Gold streaming play WPM led performance this month, while portfolio peers Royal Gold (RGLD) and Franco-Nevada (FNV) were each up 5% as well.
After a strong January, the gold price continued to rise in February and almost reached the $3,000 per ounce milestone. Gold set an all-time high closing price in New York of $2,952 on February 24 but drifted down a few points as the month concluded.
Gold advanced 2% in February and has risen 9% on a year to date basis. We provided a deep-dive update on gold in the 76report on February 21, which can be accessed here.
The accumulation of gold by central banks has been the key demand driver in recent years. We expect this trend to continue given Trump’s policy objectives, which may include a weaker dollar to spur domestic industrial activity.
Our gold-related positions within the portfolio offer leverage to a rising gold price.
COST continues to demonstrate superior execution. In early February, the company reported U.S. sales growth for January of 9.2%.
As noted above, shares of retail competitor WMT declined this month. A key point of differentiation between WMT and COST is the customer base. The typical COST customer is more affluent than the typical WMT customer.
COST customers are facing relatively less pressure on household spending in the context of an economic environment in which lower income consumers struggle to keep up with basic expenses, such as food.
At the same time, all consumers are motivated to maximize value in this environment. Through merchandising and logistics sophistication, COST continues to stand out within the retail landscape for its ability to deliver value to customers.
V shares performed well following the company’s first quarter 2025 earnings report at the end of January. V also held a well-received Investor Day in San Francisco on February 20.
“Credit cards” as a class are often described as vulnerable to technological disruption and crypto-related innovation. The most vulnerable players within the credit card ecosystem are, in our view, the banks that charge high fees, rather than payment facilitators like V, which charge relatively low fees.
V is a clear leader in payments innovation and will continue to benefit from the deployment of new technologies, including crypto, on a global scale.
At the Investor Day conference, V laid out a pathway for long-term revenue growth in the 9% to 12% range, supported by enormous and still underpenetrated addressable markets.
Shares of VMC slid towards the end of the month as they participated in a broader sell-off of stocks perceived to have cyclical exposure.
We were encouraged, however, by VMC’s strong fourth quarter earnings report, which came out on February 18. The results prompted a number of analyst target price increases.
VMC management offered reassuring guidance on volumes, with expected growth in the year ahead of 3% to 5%, supported by committed infrastructure spending.
Unit price increases are expected to land in the 5% to 7% range, while inflationary pressures on costs are said to be moderating. Above inflation pricing power remains key to the VMC business model, which benefits from resource scarcity and transportation-related moats.
With a superior footprint across the sunbelt, we see VMC as a long-term beneficiary of construction activity driven by the ongoing industrial renaissance in the U.S.—from manufacturing to energy to AI.
