Hedge-Fund Manager Bets Big on Infrastructure, Nabs 79% Gains as S&P Stagnates

Bill Harnisch didn't believe in the stock rally. He still crushed it. The 2025 performance of his $3.1 billion hedge fund, Peconic Partners, hit a staggering 79%, far outpacing the S&P 500 according to reports. While most managers diversified into Big Tech and macro bets, Harnisch staked his fund on just three under-the-radar infrastructure names-Quanta Services, Dycom Industries, and MasTec-building a concentrated, low-leverage portfolio that defied the odds.

The trio of construction and utilities firms didn't build chips or code. Instead, they laid the groundwork for AI, clean energy, and high-speed internet according to analysis. As demand for data and power surged, these firms became some of the year's most profitable trades. November alone added 20% to Peconic's value, while the S&P 500 stagnated. Quanta alone, which accounted for more than half of Peconic's long book, rose 3% in the same period.

Despite his success, Harnisch's cautious macro stance left room for doubt. He expressed deep uncertainty about the economy and the future of GDP, yet his focus on high-conviction infrastructure stocks kept his fund on track. Peconic has now outperformed the S&P 500 for the fifth time in six years, proving that a narrow, disciplined approach can beat the broader market even amid volatility.

A Bet on the Invisible Backbone of the Digital Age

Harnisch's success came from betting on the invisible backbone of the digital and energy revolutions. Quanta, Dycom, and MasTec are not glamorous names like Apple or Microsoft, but they build and maintain the power lines and fiber-optic cables that make modern infrastructure possible according to research. As AI demand surges and clean energy adoption accelerates, so too does the need for the infrastructure to support them.

This year's rally in those sectors was no accident. Harnisch's focus on long-term growth drivers-like AI's need for more electricity and data-paid off in spades. The three stocks have each gained more than 48% in 2025, with Dycom soaring 26% in November alone according to data. For Harnisch, it was a case of picking the right industry at the right time.

Short Bets as a Shield in a Turbulent Market

Peconic isn't just about long positions. The fund also uses short bets as a hedge and a way to exploit overpriced assets according to strategy. Right now, the fund is betting against big retailers like Walmart and Amazon, as well as industrial firms like GE Vernova and Eaton. The rationale? Aggressive pricing strategies by large retailers and a softening labor market could squeeze consumer spending, while industrial stocks may fall further in a market downturn.

These short positions add another layer of strategy to Harnisch's portfolio. They help offset potential losses in the core holdings and generate returns when certain sectors falter. While shorting is often seen as high risk, Harnisch's approach is calculated. The fund's short book isn't a speculative gamble-it's a defensive move in an unpredictable market.

A Cautious Outlook for 2026

Despite his recent success, Harnisch remains skeptical about the broader market. He expects flat or negative returns for the S&P 500 in 2026, a stark contrast to Wall Street's more optimistic forecasts according to analysis. His concerns are rooted in Trump-era trade policies, which he believes could disrupt global commerce, and a market he sees as overvalued. That caution hasn't always worked in his favor-last year, a short position backfired as the S&P 500 staged a strong rally. Still, Harnisch's long-term view hasn't wavered.

His approach for 2026 will likely mirror 2025. He'll focus on the same infrastructure plays, betting on the continued demand for electricity and data capacity. For now, Harnisch is content with his strategy. After all, he's not trying to predict the economy-he's trying to profit from the industries that make it work.