Van Den Berg Management I

#### I. Institutional Overview The 13F filing for the fourth quarter of 2025 reveals a sophisticated and highly disciplined investment approach by **Arnold Van Den Berg** and his firm, **Van Den Berg Management I**. With a reported portfolio value of approximately **$407.05 million** and a diverse array of **123 holdings**, the institution continues to embody the principles of classic value investing while adapting to the modern complexities of the global marketplace. Arnold Van Den Berg is widely recognized in the investment community as a "super-investor" who adheres strictly to the school of Benjamin Graham and David Dodd, focusing on the "margin of safety" and intrinsic value. This quarter’s data suggests a firm that is not merely chasing momentum but is actively engaged in the meticulous rebalancing of its capital to protect gains and hunt for overlooked opportunities. **Scale and AUM Dynamics** The portfolio value of $407.05 million places Van Den Berg Management I in the category of a mid-sized institutional manager. This scale is particularly advantageous in the current market environment; it is large enough to command significant research resources and institutional access, yet small enough to remain nimble. Unlike "mega-funds" with hundreds of billions in AUM that are often forced into the same crowded mega-cap trades, Van Den Berg has the flexibility to take meaningful positions in mid-cap and even small-cap companies without significantly moving the market price. The stability of the reported value, combined with the strategic shifts observed this quarter, indicates a period of consolidation. The institution appears to be in a "maintenance and optimization" phase rather than an aggressive capital expansion phase, which is consistent with a cautious macroeconomic outlook. **Concentration and Diversification Strategy** With 123 stocks in the portfolio, one might initially characterize the firm as overly diversified. However, a deeper look at the weightings reveals a "barbell" structure. The top 10 holdings account for a significant portion of the total AUM, representing the firm’s high-conviction bets. The remaining 113 stocks form a long "tail" of smaller positions. This structure suggests a two-tiered investment philosophy: 1. **Core Conviction**: Large, concentrated positions in companies where the firm has deep fundamental understanding and a long-term horizon (e.g., **COHR**, **SA**, **LUMN**). 2. **Exploratory and Diversified Value**: A wide net cast across various sectors to capture idiosyncratic value opportunities, manage risk through diversification, and perhaps maintain "toe-hold" positions in companies that may eventually graduate to the core portfolio. **Psychological Portrait: The Disciplined Contrarian** The psychological portrait of Van Den Berg Management I this quarter is one of **disciplined patience**. The firm is notably trimming its biggest winners—stocks like **COHR (Coherent Corp.)** and **GOOG (Alphabet Inc.)** where they have seen astronomical gains (385% and 444% respectively). This is the hallmark of a rational investor who refuses to let "house money" cloud their judgment of valuation. While the broader market might be swept up in AI euphoria or momentum, Van Den Berg is systematically harvesting profits. Simultaneously, the firm is adding to industrial and financial infrastructure plays like **MKTX (MarketAxess)** and **TKR (The Timken Company)**, suggesting a rotation toward "real-world" assets and essential market plumbing that may have been overlooked by the growth-obsessed crowd. In summary, Van Den Berg Management I enters 2026 with a robust, well-diversified portfolio that balances high-growth technology exposure with deep-value energy and materials plays. The institution’s behavior this quarter reflects a "Value-Plus" strategy: sticking to fundamental valuation roots while selectively participating in secular growth themes, all while maintaining a rigorous sell-discipline that is often the hardest trait for lesser managers to master. #### II. Sector Allocation Analysis The sector allocation of Van Den Berg Management I provides a clear window into the firm’s macro-economic worldview and its specific industry preferences. The portfolio is characterized by a heavy tilt toward **Technology** and **Energy**, which together comprise nearly 45% of the total holdings. This suggests a dual focus on secular innovation and cyclical value/inflation protection. | Sector | Weight (%) | Trend/Sentiment | | :--- | :--- | :--- | | Technology | 23.96 | Core Growth / Profit Taking | | Energy | 20.69 | Cyclical Value / Inflation Hedge | | Financials | 13.87 | Defensive Value / Infrastructure | | Healthcare | 12.40 | Structural Growth / Defensive | | Communication Services | 12.33 | Growth / Platform Value | | Industrials | 7.10 | Cyclical Recovery / Infrastructure | | Materials | 5.84 | Hard Assets / Commodity Play | | Real Estate | 2.19 | Selective Yield / Recovery | | Consumer Discretionary | 1.62 | Highly Selective / Underweight | **Concentration Analysis: The Power of the Top Three** The top three sectors—**Technology (23.96%)**, **Energy (20.69%)**, and **Financials (13.87%)**—collectively account for **58.52%** of the portfolio. This concentration indicates a firm that is not trying to "hug the index" but is instead making distinct bets on where it perceives the best risk-adjusted returns. The high allocation to Technology reflects a recognition of the sector's role as the primary engine of modern economic growth, while the nearly equal weight in Energy serves as a powerful hedge against geopolitical instability and inflationary pressures. This "Tech-Energy" axis is a sophisticated way to play both the "new economy" and the "old economy" simultaneously. **Sector Rotation and Macro Signals** The most striking feature of the current allocation is the firm’s commitment to **Energy**. At over 20%, this is a massive overweight compared to the S&P 500's typical energy weighting (usually 3-5%). This suggests a strong conviction that energy prices will remain structurally higher or that energy companies are significantly undervalued relative to their cash flow generation. Within this sector, the firm holds a mix of mega-caps like **XOM (Exxon Mobil)** and specialized players like **FANG (Diamondback Energy)** and **EQT (EQT Corporation)**. This "cluster" approach allows the firm to capture the beta of the energy sector while benefiting from the specific operational efficiencies of individual companies. In **Technology**, the 23.96% weighting is substantial but must be viewed through the lens of the quarter's activity. The firm was a net seller of its top tech positions (**COHR**, **GOOG**, **IBM**, **QCOM**). This indicates a "tactical retreat" from peak valuations. The firm isn't abandoning tech; rather, it is harvesting the "low-hanging fruit" of the recent rally to reallocate into areas with a higher margin of safety. **The Rise of Industrials and Financials** The **Industrials (7.10%)** and **Financials (13.87%)** sectors saw interesting activity this quarter. The addition of **FTV (Fortive Corporation)** as a new buy and the significant increase in **MKTX (MarketAxess)** and **TKR (The Timken Company)** signal a shift toward quality cyclicals. These companies often provide essential components or services to the broader economy. By increasing exposure here, Van Den Berg is likely betting on a "resilient economy" scenario where industrial production and financial market volumes remain robust even if the high-flying tech sector cools down. **Defensive Posturing in Healthcare and Communications** With **Healthcare (12.40%)** and **Communication Services (12.33%)** holding nearly identical weights, the firm maintains a solid defensive base. Healthcare, represented by names like **ELV (Elevance Health)** and **UNH (UnitedHealth Group)**, provides a buffer against economic volatility due to the inelastic demand for medical services. Communication Services, dominated by **GOOG (Alphabet)** and **DIS (Disney)**, offers a blend of platform-based growth and content value. The fact that these sectors are well-represented suggests that the firm is prepared for a "sideways" or volatile market where earnings stability becomes a premium. **Macroeconomic Judgment: The "Higher for Longer" and "Resilience" Play** Based on this sector layout, we can infer that Arnold Van Den Berg is positioning for a macro environment characterized by: 1. **Persistent Inflationary Undercurrents**: The heavy Energy and Materials (Gold via **SA**) exposure is a classic defense against a devaluing currency or supply-side shocks. 2. **Technological Pragmatism**: A bel ---