Smead Q1 2026: A Contrarian Bet on Energy and Malls

Smead Capital Management, the contrarian value firm run by Bill and Cole Smead, reported a $4.60B U.S. equity book for the quarter ended March 31, 2026 (Form 13F-HR, accession 0001172661-26-001955, filed 2026-05-14). Smead is known for taking unfashionable, concentrated positions in sectors the market has written off — and its book is a textbook example, dominated by energy producers, mall REITs, and homebuilders.

Energy is the defining tilt: Cenovus Energy (CVE) leads at 8.58%, followed by APA Corp (APA) at 7.63%, with ConocoPhillips (COP), Diamondback (FANG), and Occidental (OXY) also in the top ten — five energy names among the largest holdings. Alongside them sit out-of-favor mall REITs Simon Property (SPG) and Macerich (MAC), pharma names Merck (MRK) and Amgen (AMGN), and homebuilder D.R. Horton (DHI).

The quarter's most notable feature was uniform: nearly every position was trimmed by about 11-13% in share terms — a proportional reduction across the book consistent with outflows rather than stock-specific decisions.

A concentrated contrarian book

With 32 positions and the top ten at roughly 58% of the book, Smead runs a concentrated portfolio of deliberately unfashionable names. The heavy energy weighting, the bet on physical malls through Simon and Macerich, and the homebuilder exposure are all classic Smead contrarianism — owning what the market dislikes on the thesis that pessimism has made them cheap.

This is the opposite of a megacap-growth book. Smead's holdings are cyclical, dividend-paying, and tied to energy prices, consumer real estate, and housing — areas where the firm believes long-term value is mispriced by a market focused elsewhere.

A proportional trim amid outflows

The near-uniform ~13% reduction across positions is the tell. When a manager cuts almost everything by the same percentage, it usually reflects a portfolio-wide action — meeting redemptions — rather than changing views on individual names. Smead's reported value has declined steadily from $6.45B at the end of 2024 to $4.60B, consistent with outflows.

Importantly, the proportional trim means Smead did not abandon its contrarian thesis — the energy, mall-REIT, and homebuilder tilts remain fully intact, just at a smaller scale.

What it means for 13F readers

Smead is a clear example of concentrated contrarian value investing — a deliberately unfashionable book of energy, real estate, and cyclical names. The uniform trim reflects outflows, not a change of heart, so the contrarian positioning is the enduring signal. Track the firm's quarter-over-quarter holdings on the Smead Capital filer page.

FAQ

What is Smead Capital Management?

Smead Capital is a contrarian value firm run by Bill and Cole Smead, known for concentrated positions in out-of-favor sectors. It reported a $4.60B U.S. equity 13F book for the quarter ended March 31, 2026, across 32 positions.

What are Smead's largest holdings?

Its five largest positions are Cenovus Energy (8.58%), APA Corp (7.63%), Merck (6.47%), Simon Property (6.33%), and Amgen (5.34%) — heavily tilted toward energy, mall REITs, and pharma.

Why is Smead so concentrated in energy?

Smead is a contrarian value investor that favors out-of-favor sectors. Five energy names sit among its top ten holdings, reflecting a thesis that pessimism has made energy producers cheap relative to long-term value.

Why did Smead trim nearly every position in Q1 2026?

Nearly all positions were cut by about 11-13% — a proportional, across-the-book reduction consistent with meeting outflows rather than stock-specific decisions. The contrarian tilts remain intact at a smaller scale.