TCW Mid-Cap Fund Beats Q4 Benchmark With Portfolio Moves Guided by Policy and AI

Overview

• TCW’s Relative Value Mid Cap Fund, whose Q4 2025 letter was reported Tuesday, said Class I shares gained 4.54% in the quarter versus 1.42% for the Russell Midcap Value Index.
• The fund exited Westinghouse Air Brake Technologies (Wabtec) over concern that further Class 1 railroad consolidation could let large customers squeeze prices on Wabtec’s core freight and high‑margin products.
• TCW initiated Centene, noting the Medicaid managed‑care leader met three of its five valuation factors at entry and offered catalysts from new markets, new products and ongoing restructuring.
• The fund added ON Semiconductor after a period of supply gluts, citing signs that inventories have cleared, shipments now match end demand and recent cost cuts could lift results.
• TCW highlighted Seagate as seeing strong orders from hyperscale cloud providers building AI infrastructure, while the firm framed 2025’s market as buoyant yet sensitive to policy moves and earnings with valuations near historic highs.