There is no shortage of investment managers willing to tell you they are fundamental investors doing deep research in search of mispriced securities.

The phrase has become so common that it has almost lost its meaning.

Hawk Ridge Capital Management is a little more interesting.

The Los Angeles-based investment firm has spent almost two decades operating in a part of the stock market where doing your own homework can still matter enormously. Hawk Ridge focuses primarily on small- and mid-cap companies in the United States and other developed markets, using a long-short equity strategy built around fundamental research, valuation, and extensive due diligence.

That combination immediately gets my attention.

Small- and mid-cap stocks remain one of the better hunting grounds for investors willing to do work that other people are unwilling to do. Analyst coverage tends to be thinner. Institutional ownership can be lower. Management teams are often more accessible. More importantly, the gap between what a business is actually worth and the price attached to the stock can become fairly wide.

That is the territory Hawk Ridge has chosen to hunt.

The firm was founded by David Brown in 2007, and Brown remains the central figure at the organization as founder and chief investment officer. Before starting Hawk Ridge, Brown worked in investment banking at Donaldson, Lufkin & Jenrette and later in private equity at Brentwood Associates.

That investment banking and private equity background helps explain quite a bit about the way Hawk Ridge approaches public markets.

This is not primarily a macro trading organization trying to predict interest rates, elections, or the next Federal Reserve decision. Hawk Ridge evaluates stocks much more like an owner or private equity buyer might evaluate an entire business. The research process looks at the economics of the company, competitive position, cash generation, management, and valuation.

The ultimate question is whether the underlying fundamentals of the business are materially different from what the stock price currently implies.

Hawk Ridge describes its approach as value-oriented, but this is not old-fashioned statistical value investing where the manager simply sorts a database by price-to-book value and buys whatever falls into the cheapest decile.

The firm looks for long positions combining attractive business characteristics with inexpensive or at least reasonable valuations. Hawk Ridge has described its preferred companies as businesses with stable or improving prospects, attractive free-cash-flow characteristics, and valuation multiples that do not adequately reflect future earnings power.

On the short side, the process is largely reversed. Hawk Ridge looks for companies with weak or deteriorating prospects where the market valuation appears unjustifiably optimistic.

That distinction matters.

Some value investors become so focused on price that they forget the quality of the business. Growth investors occasionally make the opposite mistake and become so enamored with the business that they forget the importance of price.

Hawk Ridge is attempting to marry the two.

A great company purchased at an absurd price can still be a terrible investment. A mediocre company purchased cheaply enough can occasionally be a fantastic one.

Finding businesses where quality, cash flow, and valuation all line up is where the really interesting opportunities tend to appear.

The firm’s research process also appears to go well beyond reading SEC filings and plugging numbers into spreadsheets. Public descriptions of Hawk Ridge’s due diligence process refer to management interviews, conversations with industry participants and specialists, and the use of proprietary or specialized datasets.

The objective is to develop an independent view of a company’s economics rather than simply accepting the Wall Street consensus.

That is precisely the sort of approach investors should be looking for when examining 13F filings for potential ideas.

The value of following a successful manager is not simply discovering what stocks they own.

The real advantage comes from understanding why a particular manager might own them.

Hawk Ridge historically has spent substantial time in technology, media, business services, consumer companies, and healthcare. Rather than limiting itself strictly to the United States, the firm will also pursue opportunities in other developed markets when valuations and circumstances justify doing so. LinkedIn

The small- and mid-cap emphasis is particularly important.

Mega-cap stocks are followed by dozens of analysts, armies of institutional investors, quantitative systems, hedge funds, and increasingly sophisticated alternative-data platforms.

Everybody knows roughly what Microsoft earned last quarter.

Everybody has a model for NVIDIA.

Move farther down the capitalization scale and things become more interesting.

A $2 billion or $3 billion company may have only a handful of serious analysts following it. A temporary earnings disappointment can cause investors to abandon the shares. A new management team, restructuring, product cycle, or improvement in free cash flow may receive very little attention.

That creates the possibility of exactly the sort of disconnect Hawk Ridge is searching for: a disparity between business fundamentals and market valuation.

The short book serves another purpose.

Hawk Ridge is not simply trying to identify companies whose stocks will decline. Short positions can help reduce overall equity-market exposure while allowing the firm to express relative-value judgments. In some cases, a short position may represent the mirror image of a long thesis in the same industry.

That can turn the portfolio into something closer to a collection of individual business judgments rather than one enormous bet on whether the S&P 500 rises next month.

Risk management is also woven into the process. Correlations among securities, company balance-sheet risk, net market exposure, operating risk, position liquidity, foreign-currency exposure, and changes in the broader economic environment all matter.

The firm also remains relatively low-profile.

Hawk Ridge is not trying to build a media empire around its founder. David Brown does not appear on financial television every afternoon telling viewers what the market will do tomorrow.

The research operation appears to receive most of the attention.

There is another feature of Hawk Ridge’s philosophy that I find particularly useful for investors looking for ideas: the firm seems willing to change its mind when facts change.

Long-short investing almost requires intellectual flexibility.

A manager who falls in love with his own story eventually gets carried out feet first.

If the fundamentals deteriorate, valuation changes, or management fails to execute, yesterday’s wonderful opportunity can become today’s sell.

Price volatility is not necessarily risk.

Sometimes price volatility creates opportunity.

The underlying philosophy sounds deceptively simple. Find good businesses when the valuation fails to reflect their underlying economics. Short weaker businesses when the market is assigning them excessive expectations. Conduct enough independent research that your conclusions do not depend upon the consensus being correct. Build a portfolio where individual security selection, rather than permanently rising stock prices, can drive returns.

Simple does not mean easy.

Doing this correctly requires reading filings, interviewing management teams, understanding industries, tracking competitors, examining specialized datasets, and constantly asking what could make the thesis wrong.

That brings us to the firm’s second-quarter 2026 activity, where several positions provide a useful window into how Hawk Ridge applies that philosophy in the real world.

Five stocks in particular stand out:

AIB Data Centers (AIB).

Array Digital Infrastructure (AD).

Sensata Technologies (ST).

Fabrinet (FN).

Materion (MTRN).

They are very different companies.

But the common thread is change.

AIB Data Centers (AIB)

AIB Data Centers is easily the most speculative name of the group, but it may also be the one that best demonstrates why following Hawk Ridge can uncover stocks most investors have never heard of.

AIB is attempting to transform itself into an infrastructure provider for artificial intelligence and high-performance computing.

The company still has legacy cryptocurrency-mining exposure, but management is increasingly emphasizing access to power and the development of sites that could eventually host AI and HPC workloads.

At the end of the second quarter, AIB said it had identified approximately 570 megawatts of potential AI and HPC capacity and had 65 MW of contracted power capacity at its CLT-01 site.

Do not confuse this with an established data-center cash machine.

AIB generated just $2.9 million of second-quarter revenue and posted a $3.5 million net loss. The balance sheet, however, changed dramatically following a June stock offering. The company finished June with more than $50 million in cash, substantial shareholders’ equity, and no traditional debt.

Hawk Ridge’s position was relatively small, which is important.

This does not look like Brown betting the ranch on AI data centers.

It looks more like a venture-style position where the potential payoff could be several times the downside if management successfully converts its power portfolio into commercially viable capacity.

It is exactly the type of situation where deep research matters.

The financial statements alone will not tell you whether AIB works.

Investors need to understand power contracts, interconnections, development timelines, financing requirements, and the economics of converting sites to HPC use.

That sort of detective work is right in Hawk Ridge’s wheelhouse.

Array Digital Infrastructure (AD)

Array Digital Infrastructure is a completely different animal.

If the name is unfamiliar, the history will not be.

Array is the company formerly known as U.S. Cellular. After T-Mobile acquired most of U.S. Cellular’s wireless operations, the remaining company was reshaped around its communications infrastructure assets and renamed Array Digital Infrastructure.

Today, it owns thousands of cell towers across the United States, while Telephone and Data Systems remains the controlling shareholder.

This is the kind of corporate transformation that can create messy valuations and, therefore, opportunities.

Investors who remember U.S. Cellular as a struggling regional wireless carrier may not immediately recognize that what remains is increasingly an infrastructure company with very different economics.

Meanwhile, Array has also been monetizing retained spectrum assets, including a $1 billion spectrum transaction with Verizon and a large special dividend.

That makes AD part infrastructure investment, part sum-of-the-parts exercise, and part corporate-event situation.

Hawk Ridge made Array one of its more meaningful positions in the quarter.

That size gets my attention.

This is not merely a toe in the water.

Brown and his team appear to have found something worth investigating in the gap between the old U.S. Cellular perception and the value of the remaining infrastructure and asset base.

Sensata Technologies (ST)

Sensata Technologies is closer to the classic Hawk Ridge playbook.

Sensata manufactures sensors, electrical-protection products, and other highly engineered components used across automotive, industrial, aerospace, and other markets.

These are not exciting products in the way a new AI model is exciting.

But they are frequently mission-critical components buried inside much more expensive systems.

That can be a very good business when management executes properly.

Sensata had gone through a difficult period of softer end markets, operational issues, and investor frustration. The attraction for a fundamental investor is the possibility that earnings and cash flow recover before the market becomes convinced the turnaround is real.

There were signs of that improvement in the second quarter.

Revenue increased, earnings improved materially, and the company generated strong free cash flow.

This one fits neatly within the Hawk Ridge framework.

You have an established company with valuable products, depressed expectations, and the possibility of improving margins and cash generation.

If the operating recovery continues, the valuation investors are willing to assign ST can rise at the same time earnings are improving.

That combination is where a lot of successful small- and mid-cap investments come from.

You do not need spectacular growth.

You need results that are meaningfully better than what is embedded in the stock price.

Fabrinet (FN)

Fabrinet is the growthier name in the group and one of the more substantial commitments.

Fabrinet provides sophisticated manufacturing and packaging services for optical communications and other highly complex electronic products. It has become an increasingly important beneficiary of the enormous spending required to move data around AI data centers.

Training models requires GPUs.

But those GPUs are not particularly useful if enormous amounts of information cannot be moved rapidly between servers, racks, and facilities.

Optical networking is becoming one of the critical pieces of the AI infrastructure puzzle.

Fabrinet is sitting right in the middle of that spending cycle.

The numbers have been impressive. Revenue and earnings have been growing rapidly, aided by strong demand for optical communications products tied to data-center expansion and AI infrastructure.

There is an important distinction here.

FN is not a stereotypical cheap stock.

The Hawk Ridge process has never been about buying the lowest P/E ratio on the screen. It is about comparing valuation with future business economics.

If earnings and free cash flow are compounding substantially faster than the market expects, a stock that initially looks expensive can turn out to have been very reasonably priced.

Of course, expectations matter enormously.

Fabrinet shares have already benefited from enthusiasm surrounding AI infrastructure. That means the business can remain excellent while the stock becomes vulnerable to even modest disappointments.

That makes Hawk Ridge’s interest particularly notable.

Brown is not buying AI because somebody mentioned artificial intelligence on television.

He is buying FN, a company generating real revenue, real profits, and rapidly growing demand from the physical infrastructure buildout.

Materion (MTRN)

Materion may be my favorite example of the type of company Hawk Ridge tends to uncover.

Materion is a specialty materials company producing engineered materials, precision components, and advanced chemicals used in semiconductor equipment, aerospace, defense, energy, and other demanding applications.

In many cases, Materion’s materials represent a relatively small portion of the customer’s total product cost but are essential to the product working properly.

Those are businesses worth studying.

They can have pricing power, sticky customer relationships, and meaningful barriers to entry because customers are reluctant to replace qualified materials in mission-critical applications merely to save a few dollars.

The operating momentum has been improving dramatically.

Materion reported strong second-quarter growth in value-added sales, record aerospace and defense demand, improving semiconductor and energy demand, and sharply higher adjusted earnings.

Margins also expanded, and management raised its full-year outlook.

MTRN gives Hawk Ridge exposure to several powerful spending trends without requiring Brown to buy the obvious mega-cap beneficiaries.

Semiconductor manufacturing requires increasingly sophisticated materials.

Aerospace and defense spending is rising.

Electrification and advanced energy applications create additional demand for specialized metals and materials.

Wall Street spends all day debating which semiconductor company will sell the most AI chips.

Hawk Ridge can go several layers down the supply chain and ask which obscure materials supplier becomes increasingly valuable as those chips become more complicated.

That is much more interesting research.

Five Different Stocks, One Common Thread

Taken together, these five purchases tell us quite a bit about what Hawk Ridge is doing.

There is no single sector theme.

AIB is a speculative AI and power-infrastructure development story.

AD is a corporate restructuring and asset-value situation.

ST is an operational recovery and cash-flow story.

FN is a high-growth beneficiary of optical networking and AI infrastructure spending.

MTRN is a specialty-materials company benefiting from aerospace, defense, semiconductor, and advanced-energy demand.

What connects them is not sector membership.

What connects them is change.

Something important is happening at each company that may cause the business several years from today to look considerably different from the business investors see today.

Hawk Ridge’s job is to determine what that future business might look like before everyone else reaches the same conclusion.

That is why I find managers like David Brown much more interesting than another television strategist telling me where the S&P 500 will finish the year.

The 13F gives us the shopping list.

It does not tell us to buy the stocks.

It does not show us the firm’s short positions.

And by the time the filing appears, the portfolio may already have changed.

That is not the point.

The point is idea generation.

When a manager with Hawk Ridge’s fundamental discipline establishes or builds a position in an overlooked small- or mid-cap company, I want to know about it.

Their purchase does not tell me to buy the stock.

It tells me where to start digging.

That remains one of my favorite ways to use 13F filings.

Let the specialists spend their days interviewing management teams, studying industries, digging through datasets, and trying to identify what the market has wrong.

Then use their filings to build your own research list.

For patient, aggressive investors willing to do their own homework, it remains one of the largest free research departments in the world.

Hawk Ridge Capital is one of the desks I would want working in it.