Investment Pitches

Pitch Summary:
Mortgage Advice Bureau (MAB1) provides mortgage and insurance advice across property purchases, remortgages, and protection products, supporting partner firms with technology, compliance, and lead generation. Despite macro uncertainty, the company remains a high-quality market leader with recurring revenue from remortgaging. Management is introducing AI-driven efficiencies to enhance adviser productivity. Shares declined amid temporary UK fiscal uncertainty, which the manager views as an attractive opportunity to add.

BSD Analysis:
MAB remains a structurally advantaged mortgage intermediary, with strong broker relationships, recurring lead flow, and a model that scales efficiently during both boom and bust cycles. The U.K. mortgage market has been brutal, but MAB continues to gain share and improve adviser productivity. As rate cuts arrive, volumes should rebound sharply with high incremental margins. The market still prices MAB like a cyclical lending business when in reality it’s an asset-light distribution platform. With fundamentals stabilizing, the stock is positioned for a solid rerating.

Pitch Summary:
Since we wrote about Howden Joinery (“Howden”) in 2011, its market share of UK kitchen volumes has risen from a fifth to a third - and we don't think it will stop there. Howden's model is robust and self-reinforcing: its dominant scale in the production of kitchens drives cost advantages which are passed on to kitchen installers and end customers through lower prices, which itself drives volumes. This advantage is especially powerful in downturns, where Howden consistently takes share from weak competitors. Howden has taken so much share over the last few years that one can hardly tell that end markets are weak: over the last five years, the volume of kitchens installed in the UK has fallen more than twenty percent, while Howden has increased sales by close to fifty percent. At today’s market capitalisation of GBP 4.5bn and enterprise value of GBP 4.1bn, investors can buy a high-quality business that perpetually takes market share, trading in line with historical valuation at seventeen times enterprise value to run-rate operating profit after tax of circa GBP 240m, despite significant optionality on volume and margin recovery. Howden's competitive edge originates from its cost advantage. At two-and-a-half times the size of its closest competitor, Howden wields significant bargaining power over its suppliers, exchanging guarantees of volumes for lower prices per item. Additionally, Howden has selectively brought around a third of manufacturing in-house, capturing scale-related manufacturing efficiencies and procurement advantages that would otherwise be fragmented if sourcing from several suppliers (e.g. chipboard purchasing). Furthermore, while competitors such as Wren and Magnet operate under a consumer-facing model requiring large showrooms, Howden's offering is geared towards the kitchen installer - stores are small, unimpressive, and often hidden away on industrial estates, keeping overheads low. On top of this, Howden operates a world-class logistics network, capitalising on its greater density of stores to deliver stock faster, with fewer faults, and at a lower cost than competitors. The feather in Howden's cap is not the cost advantage itself, but how it is shared with each part of the value chain to incentivise the sale of Howden kitchens. Howden's store managers are given local P&L ownership and generous profit sharing, and the superior store economics compared to peers results in store managers making more money at Howden than elsewhere - meaning they naturally amass the best talent in the industry. Kitchen installers make more money selling Howden than any other brand: Howden kitchens are priced cheaper than peers for an equivalent product and operate under a confidential pricing model, meaning installers can mark up the sale and capture most of that pricing differential for themselves. Additionally, the in-stock model means that the majority of stock is available immediately or the next day and, combined with market-leading store proximity (nearly ninety percent of UK customers live within five miles of a Howden store), installers are able to turn over projects faster. Finally, the price to the end customer is typically lower than an equivalent kitchen from a competitor, as it is in the installers' interests to pass on enough of the economics to incentivise the end customers to choose Howden. The competition continues to weaken. Competitors such as Magnet and Wren are ceding share to Howden as the trade channel slowly suffocates the consumer-oriented channel. Benchmarx, Travis Perkins' homebrewed answer to Howden, has been closing stores having never achieved sufficient scale to compete effectively. Homebase and B&Q have both closed their trade businesses, and Ikea, though taking share, remains small and competes only within flat-pack. Thirty to forty percent of the market is still made up of specialist independents, and Howden is coming for them too. This industry is a cage fight between a gorilla and a chihuahua - and we know who we're betting on. UK kitchen volumes remain below the trough of the financial crisis in 2010-11, and more than twenty percent below what we consider normalised levels. Consumer confidence is low, pandemic-driven renovation has cooled, and higher interest rates have slowed down housing transactions – the main driver of replacement demand. The sell side models around one percent volume growth in the medium-term. We would be surprised if Howden did not outperform this even in a flat market, given incessant market share gains and maturation of the store base. In a modest recovery scenario, we believe Howden could see three to five percent volume growth annually over the next four years, driving high-single-digit sales growth after accounting for circa two percent price increases and two to three percent store count growth. Any outperformance of volumes will drop through at very attractive margins. Today, Howden's operating margin is around thirteen percent (adjusted for IFRS interest expense) compared to an average of around seventeen percent over 2015-19, and we think in the medium term margins will likely recover to, if not exceed, prior levels. CEO Andrew Livingston’s incentives are well-aligned with shareholders given that he is one, with GBP 4.5m of stock to his name. Our downside is protected by the position in the cycle, the robustness of the business model with sustainable return on capital of around thirty percent (will be higher on normalised volumes), and a healthy net cash position of a little over GBP 300m. There are two main risks to the investment. Firstly, from their current UK store base of around 870 stores, Howden is expected to reach their stated limit of 1000 stores within the next five years. We don’t necessarily believe that this is the ceiling: when we invested in 2011 we were told by management that the upper limit of Howden’s presence in the UK was 650 stores! In the face of competitors closing stores, the latest target could again turn out to be arbitrary. Regardless, our thesis does not rely on this. Stores take seven years or more to reach full maturity, as the store manager and staff build relationships with local installers, and mature stores can reach contribution margins exceeding twenty percent. As a result, when Howden stops opening new stores, it will still continue taking share and growing same-store sales at three to five percent, with expanding margins - we believe terminal operating margins of Howden with a mature estate will be closer to twenty percent than current thirteen percent. On top of this, there are other avenues of growth. The one we are most optimistic for is Howden’s expansion upmarket, representing a significant opportunity to gain share from independents. We see no reason why Howden’s value-for-money advantage would not translate into the higher price ranges. Additionally, Howden is experimenting with fitted bedroom joinery, a category often served by the same installer as kitchen cabinets, representing a straight-forward opportunity to expand wallet share among their existing customers. Secondly, Howden's haphazard international expansion has been relatively unsuccessful and widely viewed as a waste of capital. Fortunately, roll-out has now slowed to a standstill and management are aiming to improve profitability and expand more gradually. Though the economics will never rival those of the UK, we see no reason that the France and Ireland businesses cannot be reasonably attractive enterprises, especially given the ability to utilise the UK manufacturing infrastructure. With the majority of free cash flow being returned to shareholders through a dividend yield of around 3% with buybacks on top, we are comfortable with the capital allocation, though we intend to monitor the GBP 5m per year being spent on international capital expenditure closely and with a high level of scrutiny. With the benefit of hindsight, we closed our initial position in Howden early – had we held it from 2011 until today we would have achieved an enviable annualised return in the high-teens. On a more positive note, we believe our latest purchase has the potential to meet or even exceed this in the medium to long term. In the meantime, should the market show early signs of volume recovery, we expect Howden to be swiftly reappraised given how low we perceive medium-term market expectations to be today.

BSD Analysis:
Howden is a structurally advantaged trade-only retailer with cost leadership, vertical integration, and a dense depot footprint that compounds share gains through cycles. With ~£300m net cash, ~3% dividend yield, and a history of mid-teens ROCE, the balance sheet and returns profile are robust. If UK housing transactions normalize and depots mature, operating margins can migrate from ~13% back toward the 17–20% range, driving double-digit EPS CAGR. Shares around ~17× EV/“run-rate OPAT” aren’t optically cheap, but cash returns and self-help (mix, logistics, upmarket expansion) provide a credible path to rerating. Risks: stalled UK housing turnover, missteps in France/Ireland, and a slower-for-longer consumer.

Pitch Summary:
RLGT is an underfollowed non-asset based third-party (3PL) multinational logistics company at just 7x trailing and 5x normalized EBITDA, which is a low absolute multiple and a significant discount to larger peers. The company was founded in 2005 by CEO Bohn Crain, who grew it through a series of acquisitions and who still holds a 22% stake. RLGT provides transportation and value-added services to customers needing to make large shipments. It does so by operating an agency network in the US and Canada, which includes ~30 company-owned and ~70 independent agent (strategic partners) locations that operate exclusively on its behalf. These agencies arrange the shipment of products, materials or equipment when they are larger than those handled by integrated global carriers like FedEx or UPS. As a 3PL, RLGT relies on its vast network of asset-heavy carrier partners, including truck operators, railroads, airlines and ocean lines. As a complement to its transportation offerings, RLGT provides customers with other value-added services including materials management and distribution, customs brokerage and global trade management services. This model shields the company from the large fixed-cost and utilization risk faced by traditional carriers during cyclical downturns, providing significant flexibility and allowing it to adapt quickly to volume shifts while avoiding the heavy capital expenditure associated with asset ownership. Capital allocation is a core differentiator for RLGT. The company acquires agencies (from within its own network) and other greenfield operations at mid-single-digit EBITDA multiples. From 2006 to today, revenues grew 35 times to over $900 million, while the share count rose only ~40% and the balance sheet remained pristine, being net cash as of its most recent quarter and fiscal-year end. Currently, we are three years into a steep freight recession. RLGT has capitalized on this slowdown by accelerating its pace of acquisitions while reducing its share count. The current pipeline remains robust and management is actively pursuing additional acquisition opportunities, positioning the company to emerge significantly larger and stronger when volumes recover.

BSD Analysis:
Radiant Logistics’ non-asset-based 3PL model offers durable earnings power and acquisition-driven compounding at a deeply discounted valuation. Trading near 5x normalized EBITDA, RLGT’s balance sheet strength (net cash) and disciplined capital allocation provide substantial upside leverage to a cyclical freight recovery. The fund sees the freight recession as a temporary headwind, enabling Radiant to buy agencies cheaply and expand market share. With 35x revenue growth since inception and CEO Bohn Crain’s 22% ownership aligning incentives, RLGT appears positioned for multiple expansion once margins normalize. Catalysts include a cyclical volume rebound, consolidation, and potential strategic interest from larger logistics players.

Pitch Summary:
Summary: Eiffage is a diversified French infrastructure and engineering group whose shares trade at a deep discount due to political overhang and market misunderstanding of its concession asset value. The company combines stable, cash-generative concessions (APRR toll roads, Getlink stake, and various French transport assets) with high-quality infrastructure and energy engineering businesses that benefit from European grid modernization and German fiscal stimulus. Despite strong balance sheet discipline, 21% employee ownership, and a track record of rational capital allocation, the market values the concessions at an implied ~60% IRR, far below what would be expected for long-duration, inflation-linked cash flows. Near-term windfall taxes have depressed sentiment, but their financial impact is modest relative to the asset base. Management continues to increase dividends and maintain conservative underwriting, reinforcing the credibility of long-term reinvestment economics. With engineering valued at only ~10× FCF and concessions at distressed levels, shares offer ~50% upside as political noise fades and cash generation becomes more visible.

BSD Analysis:
Eiffage’s valuation disconnect stems primarily from broad-based derating of French domestic infrastructure assets due to political volatility rather than asset-specific fundamentals. The APRR toll road franchise, a uniquely inflation-linked asset with predictable traffic trends and regulated fee escalators, is being priced as though concession renewal risk or punitive taxation will eradicate the equity value—yet historical precedent shows the French government extends concessions in exchange for incremental capex rather than expropriation. Meanwhile, the company’s engineering and energy services platforms provide countercyclical stability and structural growth tied to Europe’s multi-decade infrastructure and grid investment cycle. Management’s demonstrated capital discipline, long-tenured operational expertise, and employee ownership further mitigate reinvestment concerns. Over the next 12–24 months, rising dividends, continued deleveraging, and clarity around APRR’s post-2035 trajectory should reduce the political risk premium embedded in the current share price.

Pitch Summary:
CoreWeave is positioned to capitalize on the AI data center supercycle with significant revenue growth and a strong backlog of contracts with major tech companies like Meta and Nvidia. The company is leveraging its infrastructure to secure long-term revenue streams, despite high debt levels.

BSD Analysis:
CoreWeave's recent agreements with Meta and Nvidia significantly reduce its utilization risk and provide a strong foundation for future growth. The company's revenue growth is impressive, with a 207% year-over-year increase, and its backlog has grown substantially. However, the high debt load remains a concern, and successful execution will depend on managing leverage and financing costs. The acquisition of Core Scientific enhances CoreWeave's vertical integration, allowing better control over its data center operations. The company's ability to navigate power constraints and financing pressures will be crucial to achieving its growth targets.

Pitch Summary:
Chipotle Mexican Grill Inc. is a strong brand with solid business fundamentals and innovative practices, but current economic conditions and cost pressures suggest caution. The company's premium valuation, coupled with potential risks from inflation, logistical challenges, and workforce costs, make it a hold rather than a buy at this time.

BSD Analysis:
Chipotle's business model, which includes a mix of brick-and-mortar stores and a robust digital sales channel, positions it well for future growth. The introduction of innovations like the Chipotlane and kitchen automation technologies demonstrate its commitment to efficiency and customer convenience. However, the company's margins are under pressure due to rising costs and macroeconomic factors, such as tariffs and inflation, which are affecting the restaurant industry more broadly. Despite a 3% revenue increase in Q2 2025, the decrease in comparable restaurant sales and operating margins indicates potential vulnerabilities. While Chipotle's financial situation remains balanced, with positive cash flow and manageable debt levels, the risks associated with its high valuation and external economic factors warrant a cautious approach.

Pitch Summary:
Kearny Financial Corporation is trading at a significant discount to its tangible book value, presenting a potential takeover opportunity. However, the bank has faced challenges such as declining revenues and a high payout ratio, making it less attractive for new investments or acquisitions.

BSD Analysis:
Kearny Financial has shown some signs of recovery with improved revenue in FY 2025 and a slight increase in net interest margin. Despite these improvements, the bank's past financial inconsistencies and high dividend payout ratio pose risks. The bank's asset quality is strong, with low net charge-offs, and there is potential for increased interest income from loan repricing. However, the limited geographic footprint and economic risks in its operating regions add uncertainty. The stock's valuation reflects current operational challenges, and while future earnings are expected to improve, the stock remains a hold.

Pitch Summary:
Meta Platforms is a strong buy due to its robust fundamentals, strategic investments in AI, and its dominant position in the social media advertising market. Despite a flat share price performance recently, the company's fundamentals are strengthening, and it is well-positioned to capitalize on AI advancements.

BSD Analysis:
Meta's financial health is solid, with strong cash flow and profitability driven by its social media ecosystem. The company is investing heavily in AI, which is expected to drive future growth. Meta's historical ROIC significantly exceeds its WACC, indicating efficient capital use. The company's valuation remains attractive, with a P/E ratio below historical averages, suggesting potential upside. Analysts forecast substantial revenue growth, supported by favorable secular trends and Meta's strategic positioning. Despite potential risks from new entrants and macroeconomic uncertainties, Meta's strategic investments and strong market position make it a compelling investment.

Pitch Summary:
Compass Minerals International is positioned as a 'Buy' due to its low valuation multiples compared to peers, anticipated revenue growth, and management's cost-cutting initiatives. Despite challenges like high net debt and some pricing weaknesses, the company's increase in sales volumes and operational improvements suggest potential upside.

BSD Analysis:
Compass Minerals International has demonstrated a significant recovery in its stock price, rising 68.1% since February, outperforming the S&P 500's 11.4% gain. The company's revenue for Q3 2025 increased by 5.8% year-over-year, driven by higher salt sales volumes and slight price increases in highway deicing products. Management's cost-cutting measures, including a 10% workforce reduction, are expected to enhance profitability. However, the company's high net leverage ratio poses a risk, potentially limiting upside. Despite this, the stock remains attractively valued compared to peers, suggesting further growth potential.

Pitch Summary:
PepGen Inc. is advancing its DM1 treatment into phase 2 trials after reporting strong phase 1 results. However, the discontinuation of its DMD trials and the need for significant additional funding pose substantial risks. The company's current market cap of $350 million, against a potential market size of $2.35-5.35 billion, suggests a limited upside, especially considering the high costs and long timeline to commercialization.

BSD Analysis:
PepGen's progress with its DM1 treatment is promising, but the path to commercialization is fraught with challenges. The company faces a lengthy and costly development process, with an estimated $1 billion needed to bring the drug to market. Given its pre-revenue status and the need for further financing, significant dilution is likely, which could erode shareholder value. The potential market size, while substantial, may not justify the risks and time involved, especially with the binary nature of clinical trial outcomes. Investors should weigh the opportunity cost of tying up capital in a high-risk, long-term investment against other potential opportunities.

Pitch Summary:
Udemy is positioned as a buy due to its ongoing business overhaul, focusing on AI course content and enterprise subscriptions. Despite recent stock declines and operational risks, its profit acceleration and attractive valuation present a compelling investment opportunity.

BSD Analysis:
Udemy is undergoing a strategic pivot from individual course sales to enterprise subscriptions, aiming to capitalize on the growing demand for AI skills in the corporate sector. The company has reported a 7% year-over-year growth in its enterprise segment, which now constitutes 65% of its revenue. Despite challenges such as a 1% net churn in enterprise customers, Udemy's focus on subscription-based revenue is expected to provide more stable cash flows. The company's valuation, with a 6.6x EV/FY25 adjusted EBITDA multiple, is attractive compared to the broader market, reflecting skepticism about its growth prospects. However, its strong cash position and zero debt enhance its financial stability, making it a viable investment for those seeking value in a high-priced market.