In its second-quarter 13F filing, Chuck Akre's Akre Capital Management reported a total portfolio value of $5.12 billion. The filing revealed a pattern of significant reductions across several of the firm's largest and longest-held positions. Akre's investment strategy, famously known as the "three-legged stool," prioritizes extraordinary businesses, talented management, and excellent reinvestment opportunities for long-term compounding. [2, 4] Decisions to sell or trim are often made when one of these "legs" is perceived to be broken or injured. [2]
The most notable changes included high-conviction reductions in payment processors Mastercard and Visa, as well as alternative asset manager KKR, Canadian asset manager Brookfield, and auto parts retailer O'Reilly Automotive. Despite a reduction in the number of Mastercard shares held, from 2.28 million to 1.99 million, the position's weight in the portfolio increased from 18.58% to 19.95%, likely driven by the stock's price appreciation during the quarter.
While trimming top names, the firm increased its stake in real estate data provider CoStar Group, boosting its share count from 10.35 million to 11.70 million. A smaller, medium-conviction addition was also made to software company ServiceNow. These moves suggest a reallocation of capital from positions that may have grown to outsized weights or where valuations have become a concern, into other companies that fit the firm's strict compounding criteria.