Oakmark is the mutual fund family launched in 1991 by Harris Associates, the Chicago deep-value firm founded in 1976 (about $105bn AUM). Bill Nygren runs the flagship Oakmark Fund and David Herro the Oakmark International Fund, buying businesses at large discounts to intrinsic value and holding them like owners — publishing quarterly fund commentaries, market commentaries and insight articles.
This commentary from Oakmark explains why they haven't sold their holdings in ASML (a chip equipment maker) and Samsung (a memory chip maker) even though AI hype has driven their stocks up. They say they were 'wrong in the right direction'—they underestimated how much AI would boost profits, but that mistake actually made them money. The key insight: These companies' long-term competitive advantages (like ASML's near-monopoly in EUV lithography) matter more than the temporary AI boom. For ordinary investors, it's a reminder not to sell a great company just because its stock shot up—check if its moat is still strong. Worth reading because it shows how disciplined investors think beyond market hype.
Oakmark’s second-quarter 2026 international equity market commentary notes that AI demand continues to diverge: “AI losers” (software, IT services) keep declining, while “AI winners” (semiconductors, equipment) contributed approximately 35% of the MSCI World ex USA index’s returns, despite an averag
This chapter opens Oakmark's second-quarter 2026 international equity market commentary. The report notes that the market has continued the divergence seen in the first quarter: AI-related stocks (semiconductors, equipment) have continued to rise, while non-AI sectors (software, IT services) have continued to decline. One exception is oil prices, which have fallen back to near pre-war levels as the U.S. and Iran approach a compromise.
The author's core investment argument is: Oakmark's positions in ASML and Samsung represent "directionally correct mistakes" — they underestimated the positive impact of AI on the fundamentals of these two companies, but this mistake is favorable. Despite significant short-term stock price gains, Oakmark has not substantially reduced its positions because its valuation models indicate that the market is overly pessimistic about the sustainability of cash flows driven by AI, and the companies' long-term competitive advantages (rather than the AI super-cycle) are the fundamental logic behind the holdings.
| Company | Role | Key Data | View |
|---|---|---|---|
| ASML | Semiconductor equipment | Near-monopoly supplier of EUV lithography machines | Bullish; holding logic is long-term competitive advantage, not the AI super-cycle |
| Samsung | Memory manufacturing | Scale and process leadership in HBM | Bullish; holding logic is decades of accumulated scale and process advantages |
| Intertek | Testing and certification | Acquired by private equity | Bullish on board decision; believes accepting the acquisition is a rational choice |