Investor Letters

First Eagle Investments

firsteagle.com

Short Duration High Yield Municipal Fund Commentary Short Duration High Yield Municipal Fund emphasized Brightline West bonds after greater trading activity, prospective federal loan financing and new construction contracts. Healthcare bonds benefited from improving hospital operations and reimbursement rates. Brightline Florida bonds faced pressure while the rail operator sought an equity infusion, despite improving ridership and revenue. second quarter 2026 +2.5% —
Gold Fund Commentary Gold Fund Commentary attributes gold’s decline to tighter-policy expectations following the Iran war, persistent inflation and a stronger dollar, while arguing that fiscal strains, reserve diversification and geopolitical risk preserve gold’s role as a strategic hedge. The portfolio review discusses Pan American Silver’s Escobal CVRs, Peñoles’ Fresnillo stake, B2Gold’s asset sale and Goose Project disruption, and the operating strengths of Agnico Eagle and Wheaton Precious Metals. 2Q 2026 -16.6% AEM $105BBTG $10BPAAS $22BWPM $72B
Small Cap Opportunity Fund Commentary First Eagle Small Cap Opportunity Fund maintained strict valuation discipline after sharp gains in parts of the portfolio and redeployed profits into undervalued healthcare, consumer staples and idiosyncratic opportunities. AI infrastructure demand supported semiconductor suppliers including Vishay Intertechnology, Silicon Motion, Ultra Clean, Cohu and TTM Technologies, while energy holdings faced pressure from easing Middle East tensions. second quarter 2026 +25.5% AORT $1.4BCENX $4.6BCOHU $2.6BLXU $747M
Global Equity ETF Commentary Global Equity ETF positioning favors durable, scarce assets at sensible valuations as tighter US rate expectations, elevated equity issuance and AI capital spending raise concerns over mega-cap valuations. Samsung, Alphabet, Merck, Elevance and Texas Instruments benefited from operating catalysts, while Noble, Charter, HCA, Exxon and Agnico Eagle were retained despite cyclical or operating headwinds. second quarter 2026 +5.0% 0R1M AEM $105BCHTR $18BELV $86B
Overseas Fund Commentary The Overseas Fund repositioned into international value stocks it considers attractively valued outside mega-cap benchmarks while retaining gold as a strategic hedge against fiscal and geopolitical risk. Samsung Electronics, Samsung Life, Merck, Taiwan Semiconductor and Richemont led holdings discussed, while the team maintained exposure to Shell, Imperial Oil, Alibaba and Jardine Matheson despite near-term pressures. second quarter 2026 +3.2% 032830 $43BBABA $290BCFRHF $136BIMO $66B
High Yield Municipal Fund Commentary High Yield Municipal Fund emphasized supportive municipal technicals, improving issuer fundamentals and attractive tax-equivalent yields despite uncertainty over Federal Reserve policy. The portfolio benefited from Brightline West financing progress and healthcare-credit improvements, while Brightline Florida bonds faced pressure as the rail operator sought an equity infusion to strengthen its capital structure. second quarter 2026 +4.3% —
Overseas Equity ETF Commentary Overseas Equity ETF emphasized Samsung Electronics, Merck KGaA, Richemont, Taiwan Semiconductor and FANUC, citing memory-chip demand, life-sciences expansion, luxury stabilization, AI semiconductor scarcity and industrial robotics. It retained conviction in Shell, Imperial Oil, Agnico Eagle, Jardine Matheson and Wheaton despite pressure from lower oil and precious-metals prices. second quarter 2026 +7.1% AEM $105BCFRHF $136BFANUF $36BIMO $66B
Overseas Fund Commentary First Eagle Overseas Fund trimmed successful holdings and recycled capital into out-of-favor sectors and geographies as US valuations remained elevated. Gold bullion, Alibaba, Prosus, Imperial Oil and Taiwan Semiconductor were leading contributors, while the managers retained Shimano, SMC, FUCHS, Haleon and Ambev despite cyclical or demand-related setbacks. 3Q 2025 +9.2% 6273 $28B7309 $11BABEV $45BBABA $290B
Gold Fund Commentary Gold Fund attributes demand for gold to monetary-policy uncertainty, fiscal pressures, geopolitical tension and central-bank purchases, while warning that a recession could interrupt the rally. The portfolio benefited from gold bullion and miners, with Newmont and Agnico Eagle reducing debt and repurchasing shares after selling Orla Mining stakes. 3Q 2025 +34.3% AEM $105BNEM $138BORLA $4.7BPAAS $22B
Small Cap Opportunity Fund Commentary First Eagle Small Cap Opportunity Fund argues that improving small-company earnings, lower borrowing costs and AI infrastructure spending could support a durable small-cap recovery. The portfolio benefited from mining, energy-efficiency and environmental-equipment holdings, while exiting Portillo’s and Tronox after weaker operating outlooks and balance-sheet concerns. 3Q 2025 +13.0% AMRC $1.3BCDE $22BCECO $4.2BFIP $445M
Global Value Team Annual Letter Global Value Team argues that US market concentration, China’s economic weakness and growing sovereign debt make differentiated sources of risk and return essential. The team retains a diversified, bottom-up value approach and a structural gold allocation, citing inflation, currency debasement and geopolitical risk. 2024 — EVGRF $237M
Global Value Team Annual Letter Global Value Team argues that market optimism underprices the risks of a failed soft landing, persistent fiscal deficits and widening geopolitical conflict. The team favors quality, durable businesses bought below estimated value, alongside gold and potentially oil as ballast, and promoted Max Belmont to portfolio manager of its Gold strategies. 2023 — AAPL $4.5TAMZN $2.8TBRK.A $1.1TGOOGL $4.2T