Original broadcast details

Date: Thursday, April 16, 2026

Executive Summary

Strong earnings growth offset by valuation compression
1Q26 delivered excellent earnings growth across the U.S. portfolio but was more than offset by valuation compression. Over 92% of the portfolio increased NTM EPS, yet we underperformed the S&P 500 by 2.4 percentage points because over 75% of the portfolio suffered ~15% multiple compression. If valuations had remained unchanged, returns would have been 11 percentage points higher.

Sector allocation was a modest headwind
We were underweight the best performing sectors in the quarter. However, most of the best sectors this quarter have been underperforming sectors since our inception. Overall, sector allocation was a 1-2 percentage point headwind to U.S. returns.

Similar dynamics across Global and International portfolios
Both Global and International portfolios exhibited the same pattern. Earning growth was good for most of the portfolio offset by valuation compression. Additionally, sector allocation was a minor headwind.

Our portfolio positioning looks attractive across all our products
In the U.S., our CS composite had an 11.3x NTM P/E, down 7% from year-end. This represents a compelling valuation given our portfolio’s 10.9% compound annual growth history. Additionally, our portfolio maintains lower economic sensitivity. Like the U.S., our Global and International portfolios reflect a similar combination of discounted valuation and quality growth.

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Summary Performance Data:

ALL DATA IS AS OF MARCH 31, 2026. THIS DOCUMENT IS CONFIDENTIAL AND INTENDED SOLELY FOR THE RECIPIENT. IT MAY NOT BE REPRODUCED OR REDISTRIBUTED WITHOUT THE PRIOR WRITTEN CONSENT OF LYRICAL ASSET MANAGEMENT (LAM).

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INDEXES ARE PROVIDED FOR ILLUSTRATIVE PURPOSES ONLY, ARE UNMANAGED, REFLECT REINVESTMENT OF INCOME AND DIVIDENDS AND DO NOT REFLECT THE IMPACT OF ADVISORY FEES. INVESTORS CANNOT INVEST DIRECTLY IN AN INDEX. COMPARISONS TO INDEXES HAVE LIMITATIONS BECAUSE INDEXES HAVE VOLATILITY AND OTHER MATERIAL CHARACTERISTICS THAT DIFFER FROM THOSE OF LYRICAL’S STRATEGIES.

THE S&P 500 INDEX IS A MARKET CAPITALIZATION WEIGHTED INDEX COMPRISED OF 500 WIDELY-HELD COMMON STOCKS. THE S&P 500 VALUE INDEX MEASURES THE PERFORMANCE OF THE LARGE CAP VALUE SEGMENT OF THE U.S. EQUITY UNIVERSE. IT INCLUDES THOSE S &P 500 COMPANIES WITH LOWER PRICE TO BOOK RATIOS AND LOWER EXPECTED GROWTH VALUES.

THE S&P 500 EQUAL WEIGHT INDEX (EWI) IS THE EQUAL-WEIGHT VERSION OF THE WIDELY-USED S&P 500. THE INDEX INCLUDES THE SAME CONSTITUENTS AS THE CAPITALIZATION WEIGHTED S&P 500, BUT EACH COMPANY IN THE S&P 500 EWI IS ALLOCATED A FIXED WEIGHT - OR 0.2% OF THE INDEX TOTAL AT EACH QUARTERLY REBALANCE.

THE MSCI EAFE INDEX IS DESIGNED TO REPRESENT THE PERFORMANCE OF LARGE AND MID-CAP SECURITIES ACROSS 21 DEVELOPED MARKETS, INCLUDING COUNTRIES IN EUROPE, AUSTRALASIA AND THE FAR EAST, EXCLUDING THE U.S. AND CANADA. THE INDEX IS AVAILABLE FOR A NUMBER OF REGIONS, MARKET SEGMENTS AND SIZES AND COVERS APPROXIMATELY 85% OF THE FREE FLOAT-ADJUSTED MARKET CAPITALIZATION IN EACH OF THE 21 COUNTRIES.

THE MSCI WORLD INDEX CAPTURES LARGE AND MID-CAP REPRESENTATION ACROSS 23 DEVELOPED MARKETS (DM) COUNTRIES. WITH 1,430 CONSTITUENTS, THE INDEX COVERS APPROXIMATELY 85% OF THE FREE FLOAT-ADJUSTED MARKET CAPITALIZATION IN EACH COUNTRY.

THE MSCI ACWI SUSTAINABLE IMPACT INDEX IS DESIGNED TO IDENTIFY LISTED COMPANIES WHOSE CORE BUSINESS ADDRESSES AT LEAST ONE OF THE WORLD’S SOCIAL AND ENVIRONMENTAL CHALLENGES, AS DEFINED BY THE UNITED NATIONS SUSTAINABLE DEVELOPMENT GOALS. THE SUSTAINABLE IMPACT CATEGORIES INCLUDE: NUTRITIOUS PRODUCTS, TREATMENT OF MAJOR DISEASES, SANITARY PRODUCTS, EDUCATION, AFFORDABLE HOUSING, LOANS TO SMALL AND MEDIUM SIZE ENTERPRISES, ALTERNATIVE ENERGY, ENERGY EFFICIENCY, GREEN BUILDING, SUSTAINABLE WATER, AND POLLUTION PREVENTION. TO BE ELIGIBLE FOR INCLUSION IN THE INDEX, COMPANIES MUST GENERATE AT LEAST 50% OF THEIR SALES FROM ONE OR MORE OF THE SUSTAINABLE IMPACT CATEGORIES AND MAINTAIN MINIMUM ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) STANDARDS. THE PARENT INDEX IS MSCI ACWI. CONSTITUENT SELECTION IS BASED ON DATA FROM MSCI ESG RESEARCH.