Investment Pitches

Pitch Summary:
MercadoLibre (MELI) -15% — Latin America's leading e-commerce and fintech platform sold off alongside emerging market equities broadly. A stronger dollar compounded the move. Underlying GMV and credit portfolio growth remain strong.

BSD Analysis:
Torre maintains a bullish stance on MercadoLibre despite a 15% decline in Q1 2026, attributing the selloff to broader emerging market weakness rather than company-specific issues. The stronger dollar compounded the decline, creating additional headwinds for the Latin American e-commerce and fintech leader. Torre emphasizes that underlying business fundamentals remain strong, with continued growth in gross merchandise value (GMV) and credit portfolio expansion. The characterization as "Latin America's leading e-commerce and fintech platform" highlights MELI's dominant market position across multiple business lines. The distinction between market-driven selloff and strong underlying metrics suggests Torre sees a disconnect between fundamentals and stock performance. The focus on GMV and credit portfolio growth indicates Torre's confidence in MELI's core e-commerce marketplace and expanding financial services offerings. Torre's continued conviction demonstrates belief in the long-term growth potential of Latin American digital commerce and fintech adoption despite near-term currency and emerging market headwinds.

Pitch Summary:
ThermoFisher (TMO) -15% — The life sciences end-market recovery has been slow. Biotech funding remains constrained; China exposure continues to weigh on sentiment.

BSD Analysis:
Torre acknowledges ThermoFisher's 15% decline in Q1 2026 while highlighting specific challenges facing the life sciences tools and services sector. The slow life sciences end-market recovery indicates continued weakness in biotech and pharmaceutical research spending that drives demand for TMO's products and services. Constrained biotech funding represents a significant headwind given biotech companies are major customers for laboratory equipment and consumables. The mention of China exposure weighing on sentiment reflects ongoing geopolitical concerns and potential regulatory restrictions affecting TMO's international operations. Despite these challenges, Torre's inclusion of TMO among holdings suggests he maintains conviction in the company's long-term prospects. The characterization of these as market-driven rather than company-specific issues indicates Torre views the challenges as temporary. Torre likely sees value in TMO's market-leading position in life sciences tools during a period of sector weakness. The fundamental thesis around life sciences innovation and drug development remains intact despite near-term funding constraints.

Pitch Summary:
S&P Global (SPGI) -17% — Capital markets activity slowed. S&P Global's ratings and index businesses are fundamentally sound, but issuance volumes are a near-term headwind.

BSD Analysis:
Torre maintains a bullish stance on S&P Global despite a 17% decline in Q1 2026, emphasizing that the company's ratings and index businesses remain fundamentally sound. The decline is attributed to slowed capital markets activity and reduced issuance volumes, which Torre characterizes as a "near-term headwind" rather than a structural issue. The distinction between fundamental soundness and near-term headwinds suggests Torre views the current challenges as cyclical rather than permanent. S&P Global's ratings and index businesses benefit from strong competitive moats and recurring revenue characteristics that should persist through market cycles. The focus on issuance volumes as a temporary headwind indicates Torre expects capital markets activity to eventually recover, benefiting SPGI's transaction-dependent revenues. Torre's continued conviction demonstrates confidence in S&P Global's market-leading positions in credit ratings and index provision. The characterization as fundamentally sound suggests the core business quality remains intact despite near-term volume pressures.

Pitch Summary:
Abbott Laboratories (ABT) -17% — Abbott's base business continues to grow steadily, but the stock has been caught in the broader healthcare rotation as investors moved away from defensive names that had outperformed in prior quarters.

BSD Analysis:
Torre maintains a bullish view on Abbott Laboratories despite a 17% decline in Q1 2026, emphasizing that the company's base business continues to grow steadily. The decline is attributed to broader healthcare sector rotation rather than company-specific issues, as investors moved away from defensive names that had previously outperformed. Torre's focus on "steady growth" in the base business suggests confidence in Abbott's fundamental business momentum across its diversified healthcare portfolio. The characterization as a "defensive name" that had "outperformed in prior quarters" indicates Abbott's historical role as a quality defensive holding during market uncertainty. The sector rotation explanation suggests Torre views the decline as a temporary sentiment shift rather than a fundamental deterioration. This represents a potential opportunity where strong business fundamentals are temporarily overshadowed by sector rotation dynamics. Torre's continued conviction demonstrates confidence in Abbott's diversified healthcare platform and steady growth trajectory.

Pitch Summary:
Booking Holdings (BKNG) -21% — Travel demand remains healthy, but Booking sold off on fears that elevated oil prices will weigh on consumer discretionary spending and airfare economics. We view the pullback as a short-term concern.

BSD Analysis:
Despite a 21% decline in Q1 2026, Torre maintains a bullish stance on Booking Holdings, viewing the pullback as a short-term concern rather than a fundamental issue. The manager emphasizes that underlying travel demand remains healthy, suggesting the business fundamentals are intact. The selloff was driven by fears that elevated oil prices from the Iran conflict would negatively impact consumer discretionary spending and airfare economics. Torre's characterization of these concerns as "short-term" indicates confidence that the oil price shock will not permanently impair Booking's business model. The distinction between healthy underlying demand and market fears suggests Torre sees a disconnect between fundamentals and stock price performance. This represents a potential value opportunity where temporary market concerns have created an attractive entry point. Torre's continued conviction despite the significant decline demonstrates confidence in Booking's long-term competitive position in online travel booking.

Pitch Summary:
Linde (LIN) +18% — Industrial gas is a resilient business in any environment, and Linde is the best operator in the space. Consistent pricing power and operational efficiency drove steady outperformance as investors rotated toward defensive quality.

BSD Analysis:
Torre positions Linde as the best operator in the resilient industrial gas business, with an 18% gain in Q1 2026 driven by consistent pricing power and operational efficiency. The characterization of industrial gas as "resilient in any environment" highlights the defensive qualities and essential nature of Linde's products across various industries. Torre emphasizes Linde's superior operational execution compared to peers in the industrial gas space. The mention of "consistent pricing power" suggests strong competitive positioning and the ability to pass through cost inflation to customers. The steady outperformance during a period when "investors rotated toward defensive quality" indicates Linde's appeal as a high-quality defensive holding during market volatility. Torre's bullish stance reflects confidence in Linde's market leadership, operational excellence, and the essential nature of industrial gases across multiple end markets. The combination of defensive characteristics with pricing power creates an attractive risk-adjusted return profile.

Pitch Summary:
Allison Transmission (ALSN) +20% — A quiet compounder. Allison, a leader in automatic transmissions for medium- and heavy-duty trucks, is expanding into defense/tanks, off-road trucks, and hybrid/electric drivetrain.

BSD Analysis:
Torre characterizes Allison Transmission as a "quiet compounder" with a 20% gain in Q1 2026, highlighting the company's leadership position in automatic transmissions for medium- and heavy-duty trucks. The expansion into defense applications including tanks, off-road trucks, and hybrid/electric drivetrains demonstrates diversification beyond traditional commercial vehicle markets. The "quiet compounder" description suggests Torre values ALSN for its steady, consistent performance rather than dramatic growth. The expansion into defense markets provides exposure to government spending and potentially higher-margin applications. The move into hybrid and electric drivetrains positions the company for the electrification transition in commercial vehicles. Torre's inclusion among top contributors indicates confidence in the company's ability to execute on market expansion while maintaining its core transmission leadership. The diversification strategy reduces dependence on any single end market while leveraging core transmission expertise.

Pitch Summary:
ASML (ASML) +23% — The sole supplier of EUV lithography equipment remains a bottleneck for advanced semiconductor manufacturing. ASML's order book and pricing power are insulated from near-term demand swings.

BSD Analysis:
Torre highlights ASML's monopolistic position as the sole supplier of EUV lithography equipment, which creates a critical bottleneck for advanced semiconductor manufacturing. The 23% gain in Q1 2026 reflects the company's pricing power and strong order book that insulates it from near-term demand fluctuations. ASML's monopoly in EUV technology provides exceptional competitive moats and pricing power in the semiconductor equipment market. The characterization of being "insulated from near-term demand swings" suggests Torre views ASML as having defensive qualities despite being in a cyclical industry. The strong order book provides revenue visibility and supports the bull thesis on the company's ability to maintain pricing discipline. Torre's positioning of ASML among top contributors indicates confidence in the secular demand for advanced semiconductor manufacturing capabilities. The bottleneck position in the semiconductor supply chain creates significant strategic value and pricing power.

Pitch Summary:
GE Vernova (GEV) +37% — A similar story. GE Vernova sits at the intersection of grid modernization and the electrification wave driven by AI and data center power demand.

BSD Analysis:
Torre positions GE Vernova as another beneficiary of the data center and AI infrastructure boom, with the stock gaining 37% in Q1 2026. The company sits at the strategic intersection of grid modernization and electrification trends driven by AI and data center power demand. This positioning suggests GE Vernova is well-placed to capture the massive power infrastructure investments required to support the AI revolution. The characterization as "a similar story" to Comfort Systems indicates Torre views both companies as beneficiaries of the same secular infrastructure spending trends. Grid modernization represents a multi-decade investment cycle as utilities upgrade infrastructure to handle increased power demand from data centers. The electrification wave driven by AI creates sustained demand for GE Vernova's power generation and grid solutions. Torre's bullish stance reflects confidence in the durability of these infrastructure investment trends.

Pitch Summary:
Comfort Systems (FIX) +52% — Comfort Systems continues to benefit from the massive buildup of data center infrastructure across the U.S., where its mechanical and electrical contracting services are in high demand. Backlog remains at record levels.

BSD Analysis:
Torre highlights Comfort Systems as a top performer with a 52% gain in Q1 2026, driven by the massive data center infrastructure buildout across the U.S. The company's mechanical and electrical contracting services are experiencing high demand from this secular trend. Record backlog levels provide strong revenue visibility and support the bull thesis. The positioning in data center infrastructure aligns with AI-driven capital expenditure trends that Torre views as multi-year secular spending patterns. This represents a clear beneficiary of the electrification and grid modernization wave. The strong quarterly performance validates the company's exposure to infrastructure spending that persists regardless of short-term market volatility. Torre's inclusion of FIX among top contributors suggests confidence in the durability of the data center investment cycle.

Pitch Summary:
NVIDIA's AI infrastructure business is significantly undervalued when considering its true economic unit economics. The company captures a premium not just on its chips but on the full stack of software-enabled acceleration, which is not fully reflected in its reported gross margins. NVIDIA's NVL72 rack-scale systems offer radically different economics compared to discrete GPU sales, with substantial revenue generation potential through inference tokens. The company's economic moat is further strengthened by its performance per watt advantage, which is critical for data center operators constrained by power budgets. NVIDIA's transition to rack-scale sales and its NVLink Fusion technology, which allows third-party chips to connect to its NVLink fabric, represent significant growth opportunities. These factors contribute to NVIDIA's ability to maintain pricing power and expand its economic margins.

BSD Analysis:
NVIDIA's economic unit analysis reveals that its reported gross margins understate the true value of its AI infrastructure business. The company's CUDA software stack provides a significant competitive advantage, allowing it to capture a premium on its hardware. The NVL72 rack systems demonstrate strong payback economics, even in a bear case scenario, due to their ability to generate substantial revenue per rack. NVIDIA's focus on performance per watt ensures that its hardware remains attractive to data centers with fixed power budgets, further solidifying its market position. The company's strategic shift to rack-scale sales and the potential of NVLink Fusion to generate a royalty-like revenue stream from third-party compute highlight NVIDIA's ability to capture more of the system value chain. As NVIDIA continues to innovate and expand its software attach rate, its economic margins are expected to improve, supporting a bullish long-term outlook.

Pitch Summary:
Williams Companies is strategically positioned to benefit from the growing demand for natural gas, driven by the phase-out of coal and the rise of LNG exports. The company owns critical infrastructure, including the Transco pipeline, which is essential for transporting natural gas across the U.S. Its fee-based revenue model provides stability and reduces exposure to commodity price fluctuations. With significant investments in power projects and LNG export infrastructure, Williams is poised for strong growth. The company's moat is reinforced by regulatory and geographic barriers that make it difficult for competitors to replicate its network.

BSD Analysis:
Williams Companies is capitalizing on two major growth drivers: LNG exports and power generation, particularly for data centers. The U.S. is leading the global LNG expansion, and Williams' infrastructure is crucial for this growth. The company's strategic investments in power projects cater to the rising electricity demand from AI-driven data centers, which require reliable energy sources like natural gas. Williams' financial health is robust, with a strong balance sheet and consistent cash flow generation. The company's ability to execute high-return projects ensures a sustainable growth trajectory, making it a compelling investment despite its current premium valuation.

Pitch Summary:
Alibaba's cloud revenue has shown significant growth, re-accelerating into the mid-30% range, driven by AI-related cloud products that have posted triple-digit growth for ten consecutive quarters. The company has committed over $50 billion over three years to AI and cloud infrastructure, with a five-year target of $100 billion in annual cloud and AI revenue. This represents a potential 5x increase from current levels. Despite challenges in deploying servers fast enough, Alibaba's strategic investments in AI and cloud infrastructure position it well for future growth.

BSD Analysis:
Alibaba's aggressive investment in AI and cloud infrastructure is a strategic move to capitalize on the growing demand for AI-driven services. The company's focus on improving cloud economics through better utilization and pricing power is expected to enhance operating leverage. Compared to US hyperscalers, Alibaba's AI capex is more efficient, suggesting potential for higher returns on investment. The stabilization of profitability, as noted in the JPM report, indicates a solid foundation for future expansion. Alibaba's ability to maintain growth at a fraction of the cost of its US counterparts highlights its competitive advantage in the tech industry.

Pitch Summary:
MTY is a double-edged restaurant play that, on one end, we view it as an improving restaurant franchisor in what was an abysmal year for the restaurant industry. On the other hand, because so many restaurants saw deteriorating fundamentals and thus, steep stock price declines in 2025, private equity has been circling the drain to scoop up improving assets at depressed valuations. We flagged this in our 6 Themes for 2026 report last December. MTY has been an asset with improving fundamentals and garnered potential attraction from buyers. Management reaffirmed that they are still in these talks per their last earnings call, where rumors have suggested that a buyout could fetch >$50 CAD.

BSD Analysis:
Cedar Grove presents MTY Food Group as a dual-catalyst special situations opportunity in the restaurant sector. The manager positions MTY as an improving restaurant franchisor that has weathered the challenging 2025 restaurant industry environment better than peers. The investment thesis centers on two potential value drivers: operational improvement and acquisition interest. The manager notes that widespread restaurant sector distress in 2025 created opportunities for private equity to acquire quality assets at depressed valuations, which Cedar Grove anticipated in their 6 Themes for 2026 report. MTY's improving fundamentals have attracted buyer interest, with management confirming ongoing acquisition discussions during recent earnings calls. The rumored buyout price of over $50 CAD provides a clear catalyst and potential upside target. This special situations approach allows investors to benefit from both the company's operational turnaround and the potential acquisition premium. The combination of improving restaurant franchisor fundamentals and active M&A interest creates an attractive risk-adjusted opportunity in a sector that has been broadly out of favor.

Pitch Summary:
Nektar is another biotechnology company with a drug asset, rezpegaldesleukin ("Rezpeg"), that primarily targets atopic dermatitis (AD, or eczema) and alopecia areata. Right now, many of the most effective treatment offerings for AD are done via JAK inhibitors, but are largely unsafe, which requires patients to use less effective drugs. Rezpeg has shown competitive efficacy with a clean safety profile and, importantly, strong durability and response deepening in maintenance data, along with infrequent dosing (potentially quarterly), positioning it as a best-in-class option for patients who fail first-line biologics. The AD market is large, with over 80 million patients suffering from the disease globally, generating >$50 billion in sales. If Nektar is able to show positive data in its P3 trial, then peak sales could be anywhere from $3 - $5 billion against a current EV of just ~$2 billion. Similar to our ABVX trade, the ideal scenario would be a buyout with commercialization coming second.

BSD Analysis:
Cedar Grove presents a compelling biotechnology opportunity in Nektar Therapeutics, focused on the company's rezpegaldesleukin drug for atopic dermatitis and alopecia areata. The manager highlights a significant unmet medical need, as current JAK inhibitor treatments are effective but unsafe, forcing patients to use less effective alternatives. Rezpeg's differentiated profile combines competitive efficacy with a clean safety profile, strong durability, and convenient quarterly dosing, positioning it as best-in-class for patients failing first-line biologics. The addressable market opportunity is substantial, with over 80 million AD patients globally generating more than $50 billion in sales. The risk-reward profile appears attractive with potential peak sales of $3-5 billion against a current enterprise value of approximately $2 billion. The upcoming Phase 3 trial data represents a key catalyst that could drive significant value creation. Similar to the Abivax position, the manager views acquisition as the preferred outcome, given the scarcity of high-quality dermatology assets and the drug's best-in-class potential. NKTR was noted as one of the quarter's biggest contributors, suggesting positive momentum leading into the critical Phase 3 readout.

Pitch Summary:
Abivax is a small French biotechnology company that released P3 data in July of last year on its ulcerative colitis (UC) drug, obefazimod. Obefazimod appears to be a better option for treating UC than JAK inhibitors or TNF-alpha blockers, given its efficacy, delivery, tolerability, and safety profile. Plenty of rumors have come from French publication La Lettre about a possible buyout of the company from various pharma companies looking to boost their existing UC portfolio. Given the limited number of good drug assets in the market, Abivax seems like an excellent take-out target ahead of maintenance data later this summer. Rumors have circulated that Abivax could fetch between $15 and $20 billion before maintenance data is released. If no deal comes through, commercialization will come next, which is already being prepared with their recent CCO hire. Assuming maintenance data comes in positive, the future looks bright for Abivax, whether the strategy is to get acquired or bring the drug to market.

BSD Analysis:
Cedar Grove presents a compelling special situations opportunity in Abivax, centered on the company's promising ulcerative colitis drug obefazimod and potential acquisition scenarios. The manager highlights obefazimod's superior profile compared to existing treatments like JAK inhibitors and TNF-alpha blockers, based on positive Phase 3 data released in July. The investment thesis is enhanced by persistent acquisition rumors from French publication La Lettre, suggesting multiple pharmaceutical companies are interested in bolstering their UC portfolios. The manager notes the scarcity of high-quality drug assets in the market, making Abivax an attractive takeover target with rumored valuations between $15-20 billion ahead of maintenance data. The company is preparing for potential commercialization through recent CCO hiring, providing optionality if acquisition talks don't materialize. The upcoming maintenance data represents a key catalyst that could drive significant value creation regardless of the strategic path. This special situations investment offers asymmetric upside through either acquisition premium or successful drug commercialization, with the manager viewing positive maintenance data as highly probable given the strong Phase 3 results.

Pitch Summary:
The Oncology Institute is a niche oncology platform that delivers end-to-end cancer care for lower-cost outpatient areas. The business strategy runs on a value-based care (VBC) model, where it assumes risk and is paid for managing total patient outcomes rather than just a standard billing per service model. This allows TOI to align incentives across payers, physicians, and patients, lowering the total cost of care while capturing economics across the full oncology value chain. The stock performance has done well since bottoming in 2024, with new management implementing changes that have directly led to accelerated topline growth via new payer contracts and rapid growth in the pharmacy segment. The company is currently inflecting towards an adjusted EBITDA profitability and is proving that operating leverage can be achieved as their VBC model continues to gain traction.

BSD Analysis:
Cedar Grove presents a compelling transformation story for The Oncology Institute, highlighting the company's differentiated value-based care model in oncology. The manager emphasizes how TOI's risk-sharing approach aligns incentives across all stakeholders while capturing economics across the entire oncology value chain, creating a sustainable competitive advantage. The investment thesis is strengthened by new management's successful execution, evidenced by accelerated revenue growth through new payer contracts and rapid expansion in the pharmacy segment. TOI's VBC model is demonstrating meaningful operating leverage as the company approaches adjusted EBITDA profitability, validating the scalability of the business model. The manager notes strong stock performance since the 2024 bottom, suggesting market recognition of the turnaround progress. The oncology care market's shift toward value-based models provides significant tailwinds for TOI's specialized platform. The combination of proven management execution, operating leverage inflection, and favorable industry dynamics positions TOI well for continued growth as the VBC model gains broader adoption in oncology care.