AMETEK, Inc.

(New York Stock Exchange)
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Slightly Bearish -20

Giverny Capital Asset Management Sold Ametek (AME) Due to Valuation Gap - Insider Monkey

AI-generated analysis

πŸ“‰ Giverny Capital Asset Management exited its position in Ametek (AME) in February 2026 after trimming holdings in the fourth quarter.

πŸ’° The firm sold shares at $232, citing a price-to-earnings multiple of approximately 27x as too high relative to earnings growth.

πŸ“Š Ametek reported a one-month return of 3.63% and a 52-week gain of 30.10% as of June 17, 2026.

🏭 The company has a market capitalization of $53.00 billion and operates as a leading manufacturer of electronic instruments.

πŸ“ˆ Giverny noted Ametek's long-term earnings growth rate is about 10% with a return on equity of 15%.

πŸ€– The investment firm believes AI stocks currently offer greater promise for delivering higher returns in a shorter timeframe than Ametek.

πŸ“‰ Hedge fund ownership of Ametek increased to 70 portfolios at the end of Q1 2026, up from 64 in the previous quarter.

πŸ“ Giverny Capital's model portfolio fell 6.88% this quarter compared to the S&P 500's 4.33% decline.

Bullish Signals
  • Ametek is described by the investor as a 'leading manufacturer' with 'fine returns' earned over six years of ownership.
  • The company maintains solid fundamentals with an approximate 10% long-term earnings growth rate and a 15% return on equity.
  • Hedge fund interest in the stock has increased, with 70 portfolios holding shares at the end of Q1 2026 compared to 64 previously.
  • The stock demonstrated strong recent performance with a 30.10% gain over the past 52 weeks as of mid-June 2026.
Risk Factors
  • Giverny Capital exited the position because the rising PE multiple of ~27x felt too high relative to its long-term earnings growth rate.
  • The firm explicitly stated that Ametek's growth and return on equity figures do not justify a growth stock multiple at current prices.
  • The investment manager believes other AI stocks hold greater promise for delivering higher returns within a shorter time frame than Ametek.
Full Analysis
Giverny Capital Asset Management sold its position in Ametek, Inc. (NYSE: AME) in February 2026 following the release of its first-quarter 2026 investor letter. The firm exited the stock at a price of $232 per share after trimming the position during the fourth quarter, citing a significant valuation gap as the primary reason for the move. The investment manager described Ametek as a solid company with admirable long-term earnings growth of approximately 10% and a return on equity of 15%. However, Giverny determined that these fundamental metrics did not justify the stock's rising price-to-earnings multiple, which had reached roughly 27x. The firm concluded that the valuation was too high relative to the company's growth profile. Despite exiting the position, Giverny Capital remains an admirer of Ametek and acknowledges the risk and potential associated with the industrial manufacturer. The firm noted that while Ametek is a quality holding, it currently lacks the promise for higher returns within a shorter timeframe compared to certain artificial intelligence stocks, which they view as having greater upside potential.