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MD Sass Concentrated Value Strategy spotlights Flowserve amid nuclear focus
The strategy posted a 10.0% second-quarter gain net of fees, while Energy exposure that returned about 20% in the first half was cited as absent.
MD Sass, a boutique asset management firm, released its second-quarter investor update for its MD Sass Concentrated Value Strategy, highlighting the portfolio’s positioning in the nuclear market and calling out Flowserve Corporation as a key example. In the update, the firm said AI infrastructure stocks drove the broader market in the first half of 2026, with the Russell 1000 Value up 16.3% versus 10.2% for the S&P 500 and 5.3% for Russell 1000 Growth. MD Sass added that AI-related semiconductor, memory, and hardware names helped power results, despite being viewed as cyclical, and noted these sectors were only 7.7% of Russell 1000 Value at the start of the year while contributing nearly 70% of its returns.
MD Sass reported its own performance came in at a 10.0% gain in the second quarter, net of fees, compared with 13.9% for the Russell 1000 Value Index. Year to date, the strategy returned 6.6% net of fees, versus 16.3% for the index. The letter also pointed to headwinds, including limited exposure to stocks seen as having the greatest upside from AI infrastructure spending, as well as a lack of Energy exposure. The firm said Energy returned about 20% in the first half as geopolitical tensions with Iran increased commodity prices, and it discussed the need to adapt while maintaining core investment principles as it looks ahead to emerging technological themes.
As part of the update, MD Sass said it initiated a position in Flowserve, described as a producer of pumps, valves, seals, and flow control equipment used across energy, power generation, chemicals, water, and general industrial markets. The update noted Flowserve operates through its Pumps and Flow Control divisions and referenced the company’s installed base, while the stock last closed at $80.33 per share on August 28, 2026.
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