Kahn Brothers Group Portfolio Q2'2025: Top Holdings & Recent Changes
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Kahn Brothers Group, the storied value investing firm founded by Irving Kahn, continues to exemplify patient, disciplined stock selection. Their Q2’2025 portfolio reflects a classic contrarian approach, with $497.9 million allocated across 50 positions—showcasing both conviction in core holdings and a willingness to adapt as market conditions evolve.
Portfolio Overview: Enduring Value, Strategic Adjustments
Portfolio Highlights (Q2’2025): - Market Value: $497.9M - Top 10 Holdings: 81.3% - Portfolio Size: 50 -5 - Average Holding Period: 18 quarters - Turnover: 34.0%
The Kahn Brothers portfolio remains highly concentrated, with over 81% of assets in the top 10 holdings. Despite a broad base of 50 positions, the firm’s true convictions are clear—most capital is allocated to a handful of undervalued, often out-of-favor names. The average holding period of 18 quarters (4.5 years) underscores a long-term, patient approach, while a 34% turnover rate signals that Kahn Brothers is not afraid to make decisive changes when value opportunities arise.
This quarter, the portfolio size contracted by five positions, suggesting a tightening focus and a willingness to exit lower-conviction ideas. The blend of stability and selectivity is a hallmark of the firm’s philosophy, balancing deep research with the flexibility to respond to shifting fundamentals and market sentiment.
Top Holdings Analysis: Defensive Plays and Opportunistic Buys
The portfolio’s core is defined by a mix of financials, healthcare, and select industrials, with several notable moves this quarter. The Walt Disney Company (DIS) now commands 9.8% of assets after a significant buy, reflecting renewed confidence in the media giant’s turnaround potential. Merck & Co., Inc. (MRK) 7.8% and Bristol-Myers Squibb Company (BMY) 5.1% were both increased, reinforcing the firm’s commitment to resilient healthcare franchises.
Among financials, CITIGROUP INC stands out as the largest position at 15.2% following a fresh buy, while FLAGSTAR FINANCIAL, INC. 9.2% also saw new capital deployed. BP p.l.c. (BP) 6.8% was trimmed slightly (Reduce 1.79%), indicating some profit-taking or risk management in energy exposure.
Other key moves include a 2.36% addition to BAYER AG SPONS ADR 10.2%, a substantial buy in Organon & Co. (OGN) 6.8%, and new purchases in IDT Corporation (IDT) 5.4% and GSK plc (GSK) 5.1%. These actions highlight a willingness to double down on perceived value, particularly in sectors with defensive characteristics and stable cash flows.
Rounding out the top 10 are a blend of established blue chips and special situations, with most positions reflecting either incremental additions or fresh buys—underscoring a proactive stance in capital allocation.
What the Portfolio Reveals About Current Strategy
- Quality and Value Focus: The portfolio is anchored in large-cap financials and healthcare, sectors known for durability and cash generation.
- Opportunistic Buying: Multiple “Buy” actions in top holdings signal conviction in current valuations, especially where market pessimism may have created bargains.
- Selective Trimming: The reduction in BP suggests active risk management, particularly in cyclical or commodity-linked exposures.
- Long-Term Orientation: An 18-quarter average holding period reflects a commitment to letting value theses play out, rather than chasing short-term trends.
- Concentration with Diversification: While 81.3% of assets are in the top 10, the remaining 40 positions provide a measure of diversification and optionality.
Portfolio Concentration Analysis
| Position | Value | % of Portfolio | Recent Change |
|---|---|---|---|
| CITIGROUP INC | $75.5M | 15.2% | Buy |
| BAYER AG SPONS ADR | $50.7M | 10.2% | Add 2.36% |
| The Walt Disney Company (DIS) | $48.7M | 9.8% | Buy |
| FLAGSTAR FINANCIAL, INC. | $45.8M | 9.2% | Buy |
| Merck & Co., Inc. (MRK) | $38.8M | 7.8% | Buy |
| BP p.l.c. (BP) | $33.8M | 6.8% | Reduce 1.79% |
| Organon & Co. (OGN) | $33.8M | 6.8% | Buy |
| IDT Corporation (IDT) | $27.1M | 5.4% | Buy |
| Bristol-Myers Squibb (BMY) | $25.5M | 5.1% | Buy |
| GSK plc (GSK) | $25.3M | 5.1% | Buy |
The table above illustrates a classic value discipline: the top two positions (CITIGROUP INC and BAYER AG) alone account for over a quarter of total assets, while the top 10 collectively represent more than 80%. This high concentration reflects deep research and conviction, but also exposes the portfolio to idiosyncratic risk—an accepted tradeoff in the pursuit of outsized returns. The prevalence of “Buy” actions in the top 10 signals a willingness to lean into volatility when valuations are compelling.
Investment Lessons from Kahn Brothers’ Value Discipline
- Concentrate When You Know: Kahn Brothers is unafraid to allocate heavily to their best ideas, especially when market sentiment diverges from intrinsic value.
- Hold for the Long Haul: With an average holding period of 4.5 years, the firm demonstrates that patience is essential for value realization.
- Buy When Others Fear: Many top holdings were increased or newly purchased during periods of uncertainty, reflecting a contrarian mindset.
- Diversify for Optionality: While conviction is high at the top, a broad base of smaller positions provides flexibility and downside protection.
- Active Yet Disciplined: Turnover is meaningful but not excessive, indicating a balance between conviction and adaptability.
Looking Ahead: What Comes Next?
With $497.9 million in assets and a streamlined set of 50 positions, Kahn Brothers is well-positioned to capitalize on further market dislocations. The high concentration in financials and healthcare suggests continued confidence in sectors with stable earnings and undervalued assets. Given the firm’s history, expect further opportunistic buying if volatility persists, and selective trimming where valuations recover.
Investors should watch for new positions in out-of-favor sectors and potential increases in existing holdings as the market cycle evolves. The current portfolio sets the stage for strong performance if mean reversion and value recognition play out over the coming quarters.
FAQ about Kahn Brothers Group Portfolio
Q: What were the most significant changes in the latest Kahn Brothers portfolio?
A: The most notable moves were fresh buys in CITIGROUP INC, The Walt Disney Company (DIS), Merck & Co. (MRK), and Organon & Co. (OGN), as well as a reduction in BP (BP). These actions reflect a mix of conviction in core holdings and active risk management.
Q: How concentrated is the Kahn Brothers portfolio?
A: Over 81% of assets are in the top 10 positions, with the largest single holding (CITIGROUP INC) at 15.2%. This high concentration is typical of value investors with strong conviction in their research.
Q: What is the average holding period for Kahn Brothers investments?
A: The average holding period is 18 quarters (4.5 years), underscoring a long-term, patient approach to value investing.
Q: Which sectors are most prominent in the portfolio?
A: Financials and healthcare dominate, with significant positions in CITIGROUP INC, Merck & Co. (MRK), Bristol-Myers Squibb (BMY), and GSK plc (GSK).
Q: How can investors track Kahn Brothers’ moves?
A: The best way is to follow quarterly 13F filings, which are available with a 45-day lag. For real-time analysis, use ValueSense’s Kahn Brothers portfolio tracker for up-to-date holdings, changes, and in-depth research.
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