StockDriftsWhere Conviction Is Rising: Toll Roads, Foundries and Power
Fundsmith's biggest new dollars went into businesses that sit between customers and complex ecosystems. The common thread is pricing power with asset-light or bottleneck economics.
- Uber: new at 4.73%, worth $645.3M; average cost implies +7.8%.
- Mastercard: new at 4.69%, worth $639.5M; average cost implies +13.2%.
- Taiwan Semiconductor: new at 4.02%, worth $548.5M; average cost implies +7.5%.
- Netflix: new at 3.66%, worth $499.1M; average cost implies -6.2%.
- GE Vernova: new at 3.53%, worth $481.5M; average cost implies +8.5%.
- Nextpower: new at 2.49%, worth $340.3M; average cost implies -12.4%.
- AppLovin: new at 2.63%, worth $358.9M; average cost implies -29.6%.
The second tier broadens the bet. TJX, Veeva and Yum Brands are new consumer/software positions. Several were bought near or below cost, especially AppLovin, Nextpower and Netflix, which suggests quality buying rather than momentum chasing.
Conviction
The big buys
The biggest dollar adds this quarter — where conviction is rising.
| Position | Change | Portfolio weight | Value |
|---|---|---|---|
| UBERUBER TECHNOLOGIES INC | New+$645.3M | 4.7% | $645.3M |
| MAMASTERCARD INCORPORATED | New+$639.5M | 4.7% | $639.5M |
| TSMTAIWAN SEMICONDUCTOR MANUFAC | New+$548.5M | 4.0% | $548.5M |
| NFLXNETFLIX INC. | New+$499.1M | 3.7% | $499.1M |
| GEVGE VERNOVA INC | New+$481.5M | 3.5% | $481.5M |
| APPAPPLOVIN CORP | New+$358.9M | 2.6% | $358.9M |
| TJXTJX COS INC NEW | New+$344.3M | 2.5% | $344.3M |
| NXTNEXTPOWER INC | New+$340.3M | 2.5% | $340.3M |
Dollar changes estimated at current prices (shares added × current price); top-50 current positions only.
What They Are Trimming: Profit-Taking as Funding
The trims read like a funding source. The biggest cuts were spread across extended winners:
- Alphabet: down 40.0% in shares, -$422.7M, still 4.64% and +147.6% vs average cost.
- Philip Morris: down 43.0%, -$397.9M, still 3.86% and +118.6% vs average cost.
- Fortinet: down 41.0%, -$388.2M, still 4.09% and +176.4% vs average cost.
- Visa: down 34.9%, -$372.0M, still 5.08% and +386.4% vs average cost.
- Waters: down 29.2%, -$352.0M, still 6.25% and +123.9% vs average cost.
- Marriott: down 23.3%, -$291.0M, still 7.02% and +88.7% vs average cost.
ADP, Texas Instruments and Microsoft were also cut. These cuts funded Uber and Mastercard. They also helped finance Taiwan Semiconductor, Netflix and GE Vernova.
The message is not that Fundsmith has turned bearish on these businesses, but that after huge runs the risk/reward has narrowed relative to newer opportunities. The Visa trim alongside a new Mastercard position is the cleanest example. Fortinet and Texas Instruments cuts suggest rotation within tech rather than an exit.
How Exposure Is Shifting: Tech and Health Care Out, Payments and Power In
The reported sector weights show Technology falling from 34.54% to 29.99%, Health Care from 20.92% to 14.82%, and Industrials from 16.14% to 13.20%. Consumer Discretionary rose from 19.77% to 23.31%, while the mislabeled Real Estate bucket jumped from 8.51% to 14.87%. That last bucket is not property; it contains payments, mobility and financial-data names that the screener misfiled.
Read through the labels and the real rotation is clear. Fundsmith is cutting secular tech and health-care compounders, adding consumer franchises like Netflix, TJX and Yum, and building a payments/mobility/data cluster. The new GE Vernova position adds a 3.53% power-generation bet, while Nextpower adds solar/electrification exposure inside Industrials; the book is still concentrated, with the top 10 at 52.5%.
What This Suggests Going Forward: A Different Price for Quality
Fundsmith's Q2 2026 moves suggest a manager trying to keep the quality bias while avoiding its most crowded expressions, shifting from mega-cap software and cybersecurity toward the foundry, power and data-center infrastructure that enable AI. Taiwan Semiconductor and GE Vernova fit that plumbing thesis. Mastercard, Uber and Netflix offer durable cash flows with less dependence on a single capex cycle.
The consumer adds are also coherent: TJX, Yum and O'Reilly point to value-oriented spending and resilient demand. Marriott, Procter & Gamble and Church & Dwight were trimmed but not abandoned. If the fund keeps adding to these new names on weakness, it will look like a classic quality-at-a-reasonable-price reset; if it keeps cutting mega-cap tech, valuation discipline is overriding inertia.
The 13F is backward-looking, covers only top-50 positions and was filed up to 45 days after quarter-end. So the next filing matters: watch whether payments and power positions grow, and whether the trimmed mega-caps stabilize or continue to shrink.
Rotation
How the book's themes shifted
Portfolio weight by theme, this quarter versus last.
Frequently asked questions
What did Fundsmith LLP buy in 2026-Q2?+
Its largest new positions were Uber at $645.3M and Mastercard at $639.5M. Taiwan Semiconductor, Netflix and GE Vernova also opened as major new stakes. Smaller new names included TJX, Nextpower and AppLovin.
What is Fundsmith LLP's biggest holding?+
Marriott International is the largest reported position at 7.02% of the book, worth $958.3M, even after a 23.3% share-count reduction. Stryker is second at 6.72%, and Waters is third at 6.25%.
What did Fundsmith LLP trim in 2026-Q2?+
The biggest dollar trims were Alphabet (-$422.7M), Philip Morris (-$397.9M) and Fortinet (-$388.2M). Visa (-$372.0M) and Waters (-$352.0M) were also cut hard. Marriott, ADP and Texas Instruments saw meaningful reductions.
How concentrated is Fundsmith LLP's portfolio?+
The top 10 positions account for 52.5% of the reported book, and the 13F covers top-50 positions only. That keeps Fundsmith in concentrated quality-compounder territory despite the quarter's new names.
What sectors is Fundsmith LLP rotating into?+
The reported shift is toward payments and mobility, consumer/retail franchises and power/electrification. Technology and health-care weights fell, while the mislabeled Real Estate bucket rose because it contains Visa, Mastercard and Uber.
Did Fundsmith LLP sell Visa?+
It trimmed Visa by 34.9%, reducing the position to 5.08% of the book, worth $693.0M. Visa remains a top-five holding, and Fundsmith simultaneously opened a new Mastercard position at 4.69%.