FPA Queens Road Small Cap Value Fund on Fabrinet

Fabrinet is a leading contract manufacturer of complex optical-networking equipment and modules and dominates a specialized manufacturing niche. High-bandwidth products are experiencing strong demand from AI data centers, and Nvidia became a meaningful customer as this opportunity accelerated. The fund believes long-term demand for high-bandwidth networking remains compelling and values Fabrinet's diversification into other precision-manufacturing niches. However, the share price has already incorporated substantial expectations for data-center spending. The fund has therefore trimmed the holding to less than 1% while maintaining exposure to the long-term opportunity.