Investment Pitches

Pitch Summary:
New Fortress Energy (NFE) is on the brink of bankruptcy due to its aggressive expansion strategy, which involved stacking large, capital-intensive projects. The company has a portfolio of high-quality assets but is burdened with expensive debt and financial obligations. Despite having valuable assets in Brazil and Puerto Rico, NFE is struggling with cash flow issues, leading to missed payments and entering forbearance with bondholders. The company's equity story is essentially over, and the focus is now on asset-by-asset negotiations. The 12% senior secured notes due 2029 are seen as the most promising investment, given their collateral in Brazil.

BSD Analysis:
NFE's strategy of rapid expansion has left it with a complex debt structure and significant financial challenges. The company's assets, particularly in Brazil and Puerto Rico, have the potential to generate substantial revenue if properly managed. However, the current financial distress and impending bankruptcy filing create a high-risk environment for investors. The restructuring process will likely involve significant negotiations over asset control, with the 12% senior secured notes positioned to benefit from Brazil's assets. The junior debt, while riskier, offers potential upside if the restructuring is more favorable than expected. Overall, NFE's situation highlights the risks of over-leveraging in capital-intensive industries.

Pitch Summary:
Analog Devices represents a premium analog compounder entering an upcycle with superior economics. Over half of revenues are derived from products with lifecycles exceeding 10 years, reflecting extreme switching costs and pricing power. The company targets 70%+ gross margins and 45–50% EBIT margins, supported by a hybrid manufacturing model with structurally lower capex intensity than peers. Secular drivers include industrial automation, electrification, and rising AI-related data center power and testing demand. Management expects meaningful earnings upside as pricing and margins inflect following the cycle reset.

BSD Analysis:
Analog Devices stands out as a high-quality compounder in the semiconductor industry, specializing in high-performance analog and mixed-signal chips. For 2026, the company is projected to see a 28% increase in earnings as industrial and automotive inventories normalize and the next demand cycle for factory automation and electric vehicles begins. ADI’s chips are critical for sensing, power management, and signal conversion, making it an essential partner for the digitization of the physical world. Management’s disciplined focus on innovation and operational efficiency allows the company to sustain gross margins above 60% even during periods of macro uncertainty. The investment narrative is further strengthened by a robust capital return program, including consistent dividend growth and opportunistic share buybacks. As the "edge" becomes more intelligent, ADI’s technological moat in high-precision analog solutions ensures long-term pricing power and steady earnings growth.

Pitch Summary:
Caterpillar is positioned at a cyclical trough with multiple secular tailwinds emerging simultaneously. Construction and mining activity are at low-to-mid cycle levels, dealer destocking is largely complete, and pricing is re-accelerating as inventories bottom. Non-residential and manufacturing starts are inflecting sharply, supported by reshoring, de-globalization, and U.S. fiscal incentives. Importantly, rising data center power demand is creating incremental upside across Caterpillar’s Energy & Transportation segment. Historically, prior CAT cycle troughs have generated significant alpha versus the S&P 500 as earnings and margins rebound.

BSD Analysis:
Caterpillar is leading the "Industrial AI" revolution, transforming traditional heavy equipment into intelligent, connected systems for the global mining and construction sectors. The 2026 investment case is highlighted by the launch of the Cat AI Assistant and a deepening collaboration with NVIDIA to accelerate autonomous machine capabilities. These digital innovations are creating high-margin, recurring service revenues that are diversifying the company’s cyclical earnings base. Demand remains robust across its three primary segments, particularly in infrastructure and energy, as global data center and power grid build-outs require massive amounts of earthmoving and power generation equipment. For 2026, management is doubling down on its technology investments, with plans to significantly increase spending on digital and autonomous systems through the end of the decade. For investors, Caterpillar offers a rare combination of industrial scale and cutting-edge tech upside, supported by a world-class dealer network.

Pitch Summary:
MACOM designs and manufactures high-performance semiconductors. Shares rose after the company delivered in-line results and issued a stronger-than-expected Q1 outlook. Its results included sequential gross margin improvement and one of its strongest booking quarters in years, as demand remained robust across key end markets, including data infrastructure and satellite communications. The company continues to execute on its strategy of expanding margins through differentiated compound semiconductor solutions and product cycles. We trimmed the position in line with our valuation discipline.

BSD Analysis:
MACOM is a key beneficiary of the high-speed networking and AI infrastructure boom, providing high-performance semiconductor solutions for data centers and telecommunications. The company’s 2026 outlook is supported by surging revenue growth, driven by its industry-leading optical and radio frequency (RF) components. Its "fab-rite" manufacturing model allows it to maintain a flexible cost structure and achieve superior gross margins compared to traditional integrated manufacturers. For 2026, the investment thesis centers on the massive rollout of 800G and 1.6T networking products, which are essential for connecting the next generation of AI clusters. Institutional interest is rising as the company consistently beats earnings expectations and expands its design wins among top-tier cloud providers. With a strong balance sheet and a focus on long-lifecycle products, MACOM offers a high-quality way to play the expansion of global digital connectivity.

Pitch Summary:
In addition to Coherent, notable trims in the quarter included iRhythm. iRhythm develops the Zio wearable patch for cardiac monitoring. The company delivered a strong quarter with solid growth in its core services, improving cash flow trends and raised full-year guidance, while its mobile cardiac telemetry (MCT) device remains under FDA review. We trimmed the position to take profits after a strong year, as growth may moderate in 2026 with fewer near-term catalysts despite an attractive long-term outlook.

BSD Analysis:
iRhythm is a transformative digital healthcare leader, specializing in AI-driven continuous cardiac monitoring through its Zio platform. For 2026, the company is entering a high-growth phase with projected revenue growth of 17% to 18% as it deepens its penetration in primary care and population health. A major catalyst for the year is the achievement of sustained free cash flow positivity, a milestone that significantly de-risks the investment narrative. The company’s extensive clinical evidence program continues to prove Zio’s superiority over traditional short-term monitors, supporting its expansion into international markets and adjacent care settings. While valuation remains a consideration, the massive addressable market for ambulatory cardiac monitoring provides a long runway for revenue scaling. As payer support for digital health solutions increases, iRhythm’s integrated data-and-device model is well-positioned to become the standard of care.

Pitch Summary:
We ended our investment campaigns in Samsara during the quarter. Samsara provides software that helps asset-intensive industries, such as trucking and construction, to track assets, improve performance and enhance safety. While we expected share gains and new products in a large addressable market to drive long-term growth, recent results showed signs of slowing. A combination of valuation concerns and limited near-term catalysts in comparison to other opportunities led us to exit the position.

BSD Analysis:
Samsara has established itself as a leader in "Connected Operations," providing a comprehensive AI-powered platform for fleets, construction sites, and logistics networks. The 2026 investment case is bolstered by the company’s explosive 30% year-over-year growth in annual recurring revenue, now exceeding $1.6 billion. With a growing base of high-value customers contributing more than $1 million each in ARR, Samsara is effectively moving up-market into the enterprise segment. For 2026, the company is focusing on expanding its non-GAAP operating margins while continuing to innovate in safety and efficiency applications. The structural shift toward real-time data and autonomous monitoring in physical industries acts as a massive tailwind for its multi-product ecosystem. While the stock’s valuation reflects high expectations, its consistent execution and "Rule of 40" profile make it a standout in the IoT and SaaS space.

Pitch Summary:
We ended our investment campaigns in Nemetschek during the quarter. Nemetschek provides software solutions for the architecture, engineering and construction sectors. We initiated our position during its transition to a subscription model, expecting this shift to drive growth and improve margins. While we still view Nemetschek as a strong franchise, we exited the position due to limited near-term growth prospects and increased downside risk amid softer macro conditions and execution uncertainty.

BSD Analysis:
Nemetschek remains a premier software leader in the architecture, engineering, and construction (AEC) market, with a focus on high-quality BIM workflows and digital twins. The 2026 outlook is exceptionally strong as the company nears the completion of its transition to a subscription-based model, which has already pushed recurring revenues above 90%. Strategic acquisitions, such as GoCanvas, are expanding the company's capabilities into field services and mobile-first construction management, diversifying its revenue mix. Despite broader sentiment-driven volatility in the software sector, Nemetschek’s resilient fundamentals and high customer retention rates provide a solid floor for performance. Management is actively addressing institutional concerns regarding capital allocation and margin expansion, with a clear focus on double-digit organic growth. For investors, the company represents a high-quality "pure-play" on the long-term digitization of the global construction industry.

Pitch Summary:
ServiceTitan is a leading provider of vertical software solutions for the trades, including plumbing, HVAC and electrical. Its platform supports the entire workflow from lead generation to payment, generating revenue through subscriptions and usage-based processing. We see meaningful growth opportunities through new customer acquisition, upselling and expansion into additional trades. During the quarter, we increased our position following a pullback amid broader weakness in the software industry, reflecting our conviction in the durability of its profit cycle.

BSD Analysis:
ServiceTitan is the leading end-to-end software platform for the trades, successfully digitizing high-growth industries like HVAC, plumbing, and electrical services. The 2026 investment thesis is anchored by the company's 25% annual revenue growth and its expanding ecosystem of fintech products, including integrated payment processing and financing. While the firm is still in its investment phase, it is demonstrating significant operating leverage with a marked narrowing of trailing net losses. Its massive user base and high switching costs create a durable recurring revenue stream that is largely insulated from macroeconomic downturns. For 2026, the potential for ServiceTitan to achieve free cash flow positivity for the first time marks a major turning point for the stock's valuation. As more field service businesses move toward digital transformation, ServiceTitan’s role as the operating system for the trades provides a long and clear runway for market share expansion.

Pitch Summary:
SailPoint provides technology solutions that help organizations manage and protect access to systems and data. Adoption of cloud-based infrastructure and integration of AI technologies are supporting steady demand for subscription offerings. We believe the company’s strong governance capabilities and early investments in AI position it well to capitalize on emerging agentic security trends over time.

BSD Analysis:
SailPoint is a critical player in the identity security sector, with a 2026 narrative defined by its successful transition toward a high-margin, recurring SaaS model. The company has reached a key scale milestone, with trailing revenue now exceeding $1 billion and annual recurring revenue growing at a steady 30% clip. For 2026, the focus is squarely on operational leverage, as the firm narrows its net losses and moves toward consistent GAAP profitability. The increasing complexity of hybrid cloud environments is driving unprecedented demand for its AI-powered identity governance solutions among large enterprise customers. While the stock trades at a premium relative to its peers, this valuation is supported by SailPoint's "Rule of 40" potential and its dominant position in a mission-critical cybersecurity niche. Investors should view the recent upgrades in revenue guidance as a sign of deepening market penetration and a strong competitive moat.

Pitch Summary:
TopBuild is entering a strong profit cycle driven by acquisitions that expand exposure to higher growth segments such as commercial roofing and data centers. Its duopoly position in residential insulation, enterprise technology platform and proven integration capabilities provide competitive advantages. With residential trends near a cyclical low and non-residential demand increasing, we believe TopBuild is well positioned for long-term growth.

BSD Analysis:
TopBuild is a dominant force in the high-barrier-to-entry insulation and building material distribution market, benefiting from a unique integrated installer-distributor model. The investment case for 2026 is driven by its disciplined M&A strategy, which continues to consolidate a highly fragmented industry and unlock significant operational synergies. As the U.S. construction cycle shows renewed momentum, TopBuild is well-positioned to capture increasing demand from both residential and light commercial projects. Management’s focus on supply chain optimization and digital procurement has pushed EBITDA margins toward record levels, providing a strong platform for earnings growth. While the stock has historically been sensitive to interest rate cycles, its diversified revenue streams and focus on retrofitting existing homes provide a hedge against new construction volatility. For long-term investors, the company’s ability to generate significant free cash flow and reinvest it at high rates of return makes it a compelling industrial play.

Pitch Summary:
We initiated a new position in Texas Roadhouse, a casual dining company operating a core steakhouse brand alongside smaller concepts. The company is well run with a defensible brand and an owner-operator culture. We see a long runway for growth driven by new restaurant openings, higher throughput and a return to historical margin levels. Texas Roadhouse’s value proposition continues to resonate with consumers, supporting consistent traffic and unit economics.

BSD Analysis:
Texas Roadhouse enters 2026 with a robust growth outlook, supported by strong same-store sales and the successful integration of newly acquired franchise locations. The company’s digital kitchen initiative has reached nearly 95% of stores, driving significant improvements in labor efficiency and throughput during peak dining hours. For 2026, management expects store week growth of 5% to 6%, bolstered by a steady pipeline of new openings and a continued focus on its value-driven menu. While commodity inflation remains a factor, the firm’s disciplined pricing strategy and high average unit volumes provide a resilient margin profile that outpaces many casual dining peers. Investors are increasingly focused on the brand's ability to sustain its premium alcohol sales and to-go business, which have become high-margin staples of the revenue mix. With a consistent capital allocation strategy and a commitment to shareholder returns, the stock remains a top-tier pick in the restaurant space. The company’s focus on the middle-market consumer segment offers a defensive cushion against broader economic fluctuations.

Pitch Summary:
Babcock is the UK’s second-largest defense supplier and has been capitalizing on its control of critical infrastructure and nuclear-capable workforce. New leadership has stabilized operations, strengthened the balance sheet and addressed legacy contract issues. The company is expanding internationally amid rising global defense spending. Shares pulled back during the quarter but remained positive for the year, leading us to trim the position to mitigate valuation risk.

BSD Analysis:
Babcock is a defense and engineering contractor rebuilding credibility after years of overreach. Its core naval, nuclear, and aviation services are mission-critical and long-dated. Backlogs provide visibility, but execution is everything in complex programs. Balance-sheet repair has taken precedence over growth ambitions. Defense spending tailwinds help, but contracts punish mistakes. Management is now focused on fewer, higher-quality projects. This is not a fast-growth defense play. It’s a turnaround rooted in discipline and delivery. Babcock works if boring execution finally sticks.

Pitch Summary:
Spotify is a leading audio streaming platform that we believe is well positioned to increasingly monetize its dominant share in global music distribution through pricing, advertising and tiered premium subscriptions. Strategic investments in podcasts, audiobooks and video diversify the business beyond music. While shares declined during the quarter amid near-term advertising weakness, the company delivered a strong quarter with beats on users, revenue and margins. We added to the position on recent weakness as we remain confident in long-term monetization opportunities.

BSD Analysis:
Spotify owns global audio distribution but still hasn’t convinced investors it deserves to keep the economics. User growth remains strong, yet labels capture most of the value. Podcast investment improved engagement but took years to show discipline. Pricing power is slowly emerging, though margins remain thin. Scale matters because discovery algorithms improve with data density. Competition from Apple is real but constrained by platform incentives. Cost control has become a priority rather than an afterthought. This is not a broken business. It’s a platform still negotiating its share of the value chain.

Pitch Summary:
Sea is a leading Southeast Asian Internet company operating in digital entertainment, e-commerce and digital financial services. The company delivered strong top-line growth across all segments in Q3. However, e-commerce margins did not expand as much as in recent quarters due to stepped-up investment in logistics, fulfillment and a new VIP loyalty program. Shares pulled back during the quarter as investors focused on commentary about the pace of profitability. We continue to believe that the competitive environment remains rational and that profitability will trend toward that of global peers, leading us to add on weakness.

BSD Analysis:
Sea is no longer the reckless growth story that burned cash to buy market share. Shopee remains a dominant e-commerce platform in Southeast Asia, even as competition stays cutthroat. Management proved it can generate real profits once discipline replaced ambition. SeaMoney deepens ecosystem economics, but risk management has to stay tight. Garena is volatile, yet still provides cash optionality when game cycles cooperate. Currency swings and regulation are structural, not temporary. Growth is now measured, not promotional. This is not a clean compounder yet. It’s an execution story where restraint finally matters more than scale.

Pitch Summary:
JFrog is the market leader in continuous software release management, enabling a faster cadence of developing, securing and releasing software. Recent earnings were strong, driven by continued acceleration in cloud revenue as customer usage expanded beyond committed levels and adoption of its security offerings increased. The increasing use of generative AI tools is democratizing software development, leading to more code being written by a broader set of users and teams. This expansion in code creation supports growing demand for JFrog’s binary repositories and code security scanning products. With JFrog increasingly integrated into development workflows, we believe the company is well positioned to benefit from rising software complexity.

BSD Analysis:
JFrog sells developer infrastructure that becomes invisible once installed and painful to remove. Artifact management sits at the center of modern software supply chains, which makes JFrog mission-critical whether budgets are expanding or being squeezed. Investors fixate on growth deceleration and miss that optimization phases don’t reduce dependency — they entrench it. Software supply-chain security has moved from “nice to have” to board-level concern, quietly expanding JFrog’s relevance. Consumption-based pricing improves revenue quality as usage scales with complexity. Competition exists, but ripping out build infrastructure mid-workflow is operationally reckless. Margins expand as platform costs amortize and customers deepen usage. This is plumbing for software factories, not experimental SaaS chasing seats.

Pitch Summary:
Insmed is a biotechnology company focused on pulmonary diseases. Its lead product, ARIKAYCE®, continues to perform well, with management raising full-year revenue guidance following 22% YoY growth. The company also reported a strong launch for Brinsupri™ (brensocatib), the first approved therapy for non-cystic fibrosis bronchiectasis, generating $28 million in initial sales with more than 2,500 patients and 1,700 prescribers. We remain encouraged by Insmed’s execution and believe Brinsupri™ is likely to drive a substantial profit cycle in the coming quarters and years.

BSD Analysis:
Insmed is a high-growth biopharmaceutical company that is successfully transitioning from a single-product firm into a multi-blockbuster powerhouse. The primary catalyst for 2026 is the rapid commercial uptake of Brensocatib, following its landmark approval for the treatment of bronchiectasis, a market with significant unmet need and no existing approved therapies. Additionally, the company's flagship product, Arikayce, continues to see strong double-digit revenue growth as it expands into the first-line treatment setting for MAC lung disease. Insmed’s robust clinical pipeline, which includes promising gene therapy candidates and treatments for rare respiratory conditions, provides a long-term growth floor beyond its current commercial portfolio. For 2026, the company is expected to move closer to overall profitability as rising revenues from its new launches begin to outpace its R&D and commercialization expenses. With a focused management team and multiple high-impact readouts on the horizon, Insmed remains a top-tier pick in the mid-cap biotech space.

Pitch Summary:
Among our top contributors in Q4 were Coherent. Coherent is a leading supplier of lasers and photonics solutions used across data center, industrial and communications applications. Recent earnings were solid, with results exceeding expectations and management highlighting strong demand for high-speed optical components supporting AI-driven data center growth, alongside improving margins. Management also expressed increased confidence in Coherent’s vertically integrated indium phosphide platform, which provides supply chain flexibility and a competitive advantage amid constrained industry capacity. Given the stock’s strong performance and valuation nearing the upper end of our assessed range, we trimmed the position during the quarter while maintaining conviction in the company’s longer term growth opportunities.

BSD Analysis:
Coherent is a major under-the-radar beneficiary of the AI boom, providing the essential optical components and laser systems required for high-speed data center networking. Under new leadership, the company is successfully streamlining its portfolio to focus on high-growth areas while using divestiture proceeds to significantly reduce its debt leverage. For 2026, the investment thesis is driven by the "second wave" of AI investment, where the focus shifts from raw GPU power to the networking infrastructure needed to move data between clusters. Coherent’s 800G and next-generation 1.6T transceiver modules are seeing surging demand from cloud hyperscalers who are building out massive AI-optimized data centers. The company is also seeing stable demand in its industrial and semiconductor laser segments, providing a diversified revenue base. With strong earnings beats and a bullish outlook for its networking division, Coherent is well-positioned for continued outperformance as the global build-out of AI infrastructure continues.

Pitch Summary:
We re-established a position in Nu Holdings Ltd., the leading digital bank in Latin America, as we see the company emerging from a benign credit cycle with long-term advantages intact. Nu has attracted over 100 million users with minimal marketing spend by offering a low-cost, tech-first platform. The company benefits from disciplined credit underwriting, strong brand trust, and a retail deposit-based funding model. Financial services remain structurally underpenetrated across its core markets. We expect operating leverage and balance sheet optimization to drive rising returns on equity.

BSD Analysis:
Nu Holdings, better known as Nubank, is the world's leading digital banking platform, currently disrupting the financial services landscape across Brazil, Mexico, and Colombia. With a customer base exceeding 120 million, the company is seeing explosive growth in its credit card, personal loan, and insurance offerings. The 2026 investment narrative is centered on the rapid monetization of its existing user base and the successful replication of its low-cost Brazil model in the Mexican and Colombian markets. Nubank’s proprietary technology and data-driven underwriting allow it to maintain significantly lower operating costs and better credit performance than traditional incumbent banks. As the company achieves sustainable GAAP profitability and expands its free cash flow, it is becoming a prime example of a fintech scaling into a global powerhouse. While regional macroeconomic volatility and currency risks are ever-present, Nubank’s superior customer engagement and massive scale provide a powerful moat against both traditional banks and new fintech entrants.

Pitch Summary:
We initiated a position in FirstRand Limited as South African banks enter a more favorable cycle. FirstRand stands out for its structurally higher returns, diversified earnings streams, and disciplined asset-liability management. Loan growth is improving while credit quality remains stable. Lower inflation targets and easing policy should support affordability and valuation multiples. We believe FirstRand is well positioned to defend margins and compound earnings through the cycle.

BSD Analysis:
FirstRand continues to be the most efficient and profitable banking group in South Africa, distinguished by its innovative "portfolio" approach that includes market-leading brands like FNB and RMB. The company’s 2026 strategy is built on deepening its digital engagement with customers and leveraging its superior data analytics to drive lower credit loss ratios than its peers. FirstRand is seeing robust growth in its transactional and deposit volumes, supported by a flight to quality as consumers seek out the most reliable and technologically advanced financial partners. The bank’s strong capital position and conservative underwriting standards provide a significant cushion against potential macroeconomic shocks. Furthermore, its expanding footprint in other African markets and its growing presence in the U.K. through Aldermore are providing new avenues for long-term growth. For investors seeking exposure to the South African financial sector, FirstRand offers the highest quality metrics and a proven track record of disciplined growth.

Pitch Summary:
We initiated a position in Absa Group Limited as we believe South African banks are at the cusp of a favorable banking cycle. Loan growth is accelerating across corporate and retail segments, while asset quality remains stable with credit losses within through-the-cycle ranges. Easing monetary conditions are improving affordability and activity, supporting potential margin recovery. Absa offers strong leverage to improving domestic growth through its corporate and transactional banking franchises. Operating leverage should emerge as revenue growth outpaces costs.

BSD Analysis:
Absa Group is undergoing a successful strategic transformation under new leadership, focusing on operational efficiency and improved capital allocation to drive superior returns on equity. The South African banking giant is benefiting from a more supportive domestic macroeconomic environment, characterized by easing interest rates and improving consumer confidence. For 2026, the company’s "Rest of Africa" segment is becoming an increasingly important earnings driver, providing meaningful geographic diversification and higher growth potential than the domestic market. Management’s commitment to a leaner cost structure and a renewed focus on non-interest revenue generation is expected to push ROEs toward the group’s 18% target. While the South African banking sector remains competitive, Absa’s strong brand and improved digital offerings are helping it win market share in the retail and corporate segments. The stock offers a compelling combination of attractive dividend yields and a potential valuation re-rating as execution momentum continues.