Prediction Not checkable as stated
Lewinsohn: Building products earnings expectations have capitulated, setting up outperformance
“Building products in particular, earnings expectations have really capitulated in 26, which could create interesting environment for outperformance.”
Disclosure
Lewinsohn: Telecom has been Diameter's most active and profitable microcycle since COVID
“We've seen that telecom has been the microcycle that we've prosecuted the most since COVID, that's been incredibly profitable, and with limited bankruptcies.”
Insight
Lewinsohn: Pure bankruptcy knowledge edge in distressed debt has competed away
“Distressed at investing was such a frontier, say at least 25 years ago, even before the financial crisis. You didn't need to really care if it was a sock company or a steel company. You knew bankruptcy. The other guys didn't. That has been competed away and is…”
Disclosure
Lewinsohn: Credit losses correlate with over-relying on capital structure seniority
“Will we invest in a business that we don't think is amazing because we think it's good enough where we are in the capital structure? Certainly. But if I look back at places where we've lost money and credit, do they line up in those type of situations more oft…”
Prediction Not checkable as stated
Lewinsohn: Legacy cable faces market share erosion from fiber and fixed wireless
“What we think is going to happen in telecom is more and more legacy, perhaps coaxial companies are going to be impacted by not only fixed wireless share, but fiber as it get laid all over the country. And that fixed wireless is like a transitionary technology …”
Disclosure
Lewinsohn: Diameter avoids single-product and single-payer healthcare businesses
“And so we tend to stay away from things that are single product or single payer. We like it. If there's a mix of commercial Medicare and Medicaid, we like larger businesses.”
Insight
Lewinsohn: Credit is governed strictly by contract law, not fiduciary duty
“In credit, that doesn't really exist. The way the law has worked is, it's a contract. It's not being analyzed under fiduciary duties law. It's not being analyzed under what the securities laws say about fiduciary duties. It's contract. What does the contract l…”
Assertion Supported
Lewinsohn: Creditor cooperative agreements surged in popularity over the last 18 months
“One thing you're seeing is co-ops, which are cooperative agreements between creditors to say, we're not going to do a deal with the company alone, neither should you, have really come into vogue over the last 18 months.”
Insight
Lewinsohn: Repeat players receive different treatment in credit restructuring
“If you're a repeat player, then the market treats you differently than if you're a one-time player.”
Disclosure
Lewinsohn: Diameter avoided packaging investments because Americans are consuming less food
“And that's why we haven't made a lot of recent investments in packaging is it seems that Americans are using less, right? Buying less food, even with not on GLP ones.”
Assertion Contradicted
Lewinsohn: Unemployment among college graduates is currently nearly 9%
“Today, just sitting here with AI, not even really ready for prime time, and you have very high, I think almost nine percent unemployment from college grads.”
Insight
Lewinsohn: Credit investors must obsess over downside risk instead of upside return targets
“One, you have to constantly be thinking about the downside protection in what you invest in. So instead of just always looking, a lot of people say, oh, I want to invest in something I can make 20% in. But you have to obsessively say, if the macroeconomic cont…”
Insight
Lewinsohn: Tracking cyclical shifts in company narratives is critical for security selection
“Understanding investing as narrative, not just for the long term about how a company will improve, or how, you know, Amazon will go last mile and transform the way we do things. But actually, within the macroeconomic cycle, how the narrative around a company w…”
Opinion
Lewinsohn: Hertz is primed to perform very well post-pandemic
“Today, Hertz is primed to do very well because they have far fewer cars and people want to travel like it's, you know, the end of the world.”
Insight
Lewinsohn: Most Investment Firms Suffer Friction Between Traders and Analysts
“In most instances, traders and analysts do not like each other. Or at the very least exist with like a cold piece because the traders believe that the analysts are eggheads who want to work at a think tank and can't really make money or can't really, if they m…”
Insight
Lewinsohn: Mean-reversion trading strategies fail during rapid technological disruption
“And a lot of trading only focused businesses eventually explode on those when the reversion to the mean doesn't work, particularly now where there's so much technological change that formerly stable industries become very different in a short period of time.”
Insight
Lewinsohn: Chasing illiquid yield in frothy markets destroys portfolio flexibility
“When markets get very frothy, illiquids become in vogue, and they end up not returning a lot. If all of a sudden you're being pitched a lot of nine percent illiquids, you maybe really want to realize that you're creating a situation where if the world changes,…”
Insight
Lewinsohn: Public markets heavily penalize illiquid post-bankruptcy reorganized equities
“There's really nothing worse to public equity markets than a reorganized equity that's less liquid than a regular equity that just went through bankruptcy and is a value stock.”
Insight
Lewinsohn: Corporate CEOs have inherent long bias that limits forecasting objectivity
“If I want to know maybe about auto technology, obviously she's the one to talk to, but she's long. That's the only way. And that creates a bias because if you own a company, if you manage a company, you think it's going to do well.”
Disclosure
Lewinsohn: Diameter caps direct lending software exposure under 10%
“We've spent a lot of time making sure that we have sub 10% of our direct lending business in that space”
Disclosure
Lewinsohn: Diameter avoids long-term residual risk in AI infrastructure financing
“We've not financed long-term residual risk. We think it's been too hard for us, but this is America. Everything can be trunched. We've invested at the top of the capital structure in an amortizing way.”
Assertion Supported
Lewinsohn: Fixed wireless drove 150% of US broadband growth last year
“It was a 150% of the growth last year in broadband across the country.”
Assertion Supported
Lewinsohn: US commercial healthcare costs rose 7.5% and employer costs 7%
“Last year, you saw healthcare costs up across the board, commercial healthcare costs up seven and a half percent, employer payment for healthcare up seven percent.”
Assertion Supported
Lewinsohn: Top 25% of earners drive ~50% of US durables and services spending
“In places like durables and services, the top 25% are responsible for, say, 50% of the spending.”
