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Spyglass Reports 24.6% Q2 Gain While Flagging Valuation Compression and Stock-Sized M&A Risk

The firm says strong underlying earnings and sector rebounds drove returns but a $17 billion QXOTopBuild deal and Roblox’s age checks changed specific investment cases.

Overview

  • Spyglass Growth Strategy rose 24.63% in the second quarter and outperformed multiple growth benchmarks while reporting portfolio earnings growth above 40%.
  • The fund says valuations compressed despite earnings strength and that 85% of its holdings beat revenue estimates, leaving the portfolio slightly negative year-to-date.
  • Spyglass added QXO as a new position in Q2 but says QXO’s announcement that it would buy TopBuild for $17 billion, financed with stock and debt, sparked investor concern about leverage and integration risk.
  • Roblox was a bottom contributor in Q2 after the company rolled out age verification features that reduced bookings and user growth, prompting Spyglass to exit the position and redeploy capital.
  • Market data cited by Spyglass show QXO trading near $13.46 and Roblox near $48.67 on July 30, 2026, and the firm highlights housing demand, data-center buildouts, and digitization as long-term drivers for its industrial and software bets.