Investment Pitches

Pitch Summary:
GetBusy provides online document exchange systems—primarily for accountants. GetBusy spun out of Reckon in August 2017, and has continued to grow since then. GetBusy does not earn money, investing through higher expenses to grow its existing businesses and attempting to launch new products. The underlying businesses are profitable and sustainable in the U.K. and U.S.

BSD Analysis:
GetBusy is a small vertical-software operator reinvesting aggressively in growth, suppressing near-term earnings but enhancing long-term strategic value. Core products have strong retention and niche dominance within accounting workflows. Expansion into new modules and geographies provides optional upside. While unprofitable today, underlying unit economics remain attractive, and valuation reflects minimal expectations.

Pitch Summary:
Frontdoor sells home service plans to homeowners. The company contracts with HVAC and other contractors and dispatches them when customers have problems with one of their major home appliances and systems (furnace, air conditioning, refrigerator, electrical system, etc). Frontdoor spun out of ServiceMaster in October 2018. Frontdoor serves about 2% of U.S. homes, and uses its free cash flow to grow organically, pay down debt, repurchase shares, and acquire complementary businesses.

BSD Analysis:
Frontdoor operates a subscription-like model with sticky customers and recession-resistant demand, supporting recurring cash flow. Penetration remains low at ~2% of U.S. households, offering long runway for expansion. Management has been disciplined in capital allocation—deleveraging, repurchasing shares, and pursuing bolt-ons. Strengthening contractor networks and digital dispatching improve efficiency and margins. Shares trade at modest multiples despite stable mid-cycle cash generation.

Pitch Summary:
Fortrea is a contract research organization (CRO), which means they run clinical trials to test treatments that pharmaceutical companies are trying to get approved for use in patients. I have been following Fortrea since it spun out of Labcorp in June 2023. Back then, Fortrea seemed like an exciting, fast growing business earning good returns on capital, with a star CEO who had a reputation for running (and selling) a similar business. Things have fallen apart since then… Compared to the exciting period after COVID, fervor for new drug research has declined. Less money has flowed to biotech companies, who hire CROs to help run the clinical trials they need in order to market their therapies. In addition to this industry-wide headwind, Fortrea has gone through the expensive process of setting up its own IT systems and operations separate from Labcorp. Fortrea also has a decent amount of debt, which is common in spinoffs. All in, this once exciting business ran into an industry slowdown, increased spending on stand-up costs, and still had all that debt to deal with. Earnings turned to losses, the stock price dropped and kept dropping, and as of mid-May the star CEO was out. Okay…what is there to like about this situation? The positives are that Fortrea has been winning new clinical trials and growing its backlog. The company has nearly completed the stand-up of its own systems and separation from Labcorp’s – which means they can stop paying for two systems, reducing expenses. The financial picture is ugly, but I think that it is improving and that the company will avoid a painful financial restructuring. Also, the stock is priced for disaster. On the other side of the current unpleasantness is a good business in a good industry. Running clinical trials is not capital intensive – the drug company customer supplies the medicine, and the contract research organization finds investigators (doctors) who generally see the trial participants in the doctors’ own offices. While this capital-light model allows contract research organizations to earn good returns on capital, there are barriers to entry for would-be competitors. CROs have to know the science and regulations involved in getting drugs approved in different jurisdictions worldwide, they need to know and have a good reputation with doctors who can work on the clinical trials and bring in patients. And in addition to this know-how and know-who, drug companies need to feel confident that they are hiring a CRO who will give them a solid shot at getting their drug approved for use. Getting a new drug approved is a long and expensive process – and the drug company’s main goal is to maximize the time that their therapy is on-market and patent-protected. Anything that delays FDA approval—be it signing up investigators, recruiting and retaining patients, analyzing and presenting data, and generally jumping through regulatory hoops—eats into that patent-protected period and costs Fortrea’s customers a lot of money. Going with a lower priced new entrant, vs going with Fortrea or one of the other large players with a track record, is risky for the pharmaceutical company customer (and introduces career risk for the individual making the choice) because the new entrant may delay—by months, years, or even permanently—approval by the FDA and other regulators. New drug research should continue as long as patents are legally protected and valuable, and the aging global population increases demand for new treatments. I do not see the current political climate changing either of these long-term drivers. Increasing demand is met by a limited supply of CROs with a track record, which sets the industry up for continued growth at high returns on capital. Historically, CROs have used their free cash flow to grow and to buy back stock. While turnarounds often take more time than I would like, Fortrea should make it back to being a growing business earning high returns on capital, and that might even earn it an exciting earnings multiple. I think they are on track. We paid $5.85 per share for our position in Fortrea, which was about 4.5% of the fund. I thought that price was extremely cheap, though the stock has since dropped further.

BSD Analysis:
Fortrea is a distressed-valuation CRO with durable long-term fundamentals obscured by temporary separation costs, biotech funding cyclicality, and inherited leverage. Its growing backlog demonstrates relevance and customer trust, while completion of the Labcorp separation should unlock meaningful cost relief. CROs historically generate high ROIC through regulatory expertise and reputation-based moats—advantages Fortrea still possesses. Shares trade at crisis-level multiples inconsistent with mid-cycle earnings power. If biotech funding stabilizes and internal execution improves, the stock could re-rate significantly. Key risks include leverage, execution, and industry budget cycles.

Pitch Summary:
Credit Acceptance is a subprime auto lender, enabling subprime borrowers to buy vehicles from used car dealerships. The business has profitably gained share in a large and difficult market for more than two decades. Management allocates free cash flow to growing the business and repurchasing shares at attractive prices. Credit Acceptance currently trades at an attractive upside-to-downside ratio.

BSD Analysis:
CACC’s decades-long track record of disciplined underwriting, countercyclical profitability, and aggressive share repurchases make it a uniquely resilient subprime auto lender. Its dealer-centric model generates robust returns even in tightening credit environments. Long-term EPS compounding is supported by consistent buybacks and strong cash generation. While regulatory scrutiny is an ongoing risk, CACC’s conservative loss provisioning and pricing power help mitigate downside. At current valuation levels, shares appear materially discounted relative to normalized earnings power.

Pitch Summary:
Advance Auto Parts is a store-based retailer of aftermarket automotive parts and supplies. This includes batteries, windshield wipers and fluid, air filters, motor oil, etc. The company has historically earned decent (approaching 20%) returns on tangible capital. The company is attempting a turnaround, and has fixed its balance sheet and is improving operations. Advance Auto currently trades at an attractive upside-to-downside ratio.

BSD Analysis:
AAP represents a classic balance-sheet-first turnaround with historically strong ROIC and a clear operational improvement path. As management rationalizes inventory, tightens cost controls, and restores category competitiveness, margins should recover toward mid-cycle levels. Shares trade below normalized earnings power, offering asymmetric upside if the turnaround sticks. The DIY and DIFM channels remain resilient and provide stable cash flow, while a cleaned-up balance sheet reduces solvency risk. Key catalysts include improving comps, margin expansion, and further capital allocation discipline.

Pitch Summary:
1. Mettler-Toledo International, Inc. (MTD) While MTD remains a best-in-class operator with leading market share in precision weighing and analytical instruments, macroeconomic pressures across its end markets continue to constrain its ability to achieve the mid-teens earnings growth it has delivered historically. China represents a high-teens percentage of MTD’s revenue, and ongoing US-China tensions create an additional headwind, limiting visibility into a return to historical growth rates in the region. Given these dynamics, we exited our position and redeployed the proceeds into investments with clearer long-term growth trajectories.

BSD Analysis:
MTD is a high-quality franchise, but its near-term growth outlook is challenged by cyclical lab and industrial spending softness and elevated China exposure. The company’s historic mid-teens EPS CAGR now looks difficult to sustain given macro headwinds and geopolitical friction. Valuation has often been at a steep premium to peers on the back of its track record, leaving limited margin of safety if growth normalizes lower. While margins and returns on capital remain strong, the risk-reward skews less favorably relative to other compounders with cleaner secular runways. Re-entry could be attractive if expectations reset and visibility into end-market recovery improves.

Pitch Summary:
3. Cloudflare, Inc. (NET): Based in San Francisco, Cloudflare secures over 20% of global internet traffic. Its unified platform, running identical software across 330+ cities, creates a powerful structural edge in cost, scalability, and speed to market. We initiated a position in 2Q as this architecture fuels rapid expansion from its networking core into a large and growing $200B+ addressable market spanning cybersecurity, developer tools, and AI workloads. With new enterprise leadership accelerating platform adoption, we believe the company has visibility into durable 25-30% revenue growth and expanding margins, positioning it as a compelling long-term compounder.

BSD Analysis:
Cloudflare’s globally distributed edge network gives it a unique cost and latency advantage versus traditional data-center-centric architectures. Its expansion from core content delivery into zero-trust security, developer platforms, and AI-adjacent workloads materially enlarges its addressable market. The business is still in the early innings of enterprise penetration, so sustained 25–30% top-line growth with improving operating leverage is plausible. Gross margins are high, and as sales and R&D efficiencies scale, free cash flow margins should expand. While the stock trades at a premium EV/sales multiple, the combination of secular tailwinds, product velocity, and platform effects justifies a long-duration growth thesis.

Pitch Summary:
2. Fair Isaac Corp. (FICO) A graduate of our SMid Cap Growth strategy, FICO provides credit-scoring and other services throughout a wide variety of industries to assist companies with providing credit, protecting against fraud, and analyzing customer data. The company’s successful growth in revenue and earnings has raised its market capitalization to levels appropriate for the Mid Cap Growth strategy, and we believe FICO continues to offer long-term capital appreciation potential.

BSD Analysis:
FICO benefits from a highly entrenched credit-score franchise with quasi-utility characteristics and growing demand for advanced decision analytics. Pricing power and volume growth in scores, combined with expanding software adoption, support strong, high-margin recurring revenue. The company’s asset-light model converts a large share of earnings into free cash flow, enabling buybacks and potential strategic investments. While the stock trades at a premium P/E relative to the market, its dominant competitive position and durable mid-teens EPS growth profile justify the valuation. Rising consumer credit usage and bank investment in risk analytics remain key tailwinds, though regulatory changes and macro credit cycles are risks to monitor.

Pitch Summary:
1. AAON, Inc. (AAON): A multi-year holding of our Small Cap Growth strategy, AAON provides specialty heating, ventilation and air conditioning (HVAC) services which are distributed by its own internal sales force and third-party representatives. AAON has benefited from the increased demand for data center cooling solutions, as well as the secular population growth in warmer climates. AAON’s stock price has dipped in 2025 due to issues which we believe are short-term, and we took the opportunity to add this Industrials sector holding to the Mid Cap Growth strategy.

BSD Analysis:
AAON is levered to strong secular trends in energy-efficient HVAC and rapidly growing data center cooling needs. Its focus on specialty and mission-critical applications supports pricing power and attractive margins versus commodity peers. Near-term execution issues that pressured the stock appear transitory relative to the long-term growth drivers in data centers and hot-climate construction. The company has a healthy balance sheet and a history of disciplined capacity expansion. Buying into temporary weakness should allow investors to benefit from a recovery in earnings growth and potential multiple re-rating.

Pitch Summary:
5. Pool Corp. (POOL) POOL is one of the largest distributors of pool equipment, supplies and related building materials in the world. The stock sold off after missing estimates during its seasonally smallest quarter. While macro uncertainty and persistently high interest rates have delayed discretionary projects, maintenance revenues (60+% of revenue) have performed well.

BSD Analysis:
Pool is a dominant, scale distributor in a niche category with attractive long-term dynamics tied to an expanding installed base of pools. Maintenance and repair, which constitute the majority of revenue, are non-discretionary and provide recurring, high-margin cash flows even when new construction slows. The current drag from higher rates on discretionary projects is cyclical and should ease as conditions normalize. Pool’s balance sheet and cash generation support ongoing share repurchases and a growing dividend. The pullback on a seasonally small quarter gives investors an opportunity to accumulate a high-quality compounder at a more reasonable multiple.

Pitch Summary:
4. Roper Technologies, Inc. (ROP) ROP is a diversified industrial and technology (license and Software-as-a-Service) consolidator with a long history of mid-teens free-cash-flow growth. ROP is a best-in-class operator and allocator of capital. The company reported a solid quarter and maintained full year organic growth guidance, which was viewed positively given several macroeconomic headwinds (government funding uncertainty and tariffs). ROP shares were down slightly in the quarter, which lagged the sharp gains of the benchmark following the tariff pause announcement on April 9th.

BSD Analysis:
Roper combines high-quality vertical software assets with a disciplined capital allocation framework, producing consistent mid-teens free-cash-flow growth over cycles. Its portfolio skews toward mission-critical, recurring revenue businesses with high switching costs, which supports resilient margins and low churn. Management has a strong track record of value-accretive M&A and pruning lower-quality assets. The modest share price weakness appears sentiment-driven amid style rotation rather than fundamental deterioration. Given its cash-generation profile and reinvestment runway, Roper deserves a premium multiple to the market and should continue compounding value.

Pitch Summary:
3. Watsco, Inc. (WSO) WSO is the nation’s largest distributor of heating, ventilation and air conditioning (HVAC) equipment, parts and supplies with 80% of revenue tied to the Sun Belt region. The stock sold off after missing estimates in its seasonally smallest quarter citing residential equipment weakness due to an industry-wide refrigerant transition. We believe this disruption will be resolved during peak heating months.

BSD Analysis:
Watsco is a dominant HVAC distributor positioned to benefit from long-term replacement cycles, energy-efficiency upgrades, and population growth in the Sun Belt. The current refrigerant transition is a known, temporary headwind that should normalize as channel inventory adjusts and installers adapt. Watsco’s scale, vendor relationships, and technology investments in e-commerce and analytics give it a structural advantage over smaller competitors. The company has a strong balance sheet and a history of steady dividend growth and occasional special dividends. Weakness around a seasonally small quarter offers an attractive entry point into a high-return distribution franchise with solid pricing power.

Pitch Summary:
2. Waste Connections, Inc. (WCN) WCN is a leading provider of non-hazardous waste collection, transfer, disposal, and recycling services in the U.S. and Canada. While the company reported a strong quarter and reaffirmed its full year guidance, it was one of many low beta stocks that underperformed during the intra quarter surge in the market.

BSD Analysis:
Waste Connections offers a defensive, predictable cash-flow profile with high route density, strong pricing power, and long-term municipal and commercial contracts. Its focus on secondary and exclusive markets reduces competitive intensity and helps sustain above-average margins. The company has a long history of disciplined roll-up M&A, using its balance sheet to add tuck-in haulers and landfills at attractive multiples. Near-term underperformance appears purely factor-driven as investors rotated into high-beta names, not thesis-driven. Over time, steady volume growth, price increases, and continued acquisitions should support mid-single-digit to high-single-digit organic growth plus incremental upside from capital deployment.

Pitch Summary:
1. Copart, Inc. (CPRT) CPRT is a leading provider of salvage auctions in the U.S., Canada and the United Kingdom. Shares sold off sharply after missing fiscal 3Q revenue estimates. This is the second quarter in a row of softer than expected unit volume growth due, in large part, to some drivers electing to reduce insurance coverage which results in lower accident claims volume. We believe this headwind is temporary as insurance carriers have finally priced their way back to profitability which was pressured during the pandemic.

BSD Analysis:
Copart remains a structurally advantaged marketplace with dominant share, extensive yards, and significant network effects in salvage auctions. Short-term volume softness tied to insurance coverage mix should normalize as carriers and consumers settle into new pricing levels. The company generates high margins and returns on capital, with a strong balance sheet that enables continued yard expansion and technology investment. Longer term, rising complexity and value of vehicles support salvage economics and Copart’s fee pool. The recent pullback offers an opportunity to own a high-quality compounder at a discount to its historical valuation.

Pitch Summary:
5. Veeva Systems, Inc. (VEEV) VEEV is a vertical SaaS company for the life sciences industry with a wide range of integrated cloud-based software applications and services. VEEV reported a strong start to their fiscal year, materially outperforming expectations across the board. The company added 28 new Vault CRM customers during the quarter, marking over 80 customers live vs. only a handful a year ago. Additionally, VEEV now expects about 200 Vault CRM customers by next year.

BSD Analysis:
Veeva remains a category-defining vertical SaaS leader with deep entrenchment across pharma commercial and R&D workflows. Rapid adoption of Vault CRM underscores customer willingness to migrate away from legacy platforms and deepen standardization on Veeva’s stack. The business model is highly recurring and capital-light, supporting strong free cash flow conversion and a robust net cash position. Over time, incremental modules and data products can lift ARPU and expand the addressable market. While the stock trades at a premium EV/sales and EV/EBIT, its predictable growth, high returns on capital, and near-monopoly positioning in key niches justify a structurally higher multiple.

Pitch Summary:
4. IDEXX Laboratories, Inc. (IDXX) IDXX is the industry leader in providing instruments (and consumables) used in diagnostics, detection, and information systems for veterinary, food, and water testing applications. Earnings for the quarter were solid and guidance for high-single-digit organic revenue growth was maintained, despite weak traffic trends. Shares rallied off five-year low valuation and the 'better-than-feared' results in the quarter.

BSD Analysis:
IDEXX is a high-quality, recurring-revenue diagnostic franchise levered to structurally rising pet health spending and global testing needs. Its razor-razorblade model in vet clinics drives sticky, high-margin consumables and software revenue. Maintaining high-single-digit organic growth despite softer traffic highlights the resilience of demand and pricing power. The stock had de-rated to a multi-year low valuation, creating an opportunity as fundamentals remain intact and margins have room to expand with scale. Over the medium term, increasing penetration of diagnostic testing and software integration should support above-market earnings growth and renewed multiple expansion.

Pitch Summary:
3. Guidewire Software, Inc. (GWRE) We believe GWRE is a best-in-class provider of core software solutions for property and casualty insurers. During 2Q, GWRE reported quarterly results that featured subscription revenue growth coupled with stronger profit margins and bookings. We were particularly pleased to see GWRE report 17 cloud-based deals (which are more profitable) versus 8 in the year ago period.

BSD Analysis:
Guidewire is in the sweet spot of insurance core-system modernization, with a growing mix of high-margin cloud subscriptions replacing legacy licenses. Strong bookings and rising cloud deal count point to an accelerating SaaS transition, which should drive recurring revenue growth and operating leverage over time. The company has a dominant market share in P&C core platforms, creating high switching costs and a durable competitive moat. While near-term margins are weighed by cloud investments, the long-term model envisions meaningful free cash flow expansion as implementations mature. Valuation embeds quality but still looks reasonable given the multi-year transformation and limited direct competition.

Pitch Summary:
2. HEICO Corp. (HEI.A) Commercial and military aircraft aftermarket parts company which designs, manufactures, repairs and distributes jet engines and aircraft component replacement parts. The company has benefited from solid travel growth, albeit slower than the pandemic recovery, as well as healthy parts and maintenance spending due to the delayed retirement of older aircraft given production issues at Boeing (BA) and Airbus.

BSD Analysis:
HEICO is a structurally advantaged aftermarket aerospace supplier with high margins, strong pricing power, and a proven M&A playbook. Deferred fleet retirements and elevated flight activity support multi-year demand for replacement parts and repair services. The company’s asset-light model converts a high portion of earnings into free cash flow, enabling continued bolt-on acquisitions at attractive returns. Balance sheet leverage is moderate, giving room for further deals without stressing credit metrics. Valuation is rich versus traditional industrials, but HEICO’s defensive growth and long history of compounding justify a premium.

Pitch Summary:
1. Bentley Systems, Inc. (BSY) BSY, a provider of infrastructure engineering software, outperformed the benchmark in 2Q, delivering its thirteenth consecutive quarter of double-digit annual recurring revenue growth (ARR). Management saw strength in Public Works, Utilities, and Small/Medium sized customers, as well as a resilient infrastructure spending environment, underpinned by the flow through in government funding (IIJA).

BSD Analysis:
Bentley is executing a classic high-quality software compounder playbook with durable double-digit ARR growth and strong visibility from critical infrastructure projects. Its exposure to public works and utilities ties growth to long-term government and regulated spending cycles, dampening macro cyclicality. Margin structure is attractive and should expand as cloud adoption and scale efficiencies continue. The balance sheet is solid and recurring revenue dominates, supporting consistent free cash flow generation and shareholder returns. While the stock typically trades at a premium to general software and market multiples, its “infrastructure rails” positioning and long runway of digitization justify the valuation.

Pitch Summary:
RBC is a manufacturer and marketer of highly engineered precision bearings that are sold into the Industrial (64% of revenue) and the Aerospace/Defense markets (36% of revenue). RBC reported solid 1Q quarterly results and is starting to see an acceleration of revenue as the commercial aerospace industry improves. RBC continues to gain market share due to its on-time performance and superior quality of its products.

BSD Analysis:
RBC Bearings is a high-quality industrial consolidator with an indispensable, high-moat position in aerospace and defense bearings and specialized engineered components. The investment thesis is a pure-play on the accelerating defense spending cycle and the enormous commercial aircraft backlog, where over 70% of its defense revenue is derived from sole- or single-sourced contracts. The company successfully de-leveraged its balance sheet following the highly accretive Dodge acquisition, transforming into a robust cash generator. With S&P upgrading its rating, RBC is positioned to aggressively resume its proven M&A strategy, acquiring specialized, high-margin industrial assets to drive perpetual EPS growth.