Commentary
3Q2024 - International Growth Commentary
In volatile times, focusing on what matters—profit growth trajectories—steadies and, in fact, dictates our thinking.
- After a quiet first half of 2024, volatility from various sources impacted international markets during the quarter. Shares of companies we own and follow swung higher and lower—such moves can whipsaw thinking and confuse regular observers about business or economic trends.
- Amid volatility, we focus on our long-standing approach of following companies' underlying earnings growth and constructing portfolios to grow at a mid-teens rate over the long term.
- Despite our disappointment at quarterly and year-to-date performance, a review of earnings growth across our underlying holdings affirms our conviction in our approach.
- We recognize that short-term results from some of our large holdings exemplify negative market views towards businesses that we saw as fairly valued at the start of 2024, and which we see as poised to grow earnings at well above market rates for the long term.
- The top three contributors to the Portfolio's relative performance were AON, MercadoLibre, and SAP. The top contributors to absolute performance were AON, SAP, and MercadoLibre.
- The Portfolio's bottom relative detractors were ICON plc, ASML, and Tokyo Electron. The bottom absolute detractors were ICON plc, ASML, and Novo Nordisk.
- We initiated a new position in On Holding AG and did not eliminate any positions. We added to existing positions in Teleperformance, MercadoLibre, Novo Nordisk, and ASML and trimmed positions in Experian, Unilever, and Temenos.