Investment Pitches

Pitch Summary:
MSA manufactures safety equipment (firefighter helmets, SCBA air respirators, gas detection devices and much more) for hazardous environments across oil & gas, construction, mining, and military applications. As the world navigates energy transition and electrification, safety remains paramount for executives, positioning MSA to benefit from sustained demand. We acquired this high-quality company at a discount to its historical valuation. During our investment career of analyzing and learning about successful companies, it's clear that safety is a priority for many top-performing organizations. We've been watching MSA Safety (MSA) for a while and are excited about the opportunity to buy a high-quality company at a discount relative to its historical valuation. As the world navigates the energy and electrification transition, safety will continue to be at the forefront of executives' decision-making, and MSA is poised to benefit.

BSD Analysis:
The manager presents a bull case for MSA Safety based on the company's position as a leading manufacturer of safety equipment for hazardous environments across multiple industries including oil & gas, construction, mining, and military applications. The investment thesis centers on the secular trend of increasing safety prioritization among top-performing organizations, particularly as the world navigates the energy transition and electrification. The manager emphasizes that safety remains paramount for executives during this transition period, positioning MSA to benefit from sustained demand for its products including firefighter helmets, SCBA air respirators, and gas detection devices. The timing appears opportunistic, as they acquired this "high-quality company" at a discount to its historical valuation. The manager's long-term observation of MSA suggests patience and conviction in the investment case. The energy transition theme provides a compelling secular tailwind, as new technologies and infrastructure projects typically require enhanced safety protocols and equipment, supporting MSA's long-term growth prospects.

Pitch Summary:
Griffon operates through consumer/professional products (True Temper, AMES, ClosetMaid) and home/building products (Clopay garage doors). It's possible you may be a customer of Griffon without even knowing it. Riverwater has been a customer since 2017. We installed their Clopay garage doors for our conference room walls. We met with management recently in our office and they were surprisingly impressed with our design, which they had not seen before. Maybe we'll be able to take credit for a future growth opportunity! The company has methodically streamlined its portfolio and is gaining market share through attractive product design and innovation. It has also significantly improved operating margins over the last five years. While the stock has performed well, it still trades at a significant discount to the market and what we believe to be the true intrinsic value - currently it is trading at 12.4x the next 12 month's earnings. We see potential for continued expansion in the fragmented commercial door market.

BSD Analysis:
The manager presents a bull case for Griffon Corporation, highlighting the company's successful portfolio streamlining and operational improvements over the past five years. Griffon operates in two main segments: consumer/professional products including well-known brands like True Temper, AMES, and ClosetMaid, and home/building products featuring Clopay garage doors. The investment thesis emphasizes the company's market share gains through attractive product design and innovation, along with significantly improved operating margins. At 12.4x forward earnings, the manager believes GFF trades at a significant discount to both the broader market and its intrinsic value. The manager sees expansion potential in the fragmented commercial door market, suggesting room for continued growth. The personal anecdote about Riverwater's own use of Clopay products and management's interest in their innovative installation design adds a unique touch to the investment case. The combination of operational improvements, attractive valuation, and market expansion opportunities forms the core of this value-oriented investment thesis.

Pitch Summary:
Everus represents the type of opportunity we seek: a quality company trading at a significant discount due to temporary market conditions. ECG is an engineering and construction company focused on Electrical & Mechanical (E&M) and Transmission & Distribution (T&D) markets. ECG was recently spun off from MDU Resources, creating a pure-play engineering and construction company focused on electrical & mechanical (E&M) and transmission & distribution (T&D) markets. Since the spinoff announcement, ECG's backlog has grown by over 40% with a valuation now exceeding its former parent's market cap. This is primarily driven by data center and high-tech infrastructure projects. The company benefits from two powerful trends: exponential power demand from AI and data centers, exemplifying Jevons Paradox where efficiency gains are overwhelmed by usage growth; and grid modernization needs as aging utility infrastructure (graded "D+" by industry assessments) requires substantial investment. At the time of the spin and the subsequent market pullback, we believed ECG's steady data center buildout and robust backlog were underappreciated by the market. At the time of our purchase, ECG traded at nearly a 50% discount to peers on a historical basis. This disconnect likely reflects its status as a newly public company and investor skepticism about AI-related demand sustainability. We believe the market underappreciates ECG's proven operating history and the management team's execution capabilities. While we expect normal fluctuations in backlog, the long-term outlook remains favorable. ECG is well-positioned to benefit from sustained infrastructure investment driven by exponential growth in power demand from technological advancement.

BSD Analysis:
The manager presents a compelling bull case for Everus Construction Group, viewing it as a quality company trading at a significant discount following its spinoff from MDU Resources. The investment thesis centers on ECG's exposure to two powerful secular growth drivers: exponential power demand from AI and data centers, and the critical need for grid modernization of aging U.S. utility infrastructure. The company's backlog has grown over 40% since the spinoff announcement, primarily driven by data center and high-tech infrastructure projects. At the time of purchase, ECG traded at nearly a 50% discount to peers, which the manager attributes to its newly public status and investor skepticism about AI demand sustainability. The manager believes the market underappreciates ECG's proven operating history and management execution capabilities. With utility infrastructure graded "D+" and exponential growth in power demand from technological advancement, ECG appears well-positioned for sustained long-term growth. The timing of their purchase during the April market decline proved fortuitous, contributing over 150 basis points to quarterly performance.

Pitch Summary:
This is how we got to own Broadcom and Oracle, two of the best AI plays around, (in addition to Apple, Microsoft, Visa and others). But, unlike today, we built our positions in Broadcom and Oracle when their stocks embedded weak outlooks, not meteoric expectations. We bought Oracle in September 2020 when it was trading 14x earnings and investors were sour on the name. It has likewise performed well. We have taken gains along the way but still hold a large, but measured position, of 2.2%.

BSD Analysis:
The managers identify Oracle as one of the premier AI investment opportunities, alongside Broadcom, but emphasize their contrarian entry strategy. They purchased Oracle in September 2020 at 14x earnings when investor sentiment was negative and the stock was out of favor. This timing allowed them to benefit from the subsequent AI-driven revaluation as Oracle's cloud and database capabilities became increasingly valuable for AI applications. The investment has performed well, validating their contrarian approach and patience in waiting for attractive entry points. Similar to their Broadcom strategy, they have actively managed the position by taking gains during the appreciation while maintaining a substantial 2.2% allocation. The measured position size reflects their balanced approach to capturing AI upside while managing concentration risk. Their success with Oracle demonstrates the value of buying quality technology companies when they embed weak expectations rather than chasing momentum at premium valuations.

Pitch Summary:
This is how we got to own Broadcom and Oracle, two of the best AI plays around, (in addition to Apple, Microsoft, Visa and others). But, unlike today, we built our positions in Broadcom and Oracle when their stocks embedded weak outlooks, not meteoric expectations. We bought Broadcom at around a price/earnings of 11x in March 2020. Since then, we have taken profits at several points, but we still have a 3.4% position, making it our third-largest position.

BSD Analysis:
The managers position Broadcom as one of the best AI investment opportunities available, but emphasize their disciplined approach to valuation and timing. They originally purchased Broadcom in March 2020 at approximately 11x price-to-earnings when the stock embedded weak expectations rather than the meteoric expectations seen in today's AI market. This contrarian timing allowed them to capture significant upside as the AI theme developed and Broadcom's prospects improved. The managers have demonstrated active portfolio management by taking profits at multiple points during the stock's appreciation, balancing the desire to participate in the AI opportunity with prudent risk management. Despite profit-taking, Broadcom remains their third-largest position at 3.4% of the portfolio, indicating continued conviction in the company's AI positioning. Their approach contrasts sharply with current market participants who are paying premium valuations for AI exposure, highlighting the importance of entry point in generating superior returns.

Pitch Summary:
We also significantly increased our position in Exxon Mobil, as commodity weakness weighed on the shares, providing a compelling opportunity. Commodity prices are cyclical but the change underway at Exxon Mobil is secular. The company is simultaneously lowering its cost per barrel and reducing its emissions intensity while growing its production. This is a powerful combination that puts the company in its best position in decades. Exxon Mobil is positioned to deliver double-digit returns, even without any improvement in oil prices. If stagflation occurs, Exxon Mobil's returns should be even higher, while most other stocks will come under pressure, providing a sturdy portfolio hedge.

BSD Analysis:
The managers significantly increased their Exxon Mobil position during commodity weakness, viewing this as a compelling contrarian opportunity. They distinguish between cyclical commodity price movements and the secular transformation occurring within Exxon Mobil itself. The company is executing a powerful operational strategy of simultaneously reducing costs per barrel, lowering emissions intensity, and growing production - positioning it for its best competitive stance in decades. Management believes Exxon can deliver double-digit returns even without oil price improvements, demonstrating the strength of the operational improvements. The investment also serves as a stagflation hedge, as energy companies typically outperform during inflationary periods while other sectors struggle. This positioning aligns with their portfolio strategy of finding attractively valued securities that can perform across various economic scenarios. The timing of the increased position during commodity weakness demonstrates their disciplined approach to valuation-driven investing.

Pitch Summary:
During the quarter we initiated a position in L3Harris, a defense company which had sold off on DOGE-related concerns. With armed conflict breaking out all over, robust defense spending seems like one of today's few safe bets. L3Harris possesses a robust balance sheet and a strong outlook, and it offered an attractive entry point at a steep discount to the broader market in terms of free cash flow.

BSD Analysis:
The managers initiated a position in L3Harris following a sell-off related to DOGE (Department of Government Efficiency) concerns, viewing this as an attractive entry opportunity. They believe robust defense spending is a safe bet given global armed conflicts, positioning L3Harris to benefit from increased defense budgets. The company's strong balance sheet and positive outlook provide fundamental support for the investment thesis. The managers emphasize the valuation opportunity, noting L3Harris trades at a steep discount to the broader market on a free cash flow basis. This contrarian approach aligns with their strategy of buying quality companies when they embed weak outlooks rather than meteoric expectations. The defense sector positioning also provides portfolio diversification away from overvalued mega-cap technology stocks. The timing appears strategic given the current geopolitical environment and potential for sustained defense spending increases.

Pitch Summary:
Another top contributor for the strategy was Agilysys, Inc. (AGYS), another technology company. The stock of the hospitality-software company was up sharply after the firm released its latest quarterly operating results. Fundamentals for the business remain encouraging, with Agilysys reporting record quarterly revenue growth of $74.3 million, up 19.4% from the same period last year. Going forward, we continue to like Agilysys' growth potential as its niche software takes market share across the hospitality industry.

BSD Analysis:
The managers express strong confidence in Agilysys following impressive quarterly results that demonstrated the company's ability to execute on its growth strategy in the hospitality software market. The record quarterly revenue of $74.3 million, representing 19.4% year-over-year growth, validates the company's market share gains and pricing power in its specialized niche. Agilysys benefits from providing mission-critical software solutions to hotels, restaurants, and other hospitality businesses, creating high switching costs and recurring revenue streams. The company's focus on hospitality-specific functionality gives it competitive advantages over generic software providers, allowing it to command premium pricing and maintain customer loyalty. The managers see continued growth potential as the hospitality industry increasingly adopts digital solutions for operations, customer management, and analytics. Agilysys' established market position and domain expertise should enable it to capture a disproportionate share of this digital transformation spending. The strong financial performance suggests successful execution of the company's strategy to expand its customer base and increase wallet share with existing clients.

Pitch Summary:
Two of the strategy's top contributors to performance were technology companies, Fabrinet (FN) and Nova Ltd. (NVMI). Fabrinet makes optical components that are used in data centers. Nova sells metrology and process control systems used in semiconductor manufacturing. Both businesses have benefited from the increasing use of artificial intelligence (AI). While fundamentals for the two companies remain strong, AI has been a popular investment theme and that likely played a larger role in fueling the stocks' rise.

BSD Analysis:
The managers view Nova as well-positioned to benefit from the AI-driven semiconductor manufacturing boom, with the company's metrology and process control systems becoming increasingly critical as chip designs grow more complex. Nova's specialized equipment helps semiconductor manufacturers maintain quality and yield in advanced node production, which is essential for AI chips requiring cutting-edge process technologies. The company's strong fundamentals support the investment thesis beyond just AI momentum, including established relationships with leading foundries and IDMs, technological leadership in metrology solutions, and recurring revenue from service and upgrades. However, the managers acknowledge that AI-related investor enthusiasm has likely amplified the stock's recent gains, suggesting awareness of potential valuation risks. The secular trend toward more sophisticated semiconductor manufacturing processes should drive long-term demand for Nova's precision measurement and control systems. The company's focus on critical quality control equipment creates customer stickiness and pricing power. While AI has been a near-term catalyst, Nova benefits from broader semiconductor industry trends requiring advanced process control capabilities.

Pitch Summary:
Two of the strategy's top contributors to performance were technology companies, Fabrinet (FN) and Nova Ltd. (NVMI). Fabrinet makes optical components that are used in data centers. Nova sells metrology and process control systems used in semiconductor manufacturing. Both businesses have benefited from the increasing use of artificial intelligence (AI). While fundamentals for the two companies remain strong, AI has been a popular investment theme and that likely played a larger role in fueling the stocks' rise.

BSD Analysis:
The managers view Fabrinet as a key beneficiary of the artificial intelligence infrastructure buildout, with the company's optical components playing a critical role in data center connectivity and performance. Fabrinet's specialized manufacturing capabilities in advanced optical packaging position it well to capture growing demand from hyperscale data center operators investing heavily in AI computing infrastructure. The company's strong fundamentals provide a solid foundation beyond the AI theme, including established customer relationships, manufacturing expertise, and operational scale. However, the managers acknowledge that AI-related enthusiasm has likely contributed significantly to the stock's recent outperformance, suggesting some caution about valuation levels. The secular trend toward higher bandwidth requirements and more sophisticated optical networking in data centers should support long-term demand for Fabrinet's products. The company's focus on high-value, complex optical components creates barriers to entry and pricing power. While AI has been a catalyst, the underlying business benefits from multiple technology trends requiring advanced optical solutions.

Pitch Summary:
Goosehead Insurance, Inc. (GSHD) also detracted. Through its network of franchisees and corporate agents, Goosehead brokers insurance products from a wide range of carriers. Fundamentals for the business remain robust, but after a strong run by the stock over the past year, it gave back some ground this quarter. Looking ahead, we continue to like Goosehead for its innovative business model, which leverages technology to manage a variety of customer-service and back-office functions, allowing its brokers to focus primarily on sales.

BSD Analysis:
The managers maintain a bullish outlook on Goosehead Insurance despite recent stock price weakness, viewing the decline as a natural pullback following strong prior performance rather than a fundamental deterioration. They emphasize that the company's underlying business fundamentals remain robust, supported by an innovative franchise-based model that differentiates it from traditional insurance brokers. The key competitive advantage lies in Goosehead's technology platform, which automates customer service and back-office operations, enabling agents to focus on revenue-generating sales activities rather than administrative tasks. This operational efficiency should drive superior productivity and margins compared to conventional brokers. The franchise model provides scalable growth with lower capital requirements while maintaining quality control through corporate oversight. The managers appear confident that the technology-enabled approach will continue to gain market share in the fragmented insurance brokerage industry. Recent stock weakness likely represents a buying opportunity in a high-quality growth business with sustainable competitive advantages.

Pitch Summary:
Clearwater Analytics Holdings, Inc. (CWAN) was another detractor. Clearwater Analytics offers a software platform for investment accounting, compliance, risk management and reporting that gives asset managers and insurers daily insights into portfolio holdings. During the quarter, the stock reacted negatively as the company completed its acquisition of a software provider for the investment management and hedge fund industry. We continue to like Clearwater but lowered the stock's weight in the strategy as we assess what the acquisition might mean for Clearwater's business.

BSD Analysis:
The managers express a cautiously neutral stance on Clearwater Analytics following the company's recent acquisition activity. While they maintain positive sentiment toward the underlying business model, which provides critical investment accounting and compliance software to asset managers and insurers, they have reduced position sizing due to acquisition-related uncertainty. The platform's value proposition of delivering daily portfolio insights across accounting, compliance, and risk management remains compelling in an increasingly complex regulatory environment. However, the recent acquisition of a software provider serving investment management and hedge fund clients introduces integration risks and potential business model changes that require careful evaluation. The managers appear to be taking a wait-and-see approach to understand how this acquisition will impact Clearwater's competitive positioning and growth trajectory. The stock's negative reaction suggests market concerns about execution risk or valuation. The reduced weighting reflects prudent risk management while maintaining exposure to what they view as a fundamentally attractive business.

Pitch Summary:
The largest detractor from the strategy's performance for the quarter was BellRing Brands, Inc. (BRBR). The company provides various nutritional products and is best known for its Premier Protein and Dymatize brands. BellRing's fundamentals are strong, but there is a one-off channel inventory dynamic affecting guidance for the third quarter, which caused the stock to sell off. We visited the company recently, and believe our secular thesis is on track given strong consumption metrics and a continued runway to increase distribution and penetrate new households.

BSD Analysis:
The managers maintain a bullish stance on BellRing Brands despite recent underperformance, viewing the stock's decline as a temporary setback rather than a fundamental issue. They emphasize that the company's core fundamentals remain strong and that the third-quarter guidance impact is due to a one-off channel inventory dynamic. The investment thesis centers on secular growth drivers including robust consumption metrics and significant expansion opportunities through increased distribution and household penetration. The managers' recent company visit reinforced their confidence in the long-term trajectory. BellRing's position in the growing nutrition and protein supplement market, anchored by well-known brands like Premier Protein and Dymatize, provides a solid foundation for continued growth. The temporary inventory headwind appears to be masking underlying business strength. The managers view this as a high-quality business experiencing short-term noise rather than structural challenges.

Pitch Summary:
On the other side of the care continuum lies Encompass Health, one of the largest U.S. operators of inpatient rehabilitation hospitals. These facilities play a pivotal role in the recovery process for seniors after events like strokes, hip fractures, and cardiac surgeries —conditions whose frequency grows with age. Unlike acute-care hospitals or long-term skilled nursing facilities, Encompass focuses on intensive post-acute rehab —a cost-effective, outcomes-oriented model that's increasingly favored by insurers and policymakers. Their facilities combine physical therapy, nursing, and medical care in a setting optimized for recovery and return-to-home metrics. Why we like it: • Exposure to rising procedure volumes with lower policy volatility • Real-estate-backed business model with stable occupancy and low turnover • Predictable cash flows and secular demand from an aging population Despite volatility in other corners of healthcare, Encompass continues to deliver solid fundamentals —a reminder that longevity investing isn't just about breakthrough science, but also about reliable care infrastructure.

BSD Analysis:
Tall Oak's investment in Encompass Health represents a strategic play on the post-acute care segment of healthcare, targeting the growing need for rehabilitation services among aging populations. The fund emphasizes the company's position as the largest operator of inpatient rehabilitation facilities in the U.S., benefiting from increasing volumes of strokes, hip fractures, and cardiac surgeries that require intensive recovery care. The managers highlight the business model's appeal to insurers and policymakers as a cost-effective alternative to traditional acute care or long-term nursing facilities. Encompass Health's real estate-backed model provides stability through consistent occupancy rates and low tenant turnover, generating predictable cash flows. The company operates in a segment with lower regulatory volatility compared to other healthcare subsectors, reducing policy risk. Tall Oak views this as a defensive play within the longevity theme, focusing on essential care infrastructure rather than speculative medical breakthroughs.

Pitch Summary:
Intuitive Surgical continues to be a prime beneficiary of the shift toward minimally invasive care —a preference that's particularly pronounced among aging patients and hospitals managing resource constraints. The company's Da Vinci robotic surgery systems are now deployed across thousands of hospitals globally, and Q2 2025 marked a record-setting quarter: 110 new placements, up from 70 the previous quarter. What drives this growth? In short: real-world demand. Hospitals increasingly prefer robotic-assisted procedures for their shorter recovery times, reduced infection risks, and greater surgical precision —all critical factors in aging populations undergoing hernia repair, prostatectomy, or cardiac surgery. Why we like it: • High-margin, recurring revenue from service contracts and surgical instruments • Strong balance sheet with no debt and a long runway for global adoption • A "pick-and-shovel" approach to rising surgical volumes in aging populations As AI spreads into physical healthcare applications, Intuitive is well positioned at the intersection of automation, medicine, and demographic necessity.

BSD Analysis:
Tall Oak presents a compelling bull case for Intuitive Surgical based on secular demographic trends and operational excellence. The fund highlights the company's record Q2 2025 performance with 110 new system placements, representing 57% quarter-over-quarter growth, demonstrating accelerating adoption of robotic surgery. The investment thesis centers on the aging population driving demand for minimally invasive procedures that offer shorter recovery times and reduced complications. The managers emphasize Intuitive's attractive business model featuring high-margin recurring revenues from service contracts and surgical instruments, creating predictable cash flows. The company's debt-free balance sheet provides financial flexibility for continued R&D investment and global expansion. Tall Oak positions this as a "pick-and-shovel" play on the inevitable increase in surgical volumes as demographics shift. The convergence of AI technology with physical healthcare applications creates additional upside potential for the robotic surgery leader.

Pitch Summary:
FICO is the leading provider of consumer credit analytics and scoring algorithms: Best known for the "FICO Score"—a three-digit metric used in 90%+ of consumer credit decisions across the U.S. (including mortgage, auto, credit card, and personal loans). FICO generates revenue in two ways: Scores (53% FY24 revenue / 76% FY24 EBITDA): Proprietary risk algorithm is licensed to banks, credit bureaus, insurance companies, and other financial intermediaries. Royalty paid on a per score basis. Software (47% FY24 revenue / 24% FY24 EBITDA): Subscription software solutions, help banks and lenders manage the lifecycle of a loan (customer acquisition, fraud detection, repayment schedules). 35+ year history in consumer scoring has established it as the benchmark used in all domestic credit decisioning: In 1987, they introduced nation's first standardized credit score. Since then, all key constituents in consumer credit value chain have adopted and embedded it into their risk systems. Industry standard: FICO score is used in 90% of lending decisions. Embedded in underwriting & secondary market risk technology systems. Entrenchment makes it difficult to displace as it serves as the common language in communicating consumer risk profiles to market participants. Score monetization/Proliferation: Accelerates volume by encouraging increased score pull cadence (monthly → weekly pulls) and monetizing new areas (mortgage non-originations). Volume Growth in Core Categories: Mortgage volumes are depressed relative to recent history (53% below the 2021 peak). We see potential for bounce back followed by long-term secular growth driven by housing starts. Pricing Opportunity across Mortgage and Auto: FICO is underpriced relative to the value it provides in credit underwriting. Management Aligned with Shareholders: CEO Will Lansing is a top 15 shareholder. Company has investor friendly capital return strategy (~$3B shares repurchased since 2021). New U.S. administration created policy uncertainty which led to a buying opportunity: Investors have raised concerns around changes at Fannie Mae and Freddie Mac that could impact FICO's position in market and its role in scoring government-backed mortgages (~57% of new mortgages). FICO has faced regulatory scrutiny before and navigated it successfully. We felt that the recent stock pullback (down 20%+ in mid-May) compensated investors for regulatory uncertainty.

BSD Analysis:
Edgewood's FICO investment thesis capitalizes on the company's entrenched position as the dominant credit scoring standard, used in 90%+ of U.S. lending decisions across mortgage, auto, and credit card markets. The manager emphasizes FICO's dual revenue model: high-margin Scores business (53% revenue, 76% EBITDA) generating royalties per score pull, and Software solutions (47% revenue) providing loan lifecycle management tools. The investment case centers on score proliferation opportunities, including increased pull frequency and monetization of secondary market transactions currently uncompensated. With mortgage volumes 53% below 2021 peaks, the manager sees cyclical recovery potential alongside secular housing growth. Key value drivers include pricing power given FICO's minimal cost relative to total lending expenses and management's shareholder-friendly capital allocation, evidenced by $3B in buybacks since 2021. The manager viewed recent regulatory uncertainty around Fannie Mae/Freddie Mac changes as creating an attractive entry point, with the stock down 20%+ in May. FICO's 35-year track record and embedded position in risk systems provide defensive moats against displacement.

Pitch Summary:
Diversified Technology Leader: Broadcom is a global technology company that designs, develops, and supplies a broad range of semiconductor & infrastructure software solutions. Broadcom operates two primary segments: Semiconductors (58% of revenue): Serves networking, wireless, broadband, compute & storage end markets. AI offerings (24% of total revenue, growing 40%+) consist of custom chips & networking equipment for AI datacenter buildouts. Software (42% of revenue): Mission critical on-premise software with offerings that span cybersecurity, private cloud, observability, and mainframe. High margins: Broadcom boasts a ~60% operating margin and 38% FCF margin which enables consistent capital return. AVGO seeks to acquire businesses with #1 or #2 market share, high switching costs and attractive financial profiles. Upon acquisition, Broadcom aims to cut costs, simplify go to market strategy and continue to invest in R&D. Over the last decade, Broadcom's aperture has expanded to software companies with mission critical offerings across security, mainframe & public / private cloud infrastructure. Semiconductor market likely to grow from $655B today to $1T+ by 2030 (+9% CAGR) driven by AI compute, networking & digital communications. Broadcom's diversified semiconductor business likely to benefit from hyperscaler investment in custom silicon. AI hyperscaler capex est. $455B this year to $1T+ by 2029. Company anticipates AI compute clusters scaling from 10k to 100k or 500k over medium term. Four new unnamed customers to expand AI revenue opportunity across compute & networking. Potential new customers offer meaningful upside to AI revenue. Non-AI semiconductor business to see a cyclical recovery with mid-single digit growth longer-term. Broadcom's software business centered around VMware likely to grow. 53% of senior IT leaders say private cloud is top priority for deploying new workloads. 84% of senior IT leaders use private cloud for traditional enterprise applications & cloud native workloads. CEO Hock Tan likely to continue long history of shareholder value creation through operational efficiency, M&A, and capital return. EBIT margins up 700bps over 5 years from 53% to 60%. Dividend CAGR of 32% since FY 2016. $10B buyback announced April 2025.

BSD Analysis:
Edgewood's investment thesis for Broadcom centers on the company's strategic positioning in the AI semiconductor boom and its diversified technology platform spanning chips and software. The manager emphasizes AVGO's dual revenue streams from semiconductors (58%) and infrastructure software (42%), with AI offerings representing 24% of total revenue growing at 40%+ annually. The bull case rests on massive AI datacenter buildouts driving demand for custom silicon and networking equipment, with hyperscaler capex expected to grow from $455B to over $1T by 2029. Broadcom's high-margin business model (60% operating margin, 38% FCF margin) enables aggressive capital returns, including a recent $10B buyback authorization. The manager highlights CEO Hock Tan's proven M&A execution and operational efficiency track record, evidenced by 700bps of EBIT margin expansion over five years. The VMware-centered software business benefits from enterprise private cloud adoption trends, with 84% of IT leaders using private cloud for core applications. This diversified approach provides both AI upside and defensive software recurring revenue streams.

Pitch Summary:
Boston Scientific is a global medical device company that develops and manufactures minimally invasive products used in a variety of medical specialties. BSX operates two primary segments: Cardiovascular: Includes Watchman (atrial fibrillation device), electrophysiology (EP), and interventional cardiology. MedSurg: Includes endoscopy, urology, and neuromodulation. Medical technology is an attractive segment of healthcare. Procedure based sales drive durable and recurring revenue stream. Advances in technology enabling safer, more effective treatments are potential long-term tailwinds. Regulatory approval process & scaled distribution create high barriers to entry. Durable growth profile: Broad portfolio, continued innovation, tuck-in M&A, economies of scale can drive top line and double-digit EPS growth. Product innovation driving growth: Electrophysiology (EP) product portfolio likely to continue gaining share. Watchman (AF device) has sustained physician loyalty in fast-growing end market. Pipeline of other bets in emerging areas. Near-term margin opportunity underappreciated: Key growth products are margin accretive. High quality management team with track record of M&A execution: Venture capital portfolio enhances M&A efforts. Electrophysiology is a cardiology subspecialty focused on the electrical activity in the heart. Rapid transition from legacy ablation—radiofrequency (RF) & cryoablation (Cryo)—to pulsed field ablation (PFA). Gaining market share in EP with a strong pipeline.

BSD Analysis:
Edgewood's thesis centers on Boston Scientific's position as a diversified medical device leader with strong growth prospects driven by innovation and market expansion. The manager highlights BSX's dual-segment structure spanning cardiovascular and MedSurg markets, with particular emphasis on the electrophysiology opportunity where the company is gaining share through advanced pulsed field ablation technology. The investment case rests on durable procedure-based revenue streams, high barriers to entry from regulatory requirements, and management's proven M&A execution track record. Key growth drivers include the Watchman atrial fibrillation device's sustained physician adoption and the broader EP market transition from legacy ablation methods. The manager sees underappreciated margin expansion potential as higher-margin innovative products scale. With a $70B total addressable market growing 8-9% annually and BSX's strong competitive positioning in high-growth subspecialties, the thesis reflects confidence in sustained double-digit earnings growth.

Pitch Summary:
Newmont, the world's largest gold miner, rallied 21% during the quarter amid increased geopolitical tensions, notably the escalation of the Iran-Israel conflict and direct involvement by the US. While gold prices pulled back slightly from an earlier all-time high above US$3,400 per ounce, the physical gold price remains elevated, reflecting the ongoing demand from central banks and investors seeking stability amid persistent economic uncertainty. After years of underperforming relative to gold prices, Newmont's stock price has begun catching up, though it remains almost 30% below its 2022 peak, at which point gold was trading at US$2,000 per ounce.

BSD Analysis:
PM Capital's Newmont position represents a strategic play on gold's safe-haven status amid escalating geopolitical tensions and economic uncertainty. The investment thesis capitalizes on Newmont's position as the world's largest gold miner while the stock trades at a significant discount to its 2022 peak despite gold prices reaching new highs above $3,400 per ounce. The manager identifies strong fundamental drivers including central bank demand and investor flight to safety during periods of geopolitical stress, particularly the Iran-Israel conflict escalation. Newmont's stock has historically lagged gold price movements but is beginning to catch up, suggesting potential for continued valuation re-rating. With gold remaining elevated and Newmont trading 30% below previous peaks when gold was $1,400 lower, the risk-reward profile appears attractive for continued outperformance.

Pitch Summary:
Freeport McMoRan, a portfolio holding, is the world's second-largest copper producer with strategic assets in the US. It could be a direct beneficiary of favourable US government policy for domestic copper production. President Trump is using commodities as bargaining chips for trade concessions, diplomacy and international politics. This is evident in uranium, rare earths, copper, battery metals, steel, aluminium and other commodities. China is also engaging in commodity warfare, having increased its investment in African resource projects. These artificial barriers to commodity supply coincide with decades of global underinvestment in resource projects, and with new drivers of commodity demand from the transition to renewables. Copper, for example, is a key commodity in electric vehicles.

BSD Analysis:
PM Capital's investment in Freeport-McMoRan capitalizes on the intersection of geopolitical commodity strategy and structural supply-demand imbalances in copper markets. The thesis centers on Freeport's position as the world's second-largest copper producer with strategic US-based assets, positioning it to benefit from favorable domestic production policies. The manager identifies President Trump's use of commodities as geopolitical tools and China's commodity warfare as creating artificial supply constraints. These dynamics coincide with decades of underinvestment in resource projects and rising demand from the renewable energy transition, particularly electric vehicles where copper is essential. Freeport's domestic US production base provides strategic value in an environment of increasing resource nationalism and supply chain security concerns, potentially commanding premium valuations.