Investment Pitches

Pitch Summary:
Kosmos Energy Ltd. (KOS) is an independent exploration and production company focused offshore. In addition to its existing production, KOS has liquified natural gas (LNG) assets that are set to begin production in 2024 and a platform to acquire and operate additional offshore resources. Shares fell over the quarter after Organization of the Petroleum Exporting Countries (OPEC+) delegates announced that the group would move forward with plans to restart previously halted oil production. We believe these short-term issues are significantly outweighed by the long-term value of the company's existing production, which the current stock price does not fully reflect.

BSD Analysis:
The manager maintains conviction in Kosmos Energy despite near-term headwinds from OPEC+ production decisions that pressured the stock during the quarter. The investment thesis centers on the company's diversified offshore production profile and upcoming LNG assets scheduled to begin production in 2024, providing significant growth catalysts. The manager views the OPEC+ announcement as a temporary market concern that has created an attractive entry point rather than a fundamental threat to the company's long-term value proposition. Kosmos's platform for acquiring and operating additional offshore resources suggests potential for inorganic growth and portfolio optimization. The manager believes the current stock price fails to reflect the intrinsic value of existing production assets, indicating a classic value opportunity. The offshore focus provides exposure to potentially higher-margin production while the LNG development offers diversification beyond traditional oil production. This contrarian positioning reflects confidence in the company's asset quality despite broader energy market volatility.

Pitch Summary:
F5 (FFIV) sells application networking and security software, as well as data center appliances. F5 reported a strong quarter that benefited from an improving IT spending environment, the beginning of a hardware refresh cycle, and better than expected software renewals, expansions and net new customer acquisition. Management raised guidance for FY25 and described the new guide as "prudent" given the strong trends they are seeing on hardware refresh and software growth metrics. F5 has no debt, trades at an attractive valuation, and is benefiting from an improving gross margin and lower operating expenses.

BSD Analysis:
The manager presents a compelling bull case for F5 based on multiple operational and financial catalysts converging simultaneously. The company is benefiting from an improving IT spending environment and the early stages of a hardware refresh cycle, providing both near-term revenue visibility and longer-term growth potential. Strong software metrics including renewals, expansions, and new customer acquisition demonstrate the stickiness and growth potential of F5's recurring revenue base. Management's guidance raise and characterization of it as "prudent" suggests conservative forecasting with potential for upside surprises. The debt-free balance sheet provides financial flexibility and reduces execution risk during this growth phase. Improving gross margins and lower operating expenses indicate operational leverage as the business scales. The manager views the current valuation as attractive relative to these improving fundamentals and growth prospects in the application networking and security markets.

Pitch Summary:
CVS Health Corp. (CVS) is a diversified healthcare company operating as a Pharmacy Benefits Manager (PBM), health insurer, and retail stores and pharmacies. In January, CVS and other health insurers with large Medicare Advantage plans rose after the Centers for Medicare & Medicaid Services (CMS) published better-than-expected reimbursement rates for 2026. CVS maintained that momentum in February by reporting expected fourth-quarter results. It then reported decent quarterly results. The PBM segment and physical stores were in line with expectations. However, Aetna incurred losses across multiple lines of business, driven by Medicare Advantage and the Exchanges. Despite this, the losses in the health insurance segment were less severe than anticipated, leading to a positive market reaction.

BSD Analysis:
The manager maintains a constructive view on CVS despite mixed operational results across its diversified healthcare platform. The positive catalyst came from better-than-expected Medicare Advantage reimbursement rates for 2026, providing visibility into improved profitability for this key segment. While the Aetna insurance division experienced losses in Medicare Advantage and Exchange plans, the manager emphasizes these losses were less severe than feared, suggesting operational stabilization. The PBM and retail pharmacy segments performed in-line with expectations, indicating steady cash flow generation from core operations. CVS's diversified model provides multiple revenue streams and cross-selling opportunities across its integrated healthcare ecosystem. The manager appears to view current challenges as transitory headwinds rather than structural issues. The stock's positive reaction to better-than-expected insurance losses suggests the market was overly pessimistic about the company's prospects.

Pitch Summary:
American International Group Inc. (AIG) is a leading commercial insurance company, providing property-casualty insurance, life insurance, and risk management products. Over the quarter, shares of AIG rose after the insurer authorized the repurchase of $7.5 bn of common stock and announced an ambitious 2025-2027 growth target for operating earnings per share. We believe AIG is poised for further improvements in operating performance. AIG has an improving return on equity and good management that is committed to smart allocation of its excess capital, which its current valuation does not fully reflect.

BSD Analysis:
The manager presents a bullish thesis on AIG based on capital allocation and operational improvements. The $7.5 billion share buyback authorization and ambitious earnings growth targets for 2025-2027 demonstrate management's confidence in the business trajectory. The fund highlights AIG's improving return on equity as evidence of operational progress under competent leadership. The manager believes the current valuation fails to reflect the company's improving fundamentals and disciplined capital allocation strategy. This represents a classic value play where operational improvements and shareholder-friendly actions should drive multiple expansion. The insurance sector positioning provides defensive characteristics while the capital return program offers near-term catalysts. The manager's confidence in management quality suggests sustainable competitive advantages in the commercial insurance space.

Pitch Summary:
Workday (WDAY) is a leader in cloud application software for back-office business functions including human capital management, financials management, and ERP (enterprise resource planning). Stock price was negatively impacted by a reduction in 2025 revenue guidance. Management noted the pressure on current year sales is macro-related. We believe Workday has a formidable competitive advantage that trades at an attractive valuation for a company with premier franchise potential.

BSD Analysis:
The manager maintains conviction in Workday despite recent guidance reduction, viewing the stock weakness as a buying opportunity for a market-leading SaaS company. Workday's dominant position in cloud-based human capital management and enterprise resource planning software creates significant competitive moats through high switching costs and deep customer integration. The 2025 revenue guidance cut appears to be macro-driven rather than company-specific, suggesting temporary headwinds rather than structural challenges. The fund emphasizes Workday's "formidable competitive advantage" and "premier franchise potential," indicating confidence in the company's long-term market position. The current valuation is viewed as attractive relative to the company's quality and growth prospects in the enterprise software market. This represents a contrarian value play on a high-quality SaaS leader during a temporary growth deceleration. The manager appears confident that Workday's competitive advantages will drive superior returns once macro conditions improve.

Pitch Summary:
Alphabet's Google (GOOGL) declined in the quarter after reporting mixed Q4 earnings results. Shares continue to trade at an attractive valuation despite healthy growth potential, an overcapitalized balance sheet, and significant value in Cloud, Other Bets, and new advertising products.

BSD Analysis:
The manager views Alphabet's recent decline as creating an attractive entry point for a high-quality technology company with multiple growth drivers. Despite mixed Q4 earnings that pressured the stock, the fund emphasizes Alphabet's compelling valuation relative to its growth prospects across search, cloud computing, and emerging advertising products. The investment thesis highlights the company's overcapitalized balance sheet, suggesting potential for significant capital returns or strategic investments. The manager sees substantial embedded value in Google Cloud, the Other Bets portfolio, and new advertising innovations beyond the core search business. This represents a value play on a dominant technology platform during a temporary earnings disappointment. The fund appears confident in Alphabet's long-term competitive advantages and diversification efforts across multiple high-growth technology markets. The position reflects conviction in the company's ability to monetize its technological leadership and vast user base across expanding digital advertising and cloud infrastructure markets.

Pitch Summary:
WPP (WPP) is a large ad agency holding company. WPP's stock price came under pressure following weaker-than-expected Q424 earnings results. The company trades at a low multiple of consensus earnings with a good balance sheet, we believe WPP can deliver near mid-teens returns from the combination of capital return and capital-free organic growth.

BSD Analysis:
Despite recent earnings disappointment, the manager maintains a bullish stance on WPP based on attractive valuation and capital allocation potential. The world's largest advertising company is trading at low earnings multiples following weaker Q4 2024 results, creating a value opportunity. The investment thesis rests on WPP's ability to generate mid-teens returns through a combination of capital returns to shareholders and organic growth that requires minimal capital investment. The manager emphasizes the company's strong balance sheet as providing financial flexibility for shareholder-friendly actions. This represents a contrarian value play on a market-leading advertising agency during a temporary earnings trough. The fund appears confident in WPP's ability to recover from recent operational challenges while benefiting from the asset-light nature of the advertising business model. The position reflects conviction in the company's long-term competitive position despite near-term headwinds.

Pitch Summary:
Siemens (SIE.GR) is a global leader in electrical engineering. The company focuses on industry (automation, software and drives), healthcare, and infrastructure (transport, building technologies, power distribution). Shares moved higher in the quarter as reported earnings exceeded expectations. Siemens continues to trade at a discount to the market and a significant discount to competitors due to its complexity and conglomerate discount.

BSD Analysis:
The manager views Siemens as an undervalued industrial conglomerate trading at an attractive discount despite strong operational performance. The company's diversified portfolio spans automation, software, healthcare technology, and infrastructure solutions, positioning it across multiple growth markets. Recent earnings outperformance demonstrates the underlying business strength across these segments. The investment thesis centers on the valuation disconnect, where Siemens trades at a discount to both the broader market and direct competitors due to conglomerate complexity. This creates an opportunity for value investors to access a global leader in electrical engineering and industrial automation at compelling valuations. The manager appears confident that the market will eventually recognize the intrinsic value of Siemens' diversified industrial platform. The position reflects a classic value play on a quality industrial company suffering from a conglomerate discount despite solid fundamentals and earnings growth.

Pitch Summary:
Babcock International (BAB.LN) is a UK government outsourcer with ~60% of revenue from Ministry of Defense (MoD) contracts. The company performed well in Q1 after guiding for higher revenue growth. Revenue growth and profitability should continue as the UK and other European countries invest more in defense spending.

BSD Analysis:
The manager presents a bullish case for Babcock International based on increasing defense spending trends across Europe. With approximately 60% of revenue derived from UK Ministry of Defense contracts, the company is well-positioned to benefit from rising defense budgets. The Q1 performance was strong, supported by management's guidance for accelerating revenue growth. The investment thesis is anchored on the geopolitical backdrop driving increased defense expenditures across the UK and broader European markets. This creates a favorable operating environment for government defense contractors like Babcock. The manager views the company as a direct beneficiary of the structural shift toward higher defense spending in response to regional security concerns. The position represents exposure to the defense industrial complex through a UK-based contractor with established government relationships and contract visibility.

Pitch Summary:
CVS Health Corp. (CVS) is a diversified healthcare company operating a Pharmacy Benefits Manager, health insurer, and retail stores and pharmacies. CVS outperformed in Q1 on improved earnings and forward guidance. We believe CVS is on a sustainable path to improved profitability, which will help reduce debt and restore margins.

BSD Analysis:
The manager presents a bullish thesis on CVS Health based on operational improvements and financial recovery. The fund views the company's diversified healthcare model spanning pharmacy benefits management, health insurance, and retail operations as positioned for sustainable profitability gains. Recent Q1 outperformance was driven by better-than-expected earnings and forward guidance, suggesting management execution is on track. The investment thesis centers on CVS's ability to improve margins while reducing debt levels, indicating a balance sheet repair story. The manager appears confident in the company's turnaround trajectory across its integrated healthcare platform. This represents a value play on a healthcare services company trading at attractive levels during a recovery phase. The position reflects the fund's focus on undervalued companies with improving fundamentals and clear paths to margin expansion.

Pitch Summary:
New Gold, Inc. is a mid-tier gold miner with potentially favorable Canadian-based mining assets. The stock had long underperformed due to past operational missteps and capital allocation issues. However, a new CEO appointed in 2022 launched a comprehensive turnaround, including a strengthened management team and renewed operational discipline that would take advantage of its favorable mining properties, including its New Alton mine. Despite a neutral stance on gold prices, we viewed the company's efforts to unlock value from its core assets as a catalyst for differentiation. The stock appreciated during the period as gold prices reached new highs on geopolitical uncertainty. We increased our position early in the quarter as internal execution improved and gold miners lagged the commodity price.

BSD Analysis:
The fund maintains a bullish view on New Gold as a turnaround story in the mid-tier gold mining sector, focusing on operational improvements rather than commodity price speculation. The investment thesis centers on the 2022 CEO appointment and comprehensive management overhaul addressing historical operational missteps and capital allocation failures. The company's favorable Canadian mining assets, particularly the New Afton mine, provide the foundation for value creation through enhanced operational discipline and execution. Despite maintaining neutrality on gold prices, the fund views internal operational improvements as the primary catalyst for differentiation and outperformance. Strong quarterly performance coincided with gold reaching new highs amid geopolitical uncertainty, validating the operational turnaround thesis. The fund increased its position early in the quarter, capitalizing on the disconnect between improving internal execution and lagging miner valuations relative to commodity prices. This represents a classic operational turnaround play in quality mining assets with new management execution.

Pitch Summary:
Axis Capital Holdings Ltd. is a global specialty insurer and reinsurer. We invested in 2020 following a period of earnings pressure tied to unfavorable underwriting results. We were initially attracted by a new management team's operational turnaround efforts, including reduced exposure to catastrophe risk and a strategic focus on high-potential areas such as cyber insurance. In 2023, a newly appointed CEO accelerated the company's repositioning, aiming to achieve top-tier performance versus peers. The stock performed well in the quarter, and we trimmed the position into strength as part of our risk management process, while maintaining a large position.

BSD Analysis:
The fund maintains a bullish stance on Axis Capital following a successful turnaround investment initiated in 2020 during a period of underwriting pressure. The original thesis centered on new management's operational restructuring, including strategic catastrophe risk reduction and pivot toward high-growth specialty lines like cyber insurance. The 2023 CEO appointment accelerated the transformation, targeting top-tier peer performance through enhanced underwriting discipline and portfolio optimization. Strong quarterly performance validated the turnaround execution, prompting tactical position trimming while maintaining substantial exposure. The investment demonstrates successful identification of management-driven operational improvements in specialty insurance markets. Axis's repositioning toward higher-margin, less volatile specialty lines positions it for sustained outperformance as underwriting cycles normalize. The fund's risk management approach of trimming into strength while maintaining conviction reflects disciplined portfolio management in a successful turnaround story.

Pitch Summary:
Radius Recycling, Inc. is a leading scrap metal recycler and global manufacturer of finished steel products. Its vertically integrated model—from automotive recycling to final steelmaking capabilities—offers distinct competitive advantages. We invested based on our view that recent growth investments would allow the company to capture more value through the recycling chain. The stock had been trading below the replacement value of its unique, difficult-to-replicate assets, offering what we viewed as a compelling margin of safety. Our thesis played out more rapidly than we expected when the company agreed to be acquired by Toyota Tsusho America. We liquidated our position during the quarter following the announcement.

BSD Analysis:
The fund executed a successful contrarian investment in Radius Recycling, capitalizing on the company's undervalued vertically integrated scrap metal and steel manufacturing platform. The investment thesis centered on the company's unique competitive advantages through full value chain integration from automotive recycling to finished steel production. Management's recent growth investments positioned the company to capture enhanced value across the recycling chain, creating operational leverage. The stock traded below replacement value of its difficult-to-replicate assets, providing an attractive margin of safety for the contrarian position. The thesis materialized faster than anticipated when Toyota Tsusho America agreed to acquire the company, recognizing the strategic value of the integrated platform. The fund successfully liquidated the position following the acquisition announcement, demonstrating effective execution of a value realization strategy. This represents a textbook example of contrarian investing in undervalued industrial assets with unique competitive positioning.

Pitch Summary:
Cameco Corp. is a global leader in the mining, fabrication, and refinement of uranium products for nuclear power plants around the world. We view the company as a best-in-class operator with world-leading reserves and a low-cost profile. Cameco had been out of favor for many years following the 2011 Fukushima nuclear disaster, but became increasingly attractive as global uranium production declined below demand. We invested in 2020, believing uranium prices would recover and that there was upside optionality in the potentially resurgent interest in nuclear power. While the stock performed strongly in 2024, it weakened in the quarter as uranium stocks had become tied to the power-hungry AI data center trade. As such, the stock's volatility far exceeded its fundamentals. Our position was unchanged during the quarter as we continue to base our investment on a 5- to 10-year investment thesis.

BSD Analysis:
The fund maintains a strong bullish conviction on Cameco as a best-in-class uranium operator with world-leading reserves and low-cost production profile. The investment thesis, initiated in 2020, capitalizes on the post-Fukushima recovery as global uranium production fell below demand levels, creating a structural supply-demand imbalance. The manager views Cameco as uniquely positioned to benefit from uranium price recovery and the potential nuclear power renaissance driven by clean energy transitions. Strong 2024 performance validated the thesis, though Q1 weakness reflected the stock's unfortunate correlation with AI data center trades rather than fundamental deterioration. The fund's unchanged position demonstrates conviction in the long-term 5-10 year investment horizon, looking beyond short-term volatility. Cameco's operational excellence, reserve quality, and cost advantages position it as a primary beneficiary of nuclear power's resurgence and uranium market normalization. The investment represents a strategic play on energy security and clean power generation trends.

Pitch Summary:
Kornit Digital Ltd. is a leading provider of digital textile printing solutions, offering a more efficient and sustainable alternative to traditional screen printing for apparel and textiles. Its digitally enabled process requires fewer people, less energy, and less water. We initiated our investment last year after a prolonged stock decline from $180 to below $20, driven by volatile orders and macroeconomic concerns, including elevated interest rates. The stock contributed positively to fund performance last year, as demand stabilized and orders improved, supported in part by the company's innovative product offerings and go-to-market strategies. However, shares came under renewed pressure in the first quarter due to macro-driven uncertainty around the durability of Kornit's order pipeline. We modestly trimmed our position early in the quarter at higher levels and continue to hold shares based on long-term secular growth potential in digital textile printing and onshoring trends. Kornit's solid balance sheet, including approximately $10 per share in net cash, reinforces our confidence in its ability to weather near-term challenges.

BSD Analysis:
The fund maintains a bullish long-term view on Kornit Digital despite recent volatility, positioning it as a sustainable technology play in digital textile printing. The manager initiated the position after a dramatic decline from $180 to below $20, representing a classic contrarian entry point driven by volatile orders and macro headwinds. The investment thesis centers on Kornit's superior efficiency and sustainability versus traditional screen printing, requiring fewer resources while delivering better outcomes. The stock recovered in 2024 as demand stabilized and innovative products gained traction, validating the turnaround thesis. Recent Q1 pressure reflects macro uncertainty rather than fundamental deterioration, prompting modest position trimming while maintaining core conviction. The company's strong balance sheet with approximately $10 per share in net cash provides downside protection and operational flexibility. Long-term secular trends including digital transformation and onshoring manufacturing support the growth narrative for this technology-enabled textile printing leader.

Pitch Summary:
The Honest Company, Inc. is a consumer products company specializing in natural baby-care consumables, cosmetics, soaps, and other household supplies. We initially invested in Honest as a contrarian investment opportunity, following post-pandemic supply chain disruptions, seeing value in the brand's authenticity and in its history of generating growth in the face of operational challenges. Despite reporting quarterly results above expectations, the stock declined due to concerns about consumer demand and potential tariff impacts. Honest manufacturers diapers in Mexico, which is USMCA compliant, and baby and cleaning wipes in China. Management has demonstrated agility in adapting supply chains, as witnessed when it re-sourced its diaper portfolio in 2024. Given our confidence in the brand and management, and with net cash on its balance sheet, we increased our position size following the price decline during the period.

BSD Analysis:
The fund maintains a bullish stance on The Honest Company despite recent stock weakness, viewing it as a contrarian opportunity following post-pandemic supply chain disruptions. The manager values the brand's authenticity and proven ability to generate growth amid operational challenges. Despite beating quarterly expectations, the stock declined on consumer demand concerns and potential tariff impacts, creating an attractive entry point. The company's manufacturing footprint includes USMCA-compliant diaper production in Mexico and wipes production in China, with management demonstrating supply chain agility through the 2024 diaper portfolio re-sourcing. The fund increased its position following the decline, citing confidence in brand strength, management execution, and the company's net cash balance sheet position. This represents a classic contrarian play on a quality consumer brand trading at depressed valuations. The investment thesis centers on operational turnaround potential and brand value recognition in a temporarily dislocated market.

Pitch Summary:
CarGurus, Inc. is a leading online platform for automobile sales, operating both a retail marketplace and an auction-based wholesaling business. The company's competitive pricing and broad suite of ancillary services continue to attract dealers. Despite a strong quarter for its core business, the stock declined after revenue came in at the midpoint of guidance, and forward guidance was slightly below expectations. We remain constructive on the company's long-term prospects, supported by growing profitability and free cash flow from its core operations. In addition, we believe the ongoing restructuring of its wholesaling business presents upside potential. CarGurus remained one of the portfolio's top holdings at period end.

BSD Analysis:
The manager maintains a bullish stance on CarGurus despite near-term stock weakness, emphasizing the company's strong competitive position in the online automotive marketplace with dual revenue streams from retail and wholesale operations. The platform's competitive pricing and comprehensive ancillary services create value for dealer customers and drive continued market share gains in the digital automotive space. While the stock declined following revenue results at the midpoint of guidance and slightly conservative forward guidance, the manager views this as a temporary disconnect from strong underlying business fundamentals. The company demonstrated growing profitability and free cash flow generation from core operations, indicating operational leverage and sustainable business model economics. The ongoing restructuring of the wholesaling business represents a potential catalyst for future value creation and margin expansion. CarGurus maintained its position as a top portfolio holding, reflecting the manager's high conviction in the long-term opportunity. The dual marketplace model provides diversification benefits and multiple avenues for growth in the evolving automotive retail landscape.

Pitch Summary:
Tandem Diabetes Care, Inc. provides technology solutions for individuals living with diabetes in the U.S. and internationally. The company's automated insulin delivery systems are positioned to gain market share within a large and growing addressable market, where more than half of Type 1 diabetes patients still administer insulin manually. During the quarter, Tandem reported top-line growth that exceeded expectations, driven by strong performance in its international division. However, U.S. results were weaker than anticipated due to muted seasonality and shipping delays. Despite these near-term challenges, we believe Tandem's platform remains well-positioned for long-term growth across both the Type 1 and emerging Type 2 diabetes markets, with further opportunities for incremental share gains. We slightly reduced our position during the period based on a reassessment of the company's risk/reward profile.

BSD Analysis:
The manager maintains a bullish long-term view on Tandem Diabetes despite near-term execution challenges, based on the company's strong positioning in a large and underpenetrated addressable market. The significant market opportunity is highlighted by the fact that more than half of Type 1 diabetes patients still administer insulin manually, providing substantial room for automated insulin delivery system adoption. International operations demonstrated strong performance with top-line growth exceeding expectations, indicating successful geographic expansion and market penetration outside the U.S. However, domestic results disappointed due to muted seasonality and shipping delays, suggesting operational challenges that may be temporary in nature. The manager's slight position reduction reflects a reassessment of risk/reward dynamics rather than fundamental concerns about the long-term opportunity. Tandem's technology platform is well-positioned to capture share in both the established Type 1 diabetes market and the emerging Type 2 diabetes opportunity. The company's automated insulin delivery systems represent a significant advancement in diabetes care technology, offering improved patient outcomes and convenience.

Pitch Summary:
Ziff Davis, Inc. operates in two primary segments: business cloud services and digital media. We continue to believe the company's value lies in management's demonstrated ability to generate strong returns on capital by acquiring and turning around underperforming businesses. The stock underperformed during the period due to a slight earnings miss and weaker organic growth. Looking ahead, we believe that a return to low single-digit organic growth and a continuation of strategic acquisitions could deliver future performance catalysts. We slightly trimmed our position during the period.

BSD Analysis:
The manager maintains a neutral stance on Ziff Davis, acknowledging both the company's proven acquisition and turnaround capabilities while recognizing near-term operational challenges. Management's track record of generating strong returns on capital through strategic acquisitions and business turnarounds represents a key competitive advantage and value creation driver. However, the company faced headwinds during the quarter with a slight earnings miss and weaker organic growth, indicating some operational execution challenges in the current environment. The manager's outlook remains cautiously optimistic, expecting a return to low single-digit organic growth combined with continued strategic acquisitions to serve as future performance catalysts. The position trimming reflects a balanced approach to managing risk while maintaining exposure to the company's long-term value creation potential. Ziff Davis operates across two distinct segments in business cloud services and digital media, providing some diversification benefits. The company's acquisition-focused strategy requires strong capital allocation discipline and integration capabilities to generate sustainable returns. The manager's continued confidence in management's turnaround expertise suggests belief in the company's ability to navigate current challenges.

Pitch Summary:
RB Global, Inc. operates a global marketplace for salvage vehicles through its IAA subsidiary and for used industrial equipment via its Ritchie Bros. unit. With a broad international network and significant scale advantages, we believe the company is well-positioned to gain further market share. Shares advanced during the quarter on strong business performance that exceeded expectations, supported by solid incremental EBITDA margins in the mid-50% range. Integration of the IAA acquisition also appears to be progressing ahead of schedule, reinforcing expectations for improved financial performance. We reduced our position during the quarter following the stock's appreciation.

BSD Analysis:
The manager presents a bullish thesis on RB Global based on its dominant market position operating dual marketplaces for salvage vehicles and used industrial equipment with significant scale advantages and international reach. The company's strong operational performance exceeded expectations with impressive incremental EBITDA margins in the mid-50% range, demonstrating highly profitable growth and operational leverage. The successful integration of the IAA acquisition ahead of schedule indicates effective management execution and suggests meaningful synergy realization that should drive improved financial performance. The manager's position reduction following stock appreciation reflects disciplined profit-taking rather than fundamental concerns about the business. RB Global's marketplace model benefits from network effects where increased buyer and seller participation enhances liquidity and pricing efficiency. The company's broad international network provides geographic diversification and access to global demand for used equipment and vehicles. The combination of salvage vehicles through IAA and industrial equipment through Ritchie Bros creates a comprehensive asset disposition platform with cross-selling opportunities.