Tweedy Browne Q2 2026: 105 Holdings, Stretched Valuations, and a Portfolio Worth Stress-Testing

Tweedy Browne's latest 13F filing shows a portfolio that has expanded to $1.32 billion across 105 holdings as of June 30, 2026, up from 93 positions at the end of the first quarter. Their ETFs returned 7.4% in Q2 — trailing benchmarks that were lifted by the AI-fueled technology rally the firm deliberately avoids. The COPY and ICPY ETFs are up 14.2% and 12.6% year-to-date, respectively, which is respectable but not transformative.

The more interesting story is what the firm is warning about while it builds this portfolio. Tweedy Browne flagged the Shiller CAPE ratio near 41 times earnings and the Buffett Indicator — total U.S. market capitalization divided by GDP — near 219%, both at or near all-time peaks. The CAPE smooths earnings over a decade to remove cyclical noise; at 41x, it implies the market is pricing in decades of exceptional growth. The Buffett Indicator above 200% has historically preceded periods of below-average forward returns. Tweedy Browne is building a portfolio as if that warning is real. The question is whether the portfolio's actual holdings can survive the conditions they're warning about.

The Core Holdings: Concentration and Leverage

CNH Industrial, the agricultural and construction equipment maker, remains the anchor at 17.6% of the portfolio. The stock trades at $10.91, down 14.4% over four months and 12.8% on a rolling annual basis. Forward P/E sits at 19.6 times and price-to-cash-flow is 7.6x, which looks affordable until you check the balance sheet. CNH carries $34.3 billion in total debt against $7.9 billion in equity — a debt-to-equity ratio of 331%. Free cash flow fell 71% year-over-year to $611 million. That is $611 million of FCF against $34.3 billion of debt. Net debt after cash is $24.1 billion.

Tweedy Browne's concentration here suggests they see the pullback as cyclical weakness, not structural decline. The company generates $1.8 billion in operating cash flow and runs a 14.4% EBITDA margin, which gives it some ability to service debt. But 331% debt-to-equity is not a conservative base. If equipment cycles stay soft, that 17.6% position becomes a leveraged drag rather than a value compounder. The ROIC sits at 5.1%, which needs to reaccelerate meaningfully for this leverage to work in shareholders' favor.

Ionis Pharmaceuticals at 13.6% is a different kind of risk. The RNA-targeted drug developer trades at $56.56, down 28.5% year-to-date from a 52-week high of $86.74. It has negative trailing earnings, negative free cash flow of $567.5 million, and negative operating cash flow of $496.4 million. The balance sheet shows $2.6 billion in debt against only $440 million in equity — a 301% debt-to-equity ratio. This is not a traditional value position. It is a bet on clinical trial outcomes priced at a discount after a steep decline. Tweedy Browne has held through biotech development cycles before, and the thesis hinges on pipeline optionality rather than current cash generation. The risk is that if clinical outcomes disappoint, the leverage amplifies losses rather than providing a floor.

Coca-Cola FEMSA at 9.1% and Berkshire Hathaway Class A at 8.2% round out the top tier, and they look different. Coca-Cola FEMSA carries a 3.4% dividend yield with 20 consecutive years of dividend payments, but the 470% payout ratio means the dividend is not covered by current earnings. The company has $10.6 billion in debt but a manageable 57% debt-to-equity ratio and $1.7 billion in operating cash flow. The payout is funded from accumulated cash reserves and strong distribution economics, not from this year's earnings — a distinction that matters for dividend sustainability but doesn't suggest imminent cuts. Berkshire at 13.1x trailing P/E is the portfolio's cleanest balance sheet: 17% debt-to-equity, $40.6 billion in cash, and $46.6 billion in operating cash flow. It is the quality anchor.

What They Bought — and the Pattern Behind It

The new positions follow a strict filter: insider buying at depressed valuations, often accompanied by share repurchase programs. This is coat-tailing, not thematic investing. Executives are putting their own capital to work, and Tweedy Browne is following.

Bangkok Life Assurance was initiated after a director purchased $837,000 of shares at THB 22.70. The stock traded at 6.5 times earnings and 0.75 times book value — below asset value by book measures. Telecom Plus saw its chairman spend $4.7 million in June at £7.10 per share, then another $2.8 million the following month, while the company announced £40 million in buyback authorization at 9.1 times forward earnings. Globant, the Argentine software developer, attracted $971,000 in insider purchases while trading at 6.3 times consensus 2026 earnings — unusual for a software company during an AI investing cycle.

The COPY ETF also initiated U.S. positions in Builders FirstSource, Conagra Brands, Evertec, Euronet Worldwide, Shoe Carnival, and Zoetis. Building materials distributor, frozen foods maker, payments processor, ATM operator, shoe retailer, and animal health company. None are AI plays. All trade at single-digit or low-double-digit multiples. The common thread is insider conviction at depressed prices.

What They Sold — Discipline, Not Capitulation

Samsung Electronics was sold despite being among the quarter's largest contributors to returns, driven by improved memory chip pricing and AI infrastructure demand. The sell was a valuation stop-loss, not a thesis failure. Tweedy Browne's proprietary model flags positions when their valuation score deteriorates, and Samsung crossed that threshold.

Capital loss positions — BFF Bank, Malibu Boats, Volkswagen, and JD Sports Fashion — were eliminated for thesis deterioration or tax-loss harvesting. UMS Integration, StoneX Group, X-Fab Silicon Foundries, Cenovus Energy, and Mullen Group were also exited, most presumably after running to less attractive valuations.

This selling discipline is the difference between a value fund and a momentum fund in disguise. Many funds ride winners until sentiment reverses. Tweedy Browne exits when the valuation math no longer supports the holding period, even when the narrative remains positive. That discipline is worth noting because it is rare.

The Portfolio's Blind Spot: Energy

The quarter's top detractors were concentrated in energy: Peyto Exploration, Parex Resources, Shell, Repsol, and ConocoPhillips all dragged on falling oil prices as geopolitical tensions eased and oil transport resumed through the Strait of Hormuz. Tweedy Browne holds energy for yield and deep value — not as a macro hedge — and the sector has been in a persistent downtrend. The firm flagged AI capex as a "prisoner's dilemma" among hyperscalers and warned about rapidly rising equity valuations and persistent inflation. But if commodity prices rebound, energy typically outperforms value stocks priced on current earnings. The energy underweight relative to a broader market hedge is a genuine exposure gap.

Investment Implications

The Tweedy Browne playbook remains intact: buy below asset value where insiders are buying, sell when valuations extend beyond the model's comfort zone, and ignore thematic rallies that disconnect from fundamentals. The 105-name portfolio is wide enough to absorb individual disappointments but concentrated enough that CNH's debt profile and Ionis's binary outcomes drive a disproportionate share of risk.

If the CAPE ratio near 41x and the Buffett Indicator near 219% are correct, large-cap technology will underperform over the coming years. In that scenario, a portfolio anchored in single-digit multiple names with insider conviction looks rational rather than contrarian. If those indicators prove as stale as they were during the 2017-2021 bull market, the strategy will underperform until valuations mean-revert.

For a retirement portfolio watching for allocation opportunities, the COPY and ICPY ETFs offer structured access to this approach without replicating the research process. They are not momentum vehicles. They are barbell portfolios: deep-value names at depressed multiples on one side, quality compounders like Berkshire on the other. The rating for the Tweedy Browne value approach remains Buy — not because it will outperform next quarter, but because it is positioned for the scenario the firm considers most likely.