Investment Pitches

Pitch Summary:
Hexcel is a vertically integrated carbon fiber composites supplier whose products are mission-critical inputs for commercial aerospace (≈60% of sales) and space/defense (≈30%), with limited aftermarket exposure. The pitch argues carbon fiber’s strength-to-weight benefits keep taking share versus aluminum, and Hexcel’s position is “good business” quality: oligopolistic industry structure, deep qualification/know-how, and sticky long-term customer relationships (often sole-sourced under 5–7 year master contracts). Although headline multiples look high on depressed near-term earnings, the author claims earnings power is temporarily suppressed by persistent airframer and aerospace supply-chain disruptions that have delayed aircraft production ramps. On normalized margins (cited as ~18% adj. EBIT), the stock is framed as trading closer to ~14x normalized earnings, implying discount versus perceived quality. The market is seen as overpricing a draconian “limited production ramp” scenario over the next 3–5 years, while the bull case expects a multi-year production recovery (author cites ~70% ramp in aircraft production over 3–5 years) plus longer-duration content gains on next-gen narrowbodies. Optionality includes potential strategic interest (historical M&A rumors / prior attempted WWD merger). Catalysts are supply-chain stabilization, A350 and 777 volume ramps, and news on next-generation 737 narrowbody design.

BSD Analysis:
HXL is basically a “quality compounder temporarily trapped in an aerospace bottleneck” pitch: the multiple looks ugly because earnings are cyclically/supply-chain depressed, not because the business lacks moat. The real underwriting question is whether commercial aero production actually normalizes and ramps, because Hexcel’s model is tightly linked to build rates and is front-loaded (~6 months ahead of final assembly) with almost no aftermarket ballast. If the supply chain clears, operating leverage plus high content on A350/other programs can snap earnings back toward a normalized margin structure, making today’s P/E a mirage and the normalized multiple much more reasonable. The stickiness angle is credible—qualification costs and sole-source dynamics are real—so volume recovery should translate into durable cash generation rather than transient pricing wins. The main risk is the “aero recovery always two quarters away” trap: repeated disruptions (airframer quality issues, engine groundings, strikes) can keep the ramp delayed and the stock optically expensive for longer. Upside exists if next-gen narrowbodies increase composite content structurally, turning a cycle rebound into a longer runway.

Pitch Summary:
Bought shares in this franchised auto dealership group with approx. 100 locations across the UK, representing approx. 20 different car brands, in 2014-2015, at approx. 9x adj. EPS. Main thesis: Profit margins would gradually increase significantly as underperforming dealerships acquired in business combinations were turned around. However, the margin increase simply failed to materialize and the stock price languished as the industry was out of favor after Brexit. Re-allocated the capital invested in Vertu to another UK auto dealership group, Cambria Automobiles plc, in 2019. – Trading multiples in this industry were low, and Cambria Automobiles appeared to be a very different and more attractive investment. – We lost 27% (-8.5% annualized) on our investment in Vertu – We earned 33% (11.8% annualized) over the next 2 ½ years on Cambria investment. Main lesson learned: – Vertu did not have a solid enough track record of turning around acquired underperforming dealerships → The investment thesis was too much conjecture.

BSD Analysis:
Vertu is one of the best-run auto retailers in the UK, with disciplined capital allocation, strong cost control, and consistent profitability. The market hates the auto retail sector, but Vertu routinely outperforms peers on margins and execution. The balance sheet is clean and acquisitions are done with surgical precision. Despite this, the stock trades at a tiny multiple reflecting outdated skepticism. Regulatory and EV transitions are manageable given Vertu’s scale. This is a high-cash-flow operator hiding in a low-expectation sector. A classic UK small-cap mispricing.

Pitch Summary:
Dino Polska saw temporary share consolidation following strong multi-year performance. Q2 results slightly missed estimates, but fundamentals remain intact with accelerating store openings, low-cost vertical integration, and resilient consumer demand. The company’s expansion into underserved rural regions continues to drive steady market share gains. :contentReference[oaicite:5]{index=5}

BSD Analysis:
Dino’s disciplined execution, regional dominance, and operational efficiency provide a long runway for growth. Its low-cost sourcing and vertically integrated supply chain enable consistent margin resilience. As Poland’s retail modernization progresses, Dino remains a compounder with defensive cash flows and scalable expansion potential.

Pitch Summary:
Hugel maintained its nine-year leadership in South Korea’s botulinum toxin and filler markets, supported by strong cost efficiency and expanding export channels. While Q3 profits modestly undershot expectations, upcoming U.S. FDA approvals are expected to accelerate its international growth and reinforce its global competitiveness. :contentReference[oaicite:4]{index=4}

BSD Analysis:
Hugel’s dominance in Asia’s aesthetics market and regulatory pathway into the U.S. position it for global scale expansion. Its vertically integrated production model and robust brand recognition underpin high returns on capital. As approvals broaden and margins normalize, Hugel’s valuation discount offers asymmetric upside.

Pitch Summary:
InPost, Poland’s market leader in parcel lockers with over 70% share, experienced temporary profit headwinds from integrating a UK acquisition. Despite near-term weakness, the company’s APM network remains critical to European e-commerce logistics, offering lower emissions and higher efficiency than traditional door-to-door delivery. As integration costs normalize, margins and FCF are expected to rebound in the coming quarters. :contentReference[oaicite:3]{index=3}

BSD Analysis:
InPost’s dominant APM ecosystem, cost leadership, and sustainability appeal support durable market share growth. Integration synergies and geographic expansion across Europe create operational leverage, while rising e-commerce penetration drives long-term scalability. Logistics efficiency and recurring customer use underpin its compounding potential.

Pitch Summary:
Accton, a key enabler of AI infrastructure, delivered record revenues as global demand for high-performance networking surged. The company’s AI accelerator modules and switches have become critical to modern data center architecture, and its evolving market model favors more direct relationships with hyperscaler customers. Revenues and profits more than doubled year-to-date, reflecting exceptional earnings momentum and competitive strength. :contentReference[oaicite:2]{index=2}

BSD Analysis:
Accton’s expanding role in the AI networking supply chain makes it a structural beneficiary of hyperscaler capex. Its operational scale, efficiency, and long-term contracts underpin predictable earnings. As demand for high-bandwidth connectivity accelerates globally, Accton’s integration into next-gen data infrastructure offers sustained multi-year growth and margin expansion potential.

Pitch Summary:
Prosus rallied as its core holding Tencent posted strong results, driven by domestic gaming recovery and ad revenue growth from improved monetization of its Video Accounts platform. Prosus also benefited from its active share buyback program aimed at narrowing the discount between its NAV and share price. The company’s asset-light strategy and exposure to high-growth emerging market internet assets supported the stock’s outperformance. :contentReference[oaicite:1]{index=1}

BSD Analysis:
Prosus’s deep exposure to Tencent and its disciplined capital allocation create a compelling value proposition. Continued execution on buybacks and monetization of non-core holdings could unlock significant NAV value. The portfolio’s digital marketplace and fintech investments offer structural growth optionality across emerging markets. NAV discount compression remains a key catalyst for rerating.

Pitch Summary:
CATL, the world’s largest EV battery producer, reported over 30% quarterly profit growth driven by strong demand for its Shenxing Superfast Charging and Qilin battery models. These products now comprise nearly 40% of total shipments and are expected to expand further into 2026. CATL also benefits from China’s new energy storage roadmap targeting 180 GW of installed capacity by 2027, reinforcing optimism around its ESS division. Gross margins reached a three-year high as the company continued to lead the market in both scale and innovation. :contentReference[oaicite:0]{index=0}

BSD Analysis:
CATL’s technological leadership, high R&D intensity, and vertical integration provide durable competitive moats in EV and energy storage. Rising adoption of its next-gen products, backed by policy support and global OEM partnerships, drives multi-year visibility. With improving profitability and a robust pipeline in solid-state and sodium-ion technologies, CATL’s growth trajectory remains unmatched in the sector.

Pitch Summary:
The pace of capital moving into companies with close proximity to promising themes seems to have accelerated across AI, drones, defense, cybersecurity, semiconductors, and automation. Many of the companies we track that show interesting trends or thematic exposure are now seeing their stock prices move well ahead of fundamentals. For example, quantum stocks that have yet to show any fundamental progress have experienced massive gains in the quarter. Investors are beginning to see this froth as a possible indicator of a late-cycle market. Naturally, this has led to rising concern about the mother of all the thematic drivers: AI. Google searches for “AI bubble” increased 20-fold during the quarter, following a wave of AI-backed announcements: OpenAI signed a $300 billion compute contract over five years, and Nvidia is partnering to build massive AI data centers. We believe that while valuations are rich, the AI-investment cycle is more durable than the 1990s fiber boom. AI CAPEX is sequenced, demand-anchored, and largely cash-funded. Data center utilization remains high, providing the cushion that prevents a capital-cycle collapse. We believe those calling for an imminent AI bubble implosion will continue to be very wrong.

BSD Analysis:
Pernas views Nvidia as the fulcrum of the AI infrastructure buildout. Unlike the debt-fueled fiber bubble, AI CAPEX is backed by real demand, with hyperscalers reinvesting cash flow. Nvidia’s dominant GPU share and pricing power sustain industry leadership. High utilization and recurring data center demand underpin near-term growth. While valuation risk exists, structural AI demand keeps the bull case intact.

Pitch Summary:
Elixirr delivered strong performance during the quarter, driven by its acquisition of TRC Advisory, which expanded its U.S. client base and added manufacturing and Midwest coverage. The deal is expected to be mid-teens EPS-accretive according to Cavendish analysts. The company’s agile model and entrepreneurial culture continue to support above-market organic growth. Hurdle Rate sees Elixirr as a scalable compounder with global expansion potential.

BSD Analysis:
Elixirr continues to punch above its weight in consulting, winning global clients with a boutique, partner-led model that delivers higher margins than legacy firms. Growth remains strong across digital, strategy, and innovation engagements. The company’s asset-light structure, high utilization, and disciplined incentives create exceptional cash conversion. Despite premium fundamentals, the stock trades at a discount to global peers due to size and liquidity. As Elixirr scales and international presence expands, the setup is ripe for rerating.

Pitch Summary:
SoFi Technologies started its life in 2011 as a student loan refinancer and has rapidly evolved into a full-service digital banking platform. The company has been successful using a “land and expand” approach that both drives new customer acquisition and more dynamic relationships with those customers. This has translated into strong membership growth and in turn strong revenue growth, which has not gone unnoticed by the market this year.

BSD Analysis:
The manager sees SoFi as a fast-scaling digital bank benefiting from structural consumer shifts toward mobile-first financial services, with strong cross-sell economics boosting lifetime value. Fundamentals show rapid deposit growth, widening net interest margins, and improving credit performance relative to fintech peers. While GAAP profitability remains modest, adjusted EBITDA is scaling quickly, and the bank charter continues to drive funding-cost advantages. SoFi trades at a premium to traditional banks on price/book, but justified by higher growth and fee-mix potential. As operating leverage builds across lending, tech platform, and financial services, earnings power could surprise to the upside.

Pitch Summary:
Bloom Energy is a provider of solid oxide fuel cells that play a critical role in delivering clean, reliable, “always on” power at scale. AI data centers require an enormous amount of power, and one of the key challenges to date has been the inability of power grids to supply the necessary electricity to meet the constant and growing demands from AI workloads. Bloom's “Energy Server” fuel cells help address this issue, generating cost-efficient, reliable power onsite, converting fuels like natural gas, biogas and hydrogen into electricity without combustion. During the quarter, the company announced a massive partnership with Oracle to deliver onsite power to select data centers that caught investors’ attention and spurred a wave of analyst earnings revisions.

BSD Analysis:
The manager presents Bloom as a direct beneficiary of the explosive growth in AI-driven power demand, which is straining U.S. electric grids and creating outsized need for on-site generation. Bloom’s solid oxide platform offers high uptime, fuel optionality, and carbon advantages—positioning it competitively versus diesel backup or intermittent renewables. The Oracle partnership validates Bloom’s relevance to hyperscale workloads and indicates accelerating enterprise adoption. Fundamentally, Bloom still operates with negative net income and modest gross margins, but revenue growth is re-accelerating and backlog visibility is improving. If scale increases and installation economics continue to improve, margins could inflect meaningfully, providing substantial operating leverage.

Pitch Summary:
Alphabet is a holding company that owns a collection of businesses, the largest and most important of which by far is Google. Google is the global leader in online search and advertising and also offers cloud solutions to businesses and consumers globally, with a goal of organizing the world’s information and making it universally accessible and useful. Google dominates the US and global traditional search market with a greater than 80% share of search volumes. As a function of seeing more searches, Google is able to provide better search results, resulting in a higher customer conversion rate for advertisers and enabling Google to capture a leading share of search revenue. Google’s large network of consumers, advertisers, and publishers is a powerful business ecosystem as third-party participants such as marketing affiliates and independent software vendors add value to the user experience. As a result, we believe consumers get their best and most relevant search results and advertisers get the best returns on their advertising dollars. Such a robust ecosystem attracts increasing numbers of participants and thereby creates a virtuous cycle for a sustainable business model and long-term growth. In its emerging cloud business, we estimate that Google captures less than 10% market share of the global market for public cloud services. We believe Google remains one of the few global companies that has the scale, research and development (R&D), and technical talent to effectively compete in this market over the long term. Non-Google businesses comprise less than 1% of Alphabet revenues and are held in the company’s Other Bets segment. A holding in the fund since inception, shares responded positively following disclosure of prospective remedies in an ongoing lawsuit with the U.S. Department of Justice (DOJ) that were better than feared. In August 2024, in a case originally filed in 2020 by the DOJ and multiple U.S. states, a U.S. District Court ruled that Google had acted illegally to maintain a monopoly in online search by paying companies such as Apple to present its search engine as the default choice on their devices and web browsers. During the quarter, the judge provided potential remedies which neither required any business divestitures by Alphabet, nor called for an outright ban on payments. The company has said it may potentially still appeal both the verdict as well as the proposed remedies, but the remedies were less punitive than feared. We expect this process will likely still take over a year before it is ultimately settled and any changes are implemented. And while we do not know what the final outcome will be, based on its ongoing innovation and substantial competitive advantages, we do not believe the company’s competitive positioning will ultimately be diminished, and we believe the company continues to represent an attractive reward-to-risk opportunity. Alphabet has been a holding in our strategy since inception in July 2006.

BSD Analysis:
The manager presents Alphabet as a dominant search and ads franchise with an emerging second growth engine in Google Cloud, underpinned by powerful network effects across users, advertisers and publishers.:contentReference[oaicite:17]{index=17} They view recent DOJ remedies as less punitive than feared and unlikely to impair the core economics of default search, helping to explain the stock’s strong rerating after the ruling.:contentReference[oaicite:18]{index=18} Fundamentally, Alphabet is producing more than $80 billion of annual free cash flow, trades at a high-20s P/E multiple, and continues to retire over $10 billion of stock per quarter, giving investors a powerful capital-return component alongside growth.:contentReference[oaicite:19]{index=19} AI is now a central catalyst: Gemini, AI-enhanced search, and monetization in YouTube and Cloud are driving incremental revenue and operating leverage, while proprietary chips and massive data scale create defensibility. Risks include regulatory overhangs, heavy AI capex and intensifying competition from other hyperscalers, but on current metrics the stock still looks like a high-quality compounder with an attractive risk-reward relative to other mega-cap tech names.

Pitch Summary:
Over time, we believe that increased volumes will offset near-term margin pressure. Further, unlike traditional auto manufacturers, Tesla has the ability to sell software to car owners after the initial sale, providing incentive to grow an installed base that can later be monetized through software sales. The company is making strong progress on its industry-leading software which benefits from its data leadership in autonomous driving. The company continues to gather data from a fleet now averaging over 500 million miles of FSD driving per quarter. The company is also ramping up customer education by demonstrating the technology at every new vehicle pick up, which it will extend to every service appointment as well. In addition to the US, FSD is available in Canada, China, Mexico, Puerto Rico, Australia, and New Zealand. The company is awaiting a decision in Europe. Despite making continued progress in lowering its cost per car, operating margins of 4.1% declined by approximately 220 basis points during the period, due primarily to lower deliveries and increased research and development expenses to support future product launches. However, the Cybertruck has achieved positive gross margins within the first year after its launch, while competitors such as Rivian still generate gross losses. We believe this underscores the company’s cost leadership, scale advantages, and the maturity of its manufacturing operations. We believe these recent margin impacts are temporary and that over the long term, Tesla can generate operating margins in the mid-20% range, supported in part by an increasing mix of FSD sales. After posting negative free cash flow in the first quarter of 2024, free cash flow was positive for the fifth quarter in a row, and we believe it will remain positive as profits and capital expenditure efficiencies improve. Despite an automotive industry slowdown, we believe that Tesla is a structural share gainer in the overall auto industry and will continue to gain share and grow faster than the industry as a whole. We believe the secular growth driver for Tesla is increasing penetration of electric vehicles as a share of global automotive sales. Around the world, EVs accounted for a low-double-digit percentage of new light vehicle sales in 2024, with penetration rates ranging from high-single digits in North America to low double-digits in Western Europe and almost 30% in China. We believe the pace of EV adoption will accelerate, driven by advances in battery technology that will drive cost parity, lower ongoing cost of ownership for consumers, government incentives, and numerous global initiatives to phase out internal combustion engine sales over the next two decades. Tesla is a global leader in battery EV sales. The company recently had low-teens unit share, which is down from high teens in 2024 as a result of the refresh of the Model Y at the start of the year, while the company maintains around 25% revenue share, and a much higher share of industry profitability. While we expect competition to increase substantially, we believe Tesla’s brand, focus, technology leadership, and strong ongoing consumer demand will enable the company to maintain a leading global market position. In late 2024, the company debuted FSD version 13 that was used to power the cybercab and the unmanned Model 3 and Model Y as the company announced its robotaxi strategy. FSD 13, which represents the first version of FSD software based solely on AI training on the company’s super computers, delivered a step change improvement in autonomous driving capabilities. We believe most consumers will ultimately adopt FSD functionality over the long term. Tesla’s software offerings carry profit margins that are significantly greater than the current company average and we believe they will drive strong profit growth. Over time, we believe uptake of high-margin software capabilities, which we believe can increase from a negligible percentage of profits today to approximately 25%, will contribute to expanding the company’s operating margins. We believe the assumptions embedded in Tesla’s share price underestimate the company’s significant long-term growth opportunities and the sustainability of its global market share. We believe the company’s shares currently sell at a significant discount to our estimate of intrinsic value and thereby offer a compelling reward-to-risk opportunity.

BSD Analysis:
Loomis frames Tesla as a structurally advantaged EV and software platform whose recent margin compression is cyclical and investment-driven rather than a sign of broken economics. They highlight cost leadership, Cybertruck reaching positive gross margin quickly, and a growing trove of FSD data, all of which should support a return to mid-20% operating margins as software and autonomy mix rise. Recent fundamentals are solid: Tesla is delivering record vehicle and energy volumes, has turned free-cash-flow positive again with roughly mid-teens FCF margin in the latest quarter, and holds over $40 billion of cash, albeit with a very elevated headline P/E reflecting heavy reinvestment and high market expectations. The core long thesis rests on global EV penetration moving from low-double-digit share toward mass adoption while Tesla keeps an outsized share of both revenue and industry profits thanks to brand strength, vertical integration and software monetization.:contentReference[oaicite:14]{index=14} Key risks are intensifying competition, regulatory uncertainty around robotaxis and autonomy, and the possibility that continued price cuts needed to defend share limit the upside from the software profit pool.

Pitch Summary:
London Stock Exchange Group (LSEG) is a conglomerate of high-quality financial data and market infrastructure businesses. Its segments include Data & Applications (~45% of revenue), Markets (~40%), FTSE Russell (~10%), and Risk Intelligence (~5%). Following the 2021 acquisition of Refinitiv, LSEG has transitioned from a traditional exchange to a diversified data and analytics powerhouse. The firm’s desktop and data feed products are mission-critical to financial institutions, while its LCH clearinghouse maintains over 90% global market share in cleared interest rate swaps. Tradeweb, its 51%-owned electronic fixed income trading platform, continues to gain market share as bond markets digitize. LSEG’s portfolio of recurring, scalable businesses generates predictable cash flow and margin expansion opportunities. The stock’s decline this year reflects market overreaction to perceived AI risk in its desktop terminal business, creating an attractive entry point.

BSD Analysis:
Eagle Capital views LSEG as a durable compounder mispriced due to AI-related fears. The company’s diversification across data, indices, clearing, and trading infrastructure provides multi-cycle resilience, while AI integration offers upside. Margins are expanding from cost leverage post-Refinitiv integration, with EBITDA margins approaching 47% and incremental margins near 70%. LSEG’s 18x forward earnings multiple undervalues its mid-teens EPS growth and 20% expected IRR, aided by buybacks and a 1.5% dividend yield. As financial institutions increasingly rely on high-quality structured data, LSEG’s leading role in AI data monetization positions it for long-term outperformance.

Pitch Summary:
Dino Polska saw temporary share consolidation following strong multi-year performance. Q2 results slightly missed estimates, but fundamentals remain intact with accelerating store openings, low-cost vertical integration, and resilient consumer demand. The company’s expansion into underserved rural regions continues to drive steady market share gains.

BSD Analysis:
Dino remains one of the strongest structural growth stories in European food retail, with its high-density small-format model delivering consistent double-digit store expansion and industry-leading margins. The company’s vertically integrated supply chain and tightly controlled cost structure give it pricing power and operational consistency rare in the grocery space. Traffic and basket trends remain resilient despite macro volatility, underscoring the strength of the brand in smaller towns and underserved regions. Unit economics remain exceptional, and new-store returns comfortably support the ongoing expansion runway. Despite years of outperformance, the stock still trades below what you’d expect for a retailer delivering this level of growth and cash generation. As the network scales past 2,500 stores and efficiencies compound, Dino continues to look like one of the cleanest long-duration compounders in European staples.

Pitch Summary:
Hugel maintained its nine-year leadership in South Korea’s botulinum toxin and filler markets, supported by strong cost efficiency and expanding export channels. While Q3 profits modestly undershot expectations, upcoming U.S. FDA approvals are expected to accelerate its international growth and reinforce its global competitiveness.

BSD Analysis:
Hugel continues to expand its leadership in premium aesthetics, with its botulinum toxin and dermal-filler portfolio gaining global traction despite regulatory noise and competitive intensity. China remains the primary growth engine, and early signs of stabilization suggest the worst of the inventory and channel pressure is behind the company. Hugel’s strong clinical profile, manufacturing expertise, and cost advantage give it a defensible moat as international expansion accelerates. Margin recovery is underway, supported by product mix, normalized pricing, and operating leverage from expanding global distribution. Despite these positives, the stock still trades at a discount due to past regulatory overhang—creating an attractive mismatch between sentiment and fundamentals. As international approvals progress and aesthetics demand continues to grow, Hugel looks well positioned for a multi-year rerating.

Pitch Summary:
InPost, Poland’s market leader in parcel lockers with over 70% share, experienced temporary profit headwinds from integrating a UK acquisition. Despite near-term weakness, the company’s APM network remains critical to European e-commerce logistics, offering lower emissions and higher efficiency than traditional door-to-door delivery. As integration costs normalize, margins and FCF are expected to rebound in the coming quarters.

BSD Analysis:
InPost is the last-mile logistics assassin quietly eating Europe’s e-commerce infrastructure from the inside out. Its automated parcel locker (APL) network is a structural cost advantage — faster, cheaper, denser, and far more scalable than traditional courier delivery. As European consumers become addicted to pickup convenience and merchants hunt for cheaper fulfillment, InPost is winning share hand over fist, especially in Poland and now the UK. Operating leverage is kicking in as volumes scale, and the economics of lockers vs. door delivery are so dramatically better that competitors can’t match pricing without bleeding margin. The company’s EBITDA ramp is no fluke — it’s the result of a model that improves with every node added. Yet the stock still trades like a niche logistics provider instead of a dominant, tech-enabled infrastructure play. If consumer adoption continues at its current pace, InPost’s margin profile could look more like a software platform than a courier service.