Soumya Eswaran
3 min read
Middle Coast Investing, an investment advisory firm, released its second-quarter 2026 investor letter. The letter can be downloaded here. Market breadth in Q3 2026 reviews shows dominance by a few sectors, with S&P 500 stocks averaging a 9.7% return and only 40.55% above their 200-day moving average. Key themes include AI, inflation, and the U.S.-Iran conflict, which, though temporary, affects energy security. Inflation is pressuring consumers, while market resilience is linked to AI spending amid higher rates. During the quarter, U.S., Core U.S., and European portfolios returned -2.4%, -3.9%, and -5.0%, respectively. Despite market headwinds, underlying U.S. portfolio holdings generated solid fundamentals with median revenue growth of 7.2% and earnings growth of 16.4%, supporting a cautious strategy focused on resilient, well-capitalized businesses. Also, check the strategy’s top five holdings to see its best picks in 2026.
In its Q3 2026 investor letter, Middle Coast Investing highlighted F&G Annuities & Life, Inc. (NYSE:FG). F&G Annuities & Life, Inc. (NYSE:FG) is a US-based financial services and insurance company. On October 15, 2026, F&G Annuities & Life, Inc. (NYSE:FG) closed at $19.61, with a $2.57 billion market capitalization. F&G Annuities & Life, Inc. (NYSE:FG) posted a 36.43% YTD pullback, trading within a 52-week range of $18.75 to $35.33.
Middle Coast Investing stated the following regarding F&G Annuities & Life, Inc. (NYSE:FG) in its Q3 2026 investor letter:
“F&G Annuities & Life, Inc.’s (NYSE:FG) earnings was more on the meh or perplexing side. The company went ahead and pre-announced its Q3 earnings, and it is also meh or worse than meh. The company has a lot of investments in alternatives, and those investments are performing well below management expectations. There should be many things favorable for the business – rising interest rate environment should increase demand for its products – and the stated book value of the company’s business is much higher than the current share price. But if the investments that make up one side of that balance sheet are returning poorly, that may be empty solace. This is another case where F&G makes less sense to me as an independent operator than a part of a bigger company, and one more aligned with its business than its current ‘parent’, Fidelity National Financial (FNF). But that is a bit of a dream scenario at this stage given the company’s struggles.”
F&G Annuities & Life, Inc. (NYSE:FG) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 24 hedge fund portfolios held F&G Annuities & Life, Inc. (NYSE:FG) at the end of the second quarter, the same as in the previous quarter. While we acknowledge the potential of F&G Annuities & Life, Inc. (NYSE:FG) 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.
