Fiduciary Management Inc. (FMI), an independent money management firm, released its second-quarter 2026 investor letter. A copy of the letter can be downloaded here. The quarter saw the market optimistic about the future, while we focused on undervalued businesses. Global markets saw substantial gains in Q2, with indices like the Russell 2000 and S&P 500 posting their best returns since 2020, largely due to the rise of Artificial Intelligence (AI). AI-related sectors, including semiconductors and data centers, performed exceptionally well, but the firm’s quality compounders declined by 1%. The portfolio failed to match the momentum in a technology driven environment. The firm is cautious about the sustainability of the current AI boom, viewing it as a bubble. In addition, please check the firm’s top five holdings to know its best picks in 2026.
In its Q2 2026 investor letter, Fiduciary Management Inc. highlighted FTI Consulting, Inc. (NYSE:FCN). Headquartered in Washington, the District of Columbia, FTI Consulting, Inc. (NYSE:FCN) is a business advisory services provider. On July 16, 2026, FTI Consulting, Inc. (NYSE:FCN) closed at $164.57 per share, reflecting a market capitalization of $4.96 billion. FTI Consulting, Inc. (NYSE:FCN) posted a one-month return of 13.04%, while its shares gained 0.20% over the past 52 weeks.
Fiduciary Management Inc. stated the following regarding FTI Consulting, Inc. (NYSE:FCN) in its Q2 2026 investor update:
“FTI Consulting, Inc. (NYSE:FCN) is a leading global consulting firm specializing in crisis management and business transformation, with more than 8,100 employees across 32 countries and territories. The company operates through five segments: Corporate Finance and Restructuring, Forensic and Litigation Consulting, Economic Consulting, Strategic Communications, and Technology. Roughly 64% of revenue is domestic, with the remaining 36% generated internationally. FTI’s competitive advantages are well-established: a strong track record, respected brand, broad capabilities, and deep subject-matter expertise across its segments. Together, these qualities underpin a durable consulting franchise with a track record of organic growth. Against that backdrop, two headwinds have weighed on the shares and created our entry point. First, a rare defection by a group of Economic Consulting employees in early 2025 caused financial disruption and reputational damage. Second, broader concerns about AI displacing the consulting model have pressured FTI’s valuation. We view both risks as largely misunderstood or already resolved. The defection appears to be an isolated incident that the company has effectively put behind it. On AI, FTI’s niche as a specialist consultant delivering mission-critical work (most often for clients in the middle of a crisis) insulates it far more than most other consulting models. We believe management’s target of at least mid-single-digit organic EBITDA growth is achievable. Capital allocation has been sound, highlighted by a mid-teens reduction in shares outstanding in 2025, with buybacks continuing into 2026 as the stock remains depressed. We see the valuation as compelling within an otherwise expensive small-cap market.”
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