London Company Trims Matson After 123% Stock Surge

The London Company trimmed its stake in Matson, Inc. (NYSE:MATX) after the ocean transportation and logistics stock returned 122.95% over the past year, according to the firm's second-quarter 2026 investor letter for its Small Cap Strategy.

The fund laid out its reasoning in the letter, published this quarter: "Reduced: Matson, Inc. (NYSE:MATX) - We trimmed MATX on recent strength to reduce its relative weight following meaningful appreciation within the portfolio. The Transpacific market remains stable, the U.S. consumer is holding up, and MATX continues to generate substantial cash and reduce its share count."

The move was a position-sizing decision, not a verdict on the business. Matson closed at $234.72 per share on September 21, 2026, near the top of its 52-week range of $86.97 to $240.87. The stock gained 5.34% over the past month. The company carries a market capitalization of $7.02 billion.

A Quarter of Underperformance for the Strategy

The Matson trim came during a strong but uneven quarter for U.S. equities. According to the London Company's letter, stocks rebounded in the second quarter of 2026, driven by AI infrastructure spending and positive earnings. Rate outlook uncertainty persisted despite the optimism.

Technology, previously weak, surged to lead the market, with semiconductors at the front of the rally. Energy declined as oil prices fell. Small caps outperformed large caps, with momentum and volatility factors leading, while quality and yield acted as headwinds for portfolios.

The London Company Small Cap portfolio increased 12.9% during the quarter, trailing the Russell 2000 Index, which gained 21.5%. The firm attributed the underperformance primarily to stock selection issues.

Despite the shortfall, the firm stuck by its process. It remains confident in durable, high-quality businesses delivering attractive long-term compounding. Matson fits that description in the fund's view, which is exactly why the position was trimmed rather than eliminated — the fund wanted to cap the weight of a holding that had grown sharply, while keeping exposure to a business it believes still generates substantial cash and keeps shrinking its share count.

Hedge Fund Interest Cooled Slightly

Matson does not appear on the list of the 40 most popular stocks among hedge funds. According to database tracking, 24 hedge fund portfolios held the stock at the end of the second quarter, down from 28 in the previous quarter.

The decline in hedge fund ownership coincides with a stock that has nearly doubled in a year and trades close to its 52-week high. For a small-cap strategy managing position weights, that combination often triggers exactly the kind of rebalancing the London Company described.

The fundamentals the fund cited remain in place for now. The Transpacific market is stable, and the U.S. consumer continues to hold up, according to the letter. Those two factors drive Matson's core ocean transportation and logistics business.

For investors tracking the small-cap value trade, the question going forward is whether Matson can keep converting its cash generation into share-count reduction at a price near $235 — or whether the fund's trim marks the top of a cycle that has already delivered a 122.95% one-year return.