Every January, I publish a deep dive into market cyclicals, reviewing each of the 11 GICS industries to identify companies whose share prices declined by at least 30% during the prior year.
From that universe, 752 companies in 2025, I analyse the causes of the key drawdowns, assess whether their industry weakness are cyclical rather than structural, and curate a shortlist of 20 companies across all industries with potential for a rebound.
Each company must meet two other criteria:
A minimum market cap of $1 billion
Positive EBIT margins at the time of selection
You can read the 2025 deep dive here (PDF version here). The 2025 annual Cyclical report will be published here on Substack.
Year-to-date, an equally weighted portfolio of the 20 companies I shortlisted has returned 24.8%, or 29.2% with dividends reinvested, in USD terms.
The leaders
Solaria Energia (+118%) - A Spanish solar energy utility company
Samsung Electronics (+103%) - A Korean and global player in technology
Alibaba Group (+84%) - A Chinese e-commerce group
Neste Oyj (+57%) - A Finnish renewable diesel manufacturer
The laggards
Pernod Ricard (-33%) - A French alcoholic beverages group
Teleperformance (-29%) - A French global leader in BPO services
PayPal Holdings (-29%) - A U.S. payment solutions provider
Paycom Software (-21%) - A U.S. HR and payroll company
While the annual cyclicals list naturally includes companies exposed to economic swings, many also possess quality characteristics: good balance sheets (Kumba Iron Ore), consistent nature of demand (Solaria Energia), and value created for society (Samsung Electronics). That combination often helps them navigate downturns and rebound when conditions improve.
At the same time, not every idea plays out. For example, my 2025 commentary on Pernod Ricard, the year’s worst performer so far, did not hold as expected:
“At 14x forward P/E, the 2nd largest player in the oligopolistic international premium spirits market will likely cope with broader pressures in beverages better than expected.” - 2025 cyclicals by Jenga IP
Another example is the 2nd worst performer, Teleperformance, the global leader in the BPO industry:
“AI likely has caused some structural challenges for the BPO industry, but Teleperformance will likely cope with these challenges better than others due to its global market leadership and more diversified business model. At potentially 6x of its 2025 earnings, Teleperformance is valued at its lowest-ever multiple since going public in 1992.” - 2025 cyclicals by Jenga IP
Mixed outcomes are inherent to idea-generation lists, especially in cyclicals, where recovery paths diverge significantly.
The 2026 cyclicals list
The 2026 Jenga IP Cyclicals report will include a full reflection on this year’s performers, what worked and didn’t, what can be learned, and an updated list of 20 companies for the year ahead (2026).
Please do keep an eye out for the next edition coming out next month.