Polen Capital Management Llc released its "Polen Focus Growth Strategy" Q2 2026 investor letter. A copy of the letter can be downloaded here. Polen Focus Growth returned 6.33% (net of fees) in the second quarter of 2026, significantly underperforming the Russell 1000 Growth Index's 16.74% gain, as the market rally remained narrowly focused on AI infrastructure and semiconductor stocks.
During the quarter, Polen Capital repositioned the portfolio toward companies benefiting from structural growth in AI infrastructure, power demand, and aerospace. Looking ahead, the managers remain confident in the long-term earnings potential of the portfolio but acknowledge that changing market dynamics and the rising opportunity cost of patience require a more nimble approach. They remain focused on competitively advantaged businesses with durable growth prospects, while selectively participating in AI infrastructure, commercial aerospace, and power infrastructure opportunities where supply constraints and long-term demand could support sustained earnings growth.
In addition, please check the Fund's top five holdings to know its best picks in 2026. In its second-quarter 2026 investor letter, Polen Focus Growth Strategy highlighted stocks like Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM). Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the world's leading contract chip manufacturer, producing advanced semiconductors for major technology companies.
The one-month return of Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was 8.06% while its shares traded between $223.70 and $479.00 over the last 52 weeks. On August 13, 2026, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) stock closed at approximately $429.15 per share, with a market capitalization of about $2.23 trillion. Polen Focus Growth Strategy stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q2 2026 investor letter: Finally, we initiated a position in Taiwan Semiconductor Manufacturing Company (NYSE:TSM), the dominant pure semiconductor foundry globally.
Most of the world's semiconductor companies design but don't manufacture chips. TSMC is the go-to manufacturer with decades of investment and experience. They produce thousands of different products using hundreds of different technologies for many different end markets.
The vast majority of their sales are from leading edge manufacturing processes, which we think further distances the company from its peers who lack the resources to keep up with the increased complexity of chip production. TSMC is technology and customer agnostic, so it is the default supplier for almost all new chip technologies from whichever company designs those chips. While the company and most of its manufacturing is based in Taiwan, the vast majority of its sales are to US-based companies like NVIDIA, Apple, Amazon, Google, and Qualcomm.
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