Investment Pitches

Pitch Summary:
Meta Platforms also has a large installed data center footprint and has expanded dramatically over the past several years. While the stock was not a top performer during the quarter, it has been a top performer year-to-date. The company finished 2024 with over $200 billion in gross property, plant, and equipment and capitalized leases, up $135 billion from five years earlier. Yet it managed to take annual gross cash flows from $29 billion in 2019 to $82 billion in 2024. These capex investments have yielded astonishingly strong returns. The company has been cloud-native for over a decade and also developed one of the most important software libraries used by most AI labs today (PyTorch). The hardware and software infrastructure ecosystem within Meta Platforms and the returns on those investments have proven that Meta is hardly speculative with its large long-term spending plans.

BSD Analysis:
Meta turned cost discipline into a superpower, rebuilding margins while simultaneously dominating short-form video and scaling the world’s most efficient ad engine. Engagement is strong, Reels monetization is accelerating, and the AI-drenched ad stack is outperforming global peers. Reality Labs is still expensive — but the company can easily afford the experimentation. Meta’s balance sheet is a fortress and buybacks are relentless. Valuation remains reasonable for a company with this growth and profitability. The market underestimated Meta once; it shouldn’t again. A mega-cap execution monster.

Pitch Summary:
PayPal Holdings was a leading detractor during the quarter despite growing earnings per share +18% and adjusted transaction margin dollars +8%. The company saw double-digit growth in Venmo-branded revenue as it further expanded monetization initiatives with merchants and consumers, including Pay With Venmo and the Venmo Debit Card. In addition, the company negotiated better economics with its high-volume processing segment, Braintree, which we expect should help accelerate revenue growth later this year and into 2026. Shares continue to trade at depressed multiples as the market has rotated into AI-focused tech and cryptocurrency-related financials. PayPal is being prudent with its investments in both those emerging areas of commerce, partnering with Google in agentic commerce solutions, and also expanding issuance and acceptance of the PayPal U.S. dollar stablecoin.

BSD Analysis:
PayPal is a cash-flow machine trapped inside a stale consumer-fintech narrative. Competition is fierce, but PayPal still owns the checkout layer across millions of merchants. Margin recovery is underway, and cost discipline is the tightest it’s been in a decade. Venmo’s monetization potential remains underexploited but real. The brand isn’t cool, but relevance remains extremely high. PYPL trades like it’s dying — it isn’t. A beaten-down fintech with meaningful rerating potential.

Pitch Summary:
Alphabet was a top contributor to portfolio performance during the quarter, as the company's AI initiatives are driving strong growth in their advertising and cloud computing businesses. Furthermore, the U.S. Department of Justice proposed final remedies on Google's online search monopoly that were less severe than Wall Street's worst-case scenarios. This development allowed the forward earnings multiple to expand, bringing it more in line with the overall stock market. Alphabet's core Google search business saw a +12% increase in revenues, thanks in part to its relatively new search results page feature, "AI Overviews," which reaches over 2 billion users. AI queries place tremendous strain on computing infrastructure, as we have heard from private AI-labs, particularly OpenAI. It is therefore a remarkable achievement that Alphabet, a company at the forefront of AI hardware and software development for over a decade, possesses the infrastructure to seamlessly roll out such an indispensable service to its users, while putting up record returns on invested capital for shareholders. For example, Alphabet carried a cumulative $300 billion of gross property plant and equipment, plus capitalized leases, at the end of 2024, up almost $170 billion from five years earlier. Remarkably still, the company now generates over $115 billion in annual gross cash flows, up from $48 billion five years ago. Alphabet has long been able to convert massive capex spending into highly attractive cash flow returns. This is one of the primary proof points as to why we are confident that not all large AI industry capex spending budgets necessarily will lead to over-spending.

BSD Analysis:
Alphabet is still the unshakeable backbone of the world’s digital demand engine, with Search and YouTube capturing intent and attention at a scale no competitor can meaningfully dent. The AI “threat” narrative has flipped—Alphabet’s model performance, TPU economics, and integration speed across Search, Ads, and Cloud are improving faster than bears can update their spreadsheets. Google Cloud has moved from perennial laggard to a margin-expanding enterprise contender with real AI traction and rising deal sizes. Meanwhile, advertising continues to print cash and fund some of the biggest compute infrastructure investments on the planet. Regulatory noise is loud but toothless; the core franchise has barely flinched. Alphabet’s problem isn’t fundamentals—it’s that investors are bored with a megacap growing this smoothly. But boredom is exactly what produces mispricing. Alphabet remains an AI-age compounder trading at a discount to its strategic relevance.

Pitch Summary:
Alphabet delivered strong results and received a favorable DOJ remedies decision on its default distribution agreements. Vulcan sees reduced regulatory risk and ongoing AI innovation as supportive of long-term value growth. The fund monitors antitrust cases and follows valuation discipline as fundamentals strengthen.

BSD Analysis:
Alphabet’s full-stack AI strategy — chips (TPU), data, models, infra, and distribution — is unmatched outside of Microsoft. Search remains the most profitable digital asset on earth, and it isn’t going anywhere. YouTube continues to be a cultural and advertising powerhouse. Cloud is now a serious enterprise contender with accelerating leverage. The company is cutting fat and pushing more operating efficiency than the market expected. Alphabet is still an AI-first company — it just doesn’t announce it with fireworks. Seriously undervalued relative to its dominance.

Pitch Summary:
Medpace reported mid-teens revenue growth and 20% operating earnings growth. Management repurchased ~6% of outstanding shares amid weakness. Improved biotech funding and faster client decisions led to a raised full-year outlook. Vulcan noted a large increase in estimated value per share and trimmed after the stock outpaced its valuation growth.

BSD Analysis:
Medpace isn’t just a CRO — it’s the CRO that out-executes everyone else. Sponsor satisfaction remains elite, timelines are predictable, and the company avoids the bloated overhead that sinks competitors. Growth persists even in weak biotech funding cycles because Medpace wins on reliability, not flash. The market whines about valuation, ignoring that returns on capital justify it. Founder-led discipline is a massive competitive advantage. Medpace is the CRO equivalent of an elite special-ops team. Relentlessly efficient, consistently underestimated.

Pitch Summary:
Vulcan Value Partners re-initiated its position in Fiserv, a company it has owned multiple times before, citing high switching costs, strong cash generation, and essential financial services products. Despite a meaningful share price decline earlier in 2025, Fiserv’s value remained stable. Management plans to repurchase discounted shares using over $5 billion of expected free cash flow, enhancing per-share value growth.

BSD Analysis:
Fiserv is the quiet backbone of everyday payments, powering merchant acquiring, core banking, and digital rails with ruthless operational precision. Clover’s growth trajectory is still underappreciated, and unit economics keep improving. Recurring revenue provides stability in every macro environment. Fintech darlings fade; infrastructure names endure. Fiserv’s cash flow and margin profile rival top software players, but the valuation doesn’t reflect that. Execution is consistent, management disciplined. A long-duration sleeper compounder.

Pitch Summary:
The letter identifies quantum computing firms as the “purest expression” of 2025’s mania, noting that the four publicly traded quantum stocks collectively trade at ~$540 billion market cap versus ~$100 million in total revenues — a 600x sales multiple. The manager deems the sector a prime shorting opportunity, highlighting the lack of commercial applications and speculative valuations.

BSD Analysis:
Quantum Computing Inc. is a speculative, early-stage player in a field where hype overwhelms fundamentals. The company has interesting IP and a few differentiated approaches, but commercialization remains distant. Revenue is minimal, and dilution risk is real. Still, the optionality is massive if quantum accelerates faster than expected. The stock trades like a science project — which, to be fair, it largely is. But in deep tech, narrative can flip overnight. High volatility, high imagination, high uncertainty.

Pitch Summary:
Warden Capital criticizes the AI bubble and specifically Nvidia’s $100 billion vendor-financing arrangement with OpenAI, describing it as a symptom of late-cycle mania. The letter argues Nvidia’s willingness to fund OpenAI’s capex — which will in turn be spent on Nvidia chips — mirrors the vendor-financing excesses of the dot-com bubble. The manager questions whether current AI infrastructure spending can generate the $2 trillion in revenues needed to justify the ~$400B annualized AI capex pace.

BSD Analysis:
Nvidia is the choke point of the AI economy — without its GPUs and networking stack, the entire industry slows to a crawl. CUDA is a moat that simply doesn’t crack, and Blackwell’s early demand signal is absurd. Revenue visibility is stretching into years, not quarters. Networking (NVLink + InfiniBand) is becoming Nvidia’s second monopoly. Yes, it looks expensive — but nothing else has its unit economics, strategic positioning, or growth trajectory. Nvidia remains the most important company in modern computing. The center of gravity in AI isn’t shifting anytime soon.

Pitch Summary:
Salesforce is the world’s leading SaaS vendor for customer relationship management (CRM) and salesforce automation (SFA) software, including AI agents. Salesforce offers many other products including software for marketing automation, customer service automation, analytics, application integration, and enterprise collaboration among others. Growth guidance for the upcoming quarter was slightly lower than anticipated leading some investors to question whether Salesforce’s growth was slowing and AI investments were not bearing fruit. These questions have been amplified by a bearish industry narrative that AI will take market share from enterprise software companies like Salesforce. We believe the company is poised for sustained growth and will actually benefit from AI. Salesforce’s software is deeply embedded in the enterprise. The company is expanding its product suite with multiple cloud offerings, proprietary data, and an emphasis on being an AI innovation leader. In addition, its customers would rather focus on running their businesses instead of designing, testing, maintaining, and securing internal AI products in an ever-evolving landscape. Salesforce is deeply entrenched within its customer base, has high retention, high recurring revenue, and is a very scalable business with high margin potential. Salesforce is dominant across its offerings and is constantly innovating with new products like Agentforce to deepen customer relationships and grow the business.

BSD Analysis:
Nasdaq is a misunderstood fintech infrastructure play — the exchange is just the storefront. The engine is market technology, regulatory software, and anti-fincrime analytics, which have sticky, global customers and high margins. Growth is durable even when trading volumes stagnate. Investors still over-index to equity-market sentiment, missing the SaaS transformation underway. The balance sheet is manageable, and recurring revenue is rising. Nasdaq is becoming a data-control company, not a trading venue. A long-duration compounder hiding in plain sight.

Pitch Summary:
As a reminder, we purchased UnitedHealth Group in the second quarter after its stock had declined from approximately $600 per share to under $300 per share. Our estimated value remained stable. In late July, UnitedHealth Group issued its revised 2025 financial guidance which was poorly received by the market. During the second week of September, UnitedHealth Group made several announcements that were positively received by investors. The company reaffirmed its 2025 guidance. It also disclosed that based on preliminary review, 78% of its Medicare Advantage membership will be in 4 star or higher plans for Star Year 2026/Payment Year 2027, which is consistent with historical performance.

BSD Analysis:
UnitedHealth is a healthcare superstructure — insurance, care delivery, pharmacy services, and analytics — all feeding a closed-loop data ecosystem with massive scale advantages. Medicare Advantage volatility has spooked the market, but UNH remains one of the most consistently profitable companies in U.S. healthcare. Optum continues to expand quietly, building the rails for value-based care. Regulatory headlines make for noise, not thesis breaks. Cash flow is enormous, and capital allocation is best-in-class. When sentiment normalizes, UNH almost always bounces back fast. A defensive megacap with structural growth drivers.

Pitch Summary:
Alphabet delivered strong results during its second fiscal quarter. In early September, Alphabet received a favorable remedies decision in the case brought by the Department of Justice concerning Alphabet’s default distribution agreements with original equipment manufacturers, browser developers, and wireless carriers. The remedies decision from early September and the court’s August 2024 ruling that Alphabet violated Section 2 of the Sherman Act are both still subject to appeal. However, we believe that the remedies decision issued in early September alleviates certain outsized risk to Alphabet’s business model. We continue to monitor the AI disruption risks and the ongoing antitrust cases against the company. We will follow our discipline as we receive more information.

BSD Analysis:
Alphabet remains a scale monster in digital demand capture, sitting at the crossroads of global attention, AI compute, and cloud infrastructure. For all the noise, its core businesses are remarkably resilient. AI integration across Search and Ads is inevitable, not optional, and Google is one of the few players with the data and infra to pull it off. Cloud profitability is inflecting, and enterprise adoption is improving. Bears underestimate the optionality in Waymo, DeepMind, and health AI. Alphabet has always thrived where information density is highest — and AI increases that density exponentially. A misunderstood compounding machine.

Pitch Summary:
Salesforce is the world’s leading SaaS vendor for customer relationship management (CRM) and salesforce automation (SFA) software, including AI agents. Salesforce offers many other products including software for marketing automation, customer service automation, analytics, application integration, and enterprise collaboration among others. Growth guidance for the upcoming quarter was slightly lower than anticipated leading some investors to question whether Salesforce’s growth was slowing and AI investments were not bearing fruit. These questions have been amplified by a bearish industry narrative that AI will take market share from enterprise software companies like Salesforce. We believe the company is poised for sustained growth and will actually benefit from AI. Salesforce’s software is deeply embedded in the enterprise. The company is expanding its product suite with multiple cloud offerings, proprietary data, and an emphasis on being an AI innovation leader. In addition, its customers would rather focus on running their businesses instead of designing, testing, maintaining, and securing internal AI products in an ever-evolving landscape. Salesforce is deeply entrenched within its customer base, has high retention, high recurring revenue, and is a very scalable business with high margin potential. Salesforce is dominant across its offerings and is constantly innovating with new products like Agentforce to deepen customer relationships and grow the business.

BSD Analysis:
Nasdaq has become far more than an exchange — it’s now a risk, data, and compliance software platform with sticky recurring revenue. Anti-fincrime software, fraud prevention, and market tech are driving the real growth. Margins are expanding as the business mix tilts toward SaaS-like revenue. The exchange business provides stability, but the transformation is where the upside lies. Investors still treat Nasdaq like a market-volume proxy — totally outdated. Cash generation is strong and balance sheet risk is low. A global fintech infrastructure name trading at a discount to peers.

Pitch Summary:
Alphabet delivered strong results during its second fiscal quarter. In early September, Alphabet received a favorable remedies decision in the case brought by the Department of Justice concerning Alphabet’s default distribution agreements with original equipment manufacturers, browser developers, and wireless carriers. The remedies decision from early September and the court’s August 2024 ruling that Alphabet violated Section 2 of the Sherman Act are both still subject to appeal. However, we believe that the remedies decision issued in early September alleviates certain outsized risk to Alphabet’s business model. We continue to monitor the AI disruption risks and the ongoing antitrust cases against the company. We will follow our discipline as we receive more information.

BSD Analysis:
Google’s AI recalibration is working, with model performance rising and integration into Search, Workspace, and Cloud deepening. The company’s TPU advantage remains underappreciated — it can train cheaply at scale in ways competitors envy. YouTube continues to print money and shorts monetization is clicking. Search remains the single best asset in global advertising, no matter how loudly critics chant “AI disruption.” Meanwhile, Google Cloud is becoming a serious enterprise contender. Alphabet’s financial strength gives it a luxury few companies have: time. A long-duration tech titan with unrealized AI upside.

Pitch Summary:
Alphabet delivered strong results during its second fiscal quarter. In early September, Alphabet received a favorable remedies decision in the case brought by the Department of Justice concerning Alphabet’s default distribution agreements with original equipment manufacturers, browser developers, and wireless carriers. The remedies decision from early September and the court’s August 2024 ruling that Alphabet violated Section 2 of the Sherman Act are both still subject to appeal. However, we believe that the remedies decision issued in early September alleviates certain outsized risk to Alphabet’s business model. We continue to monitor the AI disruption risks and the ongoing antitrust cases against the company. We will follow our discipline as we receive more information.

BSD Analysis:
Alphabet still dominates global digital distribution with Search, YouTube, and Android forming an ecosystem moat that’s almost impossible to replicate. AI panic was overblown — Gemini is improving fast, and Google retains some of the best model-training infrastructure on earth. Advertising remains a cash machine and Cloud is finally profitable with accelerating margins. Regulatory noise is constant but rarely material. Alphabet’s problem is narrative, not fundamentals — which is exactly what creates opportunity. With buybacks shrinking the float, EPS leverage is real. A misunderstood AI heavyweight more durable than investors give it credit for.

Pitch Summary:
Medpace reported strong results in the second quarter. The company’s revenue grew at a mid-teens rate while operating earnings were up 20% year over year. The management team took advantage of the company’s share price weakness throughout the quarter by repurchasing nearly 6% of the outstanding shares. Importantly, Medpace significantly increased its outlook for revenue and earnings for the full year. The combination of a better biotech funding environment, fewer cancellations, and faster client decision making (among other positive trends) is now positioning the company to drive accelerated growth. This is a notable change from our prior expectation for 2025. Higher operating earnings and a meaningfully lower share count has led to a large increase in our value per share estimate. During the quarter, the share price rose faster than our value and following our discipline we trimmed the position and reallocated capital to more discounted businesses.

BSD Analysis:
Medpace is the CRO that never stumbles — elite margin profile, disciplined cost culture, and clinical execution pharma clients trust. While biotech funding cycles fluctuate, Medpace consistently posts growth because sponsors value predictable timelines more than anything else. The balance sheet is pristine, and management runs the company with the intensity of a founder-led operator. No bloated bureaucracy, no failed integrations, no drama. The market complains about valuation, but in CRO-land, flawless execution deserves a premium. Medpace feels expensive until you look at returns on capital. A compounder hiding in plain sight.

Pitch Summary:
Fiserv Inc. is a company we have successfully owned multiple times in the past. It is a global payments solutions and financial services provider. The business consists of two segments: merchant solutions and financial solutions. Each of these segments provides essential products and services to its customers. Fiserv’s products have high switching costs, which aids in customer retention and increases the stickiness of their revenues. The company expects to generate over $5 billion of free cash flow this year. The company is using its free cash flow to repurchase its discounted shares, which increases our value per share growth. Fiserv stock has declined meaningfully since we sold it earlier this year. Our value has remained stable. We are pleased to be able to own this wonderful business with a substantial margin of safety once again.

BSD Analysis:
Fiserv has become a payments-infrastructure juggernaut with Clover scaling faster and more profitably than most investors realize. Banking software, issuer solutions, and merchant acquiring combine into a multi-rail ecosystem nobody else offers at this scale. Cash flow is massive and reinvested with discipline through buybacks and selective M&A. Critics see a “legacy processor,” but new-business momentum and recurring revenue tell a very different story. Fiserv’s relevance has actually increased as fintech startups fade and merchants seek stability. Valuation is still modest for a company with this durability. A stealth compounder disguised as a boring payments name.

Pitch Summary:
Wizz Air, a leading European ultra-low-cost airline, sold off due to Pratt & Whitney engine issues that grounded part of its fleet, ballooning maintenance costs and collapsing margins. Pzena believes these are temporary, with technical fixes identified and liquidity strong. Trading near 6x depressed earnings and 4x normalized earnings, the firm increased its stake, viewing Wizz as a structurally advantaged operator positioned for recovery as fleet normalization occurs.

BSD Analysis:
Wizz Air is a high-growth, ultra-low-cost carrier with unmatched cost discipline and one of the youngest fleets in Europe. Post-COVID recovery is strong, and capacity expansion is aggressive. Operational volatility remains a problem, but demand trends remain firmly in Wizz’s favor. Fuel hedging and fleet strategy give it a long-term cost edge. The stock trades at a discount because investors fear EU macro and operational stumbles. But Wizz has consistently outgrown peers. A high-beta aviation growth story with major upside if execution steadies.

Pitch Summary:
Spectrum Brands came under pressure due to perceived tariff exposure in its Home and Personal Care (HPC) segment. Pzena notes this segment contributes only ~25% of EBITDA, while 80% of appliance profits are earned outside the U.S. Its Pet Care and Home & Garden divisions remain steady. The market’s focus on HPC overstates risk and overlooks solid core earnings, enabling Pzena to increase its position below 5x normalized earnings.

BSD Analysis:
Spectrum Brands is unlocking value through portfolio simplification, debt reduction, and margin repair. The remaining home and garden categories have defensible positions and steady demand. FX and cost inflation hit hard, but operating discipline is improving. The stock still trades like a broken consumer conglomerate even as fundamentals strengthen. Management now has a cleaner playbook and more focused assets. If margins continue trending up, the rerating is meaningful. A mid-cap consumer recovery hiding in a messy wrapper.

Pitch Summary:
France-based Teleperformance is the world’s leading outsourced customer experience provider. During COVID, call volumes surged, lifting valuation, but post-pandemic normalization and AI disruption fears have weighed heavily on shares, now down ~70% from 2022 highs. Pzena believes market fears are overblown: AI automation covers only routine calls (~10%), while AI’s greater promise lies in augmenting human agents’ productivity. Teleperformance’s in-house AI solutions already serve over half its customers. Trading at ~4.5x forward earnings and >20% FCF yield, Pzena increased its stake, citing durable business demand and market share gains among scaled providers.

BSD Analysis:
Teleperformance is still digesting the reputational hit from past labor issues, but the underlying business remains a global CX powerhouse with unmatched scale. BPO demand is stable, margins are solid, and digital transformation is boosting higher-value segments. The Majorel acquisition strengthens geographic breadth and deepens vertical expertise. Investors can’t get past the headlines, creating a major multiple gap. Teleperformance has bounced back from controversies before — and it will again. A high-cash-flow global services player trading at fear levels.

Pitch Summary:
Baxter International is a leading manufacturer and supplier of everyday hospital essentials, from IV bags and infusion pumps to smart beds and injectable drugs. The company is deeply embedded in hospital operations, with a large installed base of equipment and a broad consumables portfolio that together drive long-term customer relationships. Its core product categories are concentrated among a small number of scaled providers, which supports pricing discipline and stable margins. Despite these strengths, Baxter’s stock has fallen nearly 80% from its 2021 peak, as four temporary headwinds have weighed on margins: contract pricing lag from fixed-price hospital contracts, reduced IV bag usage following a supply disruption, stranded costs tied to dialysis divestiture, and a temporary halt in shipments of its new Novum IQ infusion pump. Pzena believes these are transitory issues, with margin recovery underway as contract repricing, volume normalization, and cost elimination progress. The firm projects operating margins returning to ~20% and sees the stock as deeply undervalued at 5.8x normalized earnings.

BSD Analysis:
Baxter is emerging from a chaotic stretch of supply-chain issues and portfolio turmoil, with margin recovery now showing real traction. The company’s spin of its kidney-care unit simplifies the story and clarifies earnings power. Core medical products remain stable with strong hospital relationships. Debt is still elevated, but cash flow is improving and deleveraging is underway. The market is anchored on the worst days of the story, not the improving present. Execution is trending the right way. A credible med-tech recovery with valuation tailwinds.