Investment Pitches

Pitch Summary:
Cairn Homes experienced temporary share price volatility, providing an opportunity to increase holdings at less than eight times earnings. We believe the stock trades at a material discount to intrinsic value, particularly as the company is positioned to capitalise on sustained growth in the Irish residential property market.

BSD Analysis:
Cairn Homes is entering 2026 as the dominant player in the Irish residential market, recently upgrading its guidance to reflect record-breaking demand and a robust forward order book exceeding 1.1 billion euros. The company is on track to deliver over 2,300 homes this year, with a strategic focus on the "First Time Buyer" segment where supply remains chronically constrained. Revenue for 2026 is projected to surpass the 1 billion euro milestone for the first time, supported by a healthy 22 percent gross margin and improving operational leverage. Management’s disciplined capital allocation, including consistent share buybacks and a growing dividend, underscores its commitment to total shareholder returns. With a return on equity target of 17 percent and a significant land bank in high-growth corridors, Cairn remains a premier "picks and shovels" play on the Irish economic recovery.

Pitch Summary:
The decision to add to Apollo was driven by a pronounced valuation disconnect as the stock experienced a peak-to-trough drawdown of approximately 30% from its 2025 highs. Apollo retains a core position anchored by its unique credit origination engine and strength of its Athene retirement services platform.

BSD Analysis:
Apollo is positioning itself as a primary beneficiary of the private credit supercycle, with its 2026 outlook centered on the massive expansion of its retirement services and wealth management platforms. The firm is successfully leveraging its Athene insurance arm to provide a steady, low-cost capital base that differentiates it from pure-play private equity peers. Management expects to drive significant fee-related earnings growth as it scales its "origination ecosystem," particularly in infrastructure and asset-backed finance. While higher-for-longer interest rates pose a challenge for traditional buyouts, Apollo's credit-heavy model is thriving, delivering high-teens returns on equity. Investors are increasingly valuing the firm for its predictable cash flows and its leading role in the professionalization of the global private markets.

Pitch Summary:
During the quarter, we initiated a position in Siemens Healthineers, a global leader in medical imaging and advanced therapies. The company benefits from aging demographics, personalised care trends, and rising chronic disease prevalence. The investment case is supported by dominant market position, transition toward high-margin recurring income, and Siemens’ planned spinoff increasing free float and simplifying governance.

BSD Analysis:
Siemens Healthineers is navigating a complex 2026 landscape with a strategic focus on its Varian and Imaging segments, which are currently driving mid-single-digit revenue growth. Despite significant headwinds in the Chinese market due to regional procurement policies, the company has maintained its full-year 2026 guidance, supported by strong demand for photon-counting CT scanners and AI-integrated precision therapy. Management is prioritizing operational efficiency and "Value Partnerships" to buffer against margin pressure in its Diagnostics division. The stock remains a favorite among analysts for its essential role in global healthcare infrastructure and its high-margin recurring service revenue. As the company continues to de-lever following the Varian acquisition, it offers a compelling defensive profile with structural upside from the global shift toward personalized medicine.

Pitch Summary:
The Fund initiated a position in Union Pacific, the largest listed freight rail operator in the United States. The catalyst was Union Pacific’s proposed combination with Norfolk Southern, creating the first transcontinental rail network in the US. We believe this provides a credible pathway to renewed volume growth and further productivity gains in a mature industry.

BSD Analysis:
Union Pacific’s moat is irreplaceable rail infrastructure across key U.S. corridors. Barriers to entry are absolute—no one builds competing railroads anymore. Pricing power exists through fuel surcharges and contract resets. Volume depends on industrial demand and commodity flows. Operating efficiency determines margin durability. Regulatory scrutiny is constant but manageable. The bull case is volume recovery layered onto precision-scheduled rail discipline. The bear case is freight softness and service issues eroding pricing. Union Pacific compounds because steel tracks don’t move—and neither do its rights-of-way.

Pitch Summary:
The European banking sector produced another period of outperformance, led by rate-sensitive majors including Lloyds Banking Group. Stabilisation of short-term interest rates and a steepening yield curve supported margins and earnings resilience.

BSD Analysis:
Lloyds’ moat is scale in UK retail banking with a low-cost deposit base. Market share in mortgages and current accounts gives structural funding advantage. Earnings ride rate cycles heavily, with limited geographic diversification to offset swings. Cost discipline is solid, but revenue growth is modest outside spread income. Regulatory scrutiny caps upside but stabilizes downside. Credit quality remains the key swing factor. The bull case is steady spreads with manageable impairments and capital returns. The bear case is housing weakness compressing profitability. Lloyds survives on scale—not growth.

Pitch Summary:
The European banking sector produced another period of outperformance, led by rate-sensitive majors including Bank of Ireland, Lloyds Banking Group, and CaixaBank. Sector returns have been underpinned by the stabilisation of short-term interest rates and a subsequent steepening of the European yield curve, which has supported net interest margins. European banks trade at a forward P/E of approximately 10x, which does not fully reflect enhanced earnings resilience and improved outlook.

BSD Analysis:
Bank of Ireland’s moat is domestic deposit dominance in a market that consolidated after crisis trauma. Competition is thinner than in most European markets, which supports spreads. Rate cycles drive earnings more than innovation ever will. Credit discipline matters because Irish property exposure never fully disappears. Capital returns are back, but still hostage to macro and regulatory oversight. Digital investments improve efficiency, not differentiation. The bull case is steady NIM with contained impairments and disciplined buybacks. The bear case is property slowdown reigniting credit stress. Bank of Ireland compounds when the Irish economy stays boring.

Pitch Summary:
Our position in UK-listed IMI plc bolstered portfolio performance. As a global leader in the engineering of mission-critical valves and actuators, IMI provides essential fluid and motion control solutions aligned with structural growth drivers across energy transition, healthcare, and industrial automation. Since our initial entry in August 2024, the position has delivered substantial capital appreciation, rising over 40%.

BSD Analysis:
IMI plc is poised for a breakout year in 2026, with strong buy ratings and robust free cash flow of over 281 million dollars providing significant strategic flexibility. The company’s commitment to sustainable engineering solutions, particularly in emissions reduction and zero-emissions transport, aligns perfectly with global environmental priorities. Management is delivering an impressive return on equity of nearly 24 percent, signaling effective capital allocation and a high ability to generate profits. While the stock has recently tested resistance levels, technical indicators like the 200-day moving average suggest a solid long-term upward trend. A sustainable dividend payout ratio of 33 percent makes IMI an attractive option for income-seeking investors who also want exposure to industrial growth. As a leader in specialized engineering, IMI is well-positioned to capitalize on the continued demand for high-efficiency fluid control and climate solutions.

Pitch Summary:
In early September Teck Resources and Anglo American announced a merger of equals that would create the world’s fifth-largest copper miner. Benefits include the ability to integrate Teck’s Quebrada Blanca II (QBII) with Anglo’s neighbouring Collahuasi mine. Synergies would be realised by depositing Collahuasi’s high grade ore through both its existing processing circuit and QBII newly constructed infrastructure. Shareholders approved the deal in December and completion is expected in the coming months. The combined group will have one of the most premier copper portfolios globally.

BSD Analysis:
Teck Resources delivered a standout performance in early 2026, with earnings per share significantly exceeding expectations at 1 dollar per share. The company’s financial health is robust, characterized by a low debt-to-equity ratio of 0.15 and a strong current ratio that indicates excellent liquidity. The centerpiece of the investment thesis is the strategic merger with Anglo American, which aims to create a global critical minerals champion with a top-five position in the copper market. Shareholders have overwhelmingly supported this move, which has already cleared key regulatory hurdles under the Investment Canada Act. With a market capitalization of 29 billion dollars and high visibility into copper production from the Quebrada Blanca site, Teck is ideally positioned for future growth. The company offers a high-quality combination of operational excellence and transformational M&A potential.

Pitch Summary:
Freeport McMoRan was able to recover the share price drawdown seen in September following a major mudflow event at their Grasberg mine, which resulted in a full suspension of production and a material cut to guidance. In mid-November, the leadership team issued an operational update that was well received by investors, and the share price finished 2025 at its high. While Grasberg’s restart and medium-term production guidance broadly is in line with previous commentary, the update helped alleviate concerns around a more material impairment of the Grasberg block cave (GBC). Copper surged 17% over the quarter, while gold gained another 12%, translating into strong performance from portfolio holdings Freeport McMoRan +30%.

BSD Analysis:
Freeport-McMoRan has received a major analyst upgrade in early 2026, moving from "Hold" to "Buy" as the outlook for copper prices remains exceptionally positive. The company is projected to see a 5 percent increase in annual revenue, reaching over 27 billion dollars as it benefits from the electrification supercycle and the global AI infrastructure buildout. Institutional sentiment is growing increasingly bullish, with total shares owned by institutions rising and a put/call ratio that reflects a positive market bias. Management is focusing on optimizing its high-margin Grasberg operations in Indonesia while advancing expansion projects in North America. Despite near-term stock volatility, the company’s dominant position as the world's leading publicly traded copper producer provides a significant competitive moat. Freeport remains a premier play for investors looking to capitalize on the long-term scarcity of critical industrial metals.

Pitch Summary:
The fund closed its position in Woodside during the quarter amid growing concerns around the company’s commodity exposure, particularly the multi-billion-dollar Louisiana LNG project. Louisiana LNG relies on low US gas prices and high global LNG prices - a dynamic that has materially reversed since the project was acquired. Subsequent to the sale of the position the shares have sold off on concerns around this US-to-Europe gas arbitrage.

BSD Analysis:
Woodside Energy is moving into 2026 with a high-conviction focus on its major growth projects, including the Sangomar and Scarborough developments which are nearing critical milestones. The company is benefiting from a robust global demand for liquefied natural gas (LNG), positioning it as a key player in the energy transition for the Asia-Pacific region. Management is prioritizing capital efficiency and a strong balance sheet, with a clear focus on delivering high-margin, low-carbon energy solutions. The integration of the BHP Petroleum merger is now fully realized, yielding significant operational synergies and a more diversified production base. While commodity prices remain subject to global geopolitical shifts, Woodside’s low-cost production profile and established customer contracts provide high visibility into future cash flows. For investors, Woodside offers a premier exposure to the global LNG market with a reliable dividend track record.

Pitch Summary:
Frontier Digital Ventures was the main detractor to performance over the period retracing the strong performance witnessed in the preceding quarter. Frontier's newly appointed management team has initiated a detailed operational review aimed at refocusing the business on its core classifieds operations. As part of the review, the decision was made to exit several non-core loss making revenue lines - these actions will lead to lower revenues and higher one-off costs in 2025 but should also help improve profitability and cash flow into 2026.

BSD Analysis:
Frontier Digital Ventures is currently facing a challenging period, with technical indicators and analyst sentiment leaning toward a negative evaluation in the near term. The company, which specializes in online classifieds across emerging markets, is dealing with high volatility and periodic low trading volumes that increase investor risk. While a recent pivot bottom point offered a brief 12.5 percent rise, the long-term moving averages suggest a general sell signal persists. Management is focusing on stabilizing operations and improving the monetization of its primary assets in Latin America and Southeast Asia. The company’s performance is highly sensitive to the macroeconomic stability of its frontier markets, which remains uneven in early 2026. For high-risk investors, FDV offers exposure to the long-term digitization of emerging economies, but current performance requires significant caution.

Pitch Summary:
Our conviction in Challenger Limited continues to yield strong results, with the position rising 8% over the quarter and achieving a 57% return for the year ending 31 December 2025. Investors are increasingly pricing in the anticipated benefits of APRA’s proposed capital requirement reforms, which are aimed at optimising capital efficiency for annuity providers. Since initiating our position in 2023, our thesis was predicated on three core pillars: the normalisation of interest rates, the structural growth of the retirement income and the emergence of regulatory tailwinds. As these catalysts materialise, we are seeing the dual benefit of organic earnings expansion and a fundamental valuation re-rating of the stock.

BSD Analysis:
Challenger Limited is well-positioned to benefit from a record year for asset-backed securities (ABS) and elevated funding needs across the Australian financial sector. The company is seeing strong demand for its innovative investment products as institutional and retail investors seek higher yields in a stabilizing interest rate environment. Management is focusing on expanding into new and esoteric asset classes, leveraging its deep expertise in retirement income solutions to capture a larger market share. While macroeconomic and geopolitical risks persist, Challenger’s diversified portfolio and structural protections in its investment vehicles provide a resilient earnings base. Regulatory changes in Europe and Australia are also expected to broaden the investor base for Challenger’s specialized offerings. As a leading player in the life and wealth management space, Challenger offers a unique play on the aging population and the growing demand for secure income.

Pitch Summary:
In steelmaking coal, Stanmore Resources remains resilient despite low commodity prices that have seen peers, including several industry giants, take measures to preserve cash. These measures include idling underperforming parts of their assets, deferring capital expenditure, or high grading their mine. Stanmore has maintained consistent mine plans and capital expenditure programs and is therefore well positioned to benefit from any improvement in commodity prices.

BSD Analysis:
Stanmore Resources is demonstrating exceptional operational excellence in 2026, with a 63 percent decrease in net debt during the final quarter of the previous year. The company’s Queensland coal operations are generating significant cash flow, supporting a competitive trailing dividend yield of nearly 4.8 percent. Management is successfully optimizing working capital and enhancing cash conversion efficiency, providing the flexibility needed for future growth initiatives like the Isaac Downs development. While the coal sector faces long-term demand scrutiny, Stanmore’s low leverage and high-quality metallurgical coal reserves provide a strong defensive buffer. Analyst consensus points to significant upside potential, with price targets suggesting a 19 percent gain from current trading levels. For income-seeking investors, Stanmore offers a rare combination of high yields and a rapidly strengthening balance sheet.

Pitch Summary:
Capstone Copper +16% performed strongly. Copper surged 17% as supply risks came back into focus following production disruptions and material downgrades to production guidance due to geotechnical issues at several large-scale mines. We have outlined our view on the impending supply shortfall in the copper markets and recent supply disruptions acutely highlighting how tight copper markets have become given the lack of new greenfield capacity coming online and record low inventories.

BSD Analysis:
Capstone Copper is targeting 2026 as a pivotal year for its production ramp-up, with consolidated copper output forecast between 200,000 and 230,000 tonnes. The company is heavily focused on executing the Mantoverde Optimized Project, which is expected to drive significantly higher production and lower cash costs by 2027. While 2026 cash costs are projected to increase slightly due to mine sequencing and inflationary pressures, the long-term cost profile remains highly competitive. Management is maintaining a disciplined capital expenditure plan of 495 million dollars, primarily directed toward brownfield expansion and high-potential exploration in Chile. Strategic copper and gold hedging collars have been implemented to ensure break-even pricing on higher-cost production, protecting the balance sheet during market fluctuations. Capstone remains a high-conviction play on the essential copper market, backed by a clear roadmap for operational growth.

Pitch Summary:
Gold and copper positions again contributed meaningfully to performance, supported by higher commodity prices. Portfolio holdings Newmont +18% performed strongly. Gold rose 12% over the period, reaching a record high in December. Monetary policy and geopolitical uncertainty continued to provide a positive backdrop for gold. In December, the United States Federal Reserve cut interest rates by 25-basis points despite inflation remaining somewhat elevated. The move followed sustained criticism from President Trump and calls for materially lower interest rates. As we enter 2026, we expect sentiment towards gold to remain favourable, particularly ahead of the announcement of a new Federal Reserve Chair.

BSD Analysis:
Newmont Corporation has unveiled an enhanced capital allocation framework for 2026, aimed at maximizing total shareholder returns through a sustainable 1.1 billion dollar annual dividend. The company is prioritizing margin expansion and robust free cash flow generation from its unrivaled portfolio of tier-one gold and copper assets. Management plans to spend 1.95 billion dollars this year, with a disciplined focus on high-return development projects like the Cadia and Lihir expansions. The ongoing share repurchase program is designed to permanently lower the outstanding share count, driving significant per-share dividend increases over the commodity cycle. While gold price volatility remains a factor, Newmont’s resilient balance sheet and low-cost production profile provide a solid defensive buffer. As the world’s largest gold miner, Newmont offers a compelling combination of income stability and exposure to the rising demand for critical minerals.

Pitch Summary:
Within the DAT sector, Sigil Core is invested in Forward Industries (FWDI). It currently trades at a discount to its holdings and we are betting on the world-class team to drive added value to their holdings. We expect the stock to act as a high-beta exposure to SOL, and when the market sentiment shifts we are betting on it to trade close to its mNAV. In the meantime, the SOL in the treasury will earn substantial yield. In general we believe high yielding utility assets such as SOL or HYPE are better suited for DAT mandates than more passive assets such as BTC.

BSD Analysis:
Forward Industries is currently operating as a niche player in the design and distribution of custom carrying cases and specialized product packaging for the medical and technology sectors. The company’s investment profile is heavily tied to its ability to secure long-term supply agreements with major global brands, which provides a steady but limited revenue base. In 2026, the firm is exploring opportunities to diversify its portfolio through small-scale acquisitions in the industrial design and engineering space to enhance its value-add capabilities. While the stock remains a micro-cap play with lower liquidity, management’s focus on maintaining a lean cost structure and improving net margins is a key priority for value creation. Investors are looking for more aggressive top-line growth to justify a significant re-rating of the stock beyond its traditional manufacturing roots.

Pitch Summary:
Advance Auto Parts (AAP) is an auto parts distributor that sells to both professional repair technicians and retail customers. The company is struggling through a difficult turnaround and sits firmly in our “opportunistic value” bucket. But the balance sheet is in good shape, new management has articulated a credible restructuring plan and the company’s mid-term guidance for 7% operating margins is reasonable compared to competitors and Advance Auto’s own history. Results have been inconsistent as management works through the restructuring of Advance Auto’s distribution, inventory, merchandising and store operations.

BSD Analysis:
Advance Auto Parts is in the midst of a massive strategic turnaround, aiming to consolidate its distribution centers from 38 to 12 by the end of 2026. This logistics overhaul, spearheaded by CEO Shane O'Kelly, is designed to enhance supply chain efficiency and drive gross margins toward a 7% target for 2027. The company recently completed the sale of Worldpac for $1.5 billion, utilizing the proceeds to reduce leverage and fund core operational fixes. While the stock remains a "recovery play," early progress in its "blended-box" strategy—serving both Pro and DIY customers—has led some analysts to tag the stock as significantly undervalued relative to its potential free cash flow.

Pitch Summary:
ServisFirst Bancshares (SFBS) is a conservatively run lending franchise helmed by Tom Broughton. Tom hires local bankers but doesn’t build branches – this allows for best-in-class efficiency metrics while maintaining a strong and conservative lending culture. Return on equity (ROE) and average earnings per share growth were near 20% for the 10 years through 2024 – very attractive for a conservative, plain vanilla commercial lender. We think that SFBS trailed the regional bank indices in 2025 because of its concentrated exposure to South-Eastern real estate, a large Q3 non-accrual for which the bank obtained additional collateral and disappointing Q3 loan growth. We have followed the company for years and are extremely comfortable continuing to hold SFBS in our top 10 holdings.

BSD Analysis:
ServisFirst enters 2026 following a strong Q4 2025 performance, where net interest margins expanded to 3.38% (up 42 bps year-over-year). The bank reported an impressive efficiency ratio of 29% and a return on average common stockholders' equity of 18.9%. For 2026, management is targeting sustained loan growth in the Southeast U.S. market, which grew by $385 million in the most recent quarter. With zero FHLB advances or brokered deposits, ServisFirst maintains one of the cleanest liquidity profiles in the regional banking sector, positioning it to gain market share as interest rates stabilize.

Pitch Summary:
Upbound Group (UPBD) is a sub-prime lender that employs a rent-to-own model. The company has two primary segments: Rent-a-Center, which focuses on furniture and appliances through physical stores; and Acima, which offers last look financing through associated retailers including electronics and tire shops. Sub-prime consumers have struggled this year and Upbound’s operating results have ticked down. The company has been slow to de-lever after purchasing Acima in 2021 and made another incremental acquisition on Jan. 31, when it bought Brigit, an app which charges subscription fees to access payday lending. UPBD stock is cheap at less than five times forward earnings. But we have been slow to add given the company’s leverage and questions about its business model.

BSD Analysis:
Upbound Group (parent of Rent-A-Center and Acima) enters 2026 with a fresh "Buy" upgrade from Loop Capital and a price target of $36. The company is benefiting from strong growth in its Acima and Brigit divisions, which provide inclusive financial solutions to underbanked consumers. Management expects 2026 to be bolstered by accelerated depreciation provisions in the "One Big Beautiful Bill," providing significant tax-related cash flow benefits. Despite some sector volatility, the firm maintains a healthy 30.5% EBITDA margin and is successfully leveraging its omnichannel technology platform to capture a larger share of the lease-to-own market.

Pitch Summary:
PVH (PVH) is an apparel company that owns the Tommy Hilfiger and Calvin Klein brands globally. Most of PVH’s earnings come from Europe, where the Tommy and Calvin brands are considered “almost luxury” and where PVH has demonstrated high single-digit organic growth with pricing power over the decade preceding Covid. CEO Stefan Larsson has done an excellent job revitalizing the company and improving margins at PVH’s moribund U.S. operations. But, comparable revenue has been roughly flat over the last four quarters as the company bumped into weaker global consumer spending and actively cleaned up its channel inventory in Europe. Investors are skittish about tariffs and, in 2025, PVH’s inclusion on China’s “Unreliable Entity” list which threatens the roughly 15% of the company’s profitability that comes from China. But PVH’s sales and sourcing are globally diversified, and the company uses its prodigious cash flow to buy back shares. We think shares are cheap at roughly 6x trailing earnings.

BSD Analysis:
PVH Corp. is accelerating its "PVH+ Plan" through a new multi-year collaboration with OpenAI to integrate generative AI into brand-building for Tommy Hilfiger and Calvin Klein. For 2026, the company is leaning into high-profile sports partnerships, including Tommy Hilfiger's arrival on the Formula 1 grid with the Cadillac Team. Financially, the company declared a quarterly dividend of $0.0375 payable in March 2026. While the firm navigates a CFO transition, its focus remains on elevating the consumer experience through social-first campaigns and the expansion of global flagship stores, such as the new lifestyle concept in SoHo, NYC.