Investment Pitches

Pitch Summary:
IAC – Digital holding company IAC has signaled its plans to dispose of all assets besides People Inc. and an approximate 25% stake in MGM. Chairman Barry Diller is focused on closing the valuation disconnect as no value has been ascribed by the markets to IAC’s assets beyond MGM for too long. Share repurchase and increasing the stake in MGM are the main capital allocation options, and the company is already acting on both. One specific simplification move IAC made this year was the spinoff of Angi, the home services marketplace.

BSD Analysis:
IAC remains a deliberately messy collection of digital assets designed for asymmetric outcomes, not quarterly smoothness. The market hates the opacity, which is exactly why optionality stays mispriced. Management has a long track record of incubating, spinning, and monetizing businesses at moments of maximum advantage. Current assets look underwhelming on a sum-of-the-parts basis—until one of them isn’t. Cash and patience are strategic weapons here. IAC is not about predictability; it’s about convexity. You own this for the unlocks, not the wait.

Pitch Summary:
Millicom – Latin American telecommunications operator Millicom was a contributor for the year. The company extended its strong 2024 performance through 2025, with the share price tracking operational delivery and the visible inflection in equity FCF we flagged in prior letters. This was driven by a focused new management team and an aligned majority shareholder partner in Iliad Group (Atlas). The business exceeded its already twice-raised 2024 FCF guidance and guided to material further growth in 2025, while reaching its 2.5x leverage target and increasing dividends and buybacks. The discount to our appraisal narrowed with this positive performance and solid Colombian M&A news. What was an attractive outlier at a double-digit dividend yield earlier in the year has now aligned with peers at mid-single-digit levels. With the value gap largely closed and limited upside remaining on a risk-adjusted basis, portfolio discipline dictated our exit in the third quarter.

BSD Analysis:
Millicom is a Latin American telecom operator with valuable fixed and mobile infrastructure in underpenetrated markets. Political and FX risk dominate the narrative, but demand for connectivity keeps compounding regardless of regime changes. The shift toward fixed broadband and digital services improves ARPU quality over time. Asset sales and balance sheet cleanup have reduced existential risk meaningfully. Investors focus on headline volatility instead of infrastructure scarcity. In many of its markets, Millicom is the network, not just a provider. This is high-risk geography paired with essential assets.

Pitch Summary:
Glanbia – Irish nutrition, ingredients and dairy company Glanbia contributed for the year. After a tough start in 2025, momentum in its core Performance Nutrition business improved from low single-digit growth rates. Management also delivered tangible progress on portfolio rationalization and capital allocation. The company added to its ongoing buyback program by opportunistically repurchasing an additional approximately 3% of its own shares at a discount in connection with Tirlán’s October 2025 placement, helping reduce the long-standing overhang from its largest shareholder. At the same time, Glanbia’s management team advanced its simplification agenda by executing on the announced sale of margin-dilutive SlimFast and Body&Fit assets, sharpening focus on the higher-quality Performance Nutrition branded franchises. We have been engaged with the company and believe that additional strategic steps can be taken in the near term.

BSD Analysis:
Glanbia sits at the crossroads of nutrition, protein demand, and branded wellness—three trends that don’t fade quietly. Its performance nutrition brands give it direct exposure to consumers, while the ingredients business benefits from long-term food system shifts. Input cost volatility has hurt margins, but pricing actions and mix improvement are working through the system. The cooperative heritage provides supply advantages peers struggle to replicate. Investors tend to view Glanbia as a food processor, missing the brand and science premium embedded in the portfolio. As costs normalize, earnings power becomes clearer. This is a nutrition platform masquerading as a commodity business.

Pitch Summary:
Canal+ – French pay-TV operator Canal+ was a contributor for the year. The company continued to make strong operational and strategic progress across both its legacy footprint and its newly enlarged African platform after the closure of the MultiChoice merger. In Europe, the renewal of exclusive UEFA Champions League rights for the 2027–2031 cycle at economics materially better than feared reinforces the quality and durability of the company’s core subscriber base and the discipline of Canal+’s management team. At the same time, the company achieved a further positive outcome just before year end in its tax discussions with the French authorities, removing an overhang and further enhancing visibility on future FCF. Despite FCF heading in the right direction and substantial value creation to come, the share price still fails to reflect the underlying progress partly due to the fact that Canal+ remains an underfollowed French media company newly listed on the London Stock exchange.

BSD Analysis:
Canal+ is a European media asset fighting the streaming wars with regional scale, premium content, and disciplined cost control. Unlike global streamers chasing subscribers at any cost, Canal+ focuses on profitability and local dominance. Its African and European footprint gives it growth markets with far less competition than the U.S. Content investment is targeted, not reckless, which matters in a capital-constrained industry. Investors lump Canal+ in with legacy TV decline stories, missing the strategic pivot. If media valuations ever normalize, Canal+ looks mispriced relative to its cash flow durability. This is a survivor’s strategy in a brutal industry.

Pitch Summary:
PVH – Branded apparel company PVH was a detractor for the quarter and the year. The company’s shares experienced considerable price fluctuations, while our appraisal stayed flattish, which was disappointing. This is a company that will likely always have more quarterly earnings volatility than others. The good news is that the long-run earnings per share power remains intact at over $10 per share. While CEO Stefan Larsson has a strong record turning around multiple brands, the turnaround has taken longer than expected. This is a company that is sensitive to consumer trends, but its brands resonate with a more price conscious buyer. PVH has numerous levers to pull to improve margins above the 10% level that the market doubts. PVH was one of our larger share repurchasers in 2025, and we believe this will continue at these prices in 2026.

BSD Analysis:
PVH is a global apparel operator hiding two enduring franchises—Calvin Klein and Tommy Hilfiger—inside a stock the market treats like a dying mall relic. The company has been ruthless about exiting low-return channels and refocusing on brand heat, pricing power, and international growth. Europe and Asia are doing far more heavy lifting than investors appreciate, particularly as North America stabilizes. Margin recovery doesn’t require heroic demand, just cleaner inventories and disciplined promotions. PVH’s licensing and DTC mix gives it flexibility most apparel peers lack. The balance sheet is in better shape than sentiment suggests. This is a brand owner trading like a commodity retailer.

Pitch Summary:
PayPal – Digital payments platform PayPal was a detractor in 2025. While the company made real operational progress stabilizing and growing transaction margin dollars, expanding profit margins through improved cost discipline, accelerating FCF generation, and returning substantial capital through buybacks the market remained focused on the lack of further acceleration in Branded checkout volume, which grew in the mid-single-digit range while investors were hoping for high-single-digit growth. Increased reinvestment in marketing and technology combined with macro pressure on discretionary spending further weighed on sentiment. Despite the stock’s underperformance, PayPal’s scale, two-sided network, and deep transaction-level data across hundreds of millions of consumers and tens of millions of merchants remain underappreciated assets that provide meaningful long-term optionality.

BSD Analysis:
PayPal is fighting to remind the market that it still owns one of the largest digital payment networks on Earth. Branded checkout growth slowed, but engagement and monetization per user remain solid. Cost cuts and focus on profitability have improved cash flow visibility. Competition is fierce, but scale and trust still matter in payments. New initiatives around wallets and merchant services aim to reignite relevance. Investors fixate on past growth rates instead of current cash generation. PayPal doesn’t need to dominate — it just needs to stay essential.

Pitch Summary:
MGM Resorts – Casino operator MGM Resorts had a relatively weaker 2025 in Las Vegas due to difficult comparisons after multiple years of strength. A significant turnaround at BetMGM plus strong performances at non-Las Vegas “regional” properties and Macau helped steady the consolidated business throughout the year. The general market narrative for most of the year has been that Las Vegas has peaked for various reasons. We, and IAC, believe Vegas cannot be replicated anywhere in the world, and MGM has a great position as the market leader. Management has corrected some pricing mistakes while making moves to narrow their focus. A recent sale of one of their lower-quality properties for a higher multiple than where the consolidated business trades, as well as withdrawing their New York City casino bid, freed up more capital for a management team who has repurchased over 40% of their shares at extremely attractive prices over the past five years.

BSD Analysis:
MGM is a leveraged play on global entertainment, tourism, and experiential spending. Las Vegas remains a cash-flow engine with pricing power that defies traditional hotel cycles. Digital gaming and sports betting add optionality, even if profitability takes time. Asset sales and partnerships have strengthened the balance sheet. Economic slowdowns hurt sentiment faster than fundamentals. MGM benefits when consumers prioritize experiences over goods. This is a cyclical name with structural tailwinds.

Pitch Summary:
IAC – Digital holding company IAC has signaled its plans to dispose of all assets besides People Inc. and an approximate 25% stake in MGM. Chairman Barry Diller is focused on closing the valuation disconnect as no value has been ascribed by the markets to IAC’s assets beyond MGM for too long. Share repurchase and increasing the stake in MGM are the main capital allocation options, and the company is already acting on both. One specific simplification move IAC made this year was the spinoff of Angi, the home services marketplace.

BSD Analysis:
IAC is Barry Diller’s capital allocation vehicle, built to incubate, spin, and recycle digital businesses over long horizons. The portfolio looks messy by design, which keeps valuation perpetually debated. Past successes like Match and Expedia prove the model works, even if timing is unpredictable. Current holdings offer optionality rather than near-term clarity. Investors need patience and tolerance for mark-to-market volatility. When value is unlocked, it tends to be lumpy and outsized. IAC is about asymmetric bets, not steady quarters.

Pitch Summary:
Regeneron – Healthcare company Regeneron was a detractor in the first half of the year but ended up as a contributor for the quarter and full year. It did not initially feel great, but our phased buy-in has worked well so far. We continue to like the company’s strong position in allergic diseases (DUPIXENT) and oncology (LIBTAYO and others). We believe the market focuses too much on EYLEA, a retinal disease medication which is less than 20% of the company's value. The company has a net cash balance sheet and great owner-partners. Unlike most others in its industry, it has sworn off large M&A and was a material share repurchaser in 2025. We still are not paying much (or anything depending on how you do the math) for the company’s sizeable pipeline value. After some initial pipeline disappointment in the first part of the year, there were more positives as the year went on. The P/V remains low, and we are excited for Regeneron to be a meaningful position entering the year.

BSD Analysis:
Regeneron is one of the few biopharma companies that consistently turns science into sustained cash flow. Its pipeline depth and discovery engine reduce dependence on any single product. Dupixent continues to expand indications, extending the growth runway. R&D productivity remains among the best in the industry, which justifies continued investment. Investors worry about eventual patent cliffs, but the pipeline keeps refilling. Regeneron operates more like a biotech factory than a lottery ticket. This is disciplined innovation at scale.

Pitch Summary:
Mattel – Children’s toy, media, and consumer products creator Mattel was a contributor for the quarter and the year. The company is in its strongest position in over 10 years, and there are multiple ways to win. Over 80% of Mattel’s value comes from growing power brands like Hot Wheels, Barbie, and UNO. Mattel has a strong balance sheet which allowed material stock repurchases of $600 million in 2025, and we believe additional share repurchase will come at these discounted prices in 2026. Fundamentally, the toy business continues to grow and gross margins remain strong at 50%. Mattel has a promising owned IP outlook for 2026 with the Masters of the Universe and Matchbox movies, along with two video games, being released.

BSD Analysis:
Mattel is rebuilding itself from a legacy toy maker into an IP-driven entertainment company, and the transition is finally showing traction. The Barbie success wasn’t just a movie win — it validated the value of Mattel’s brand vault. Toy demand is cyclical, but IP monetization smooths earnings over time. Cost discipline has improved margins in a historically sloppy industry. Licensing and partnerships reduce capital intensity while expanding reach. Investors still anchor to old Mattel mistakes. This is a brand portfolio with optionality, not just a toy shelf filler.

Pitch Summary:
HF Sinclair – Energy infrastructure company HF Sinclair was a contributor for the year. We timed our purchases well last year and earlier this year on oil price weakness and worse than expected refining spreads. More normalized refining spreads came into view as the year went on, and the company’s non-refining assets (which are over half of our appraisal) did well. The P/V gap closed, the previously strong insider buying stopped and the value per share growth was limited, so we moved on at a profit.

BSD Analysis:
HF Sinclair is a refiner with midstream and renewables exposure that gives it flexibility across energy cycles. Refining margins are volatile, but asset quality and geographic positioning help smooth the ride. The company generates significant free cash flow when spreads cooperate, enabling aggressive capital returns. Renewable diesel adds a policy-driven upside lever most refiners lack. Investors treat refiners like pure commodity plays, missing the capital discipline shift underway. Balance sheet strength reduces downside risk in weak cycles. HF Sinclair is a cash-flow machine when conditions align.

Pitch Summary:
Global food and beverage producer Kraft was a detractor for 2025. The market is overly focused on the lack of near term growth in North America and not focusing enough on the value-creating potential of the company's upcoming split into two businesses: the higher-growth Global Taste Elevation Co. which contains the Heinz brand and should garner a teens EBITDA multiple, and the stable remaining company comprised largely of North American grocery products, which can trade at the same multiple total Kraft currently trades today. This would result in a combined stock price over $40 per share. We are also extremely pleased with Steve Cahillane being named CEO. We got to know Steve during our successful investment in Kellanova / Kellogg’s, and we believe Steve is the perfect operator to lead Global Taste Elevation and help decide who should lead North American Grocery.

BSD Analysis:
Kraft Heinz is no longer the growth mirage it once pretended to be, and that honesty is actually helping the investment case. Pricing discipline has restored margins in categories consumers continue to buy regardless of macro stress. Brand relevance isn’t what it was decades ago, but shelf space and scale still matter. Cost control has improved materially after years of underinvestment. The company doesn’t need growth heroics — just steady execution and cash return. Investors underestimate how resilient food staples become when volatility rises. Kraft Heinz is built to grind, not sprint.

Pitch Summary:
Wise is the most asymmetric investment in our portfolio today and illustrates the idea of bounded downside and long-run upside in practice. As I wrote last year, Wise helps consumers and businesses hold and move money across borders. It is taking market share from the legacy correspondent banking model through an infrastructure that is cheaper, faster, and more transparent. Under the hood, it is starting to look more like a global financial services platform than a simple remittance app. Wise has three routes to market: Consumer, Business and Platform. Each uses the same underlying operating system and reinforces the others through greater volume, more corridors, and more operational learning, improving reliability and lowering unit costs. That matters because Wise does not need to win in a single channel to keep compounding. It can win by owning the account for global users, by powering other people’s products, or by some mix of both. When I first invested, the case seemed easy to underwrite at prevailing prices. The shares were out of favour, partly because falling interest rates were expected to reduce interest income and partly because investors were disappointed that management chose to cut prices and raise opex rather than harvest operating leverage. That seemed like a misunderstanding of Wise’s proven profitability and management’s commitment to a “scale economies shared” model. Over the last twelve months, they have largely done what they said they would. Underlying margins have come down from 22% to 16% as they lowered the average cross-border take-rate from 0.62% to 0.52% and increased headcount, primarily in roles that build capacity for ever-greater volumes. What makes the setup interesting again is that, after rallying following the company’s first-ever Capital Markets Day in April 2025 and an announcement to shift the primary listing to the United States, the share price has weakened even as operating momentum has improved. Growth in both Personal and Business active customers has accelerated for four consecutive quarters, with cross-border volumes, customer balances, and non-cross-border revenue all growing strongly. The Wise Account is shifting Wise from an infrequent remittance utility into a sticky product customers use to hold balances and spend locally, while Platform volumes are scaling as banks and fintechs adopt Wise as regulated infrastructure. Gross margins have remained stable at 76%, indicating efficiency rather than economic degradation. In a dull case, Wise remains a profitable, cash-generative, regulated network that continues to compound steadily. The upside comes from time, as reinvestment extends how long Wise can compound. The main non-obvious risk is operational or regulatory failure rather than demand.

BSD Analysis:
Wise is attacking global remittances and cross-border payments with radical transparency, and customers keep rewarding it for that honesty. The platform scales efficiently as volumes grow, with unit economics improving rather than degrading. Unlike traditional banks, Wise doesn’t rely on balance sheet leverage to make money, which lowers risk materially. Competition is intense, but trust and simplicity create real customer inertia. Expansion into business accounts and card products deepens monetization without bloating costs. Investors worry about pricing pressure, yet Wise continues to grow profitably. This is fintech built like infrastructure, not a hype cycle.

Pitch Summary:
During the December 2025 quarter, we initiated a position in Salesforce. Salesforce is the global leader in customer relationship management software and over the past 25 years has built a highly profitable, high-quality business exemplifying the barriers to competition just outlined. However, a combination of AI-related concerns and natural growth moderation as the business has scaled saw Salesforce’s share price fall more than 35% from its late-2024 peak, leaving it trading at levels last seen five years ago. We expect Salesforce to deliver high single digit revenue growth over the medium term, and earnings per share growth in the teens. We invested at the lower end of our assessed fair value range and view Salesforce as offering an attractive risk-adjusted return opportunity and would look to further increase the position on additional share price weakness.

BSD Analysis:
Salesforce has pulled off a rare pivot from growth maximalism to disciplined cash generation without killing the franchise. Margin expansion proved the skeptics wrong and reset how the market values the business. Its AI roadmap builds naturally on deeply embedded customer data, giving Salesforce an advantage pure-play AI vendors lack. Churn remains low because ripping out Salesforce is operationally painful. Investors now debate upside rather than survival, which is a meaningful shift. The company is behaving like a mature software platform with optional growth levers. Salesforce is finally acting its size — and benefiting from it.

Pitch Summary:
TSMC is the leading manufacturer of semiconductor chips used in AI, mobile phone and other applications. TSMC continues to benefit from extremely strong demand conditions and industry-leading manufacturing capabilities. Capacity has been expanded domestically in Taiwan, as well as large investments in manufacturing in the U.S. and other international markets. Financial performance continues to exceed base case expectations, and we believe the business has a long runway for future growth. Following substantial share price outperformance, TSMC is trading within our assessed fair value range but remains a top 10 holding.

BSD Analysis:
TSMC is the most important manufacturing company on the planet, even if most consumers have never heard of it. It sits at the choke point of advanced semiconductor production, supplying everyone from Apple to Nvidia. Capex intensity is massive, but no competitor can match its scale, yields, or customer trust. Geopolitical risk dominates the narrative, yet global governments are effectively underwriting TSMC’s strategic importance. Margins fluctuate, but technological leadership remains intact. Every AI, HPC, and advanced-node roadmap runs through TSMC. This is a monopoly with global backing — and global anxiety.

Pitch Summary:
AerCap continues to perform strongly, ahead of our base case, benefitting from a structural shortage of aircraft and aircraft engines, ongoing benefits from the highly value accretive acquisition of GE Capital Aviation Services in 2021, insurance recoveries after aircraft losses incurred when Russia invaded Ukraine, and ongoing prudent capital allocation. Following AerCap’s more than 50% share price appreciation during 2025, AerCap is now trading within our assessed fair value range. While AerCap remains the Fund’s largest position, we have slightly trimmed the investment for valuation and risk management reasons.

BSD Analysis:
AerCap is the quiet king of aircraft leasing, sitting on an irreplaceable fleet in a world where planes are scarce and delivery delays keep stretching. Airlines need capacity, and AerCap controls it, which gives the company real pricing power on leases. The Russia write-down was painful, but it forced conservatism that now benefits shareholders. Cash flow visibility is strong, and capital returns are becoming a bigger part of the story. Investors still think leasing is a leveraged commodity business, ignoring how constrained supply has changed the economics. As global travel normalizes, lease rates reset higher. AerCap is a scarcity trade disguised as financial engineering.

Pitch Summary:
Uber is a ‘battleground’ company. Uber is clearly the leader in ridesharing and meal delivery networks in the U.S. and many markets globally today. Autonomous vehicles continue to gain traction, with Waymo (Alphabet), Tesla and Zoox (Amazon.com) at the forefront, and many other companies developing their own autonomous vehicle strategies. Uber is working with many of these companies and is well placed to maintain its central network role in a hybrid world of human-driven and autonomous vehicles. That said, we recognise the inherent uncertainties and view Uber as a higher-risk, higher-return investment opportunity. Accordingly, Uber remains a smaller position in the Portfolio and is not a top 10 holding.

BSD Analysis:
Uber has crossed the psychological line from “cash-burning disruptor” to real free-cash-flow machine, and the market is still adjusting. Mobility demand remains resilient, while delivery profitability keeps surprising to the upside. Uber’s scale gives it pricing power, data advantage, and regulatory leverage competitors can’t match. Autonomous vehicles are optionality, not a requirement, which changes the risk profile entirely. Bears argue peak margins are near, but global penetration is far from complete. The platform is stronger when the macro is messy, not weaker. Uber is no longer a bet on survival — it’s a bet on platform dominance.

Pitch Summary:
Jacobs Solutions is a global leader in engineering services. We provided an overview of the business in the June 2025 Quarterly Report. The company continues to perform in line with our expectations. During the quarter, a competitor held an investor event and created an impression that AI could be disruptive to the engineering services industry. As discussed further, we are in an environment where every industry and every company is pigeon-holed into either an ‘AI Winner’ or ‘AI loser’. While almost every industry needs to incorporate and adapt AI, we believe Jacobs Solutions and the engineering services it provides will be a net beneficiary, and Jacobs Solutions’ management is already actively investing in AI. In addition to discussing this issue with Jacobs Solutions management, we spoke to the competitor and believe their CEO materially mis-spoke at their investor event and they are in damage control mode. We viewed the share price weakness as unjustified and moderately increased our position. After quarter end, Jacobs Solutions acquired the minority interests in subsidiary PA Consulting. This transaction had been well signalled, was strategically sound and the agreed acquisition price was modestly below our expectations, a small positive to our base case valuation.

BSD Analysis:
Jacobs is an engineering and consulting firm perfectly aligned with the global spend on infrastructure, defense, and environmental remediation. Its pivot away from low-margin construction toward higher-value technical services has improved earnings quality materially. Governments and corporates increasingly outsource complex project management, and Jacobs lives in that sweet spot. The backlog provides visibility that most cyclicals would kill for. Investors sometimes lump Jacobs in with old-school contractors, missing the intellectual capital embedded in the business. Margin expansion here is structural, not cyclical. This is a steady compounder riding long-duration capex themes.