Madison Mid Cap Fund Reduces Stake in Amphenol Amid Valuation Concerns

The Madison Mid Cap Fund has trimmed its holdings in Amphenol Corporation (APH), a major supplier of interconnect solutions for electronics, aerospace, and defense systems. The reduction follows an internal reassessment of valuation metrics, with the fund citing stretched price-to-earnings and price-to-sales ratios as key factors. APH’s trailing P/E ratio stood at 28.4 as of early March 2026, well above the semiconductor and industrial components sector median of 19.7. The fund’s adjusted exposure to APH now represents 2.1% of total portfolio assets, down from 3.8% in the prior quarter. This change coincides with increased allocations to LRCX (Lam Research) and RTX (Raytheon Technologies), which the fund views as offering more favorable risk-adjusted returns in the current macroeconomic environment. Lam Research, a key player in semiconductor capital equipment, saw its weight increase to 4.3%, while Raytheon’s defense-focused exposure grew to 5.6%. The shift underscores a broader trend among institutional investors to reassess high-multiple growth stocks amid rising interest rates and moderating demand forecasts in certain end markets. While APH continues to report strong revenue growth—up 15% year-over-year in Q4 2025—the fund believes the current market pricing does not adequately reflect potential margin compression or cyclical risks in defense and consumer electronics demand. Market impact includes modest short-term pressure on APH, which dipped 1.8% in after-hours trading following the disclosure. Peers in the aerospace and defense supply chain, including LRCX and RTX, experienced slight outflows and gains respectively, reflecting investor rotation within the sector. The move is being watched closely by mid-cap equity analysts as a potential signal of broader sector rebalancing.