Key Takeaways
- • McIntyre Partnerships declined 19.8% net in Q1 2026, significantly underperforming the Russell 2000 Value benchmark, which gained 5%, driven primarily by a sector-wide pullback in life science tools and medical device stocks.
- • The fund's largest position, QuidelOrtho Corporation (QDEL), lost over 500 basis points in Q1 and was the primary driver of underperformance; the manager has sized the position at more than 20% of fund capital with purchased put options limiting total loss exposure to under 20%.
- • Despite Q1 weakness, McIntyre Partnerships maintains strong long-term performance with trailing five-year returns of approximately 12% gross (9% net) versus the benchmark's 6%, and since-inception returns of approximately 14% gross (10% net) versus 7% for the Russell 2000 Value.
- • Positions in CC, ICLR, and SEG generated gains of 100–500 basis points, while FTRE, SHC, SWIM, and STHO each detracted 100–500 basis points in the quarter.
- • The manager views QDEL's current valuation as a "once-in-five-to-ten-year opportunity" and has made a conviction-weighted bet representing the third time in a decade the fund has sized a position above 20% of capital.
Summary
McIntyre Partnerships posted a challenging first quarter in 2026, delivering returns of approximately negative 19.8% net and negative 19.5% gross, a sharp divergence from the Russell 2000 Value benchmark's 5% gain. The underperformance was concentrated in the fund's exposure to life science tools and medical device equities, a sector that experienced broad-based selling pressure during the period. This headwind was amplified by stock-specific weakness at QuidelOrtho Corporation (QDEL), a life science tools company that has become the fund's largest single position.
The manager attributed the majority of Q1's decline to QDEL, which lost over 500 basis points during the quarter. In response to what the manager characterizes as a significant valuation dislocation, McIntyre Partnerships has accumulated a full position in QDEL representing more than 20% of fund capital. To manage downside risk on this concentrated bet, the fund has purchased put options that cap total potential losses on the position at under 20% of assets. The manager noted this represents the third time in a decade that the fund has sized a position above this threshold, signaling conviction in the opportunity thesis.
On a more granular level, the fund's winners in Q1 included Chemours (CC), ICLR, and SEG, each contributing between 100 and 500 basis points to performance. Detractors beyond QDEL included FTRE, SHC, SWIM, and STHO, each reducing returns by 100 to 500 basis points respectively. The manager acknowledged the poor absolute return, but emphasized that performance context requires understanding the fund's concentrated positioning in QDEL, which makes traditional benchmark comparisons less meaningful in the near term.
Despite the difficult quarter, McIntyre Partnerships' longer-term track record remains substantially ahead of its benchmark. The fund's trailing five-year gross returns are approximately 12% annually (9% net) compared to the Russell 2000 Value's 6% return. Since inception, the fund has delivered approximately 14% gross annual returns (10% net) versus 7% for the benchmark, demonstrating consistent outperformance over extended periods despite cyclical underperformance episodes.
The manager attributed the majority of Q1's decline to QDEL, which lost over 500 basis points during the quarter. In response to what the manager characterizes as a significant valuation dislocation, McIntyre Partnerships has accumulated a full position in QDEL representing more than 20% of fund capital. To manage downside risk on this concentrated bet, the fund has purchased put options that cap total potential losses on the position at under 20% of assets. The manager noted this represents the third time in a decade that the fund has sized a position above this threshold, signaling conviction in the opportunity thesis.
On a more granular level, the fund's winners in Q1 included Chemours (CC), ICLR, and SEG, each contributing between 100 and 500 basis points to performance. Detractors beyond QDEL included FTRE, SHC, SWIM, and STHO, each reducing returns by 100 to 500 basis points respectively. The manager acknowledged the poor absolute return, but emphasized that performance context requires understanding the fund's concentrated positioning in QDEL, which makes traditional benchmark comparisons less meaningful in the near term.
Despite the difficult quarter, McIntyre Partnerships' longer-term track record remains substantially ahead of its benchmark. The fund's trailing five-year gross returns are approximately 12% annually (9% net) compared to the Russell 2000 Value's 6% return. Since inception, the fund has delivered approximately 14% gross annual returns (10% net) versus 7% for the benchmark, demonstrating consistent outperformance over extended periods despite cyclical underperformance episodes.
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