SouthernSun Asset Management, LLC, an investment management firm, released its “SouthernSun Small Cap Strategy” fourth quarter 2025 investor letter. A copy of the letter can be downloaded here. During the quarter, the Small Cap Composite returned -2.45% on a gross basis (-2.64% net), compared to a 2.19% return for the Russell 2000 Index and a 3.26% return for the Russell 2000 Value Index. The composite has returned 6.21% on a cumulative basis (5.40% net) over the past 12 months, compared to 12.81% and 12.59% for the indices, respectively. The letter highlights the economic lessons learned during the oil price crash of 2014-15. Initially seen as a positive development for the global economy, the collapse in oil prices has since revealed fundamental weaknesses, leading to wider economic impacts beyond the energy sector. The author compares this current situation to artificial intelligence (AI), warning that while AI is now a fundamental aspect of economic planning and decision-making, its associated risks must be carefully scrutinized. As the market approaches 2026, the investment landscape is shaped by a variety of scenarios, including value compression and overcapacity in AI infrastructure, rather than inevitable outcomes. SouthernSun Asset Management maintains a disciplined, humble approach that focuses on intrinsic value and is optimistic about the future but aware of the lessons of history. In addition, please see the top five retention strategies to identify the best of these in 2025.
In a Q4 2025 investor letter, SouthernSun Small Cap Strategy highlighted Crane NXT, Inc. (NYSE:CXT). Crane NXT, Co. (NYSE:CXT) is an industrial technology company focused on providing solutions to protect, detect and authenticate customers’ critical assets. On February 27, 2026, Crane NXT, Co. (NYSE:CXT) stock closed at $48.29 per share. The one-month return of Crane NXT, Inc. (NYSE:CXT) was -4.53%, and its shares lost 11.51% over the past 52 weeks. Crane NXT, Co. (NYSE:CXT) has a market capitalization of $2.821 billion.
Swedish Sun Small Cap Strategy said the following about Crane NXT, Inc. (NYSE:CXT) in its Q4 2025 investor letter:
“Crane NXT, Co. (NYSE:CXT) was a low contributor in its most recent earnings release despite delivering strong operating performance. The company reported sales of $445 million (+10% YoY) with a 1% core sales increase, adjusted operating margin of 24.7%, and adjusted EPS of $1.28, while also raising full-year sales growth guidance. However, management also pointed to macroeconomic uncertainty affecting demand in the payments innovation segment, which we believe is weighing on sentiment even as the security and authentication technology segment continues to perform well and free cash flow remains strong. Crane NXT also announced and completed the first phase of its strategic acquisition of the Italian technology company – Antares Vision SpA Antares is a global provider of inspection, detection and tracking solutions that will expand the company’s exposure in the life sciences (including pharmaceutical traceability) and food sectors. It is expected to close in 2026. CXT is the latest addition to the portfolio, and we spent time with management in the fourth quarter and have further plans to meet with the team in 1q26. We are confident that our business fundamentals and capital allocation discipline align with our objectives for risk and long-term capital appreciation.
