William Smead
Chief Executive Officer
Chief Investment Officer

Dear Fellow Investors:

When I was 5 years old I got a life saver stuck in my throat while grocery shopping with my parents. My Dad grabbed me by the ankles and turned me upside down. He shook me a couple of times until the sweet lozenge dislodged. We just did the same thing in the US stock market in the last week.

We at Smead Capital Management believe that the market has an uninterrupted BRIC trade lozenge stuck in its throat. This lozenge causes the US stock market to choke on over-priced oil, basic materials and industrial shares. While we are seeing a textbook economic recovery, we are using much less gasoline than a year ago. We are also embarking into the world of electric cars. Why is the price of a commodity going up when its best customer is using less?

In our opinion, the answer is that the capital market participants believe as deeply in uninterrupted growth in China as I believed in the good flavor of orange and cherry flavored life savers at age five. The only way to get it out of me was to shake me and the only way to change the investment trend is to shake it with high volatility. The Chinese stock market, as represented by the Shanghai Composite, fell 1.9% last night in overseas trading. That’s a decline of 20% in the last nine months, qualifying for bear market territory. Stock markets have a tendency to look out one year on economic activity.

Ignore the noise and enjoy owning America’s fine companies in areas like consumer, banking and healthcare. When we get this BRIC trade out of our throats, we believe under-priced non-cyclicals will take over market leadership.

Best Wishes,

William Smead

The information contained in this missive represents SCM’s opinions, and should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results. Some of the securities identified and described in this missive are a sample of issuers being currently recommended for suitable clients as of the date of this missive and do not represent all of the securities purchased or recommended for our clients. It should not be assumed that investing in these securities was or will be profitable. A list of all recommendations made by Smead Capital Management with in the past twelve month period is available upon request.

We Advise Investors

Sign up to get our advice sent straight to your inbox.

Recent Missives

Late 2021 Speculation is Back

July 10, 2025

Our long-time investors are probably wondering why we haven't made any gains over the last 18 months. First, we have no ability to predict what already popular stocks will stay or get more...

⟶ Keep Reading

BNN Bloomberg: Cole Smead, CFA on Oil, Energy and Canadian Natural Gas

July 2, 2025

    LNG project has initial export capacity of 14M tons annually   For more information go to www.bnnbloomberg.ca. The information contained in this article represents SCM’s opinions, and should not […]

⟶ Keep Reading

Reuters: Cole Smead, CFA on the Current Market Rally

June 30, 2025

  S&P 500, Nasdaq close at record highs, cap best quarter in over a year By Sabrina Valle For more information go to reuters.com. The information contained in this tv […]

⟶ Keep Reading

Bloomberg: Cole Smead, CFA on Bank Stocks and Net Interest Margins

June 26, 2025

It’s ‘Game On’ for Bank Stocks as Rules Relax and Deals Rebound, Mayo Says By Georgie McKay For more information go to www.bloomberg.com. The information contained in this article represents […]

⟶ Keep Reading

Financial Post: Cole Smead, CFA on Aggressive Canadian Oil Companies

June 20, 2025

M&A in Canadian oil and gas accelerating: ‘We see a lot of consolidation’ says Keyera CEO Observers say a wave of consolidation is underway in the oilpatch By Meghan Potkins […]

⟶ Keep Reading

Bloomberg The Close: Cole Smead, CFA on Shock-Proof Oil Stocks 

June 20, 2025

Shock-Proof Oil Stocks to Weather the Geopolitical Storm By Romaine Bostick and Scarlet Fu For more information go to www.bloomberg.com. Stocks mentioned: SCR.TO The information contained in this article represents […]

⟶ Keep Reading

We Advise Investors

Sign up to get our advice sent straight to your inbox.

US INVESTORS

Individual Investors

OR

Financial Advisors, Family Offices,
and Institutional Investors

OR

NON-US INVESTORS

Individual Investors

OR

Financial Advisors, Family Offices,
and Institutional Investors

OR

Scroll to Top