Seeking Alpha·2026-01-29 15:00Core Insights - The investment environment in 2025 was challenging, with foreign equity markets achieving their best returns in over a decade, while the International Growth Composite Portfolio finished the year essentially flat due to a market preference for cyclically sensitive businesses [8][11]. Portfolio Performance - The International Growth Composite Portfolio's performance was -2.21% for the quarter and 0.68% year-to-date, compared to the MSCI ACWI (ex-USA) which returned 5.05% for the quarter and 32.39% year-to-date [5]. - Top contributors to the Portfolio's performance included Tokyo Electron, ASML, and Shopify, while the largest detractors were Monday.com, MercadoLibre, and SAP [13][17]. Company-Specific Insights - Tokyo Electron: A leading player in semiconductor manufacturing equipment, expected to grow revenues at a high single-digit rate and increase operating margins from 25% in 2024 to 35% in the medium term, driving mid-teens earnings growth [14]. - ASML: Benefiting from investor optimism around AI, as its equipment is essential for advanced chips, which are critical for AI applications [16]. - Monday.com: Despite strong results, the stock sold off due to concerns over near-term growth slowdown, but revenue growth is expected to sustain over 20% as it expands its market reach [18]. - MercadoLibre: The largest e-commerce platform in Latin America, experiencing a decline in stock price due to a slight decrease in operating margin while investing in growth initiatives [19]. - SAP: Despite cloud revenue growth exceeding expectations, the stock faced pressure due to market conditions, but is viewed as resilient with a strong market position and high recurring revenues [20]. Portfolio Activity - New position established in Nintendo, which is expected to see significant growth following the release of the Switch 2, with anticipated earnings growth of 30% annually over the next few years [23]. - Positions in Teleperformance and Siemens Healthineers were eliminated due to ongoing business challenges, reallocating funds to invest in Nintendo and Tencent [25][26]. Market Outlook - The outlook for the Portfolio remains positive, with expectations of benefiting from structural trends such as technology shifts and growth in emerging markets like India [27].