Investment Pitches

Pitch Summary:
AAR Corp is a diversified provider of aftermarket aviation services, offering parts supply, maintenance and repair, and integrated solutions to commercial airlines, government agencies, and defense customers worldwide. The company operates at the juncture of two durable demand drivers: a robust commercial aerospace aftermarket supported by strong global air travel demand, and a growing government and defense business that benefits from the increasing need for military operational readiness. During the quarter, shares contributed positively to performance after the company delivered a strong fiscal third-quarter earnings report, with revenue, earnings, and profitability all exceeding expectations driven by solid organic growth, particularly in its parts supply business. Management also provided an encouraging fiscal year outlook, with commercial aviation demand continuing to hold firm despite geopolitical disruptions and defense-related activity providing a meaningful tailwind.

BSD Analysis:
The fund maintains a bullish stance on AAR Corp, highlighting the company's strategic positioning at the intersection of two robust demand drivers: commercial aerospace aftermarket services and defense contracting. The manager emphasizes AAR's strong Q3 performance, with revenue, earnings, and profitability all exceeding expectations, driven primarily by organic growth in the parts supply segment. The investment thesis centers on durable demand fundamentals, including resilient global air travel demand supporting the commercial aerospace aftermarket and increasing military operational readiness requirements driving defense business growth. Management's encouraging fiscal year outlook reinforces confidence in the company's trajectory. The fund views AAR as well-positioned to benefit from both secular trends in aviation maintenance and government defense spending. The positive earnings surprise and raised guidance suggest strong execution and market positioning. This represents a quality play on essential aviation services with defensive characteristics through its diversified customer base spanning commercial airlines, government agencies, and defense contractors.

Pitch Summary:
iOCO is an IT services provider based in South Africa. It was previously known as EOH. The predecessor, EOH, has a tumultuous history. Founded by Asher Bohbot and listed on the JSE in 1998, EOH grew into one of South Africa's most celebrated IT companies through an aggressive acquisition strategy, absorbing over 270 businesses and growing revenue from R59 million in 2001 to R15 billion by 2017. The share price surged from around R0.70 in 2001 to more than R170 by late 2016, making it an institutional darling and a fixture of virtually every major SA equity portfolio. The unraveling began in 2016–17 when media reports surfaced alleging that EOH had secured government contracts through bribery and corruption. Forensic investigations revealed rigged bids, payments to subcontractors for no work done, over invoicing, and payments to politically connected middlemen. Corporate governance was virtually absent, with no anti-corruption policies, no internal audit committee, no head of risk, and excessive authority concentrated among a few directors. Bohbot resigned as CEO in mid-2017, and the share price collapsed. Stephen van Coller, appointed in 2018, inherited a business needing a R3.2 billion rescue facility. He overhauled the board, implemented governance reforms, cooperated with authorities, and sued former executives for R6.4 billion. Fast forward to 2024, and we find a cleaned-up company with good governance and controls in place, and sustainable revenue in the 25% to 30% GP margin range. Enter Rhys Summerton, the guiding hand behind Argent Industrial's transformative capital allocation and growth trajectory, as an active shareholder. Under the stewardship of Rhys Summerton (CEO), Dennis Venter (active shareholder), and Ashona Kooball (CFO), the company rebranded as iOCO in December 2024 and embarked on a new path of value creation and sustainable growth. The strategy was based on three stages: 1. Cost rationalization: Management identified significant inefficiencies in the business and took the hatchet to unnecessary or bloated costs to get to a more optimal cost structure. 2. Decentralization: Through a combination of radical autonomy, ruthless accountability, and aligned incentivization, each business division was positioned for growth with its own CEO. 3. Capital allocation: A focus on cash generation, reducing debt to conservative levels, share buybacks at discounts, and earnings enhancing acquisitions. We monitored their implementation closely and gained increasing conviction as they made successful progress. The strategy is clearly working, as can be gauged from the financial performance metrics in the charts on the following pages. iOCO strikes us as a classic mispricing. Due to the checkered past, it has fallen off everyone's radar, and no one is looking at it. We have an advantage in monitoring a universe of stocks in the unloved and inefficient part of the market. We believe we also have an informational advantage through the combination of our experience and institutional knowledge of the market, our on-the-ground presence and network, and engaging with management and relevant parties to get direct, unfiltered information. At around R4.20 per share, iOCO stock is trading at a PE of about 8 times and a FCF yield of about 14%. We expect earnings and FCF to grow at decent double digits for the foreseeable future. Add further earnings per share enhancements from share buybacks and accretive acquisitions, plus the distinct possibility of M&A at group level, and we think the setup is quite compelling.

BSD Analysis:
Desert Lion Capital presents a compelling turnaround story in iOCO, the rebranded former EOH that has undergone significant transformation following a corruption scandal. The fund manager highlights the dramatic operational improvements under new leadership, with net debt-to-EBITDA falling from 3x to 0.6x, EBIT margins expanding from 2% to 8%, and ROIC surging from 5% to over 20%. The three-stage strategy of cost rationalization, decentralization, and disciplined capital allocation appears to be delivering strong results, with free cash flow per share improving from negative to over R0.60. At R4.20 per share, the stock trades at an attractive 8x P/E with a 14% FCF yield, representing what the manager views as a classic mispricing due to the company's tainted history. The manager expects double-digit earnings growth, enhanced by share buybacks and accretive acquisitions, with potential M&A upside providing additional optionality. The investment thesis benefits from the fund's informational advantage through local presence and direct management engagement in an overlooked segment of the South African market.

Pitch Summary:
PAR Technology was also a detractor despite continued solid underlying performance. During the quarter, the company announced the acquisition of Bridg, an identity resolution platform, for $27.5 million. While modest in size, the deal is strategically aligned with PAR's data strategy, enhancing the platform's ability to identify and engage non-loyalty customers from previously anonymous transactions. Meanwhile, the company's first major AI product, Coach AI, reached a milestone deployment across nearly 900 stores as of early 2026, serving as a cornerstone of the new PAR Intelligence orchestration layer. Despite the recent selloff, we continue to view PAR as a high-quality business, and our thesis is unchanged.

BSD Analysis:
Pender maintains bullish conviction on PAR Technology despite Q1 weakness, emphasizing solid underlying business performance independent of stock price volatility. The $27.5 million Bridg acquisition, while modest, strategically enhances PAR's data capabilities by enabling customer identification from previously anonymous transactions, expanding addressable market opportunities. The milestone deployment of Coach AI across nearly 900 stores demonstrates successful product commercialization and validates PAR's AI strategy, positioning the company as a leader in restaurant technology innovation. PAR Intelligence represents a comprehensive orchestration layer that could drive significant value creation through data monetization and enhanced customer insights. Pender's characterization of PAR as a high-quality business suggests strong competitive positioning, recurring revenue characteristics, and durable customer relationships. The unchanged thesis despite recent selloff indicates confidence in long-term value creation potential and suggests current valuations may be attractive. The managers appear focused on operational progress rather than short-term market sentiment, positioning for potential re-rating as AI products gain traction.

Pitch Summary:
Coveo was a detractor in the quarter, caught up in the broader pessimism surrounding the software sector. Coveo is an AI-powered enterprise search platform delivering highly relevant experiences across websites, e-commerce, customer service, and workplace applications. We view Coveo as a beneficiary of AI rather than a business facing existential risk from it. Our thesis remains unchanged, and Coveo remains a top ten holding in the portfolio.

BSD Analysis:
Despite Q1 underperformance, Pender maintains strong conviction in Coveo, viewing recent weakness as sector-driven rather than company-specific. The managers position Coveo as an AI beneficiary rather than a disruption victim, contrasting their view with broader market pessimism around software companies. Coveo's AI-powered enterprise search platform addresses critical business needs across multiple touchpoints including websites, e-commerce, customer service, and workplace applications, suggesting diversified revenue streams and sticky customer relationships. Pender's decision to maintain Coveo as a top ten holding despite recent volatility demonstrates high conviction in the long-term thesis. The managers appear confident that Coveo's AI capabilities represent a competitive advantage rather than a vulnerability in an AI-first economy. The unchanged thesis suggests Pender views current valuations as attractive relative to the company's long-term prospects. Their contrarian stance on AI disruption risks positions them to benefit from potential sentiment recovery in the software sector.

Pitch Summary:
5N Plus also performed well, contributing 206.5 basis points to portfolio performance. The company released its fiscal year 2025 results alongside 2026 guidance that, in our view, remains conservative, implying approximately 100% growth relative to the 2025 guide. The company also announced a 25% capacity expansion in its space solar division. 5N Plus continues to solidify its position as a critical producer of specialty, proprietary materials, and we believe several catalysts remain ahead on both the product and sales fronts.

BSD Analysis:
Pender expresses strong conviction in 5N Plus, viewing the company's 2026 guidance as conservative with potential for significant upside surprise. The managers' assessment that guidance implies approximately 100% growth relative to 2025 suggests substantial business momentum and potential for guidance revisions higher. The 25% capacity expansion in the space solar division demonstrates management's confidence in demand visibility and positions the company to capitalize on the growing space economy. Pender emphasizes 5N Plus's strategic positioning as a critical producer of specialty, proprietary materials, highlighting the company's competitive moats and pricing power. The reference to multiple catalysts on both product and sales fronts indicates a robust pipeline of growth drivers beyond current guidance. The 206.5 basis point contribution to Q1 performance validates the investment thesis and suggests strong operational execution. Pender's confidence appears rooted in the company's specialized market position and expanding addressable markets in high-growth sectors.

Pitch Summary:
Saturn Oil & Gas, a Canadian energy company focused on asset development in Saskatchewan and Alberta was a top performer in the quarter. We view Saturn as a catalyst-rich company that, despite recent price appreciation driven by rising oil prices, continues to trade at dislocated valuations. As the company de-levers, we see the opportunity for multiple expansion, a thesis management has been executing on over recent quarters, accelerated by the surge in oil prices in March. Shares were up nearly 150% in Q1.

BSD Analysis:
Pender maintains a bullish stance on Saturn Oil & Gas, viewing it as a catalyst-rich energy company with compelling valuation despite recent strong performance. The managers believe the company continues to trade at dislocated valuations even after 150% gains in Q1, suggesting significant upside potential remains. The investment thesis centers on multiple expansion opportunities as Saturn executes its deleveraging strategy, with management demonstrating consistent execution over recent quarters. The surge in oil prices during March provided additional tailwinds, accelerating the thesis development. Pender's confidence appears rooted in the company's asset quality in Saskatchewan and Alberta, combined with what they perceive as ongoing valuation inefficiencies in the market. The strong Q1 performance validates their positioning ahead of the energy sector rotation. The managers' emphasis on catalyst-rich characteristics suggests they expect continued value realization through operational and financial improvements.

Pitch Summary:
Against the backdrop of higher 5-year Government of Canada bond yields, Enbridge preferred equity stands out as particularly attractive given its high credit quality, leverage to growing U.S. natural gas demand (including data-centre electricity), and a tax-adjusted IRR in the 9% range—without meaningful interest rate risk, because coupons reset every five years. Enbridge is one of the ten largest companies by market capitalization in Canada, and its preferred equity securities are a top-five issuer weighting in the Fund.

BSD Analysis:
The manager identifies Enbridge preferred shares as an attractive fixed-income alternative in a rising rate environment, offering compelling risk-adjusted returns. The investment benefits from Enbridge's blue-chip credit profile as one of Canada's ten largest companies by market cap, providing institutional-quality downside protection. The 9% tax-adjusted IRR represents significant yield pickup over government bonds while maintaining high credit quality. The five-year coupon reset feature eliminates duration risk, making these securities particularly attractive as rates rise. Enbridge's exposure to growing U.S. natural gas demand, including the expanding data center electricity market, provides fundamental support for cash flows. The preferred structure offers equity-like upside participation while maintaining senior claims on assets. This position represents a top-five holding, indicating high conviction in the risk-reward profile. The combination of yield, credit quality, and rate protection makes this an ideal core holding for the current environment.

Pitch Summary:
During March, the Team added to its position in Gran Tierra Energy (GTE) 9.75% 2031 secured notes at a discount to par, providing a double-digit yield. GTE is a publicly traded Canadian oil producer with operations in Latin America. The company has been improving its balance sheet through asset sales, and its deleveraging has recently accelerated with higher oil prices. Pro forma for a "normalized" Brent price of $75 per barrel, we estimate leverage at approximately 2.0× net debt to EBITDA—a manageable level for this free cash flow producing emerging-market energy producer with no near-term debt maturities.

BSD Analysis:
The fund manager presents a compelling value opportunity in Gran Tierra Energy's secured debt, purchased at a discount to par with double-digit yields. The investment thesis centers on the company's improving financial profile through strategic asset sales and accelerated deleveraging driven by higher oil prices. At normalized Brent pricing of $75/barrel, management estimates leverage at a conservative 2.0x net debt-to-EBITDA, indicating strong credit quality for an emerging market energy producer. The security structure is attractive with no near-term debt maturities, providing time for continued balance sheet improvement. The combination of free cash flow generation, manageable leverage, and secured note structure offers downside protection while capturing upside from higher energy prices. This position aligns with the fund's increased energy weighting strategy ahead of geopolitical tensions. The discount purchase price enhances total return potential beyond the already attractive coupon yield.

Pitch Summary:
Cushman & Wakefield (NYSE: CWK) is one of the world's largest commercial real estate (CRE) services firms, operating in over 60 countries with approximately 52,000 employees. The company provides a comprehensive suite of services—leasing, capital markets advisory, property and facilities management, and valuation—to both occupiers and investors across the office, industrial, retail, life sciences, and data center sectors. Despite strong operational fundamentals and an improving earnings trajectory, CWK shares have traded under persistent pressure due to market concerns that artificial intelligence and technology-driven platforms could disintermediate traditional CRE service providers. We believe this fear is significantly overstated. CEO Michelle MacKay has emphasized that Cushman's key differentiator lies in delivering "tailored, bespoke solutions" through deep client relationships and human expertise—capabilities that cannot be easily replicated by a generic algorithm. The company's relationship-driven advisory model, particularly in leasing and capital markets, depends on nuanced local market knowledge, negotiation skill, and trust—attributes where AI augments rather than replaces the human element. CWK possesses a meaningful moat rooted in its global scale, diversified service platform, and entrenched client relationships. Over 53% of the firm's fee revenue comes from Property, Facilities & Project Management (PFPM)—a contract-based, annuity-like business secured through multi-year agreements on a fixed-fee or cost-plus basis. This recurring revenue base provides substantial earnings visibility and creates high switching costs, as institutional occupiers and investors are reluctant to transition the management of large, mission-critical real estate portfolios to untested providers. In the transactional businesses (leasing and capital markets), barriers to entry are equally formidable: brand reputation, regulatory compliance, deep broker networks, and the ability to respond to multinational RFP standards all favor incumbents. The global CRE services industry is highly consolidated, dominated by three firms—CBRE, JLL, and Cushman & Wakefield—that collectively command the vast majority of institutional mandates and cross-border transactions. This oligopolistic structure creates significant advantages for incumbents: large corporate occupiers and institutional investors strongly prefer working with firms that can service their portfolios across geographies and asset classes from a single platform. For a new entrant, replicating the global infrastructure, talent bench, and data capabilities of these established players would require enormous capital and years of investment. While technology-enabled platforms like CoStar and VTS have carved out niche roles in data and analytics, they have not penetrated the advisory, brokerage, or management businesses where CWK's full-service value proposition is most difficult to displace. The consolidated nature of the industry also provides pricing discipline and limits the risk of destructive competition, which supports margin stability over the cycle. At its December 2025 Investor Day, Cushman & Wakefield outlined a 2026–2028 financial framework that includes 6–8% organic fee revenue growth, 15–20% annual adjusted EPS growth, 60–80% free cash flow conversion, 150 bps of adjusted EBITDA margin expansion by year-end 2028, and net leverage of 2x by year-end 2028. Management also said that this framework should translate into roughly $800 million of cumulative free cash flow through 2028, supporting continued deleveraging and reinvestment. In its February 2026 full-year 2025 earnings release, the company reported adjusted EBITDA of $656.2 million, free cash flow of $293.0 million, and noted that it prepaid $300 million of debt during 2025. Not only does CWK trade at a significant discount to peers but also a discount to its historical valuation, while in our view business is improving.

BSD Analysis:
Riverwater Partners presents a compelling contrarian thesis on Cushman & Wakefield, arguing that AI-driven fears have created an attractive entry point in a high-quality commercial real estate services franchise. The manager emphasizes CWK's durable competitive moat stemming from global scale, diversified service platform, and entrenched client relationships that cannot be easily replicated by technology platforms. The 53% recurring revenue base from Property, Facilities & Project Management provides earnings stability and high switching costs, while the oligopolistic industry structure with only three major players creates significant barriers to entry. Management's 2026-2028 financial framework targets impressive metrics including 15-20% annual EPS growth and 150 basis points of EBITDA margin expansion, supported by strong free cash flow generation and continued deleveraging. The company's ability to prepay $300 million of debt in 2025 demonstrates strong cash generation and balance sheet improvement. The manager views current AI disruption concerns as overblown, arguing that the relationship-driven advisory model requires human expertise that AI augments rather than replaces.

Pitch Summary:
Perella Weinberg Partners (PWP) is an advisory-focused investment bank trading at a discount to peers. PWP continues to benefit from a more constructive M&A environment, with a growing backlog that provides increasing visibility into future fee realization. The firm served as advisor on Abbott's acquisition of Penumbra during the quarter — a transaction that should generate a meaningful fee and, for a smaller-cap advisory platform, has an outsized impact on earnings. However, our timing has been challenged, as escalating geopolitical tensions tied to the Iran conflict have weighed on sentiment around deal activity. We remain constructive on the longer-term outlook, as backlog conversion and continued deal flow should support earnings power as conditions stabilize.

BSD Analysis:
Riverwater Partners views Perella Weinberg Partners as an attractive value opportunity in the investment banking sector, trading at a discount to larger peers despite strong fundamental positioning. The manager highlights the company's growing M&A backlog, which provides better visibility into future fee realization and earnings power. The Abbott-Penumbra advisory mandate demonstrates PWP's ability to win high-profile transactions that generate meaningful fees relative to the firm's smaller scale. The manager acknowledges near-term headwinds from geopolitical tensions affecting deal sentiment, but maintains conviction in the longer-term thesis. The advisory-focused model should benefit from an improving M&A environment as conditions normalize. The discount valuation relative to peers appears to offer attractive risk-adjusted returns for patient investors willing to look through the current geopolitical uncertainty. The growing backlog provides a buffer against near-term volatility in deal flow.

Pitch Summary:
We initiated a position in Talkspace (TALK), a digital mental health platform with improving unit economics. TALK was taken out shortly after we made the purchase, providing an immediate return. The acquisition was bittersweet: while the takeout delivered strong performance on the day, we believed the company's improving fundamentals offered more upside over a longer horizon.

BSD Analysis:
Riverwater Partners identified an attractive opportunity in Talkspace based on improving unit economics in the digital mental health space. The manager's investment thesis centered on the company's operational improvements and better financial metrics, suggesting the business was reaching an inflection point. The quick acquisition shortly after initiation validates the manager's ability to identify undervalued assets, though the timing was unfortunate from a long-term value creation perspective. The characterization of the takeout as "bittersweet" indicates strong conviction that the fundamental improvements would have driven significant additional upside beyond the acquisition price. This demonstrates the manager's skill in identifying quality businesses in the growing digital health sector before broader market recognition. The improving unit economics likely reflected better customer acquisition costs, higher retention rates, or improved pricing power in the mental health platform business.

Pitch Summary:
AtriCure (ATRC) underperformed during the first quarter of 2026 despite delivering a strong earnings report and providing 2026 guidance that came in above street expectations, reflecting continued momentum across its core atrial fibrillation and appendage management businesses. The stock's weakness was driven less by fundamentals and more by a shift in investor sentiment following Edwards Lifesciences' announcement of a competing surgical left atrial appendage closure (LAAC) product, which will directly compete with AtriCure's AtriClip franchise. This development created an overhang on the shares, as investors reassessed the durability of AtriCure's market leadership in appendage management. However, Edwards' product is not expected to be fully available until late in 2026 or 2027, while AtriCure's AtriClip is already well established and widely adopted among cardiac surgeons, supported by strong clinical data and entrenched physician relationships. In our view, the sell-off reflects near-term competitive concerns rather than a deterioration in the company's underlying growth trajectory, and AtriCure remains well positioned given its first-mover advantage and deep integration within surgical workflows.

BSD Analysis:
Riverwater Partners maintains strong conviction in AtriCure despite the stock's underperformance, viewing the weakness as a temporary sentiment-driven dislocation rather than fundamental deterioration. The company delivered strong earnings and raised 2026 guidance above street expectations, demonstrating continued momentum in atrial fibrillation and appendage management. The competitive threat from Edwards Lifesciences' LAAC product announcement created near-term overhang, but the manager emphasizes AtriCure's significant first-mover advantage and established market position. The AtriClip franchise benefits from strong clinical data, widespread adoption among cardiac surgeons, and deep integration within surgical workflows - competitive moats that should provide durability against new entrants. With Edwards' competing product not expected until late 2026 or 2027, AtriCure has substantial time to further entrench its market leadership. The manager views this as an attractive opportunity to own a quality medical device company at a discount due to competitive fears rather than fundamental weakness.

Pitch Summary:
Coastal Financial (CCB) was our largest detractor. CCB experienced a more volatile first quarter, with stock performance shaped by evolving investor perceptions around risks tied to its fintech partner ecosystem and broader private credit dynamics. While underlying fundamentals remained relatively stable—supported by its Banking-as-a-Service model and continued growth in partner-driven deposits and fee income—investors grew more focused on the durability of its fintech relationships amid increasing AI-driven disruption and tightened credit conditions. We reduced our position during the quarter but continue to hold CCB at a lower weighting, as we believe the core business model remains intact.

BSD Analysis:
Riverwater Partners maintains a cautious but constructive view on Coastal Financial despite it being the largest detractor during the quarter. The manager acknowledges market concerns around the company's fintech partner ecosystem and exposure to private credit dynamics, which have created near-term volatility. However, the underlying Banking-as-a-Service model continues to generate stable fundamentals through partner-driven deposits and fee income growth. The decision to reduce position size while maintaining exposure reflects balanced risk management in the face of evolving market sentiment around fintech relationships. Concerns about AI-driven disruption and tightened credit conditions appear to be more perception-driven than fundamental, as the core business model remains operationally sound. The manager's conviction in the long-term viability of the BaaS model suggests potential for recovery once market sentiment stabilizes around fintech partnerships.

Pitch Summary:
Adeia (ADEA), an intellectual property licensing business, was the second-largest contributor. Adeia's strong stock performance in the first quarter of 2026 was driven by a combination of fundamental execution, increasing visibility around its licensing model, and a series of high-profile agreements that reinforced the value of its intellectual property portfolio. Coming out of 2025, the company reported record revenue and profitability, supported by a surge in IP licensing activity. This improving sentiment was further reinforced by several strategic announcements during the quarter. Most notably, Adeia signed a multi-year licensing agreement with AMD tied to its hybrid bonding semiconductor technology—an area viewed as critical to next-generation chip architecture—as well as expanded partnerships with UMC and earlier agreements with Disney and Microsoft.

BSD Analysis:
Riverwater Partners demonstrates strong conviction in Adeia's intellectual property licensing model, which delivered exceptional results as the second-largest contributor to performance. The manager highlights the company's record revenue and profitability, indicating successful monetization of its IP portfolio. The strategic licensing agreement with AMD for hybrid bonding semiconductor technology positions Adeia at the forefront of next-generation chip architecture, a critical area for the semiconductor industry's evolution. The expanded partnerships with major technology companies including UMC, Disney, and Microsoft validate the breadth and value of Adeia's intellectual property assets. The increasing visibility around the licensing model suggests more predictable revenue streams going forward. The combination of fundamental execution and high-profile strategic partnerships reinforces the durability of Adeia's competitive moat in the IP licensing space.

Pitch Summary:
Among our largest contributors, Modine Manufacturing (MOD) led the way during the quarter. The thermal management specialist continued to benefit from secular demand in data center cooling and a well received spinoff of their auto cooling business into a combined company with Gentherm (THRM), with the stock appreciating over 60% as the market recognized the durability of its growth drivers. We have held Modine since early in the strategy's life and trimmed modestly during the quarter, but it remains a meaningful position.

BSD Analysis:
Riverwater Partners maintains a bullish stance on Modine Manufacturing, highlighting the company's strong positioning in thermal management solutions. The manager emphasizes MOD's exposure to secular growth in data center cooling, a theme that should benefit from continued AI and cloud infrastructure buildout. The successful spinoff of the automotive cooling business with Gentherm appears to have unlocked value and allowed the market to better appreciate the company's core growth drivers. The 60% quarterly appreciation reflects strong fundamental execution and market recognition of the business quality. Despite trimming the position after the strong performance, the manager's decision to maintain a meaningful allocation signals continued conviction in the long-term thesis. The early entry and patient holding period demonstrate the manager's ability to identify quality businesses before broader market recognition.

Pitch Summary:
PrairieSky Royalty Ltd. embodies the core tenets of scarcity that we believe underpin successful long-term investing. Our history with this company (slightly) predates its 2014 IPO. We wanted to get more time with the very talented CEO before the 100+ meeting roadshow, so we arranged to meet for coffee at the Starbucks on Yonge and King just before the day started at 7 am. Sometimes, very unique leadership teams and assets require very unique access. The company owns one of the largest portfolios of fee simple mineral title in Canada. Unlike traditional energy companies, PrairieSky does not operate wells or spend money drilling, completing or tying in wells. Instead, it collects royalties on production from third-party operators across its land base. This model results in a business with high margins and resilient free cash flow. Because PrairieSky does not bear the capital costs of drilling and is not exposed to operational execution risk, its economics are structurally different from those of traditional producers. The strength of the business is rooted in its low capital intensity. With no requirement to fund development activity, PrairieSky maintains flexibility through cycles while preserving the ability to allocate capital toward acquiring additional royalty interests. Management's role is not to operate assets, but to allocate capital and manage the asset base with discipline. Over time, outcomes are driven by decisions around royalty structures, acquisitions, and the stewardship of a finite resource. The asset base itself is difficult to replicate. PrairieSky's land position has been assembled over decades and represents a finite resource with perpetual ownership, providing long duration exposure to production without requiring ongoing capital investment. Importantly, the business benefits from industry activity without requiring capital, a combination that is difficult to replicate. We have already earned a handsome return on our investment with this company, but we felt that coming into 2025, the liquids growth and corresponding cash flows were not being appreciated by the market, so we decided to add to our investment, and it's now the largest holding in the fund. In our view, PrairieSky reflects the type of business we seek to own: one where resilient cash flows, capital efficiency, and disciplined capital allocation support long-term compounding of free cash flow per share.

BSD Analysis:
Langdon presents a compelling bull case for PrairieSky Royalty, emphasizing the company's unique asset-light business model that generates royalties without operational risk or capital intensity. The manager highlights the scarcity value of PrairieSky's extensive fee simple mineral title portfolio, which has been assembled over decades and provides perpetual ownership rights. The investment thesis centers on the company's ability to generate resilient free cash flows with high margins while maintaining flexibility through commodity cycles. Management's disciplined capital allocation approach focuses on acquiring additional royalty interests rather than operational execution. The fund recently increased its position, making PrairieSky the largest holding, based on the belief that the market was undervaluing liquids growth and corresponding cash flow generation. This represents a high-conviction investment in a differentiated energy business model that benefits from industry activity without requiring ongoing capital investment.

Pitch Summary:
CENX is the largest domestic producer of primary aluminum in the United States, operating smelters in Kentucky, South Carolina, and Iceland with combined annual production capacity of approximately 770,000 tonnes. Glencore plc is the largest shareholder at approximately 30% beneficial ownership¹ and also the company's largest customer (54% of 2025 sales).² The U.S. went from producing 4.65 million tonnes of primary aluminum at 33 smelters in 1980 to approximately 670,000 tonnes at just 4 operating smelters today — a collapse from 33% of global output to under 1%.³ The country now relies on imports for roughly 60% of its aluminum consumption.⁴ Section 232 tariffs (currently 50% on imports) create a meaningful domestic price premium for U.S. producers. LME aluminum prices have risen above $3,300/ton⁵ on tightening global supply, with Chinese production capped at 45 million tonnes and Gulf smelter capacity at risk from geopolitical disruption in the Strait of Hormuz — a dynamic we have termed the "Fog of Excursion" thesis. In January 2026, Century announced a landmark joint development agreement with Emirates Global Aluminium (EGA) to build a 750,000-tonne-per-year primary aluminum smelter in Inola, Oklahoma — the first new U.S. smelter since 1980. Century will own 40% of the joint venture, supported by a $500 million DOE grant.⁶ This single project would more than double current U.S. primary aluminum production and represents a decade-long growth runway. Construction is expected to begin late 2026, with first production by the end of the decade.⁷ Financial Outlook: Century reported full-year 2025 adjusted EBITDA of $425.1 million on $2.53 billion of net sales.⁸ Management guided Q1 2026 adjusted EBITDA of $215–235 million, implying an annualized run rate approaching $900 million as higher LME pricing flows through on a lagged basis.⁹ Near-term catalysts include the Mt. Holly capacity restart (50,000+ tonnes, targeting full production by June 2026),¹⁰ Grundartangi Line 2 recovery to near-full output by July 2026,¹¹ and the Hawesville smelter monetization ($200 million cash plus a 6.8% equity stake in a TeraWulf-developed data center project).¹² Each $100/ton movement in LME aluminum has an estimated $60–70 million annualized EBITDA impact.¹³ These projections reflect our internal estimates and are subject to change based on company execution and market conditions. At the time of purchase, CENX shares were trading at approximately 6.1x our 2026E EBITDA and roughly 2.1x trailing twelve-month sales. Metals & Mining comps typically trade at 4.0–6.0x EBITDA, but CENX arguably warrants a premium given the structural growth optionality from the Oklahoma mega-project — which at mid-cycle prices could contribute $300–400 million in proportional EBITDA by decade-end.¹⁴ B. Riley recently raised its price target to $86. We believe the market is assigning minimal value to the Oklahoma project and the broader reindustrialization narrative. Century's Grundartangi smelter in Iceland runs on nearly 100% renewable energy (geothermal and hydroelectric), producing the company's "Natur-Al" branded low-carbon aluminum for the European market. The Oklahoma project's potential to secure clean energy from wind and solar sources could make it the cleanest large-scale smelter in U.S. history. Century's role in reducing American dependence on imported aluminum from higher-carbon foreign sources provides an additional sustainability dimension. We note that the company disclosed a material weakness in internal controls over financial reporting related to a 2023–2025 restatement, which is being actively remediated.¹⁵

BSD Analysis:
Riverwater Partners presents Century Aluminum as a compelling play on US industrial reshoring and aluminum supply constraints, with CENX as the largest domestic primary aluminum producer operating just 4 of the original 33 US smelters. The investment thesis centers on the landmark Oklahoma mega-project with Emirates Global Aluminium, representing the first new US smelter since 1980 and potentially doubling domestic production capacity. Key catalysts include 50% import tariffs creating domestic price premiums, tightening global supply from Chinese production caps, and geopolitical risks in the Gulf region. At 6.1x 2026E EBITDA, the valuation appears attractive for a business with significant operating leverage to aluminum prices and structural growth from the Oklahoma project. Near-term catalysts include capacity restarts at Mt. Holly and Grundartangi, plus the Hawesville monetization generating $200 million cash. The manager believes the market assigns minimal value to the reindustrialization narrative and Oklahoma project optionality, which could contribute $300-400 million in proportional EBITDA by decade-end.

Pitch Summary:
Jack Henry & Associates (JKHY) represents what we consider to be a high-quality compounder that we find to be recently more attractive following a valuation reset driven by broad-based concerns around AI disruption in financial technology. JKHY provides backend technology for small and medium sized banks. We believe the sell-off has been largely indiscriminate, creating a rare opportunity to acquire a mission-critical, deeply entrenched business at a meaningful discount to its historical valuation. We also believe their largest competitor will force RFPs to Jack Henry as they are consolidating platforms which can cause havoc for customers. This could create a very compelling opportunity to take market share. JKHY's competitive moat remains intact, underpinned by several durable advantages: a highly regulated end market, long-standing customer relationships with community and regional banks, and deep integration within clients' core processing and digital infrastructure. These systems are not easily displaced, given high switching costs, regulatory complexity, and the operational risk associated with transitioning core banking platforms. While the market has questioned the long-term impact of AI on traditional fintech providers, we view JKHY as a beneficiary rather than a casualty, given its role as a trusted technology partner and data steward within the banking ecosystem. With strong recurring revenue, high retention rates, and consistent free cash flow generation, JKHY offers a compelling combination of resilience and long-term growth, particularly at current valuation levels which we believe understate the durability of its business model.

BSD Analysis:
Riverwater Partners views Jack Henry & Associates as a high-quality fintech compounder trading at an attractive discount due to indiscriminate AI-related selling. The investment thesis centers on JKHY's mission-critical backend technology for small and medium banks, protected by substantial switching costs and regulatory complexity. The fund sees a potential market share opportunity as the largest competitor's platform consolidation creates customer disruption and forces RFPs. Key competitive advantages include deep client integration, long-standing relationships with community banks, and the operational risk of transitioning core banking platforms. Rather than viewing AI as a threat, the manager positions JKHY as a beneficiary given its trusted partner role and data stewardship within the banking ecosystem. The business model features strong recurring revenue, high retention rates, and consistent free cash flow generation. Current valuation levels appear to understate the durability and defensive characteristics of this entrenched fintech provider serving a highly regulated end market.

Pitch Summary:
Dick's Sporting Goods (DKS) presents what we see to be a compelling investment case driven by a combination of cyclical tailwinds and company-specific execution. On the demand side, higher tax refunds relative to last year should provide incremental support to discretionary spending, particularly in categories such as athletic apparel, footwear, and equipment, where DKS has strong market positioning. This is further amplified by the upcoming 2026 FIFA World Cup in the United States, which is expected to drive increased participation and consumer interest in soccer and related sporting categories, creating a multi-quarter demand tailwind. It trades at 14.9x estimated 2026 earnings. Importantly, DKS is also well positioned to benefit from improving industry dynamics, including a potential turnaround at Foot Locker in the second half of 2026. This could help stabilize key vendor relationships—most notably with Nike—and lead to a more rational promotional environment across athletic retail. While near-term consumer headwinds remain, we believe DKS's differentiated merchandising strategy, premium store experience, and strong relationship with youth sports position the company to capture outsized share as conditions normalize, supporting continued margin resilience and long-term earnings growth.

BSD Analysis:
Riverwater Partners views Dick's Sporting Goods as positioned to benefit from both cyclical tailwinds and company-specific competitive advantages in athletic retail. The investment case combines near-term catalysts including higher tax refunds supporting discretionary spending and the 2026 FIFA World Cup in the US driving soccer-related demand. The fund emphasizes improving industry dynamics, particularly a potential Foot Locker turnaround that could stabilize vendor relationships with Nike and reduce promotional intensity across the sector. At 14.9x 2026 earnings, DKS appears reasonably valued for a market leader with differentiated positioning. Key competitive moats include premium store experience, strong youth sports relationships, and superior merchandising strategy that should enable market share gains as conditions normalize. The manager acknowledges near-term consumer headwinds but expresses confidence in DKS's ability to maintain margin resilience and deliver long-term earnings growth through its differentiated market position.

Pitch Summary:
Methanex (MEOH) is the world's largest producer and distributor of methanol. We believe the stock is well positioned to benefit from a tightening global supply-demand backdrop, particularly in light of escalating conflict in the Middle East. The company's global production footprint and integrated logistics network provide a structural advantage in supplying customers during periods of disruption. Recent geopolitical developments—specifically reduced Iranian supply and broader regional instability—are already contributing to higher methanol pricing. Importantly, this dynamic is occurring against a backdrop of structurally constrained supply and steady demand growth across industrial and energy-related applications, suggesting pricing strength may be more durable than typical cyclical spikes. It trades at 10.7x estimated 2026 earnings. From a responsible business perspective, we believe that Methanex stands out within the chemicals sector. It has industry-leading safety performance, no major environmental incidents in recent years, and meaningful progress on emissions intensity reduction ahead of stated targets. The company is also actively investing in lower-carbon methanol pathways, including biomethanol and carbon capture initiatives, positioning it to participate in longer-term decarbonization trends such as marine fuel transition.

BSD Analysis:
Riverwater Partners presents Methanex as a geopolitical beneficiary with the world's largest methanol production and distribution network positioned to capitalize on Middle East supply disruptions. The investment thesis centers on a tightening supply-demand backdrop driven by reduced Iranian supply and regional instability, creating pricing power beyond typical cyclical patterns. The fund emphasizes MEOH's structural advantages through its global production footprint and integrated logistics network, enabling superior customer service during disruption periods. At 10.7x 2026 earnings, the valuation appears attractive for a market leader benefiting from constrained supply and steady industrial demand growth. Additionally, the manager highlights Methanex's ESG credentials including industry-leading safety, emissions reduction progress, and investments in lower-carbon methanol pathways. The company's positioning in decarbonization trends like marine fuel transition provides additional long-term optionality beyond the current geopolitical pricing tailwinds.