QXO (QXO): 61% Drawdown Creates an Asymmetric 37% Annualized Return Opportunity Soumya Eswaran Mon, October 12, 2026 at 12:26 PM EDT 3 min read ^GSPC -0.09% QXO -3.24% Trade QXO on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Patient Capital Management, based in Baltimore, released its third-quarter 2026 investor letter for the "Patient Opportunity Equity Strategy". The letter can be downloaded here. The Opportunity Equity Strategy outperformed the S&P 500 in the latest quarter, gaining 4.32% compared to 2.30%, and is up 14.93% year-to-date versus the index's 12.75%. The market shows resilience, despite rate increases presenting risks and opportunities. The current market is seen as part of a long bull run, especially since March 2009, with the S&P compounding at 16.9% per year. The AI revolution adds complexity, and investor skepticism persists amidst rising valuations, yet strong corporate earnings suggest potential. The focus remains on understanding price expectations and evaluating risks, particularly around AI durability and supply-demand for computing capacity. The portfolio is concentrated in top 10 holdings, suggesting a disciplined approach towards valuation and risk management amidst market volatility. Also, check the strategy's top five holdings to see its best picks in 2026.
In its Q3 2026 investor letter, Patient Opportunity Equity Strategy highlighted QXO, Inc. (NYSE:QXO). QXO, Inc. (NYSE:QXO) is a leading US-based roofing, waterproofing, and complementary building products distributor. On October 09, 2026, QXO, Inc. (NYSE:QXO). closed at $10.81 per share, reflecting a market capitalization of $11.22 billion. QXO, Inc. (NYSE:QXO) posted a one-month return of -13.34%, while its shares lost 43.27% over the past 52 weeks.
Patient Opportunity Equity Strategy stated the following regarding QXO, Inc. (NYSE:QXO) in its Q3 2026 investor letter:
"I'm going to start with QXO, Inc. (NYSE:QXO) (QXO $11.12), which we've been aggressively adding to on significant stock weakness. The stock has been crushed, down 61% from its highs earlier this year as the building products space sold off on rising rates. CEO Brad Jacobs is a serial entrepreneur with a fabulous track record. When his other companies had drawdowns, it was always a buying opportunity. Those stocks compounded at an average return of ~40% from the drawdown through the end of his tenure. We've increased our common equity position by over 70% since the end of Q2, and we anticipate we will continue to add if the price remains in this range…" (Click here to read the full text)
QXO, Inc. (NYSE:QXO) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 83 hedge fund portfolios held QXO, Inc. (NYSE:QXO) at the end of the second quarter, up from 65 in the previous quarter. While we acknowledge the potential of QXO, Inc. (NYSE:QXO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
In another article, we discussed QXO, Inc. (NYSE:QXO) and shared GIM Focused Growth Strategy's views on the company. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.
This article is originally published at Insider Monkey.
