First Eagle U.S. Fund Q3 2025 Portfolio Review

The First Eagle U.S. Fund posted a 7.55% return in Q3 2025, underperforming the S&P 500, with materials and industrials as leading sector contributors. Key positive drivers included gold bullion's record highs amid geopolitical and monetary uncertainty, Oracle's substantial cloud contract with OpenAI, Alphabet's favorable DOJ rulings and AI capabilities, and C.H. Robinson's AI-driven cost cutting. Conversely, Elevance Health declined due to Medicaid concerns and reduced guidance, while Philip Morris saw soft sales, Comcast faced broadband subscriber losses, Colgate-Palmolive's margins were impacted by raw material costs, and Salesforce issued lower-than-expected forward guidance, raising concerns about its AI transformation.

Analysis

The First Eagle U.S. Fund returned 7.55% in Q3 2025, underperforming the S&P 500, with materials and industrials leading gains while consumer staples lagged. Gold bullion reached new nominal highs, driven by monetary policy uncertainty and geopolitical tensions, highlighting its safe-haven appeal.

Oracle Corporation (ORCL) and Alphabet Inc. (GOOG) were key positive contributors. Oracle secured a significant five-year cloud contract with OpenAI, boosting backlogs and expected margins. Alphabet benefited from favorable DOJ rulings and its robust AI ecosystem, maintaining a reasonable valuation and returning cash to shareholders. C.H. Robinson (CHRW) also gained from AI-driven cost efficiencies and anticipated pricing improvements.

However, several holdings detracted from performance. Elevance Health (ELV) saw shares decline due to Medicaid coverage concerns, increased utilization, and reduced forward guidance. Salesforce (CRM) faced pressure from lower-than-expected sales guidance, prompting concerns about its AI transformation and revenue growth.

Other detractors included Philip Morris (PM) and Comcast (CMCSA), which experienced share weakness despite strong earnings, impacted by supply issues and broadband subscriber losses, respectively. Colgate-Palmolive (CL) also traded down, with gross margins affected by raw material costs and tariffs, reflecting broader consumer staples sector challenges.

Key Decisions for Investors

• Consider increasing exposure to AI-centric technology companies like Oracle and Alphabet, given their strong contract wins and favorable regulatory environments.
• Maintain a strategic allocation to gold bullion as a hedge against ongoing monetary policy uncertainty and geopolitical tensions.
• Exercise caution with companies facing specific operational headwinds or regulatory pressures, such as Elevance Health and Salesforce, and monitor their ability to execute on strategic transformations or mitigate cost pressures.
• Evaluate consumer staples and telecommunications holdings for margin resilience and subscriber trends, as evidenced by Colgate-Palmolive's raw material cost impacts and Comcast's broadband subscriber declines.