.
Index Disclaimers
The benchmarks referenced are included to reflect the general trend of the markets during the periods indicated and are not intended to imply that the underlying returns were comparable to the market indices either in composition or element of risk. There are significant differences between client accounts and the indices herein including, but not limited to, risk profile, liquidity, volatility, and asset composition.
The S&P 500 Index is a capitalization-weighted index comprised of 500 stocks chosen for market size, liquidity and broad industry group representation within the U.S. economy. Index returns represent gross returns, and are provided to represent the investment environment during the time periods shown and are not covered by the report of the independent verifiers.
