Investment Pitches

Pitch Summary:
IQVIA Holdings was a contributor during the quarter. The U.S.-headquartered provider of advanced analytics, solutions, and clinical research services saw its stock price appreciate after having delivered solid second-quarter results amidst a challenging pharma environment. The results reaffirmed our thesis that the technology and analytics solutions (TAS) segment is underappreciated and poised for future growth. Further the R&D solutions business showed signs of gaining share, with its win rate improving significantly. We believe forward-looking indicators are encouraging and think the company can extract further value as it leverages next-gen trends.

BSD Analysis:
IQVIA is one of the few names in healthcare where the market keeps sleeping on the obvious: this is a data and analytics empire masquerading as a CRO. The TAS segment — the part everyone used to shrug off — is now driving the real re-rating, with sticky software, high-margin analytics, and AI-driven insights that pharma clients can’t live without. Meanwhile, the R&D solutions business is finally regaining share, with win rates improving as smaller CROs fail to keep up with scale, compliance, and digital capabilities. At roughly 14x EV/EBITDA, the stock trades like a slow-growth outsourcing shop despite having structural tailwinds from decentralized trials, AI-enabled protocol design, and rising data complexity across the industry. Margin expansion is already underway, and recurring software revenue provides durability that most CROs can only dream of. IQVIA isn’t just participating in next-gen pharma — it’s becoming the infrastructure layer behind it.

Pitch Summary:
Alphabet was a contributor during the quarter. The technology conglomerate’s stock price appreciated following a favorable ruling in the Google Search antitrust case and second-quarter earnings that exceeded expectations across the board. Innovations in the Google Search experience are driving both engagement and revenue benefits. Moreover, Cloud growth is accelerating thanks to robust demand for AI workloads. We continue to believe Alphabet is undervalued on a sum-of-the-parts basis and see potential for the company’s AI leadership to drive further upside across the portfolio.

BSD Analysis:
Alphabet is the rare tech giant that keeps proving the market’s paranoia wrong. Everyone screamed that AI would cannibalize Search, yet engagement is rising and monetization hasn’t cracked — if anything, Google’s AI Overviews are making the moat harder to breach. Cloud is finally acting like a real business, stacking a $100B+ backlog and printing margins while rivals fight over infrastructure scraps. The CAPEX surge looks scary on paper, but Alphabet is vertically integrating the AI cost stack in a way that competitors simply can’t match — TPUs, models, distribution, the whole thing. Meanwhile, YouTube and Android quietly keep throwing off high-margin cash, and buybacks are reducing the share count at a velocity Wall Street pretends not to notice. With a forward P/E in the low 20s, Alphabet is priced like a mature ad business while behaving like a scalable AI infrastructure powerhouse. This is still one of the cleanest long-duration compounding stories in mega-cap tech — no matter how hard the market tries to overthink it.

Pitch Summary:
Warner Bros Discovery (WBD) was a contributor during the quarter. The media company’s stock price surged by 29% in a single trading session in September – its best day on record – amid reports that it is an acquisition target for Paramount-Skydance. In our view, this merger could generate meaningful cost synergies and create a scaled competitor with a deep and unmatched content library. We continue to closely monitor WBD’s evolving outlook and believe its long-term prospects remain attractive, backed by solid recent earnings, renewed distribution deals and growing momentum in its Streaming segment.

BSD Analysis:
Warner Bros. Discovery is still trading like a messy post-merger soap opera, but the fundamentals are quietly getting a lot less chaotic. The Paramount-Skydance takeover chatter was a reminder that WBD’s content library is one of the few with real strategic scarcity value — something the market routinely forgets until a rumor drops and the stock rips 25% in a day. Yes, leverage is high, but management has been grinding it down quarter after quarter, and the earnings momentum in streaming suggests the narrative around perpetual losses is past its peak. The company’s distribution renewals and tighter cost structure are finally showing up where it matters: cash flow. At ~7x EV/EBITDA, WBD is priced for perpetual dysfunction, yet the upside scenario — cost synergies from a potential merger, improved streaming economics, and stabilization in linear — is very much alive. If sentiment ever snaps back or consolidation becomes unavoidable, this thing has far more torque than the market is pricing in.

Pitch Summary:
Naturally, as investors seek out winners, they’re quick to jettison companies they fear may be come “AI Victims”, too. No doubt, this technology will ultimately change the way businesses operate. However, we think it’s premature to declare just who the “losers” may be. For instance, this year we have built a new position in Accenture, a provider of IT consulting and managed services, including additional purchases in the recent quarter. Accenture is rapidly retooling its own operations to incorporate AI technology, and we believe this will play a critical role in the evolution of their clients’ technology stacks as well. This quarter, we also began building a new position in CDW, a value-added reseller of technology solutions to small and medium-sized enterprises, education and government clients. In 2020, CDW helped clients rapidly adapt their organizations for the challenges of remote work. Five years later, the next hardware cycle will also likely include clients asking CDW specialists how to enable their platforms to take advantage of AI. In both cases, these opportunities are not yet reflected in earnings, but for patient investors we think that creates attractive entry points.

BSD Analysis:
CDW is well positioned to benefit from the next enterprise hardware and infrastructure refresh cycle driven by AI adoption across SMB, education, and public-sector customers. As organizations upgrade networking, storage, and endpoint devices to support AI workloads, CDW’s vendor relationships and value-added engineering services should translate into accelerating gross profit dollars even if unit volumes remain uneven. The company’s scale, purchasing leverage, and deep account penetration support resilient margins, while operating efficiency and incentives from major OEM partners reinforce profitability. CDW’s balance sheet strength allows for steady buybacks, maintaining attractive per-share growth even during slower cycles. With ROIC consistently above peers and a sticky, long-tenured customer base, the firm continues to command a justified valuation premium within the IT channel. Catalysts ahead include backlog rebuilding, AI-related infrastructure orders, and increased wallet share as customers consolidate spending with fewer, higher-quality resellers. Overall, CDW offers a compelling downstream AI exposure with durable cash generation and defensible competitive advantages.

Pitch Summary:
Naturally, as investors seek out winners, they’re quick to jettison companies they fear may be come “AI Victims”, too. No doubt, this technology will ultimately change the way businesses operate. However, we think it’s premature to declare just who the “losers” may be. For instance, this year we have built a new position in Accenture, a provider of IT consulting and managed services, including additional purchases in the recent quarter. Accenture is rapidly retooling its own operations to incorporate AI technology, and we believe this will play a critical role in the evolution of their clients’ technology stacks as well. This quarter, we also began building a new position in CDW, a value-added reseller of technology solutions to small and medium-sized enterprises, education and government clients. In 2020, CDW helped clients rapidly adapt their organizations for the challenges of remote work. Five years later, the next hardware cycle will also likely include clients asking CDW specialists how to enable their platforms to take advantage of AI. In both cases, these opportunities are not yet reflected in earnings, but for patient investors we think that creates attractive entry points.

BSD Analysis:
Accenture remains one of the most strategically positioned companies in global IT services, benefiting from surging enterprise demand for AI-enabled transformation. Its scale, brand trust, and end-to-end capabilities—spanning strategy, systems integration, cloud migration, and managed services—create high client stickiness and recurring revenue visibility. Margin expansion should continue as automation, offshore leverage, and AI tooling drive higher delivery efficiency across its massive workforce. The company’s balance sheet strength, combined with consistent free cash flow generation, supports ongoing buybacks and a steadily rising dividend. With AI-related bookings already accelerating, Accenture is well placed to capture multi-year reinvestment cycles across data, cloud, and digital operations. Trading at a reasonable premium to IT services peers, the valuation is justified by double-digit EPS growth, improving utilization, and a rich pipeline of AI modernization work. Overall, the company offers a durable compounding profile with both cyclical resilience and structural growth catalysts tied to enterprise AI adoption.

Pitch Summary:
V.F. Corporation's Q2 2026 results exceeded expectations, yet the stock sold off due to conservative guidance. The company's strong performance, particularly from brands like The North Face and Timberland, and strategic moves such as the divestiture of Dickies to reduce debt, suggest a promising turnaround. Despite market skepticism, the stock presents a compelling risk/reward opportunity.

BSD Analysis:
V.F. Corporation's recent earnings beat on both revenue and EPS, with strong contributions from The North Face and Timberland. The divestiture of Dickies is a strategic move to deleverage the balance sheet, which should improve financial stability. While guidance appears conservative, it may be a strategic understatement to manage market expectations. The company's focus on expanding product lines and improving operational efficiency indicates potential for future growth. Despite macroeconomic uncertainties, such as tariffs and consumer spending, V.F. Corp.'s valuation appears attractive, trading below private market values for its brands. The company's efforts to streamline operations and focus on core brands could lead to significant upside in the coming years.

Pitch Summary:
Cenovus Energy is set to acquire MEG Energy, a move that is expected to create significant operational efficiencies and synergies due to the proximity of their operations. The acquisition is structured as a mix of cash and shares, and is likely to be accretive, allowing Cenovus to benefit from MEG's low-cost thermal oil deposits.

BSD Analysis:
The acquisition of MEG Energy by Cenovus Energy is strategically advantageous due to the geographic proximity of their operations, which allows for operational efficiencies and cost savings. The deal, which includes a mix of cash and shares, is expected to be accretive and enables Cenovus to leverage MEG's low-cost thermal oil deposits. The acquisition also reduces leverage post-transaction, providing flexibility for future share repurchases. While there are risks associated with integrating company cultures, Cenovus's familiarity with MEG's assets mitigates some of these risks. The acquisition positions Cenovus for continued dividend growth and long-term returns in the teens.

Pitch Summary:
The Schwab Emerging Markets Equity ETF (SCHE) is positioned as a low-cost option for exposure to emerging markets. However, its high concentration in a few large-cap tech companies, particularly in China and Taiwan, poses significant risks. While it offers a lower expense ratio compared to its competitor IEMG, the concentration risk and lower dividend yield make it less appealing as a core holding.

BSD Analysis:
SCHE's focus on large-cap tech companies like Taiwan Semiconductor Manufacturing, Tencent, and Alibaba results in a concentrated portfolio that is heavily reliant on the performance of these firms. This concentration, while potentially rewarding if these companies perform well, also exposes the fund to significant risks, particularly geopolitical tensions involving China and Taiwan. The fund's expense ratio is competitive at 0.07%, but this advantage is offset by lower dividend yields and performance compared to IEMG. Additionally, SCHE's lack of diversification across sectors and geographies increases its vulnerability to sector-specific shocks. Despite its cost advantages, SCHE's risk-adjusted performance does not justify switching from IEMG, especially given the transaction costs involved.

Pitch Summary:
Agilysys, Inc. has shown strong fiscal Q2 results with a significant post-earnings rally, driven by increased revenue expectations and strong cross-sell momentum. However, its high valuation multiples and potential macroeconomic risks in the travel sector suggest a balanced outlook.

BSD Analysis:
Agilysys has demonstrated robust cross-sell potential, particularly with its foodservice products, and is in the final stages of a significant deal with Marriott, which could be margin accretive. Despite these positives, the company faces challenges such as potential macroeconomic concerns affecting the travel sector and a gross margin gap compared to peers. The stock's valuation remains high, trading at rich multiples, which may already price in much of the anticipated upside. While the company's revenue growth and adjusted EBITDA margins are promising, the high valuation suggests caution. Investors may find better opportunities in other small- and mid-cap growth stocks.

Pitch Summary:
Power Solutions International has achieved remarkable growth, with its stock up 685% since July 2024. The company has returned to profitability and continues to exceed earnings expectations, driven by strong sales growth and strategic financial management.

BSD Analysis:
PSIX's focus on powertrain solutions for data centers and other industrial applications has fueled its impressive financial performance. The company's ability to reduce debt and secure additional financing demonstrates strong financial management. With consistent earnings beats and upward revisions in guidance, PSIX is well-positioned for continued growth. The stock's inclusion in major indexes further enhances its visibility and attractiveness to investors. Despite recent price retreats, the company's strong fundamentals support a bullish outlook.

Pitch Summary:
Sterling Infrastructure has demonstrated strong growth, with its stock price increasing over 210% in the past 18 months. The company has raised its 2025 EPS guidance and continues to expand its market presence, driven by demand in data center infrastructure.

BSD Analysis:
Sterling's strategic focus on e-infrastructure and transportation has resulted in significant revenue growth, with a 21% increase in the latest quarter. The company's ability to expand its footprint through acquisitions and partnerships positions it well for continued growth. Despite potential market volatility, Sterling's strong backlog and financial performance support a bullish outlook. The company's market cap has grown significantly, reflecting its successful execution of growth strategies.

Pitch Summary:
Argan, Inc. is positioned as an underappreciated AI growth play with a record backlog and strong visibility into multi-year growth. Despite recent underperformance compared to peers, the company has been upgraded to Overweight by JPMorgan.

BSD Analysis:
Argan's focus on natural gas projects and a robust pipeline in the U.S. provide a solid foundation for future growth. The company's financial health is strong, with a significant cash balance and no debt. Despite lagging in recent price performance, Argan's strategic positioning in the AI and renewable energy sectors offers potential for long-term growth. The stock's current valuation suggests that much of the future growth is already priced in, warranting a Hold rating.

Pitch Summary:
Powell Industries has shown significant growth, delivering a total return of nearly 800% since March 2023, driven by the Industry 4.0 transformation. Despite its impressive performance, the stock is currently rated as Hold due to its valuation concerns.

BSD Analysis:
Powell Industries has capitalized on the Fourth Industrial Revolution, with international revenues increasing by 39% due to higher project volumes in Canada, the Middle East, and Africa. Gross profit has also risen, indicating strong operational performance. However, the stock's valuation appears to have already priced in future growth, suggesting a potential pullback. Despite an F for Valuation, the company's Quant factor grades remain strong, supporting a Hold rating.

Pitch Summary:
Expand Energy Corporation is poised for significant growth due to its strategic acquisition of low-cost acreage in the Western Haynesville, which promises to enhance profitability and reduce the corporate breakeven point.

BSD Analysis:
The discovery of the Western Haynesville offers a transformative opportunity for Expand Energy, potentially shifting its operations to a more profitable and lower-cost basin. This strategic move could dramatically improve the company's financial outlook, as the Western Haynesville is expected to provide a competitive edge with its lower production costs. While the transition requires substantial acreage acquisition and successful de-risking, the initial results are promising. The company's investment-grade status further supports its ability to finance this expansion. However, the success of this strategy hinges on continued favorable natural gas prices and effective execution of the land acquisition and development plan.

Pitch Summary:
Brenntag's business model as a chemical distributor offers growth through acquisition and high returns on capital, despite short-term profitability impacts from chemical price fluctuations.

BSD Analysis:
Brenntag SE stands out as the largest distributor of both commodity and specialty chemicals, operating as a middleman for small- and medium-sized customers. The company's low capital intensity and high return on capital make it an attractive investment, even amidst short-term profitability impacts from chemical price fluctuations. Brenntag's strategic focus on acquisitions in a fragmented industry presents a significant growth opportunity. The recent hiring of a new CEO and CFO, both admired by the market, further strengthens the company's leadership and strategic direction, positioning it for long-term success.

Pitch Summary:
Despite a decline in share price due to negative sentiment around chemical stocks, DSM-Firmenich's specialized market position and high margins make it an attractive investment.

BSD Analysis:
DSM-Firmenich operates in the niche market of flavors and fragrances, characterized by high margins and steady growth. The company's share price declined by 20% due to broader negative sentiment towards chemical stocks, exacerbated by Chinese chemical manufacturers dumping products in Europe. However, DSM-Firmenich's business is largely insulated from the cyclical nature of the chemical industry, making it a resilient player. The company's specialized focus and strong market position suggest that it is well-equipped to weather industry challenges and continue delivering consistent returns.

Pitch Summary:
Alibaba's cloud services and large language model platforms were previously undervalued, but recent recognition of their worth has driven a significant increase in share price.

BSD Analysis:
Alibaba Group has been undervalued in terms of its cloud services and large language model platforms, which are comparable to leading US platforms valued at hundreds of billions. The market's failure to recognize these assets' true value has been corrected this quarter, leading to a 60% increase in Alibaba's share price. This adjustment reflects a broader understanding of Alibaba's strategic assets and their potential to drive future growth. As China's largest e-commerce company, Alibaba is well-positioned to leverage its technological advancements and expand its market presence, making it an attractive investment opportunity.