Investment Pitches

Pitch Summary:
The other new name introduced to the portfolio was Clean Harbors, the largest hazardous waste company in North America. We expect Clean Harbors' demand to grow a little faster than GDP as environmental regulations continue to tighten and the scarcity value of their landfill and incinerator assets allows them to consistently raise prices. Additionally, the onshoring of manufacturing and their Total PFAS solution act as further growth drivers. We initiated the position based on these robust fundamentals, coupled with our belief that the market has yet to fully appreciate the value of these assets and services, a view supported by recent private market transaction prices.

BSD Analysis:
Bell Asset Management added Clean Harbors as a new position, viewing the company as an attractive play on tightening environmental regulations and manufacturing onshoring trends. As North America's largest hazardous waste company, Clean Harbors benefits from structural demand growth that the manager expects to outpace GDP growth. The investment thesis centers on two key drivers: increasingly stringent environmental regulations and the scarcity value of the company's landfill and incinerator assets, which provide pricing power. Bell highlights additional growth catalysts including the onshoring of manufacturing operations and Clean Harbors' Total PFAS solution capabilities. The manager believes the market has not fully recognized the value of these specialized assets and services, a view supported by recent private market transaction valuations. The position represents Bell's conviction in companies that benefit from regulatory tailwinds and possess scarce, hard-to-replicate assets. Clean Harbors' dominant market position and asset scarcity provide defensive characteristics while regulatory trends support long-term demand growth.

Pitch Summary:
The first addition was Broadcom, a leading global player in the semiconductor and software industry. We established the position early in December as we saw good potential for earnings upgrades going into 2025. Broadcom's fundamentals continue to improve and there are many opportunities for them to continue growing double-digit revenue growth and faster profit acceleration. Broadcom has built their industry leading positions through both organic investment and strategic acquisitions. They are also a key player in the booming AI market where they develop custom chips used in data centres which are tailored to specific customer needs and networking infrastructure. Their recent acquisition of VMWare is another good example of how Broadcom can expand their opportunity set into enterprise software and garner strong pricing power from their existing customer base. This adds to their software footprint in mainframe, through CA Technologies, and in cybersecurity following their Symantec acquisition. The strength of their franchise is reflected in the high margins that they earn, which helps them generate a free cashflow margin near 40%. The strong results in mid-December reinforced the strength of the business and we see continued upside for this holding.

BSD Analysis:
Bell Asset Management initiated a new position in Broadcom in early December, attracted by the potential for earnings upgrades heading into 2025 and the company's strong fundamental trajectory. The manager highlights Broadcom's dual strategy of organic investment and strategic acquisitions as key drivers of their industry-leading position across semiconductors and software. Bell emphasizes Broadcom's significant exposure to the artificial intelligence boom through custom chip development for data centers and networking infrastructure. The recent VMware acquisition exemplifies the company's ability to expand into enterprise software while leveraging existing customer relationships for pricing power. Combined with previous acquisitions of CA Technologies and Symantec, Broadcom has built a diversified software portfolio spanning mainframe, cybersecurity, and enterprise solutions. The manager points to impressive financial metrics including high margins and nearly 40% free cash flow margins as evidence of franchise strength. Strong December results further validated the investment thesis, with Bell expecting continued upside from this new holding.

Pitch Summary:
Additionally, our position in UnitedHealth Group was a drag, impacted by several factors. The tragic murder of Brian Thompson, CEO of its insurance division, sparked public criticism of industry practices and damaged investor sentiment. Furthermore, the threat of legislative action to potentially break up Pharmacy Benefit Managers (PBMs) weighed on the stock, given UnitedHealth's ownership of OptumRx, a leading PBM. While increased scrutiny on the managed care industry remains a concern, we believe UnitedHealth's strong diversification, scale advantages, and attractive valuation relative to historical averages and the broader market, provide an attractive set-up for long-term share price outperformance from current levels.

BSD Analysis:
Despite recent headwinds, Bell Asset Management maintains a bullish long-term view on UnitedHealth Group, viewing current challenges as temporary setbacks rather than fundamental issues. The manager acknowledges two significant near-term pressures: the tragic murder of CEO Brian Thompson which sparked public criticism of industry practices, and potential legislative threats to break up Pharmacy Benefit Managers (PBMs), particularly relevant given UnitedHealth's ownership of OptumRx. However, Bell emphasizes the company's strong competitive advantages including diversification across multiple healthcare segments, significant scale benefits, and an attractive valuation relative to both historical levels and broader market multiples. The manager believes these structural strengths position the company well for long-term outperformance despite current regulatory and sentiment challenges. Bell views the current weakness as creating an attractive entry point for patient investors. The position detracted from performance in December but the manager maintains conviction in the long-term investment case.

Pitch Summary:
Another strong performer during the month was athletic apparel company, Lululemon Athletica. The stock rallied following the release of strong Q3 results, which highlighted improved integration between the merchandising and brand teams, strong reception from customers towards their new offerings and successful activation initiatives in China and the US. Each of these addressed key concerns that investors held over whether the slowdown in growth in the US was systemic, which we believe isn't the case, resulting in a reduction of the valuation discount that the stock traded at throughout most of 2024. We expect that upcoming trading updates should further evidence the weakness in the US being temporary, providing further upside for the name despite its significant rebound since its August 2024 trough.

BSD Analysis:
Bell Asset Management expresses strong conviction in Lululemon Athletica, viewing the recent Q3 results as validation of their investment thesis. The manager highlights three key operational improvements: better integration between merchandising and brand teams, positive customer reception of new product offerings, and successful market activation in both China and the US. These developments directly addressed investor concerns about whether the US growth slowdown was structural or temporary. Bell believes the weakness is temporary, not systemic, which has led to a re-rating of the stock's valuation discount. The manager expects upcoming trading updates to provide further evidence supporting their view that US weakness is transitory. Despite the stock's significant recovery from its August 2024 lows, Bell sees additional upside potential. The position benefited from strong Q3 results and contributed positively to portfolio performance during December.

Pitch Summary:
In terms of individual exposures, one of the strongest contributors across the month was Alphabet. The Department of Justice's antitrust case against Alphabet had weighed on the stock over the prior few months, however, strong fundamentals drove the stock up to all-time highs in December. Alphabet continues to be attractively valued, and their double-digit growth looks underwritten by their advancements in AI and supercomputing, enabling the company to remain at the leading-edge of search.

BSD Analysis:
Bell Asset Management maintains a bullish stance on Alphabet, viewing the stock as attractively valued despite recent regulatory headwinds. The manager highlights that the Department of Justice's antitrust case had temporarily weighed on the stock, but strong fundamentals ultimately drove it to all-time highs in December. The investment thesis centers on Alphabet's leadership position in artificial intelligence and supercomputing capabilities, which the manager believes underpin the company's double-digit growth trajectory. The fund sees these technological advancements as key differentiators that enable Alphabet to maintain its dominant position in search. The manager appears confident that the company's AI investments will continue to drive long-term value creation. The position contributed positively to portfolio performance during the month, validating the manager's conviction in the name. Bell views current valuation levels as attractive relative to the company's growth prospects and technological moats.

Pitch Summary:
Private Equity, private credit, real estate and infrastructure are all multi-trillion-dollar markets that are undergoing sustainable secular growth rates. In our view, these all represent very attractive alternative areas for investors over time. We estimate that these markets could achieve double-digit CAGRs over the next 5–10 years. Further, we expect total AUM in private alternative managers to reach $30 trillion in 2029, and our bull case represents a 20% CAGR in global AUM. One such private alternatives manager, Apollo Global Management, announced at its recent investor day that it's looking to more than double its AUM to $1.5 trillion over the next five years, and originate as much in debt and equity details by 2029 as the market leader, JPMorgan, is now. The opportunity set was created by cyclically weak asset monetization that resulted from lower overall capital markets activity. As a proxy, IPO and M&A activity are approximately 40% and 20% below the 10-year average, respectively, as higher interest rates and economic uncertainty pressured overall activity. In North America, the past three years have been one of the worst three-year periods for IPOs since 2001. We see substantial pent-up demand for asset transaction volumes being released over the coming years, leading to additional opportunities in companies with cyclical ties to an IPO market inflection.

BSD Analysis:
The manager presents a compelling secular growth thesis for Apollo Global Management, positioning it within the broader private alternatives ecosystem that is experiencing multi-trillion-dollar expansion. Apollo's ambitious target to more than double AUM to $1.5 trillion over five years represents aggressive growth that would rival JPMorgan's current origination volumes. The investment case is strengthened by current cyclical headwinds creating attractive entry points, with IPO and M&A activity running 40% and 20% below historical averages respectively. This cyclical weakness has created pent-up demand that should benefit Apollo as capital markets normalize. The manager's bull case scenario of 20% CAGR in global alternative AUM through 2029 provides substantial tailwinds for Apollo's fee-generating business model. The convergence of secular growth trends in private markets with cyclical recovery in capital markets activity creates a compelling dual catalyst for outperformance. Apollo's scale and market position should enable it to capture disproportionate share of this expanding opportunity set.

Pitch Summary:
Shares of Vail Resorts, Inc. detracted from performance as adverse weather conditions reduced financial results. Vail has succeeded in converting a sizeable portion of its customer base to season passes, which dampens but does not eliminate the impact of weather. We believe that Vail boasts an irreplaceable network of ski resorts. We expect the company to grow at attractive rates by adding more customers on season passes, raising prices consistently, and upselling customers to higher priced offerings. We are also excited by the launch of Vail's innovative My Epic Gear membership program, which offers visitors a technology-driven gear rental experience with attractive economics. Finally, we believe that growth can be amplified by acquisitions, particularly as the company makes headway in the vast European market.

BSD Analysis:
Baron views Vail Resorts as owning irreplaceable ski resort assets with strong pricing power and customer loyalty. The season pass model provides recurring revenue and reduces weather sensitivity, though adverse conditions still impact results. The investment thesis centers on multiple growth drivers: expanding the season pass customer base, consistent price increases, and upselling premium services. The new My Epic Gear program represents innovation in ancillary revenue streams with attractive unit economics. Baron sees significant expansion potential through acquisitions, particularly in Europe where the company is establishing presence. Despite weather-related volatility, the firm believes Vail's asset quality and business model transformation create sustainable competitive advantages.

Pitch Summary:
CoStar Group, Inc., a leader in real estate information, analytics, and marketplaces, also detracted from the Fund's results. CoStar has spent three years building its Homes.com residential real estate marketplace. We estimate that CoStar's residential products will serve a total addressable market (TAM) that exceeds $15 billion, with international markets increasing that TAM by a factor of four. CoStar is investing heavily to pursue this opportunity, spending almost $1 billion in 2024 and signaling a similar level of spend for 2025. The significant upfront investment is consistent with the scale of the opportunity, but weighed on the stock given that costs are incurred before the company can begin to generate revenue. We are excited by metrics such as growing site traffic, improving unaided brand awareness, and favorable sales activity from early cohorts of salespeople. We are also encouraged by ongoing regulatory developments, which have the potential to reshape the residential purchase process to the benefit of consumers and CoStar. We believe that residential presents a transformative growth opportunity for the company and see attractive future returns in the stock as the Homes.com investment cycle abates and the segment begins to contribute revenue with high incremental margins.

BSD Analysis:
Baron maintains conviction in CoStar despite recent underperformance, viewing the company's residential real estate expansion as transformative. The manager estimates a $15 billion domestic TAM for residential products, expanding to $60 billion globally. CoStar's $1 billion annual investment in Homes.com represents a significant near-term earnings drag but positions the company for substantial long-term growth. Early metrics including site traffic growth, brand awareness improvements, and sales team productivity provide encouraging validation. Baron sees regulatory changes potentially benefiting CoStar's marketplace model. The investment thesis relies on the residential segment eventually generating high-margin revenue as the investment cycle matures, creating significant shareholder value.

Pitch Summary:
IDEXX Laboratories, Inc., the global leader in veterinary diagnostics, has seen modest declines in pet owner visits to U.S. veterinary clinics temper its short-term growth rate. We attribute foot traffic headwinds to a temporary mix shift in pet age following the "pandemic puppy" boom, a modest reduction in service hours at U.S. veterinarians, and some macroeconomic headwinds in discrete markets. We believe IDEXX is entering a compelling new product cycle, underpinned by two new in clinic instruments and a breakthrough cancer screening panel, which should drive annual earnings growth of 20% over the long term. We expect foot traffic headwinds to ultimately revert to tailwinds, helping to accelerate growth and catalyze multiple expansion.

BSD Analysis:
Baron maintains a bullish stance on IDEXX despite near-term headwinds from reduced veterinary clinic visits. The manager attributes current challenges to temporary factors including demographic shifts from pandemic pet adoptions and reduced clinic hours. The investment thesis centers on IDEXX's market leadership position and an upcoming product cycle featuring new diagnostic instruments and cancer screening technology. Baron expects these innovations to drive 20% annual earnings growth long-term. The firm believes current foot traffic pressures are cyclical and will reverse, creating growth acceleration and valuation expansion. Despite recent underperformance, Baron views IDEXX as benefiting from structural trends in pet ownership and veterinary spending that should support sustained growth.

Pitch Summary:
LLY was a top detractor in the fourth quarter following a rare revenue miss in the company's 3Q update. The greater than $1 billion miss in the tirzepatide complex (Mounjaro/Zepbound) was caused by a combination of factors, including wholesaler stocking patterns (2Q inventory build, 3Q sell through), refrigerated supply chain constraints, timing of the company's direct-to-consumer efforts, and the pace of international market launches. We believe the diabetes/obesity/weight-loss market is enormous and that current GLP-1 drugs, though no longer supply constrained, are greatly in demand. We are confident that LLY's recent sales shortfall was supply chain-related and that the company's tirzepatide franchise growth will soon reaccelerate. LLY discovers, develops, manufactures, and markets pharmaceutical products. The company manufactures and distributes products through facilities in the United States and seven other countries and sells into 110 countries. The company has a broad and deep portfolio of products including a focus on diabetes, oncology, immunology and neuroscience. More recently, LLY's GLP-1 diabetes drug Mounjaro and obesity drug Zepbound, have delivered strong revenue growth, and investors are optimistic that the company's recently approved Alzheimer drug, Kisunla, will add to that growth. LLY has a stable portfolio of franchise products, which enables it to invest heavily in its product pipeline. We believe that this combination of franchise and growth products will drive high teens revenue growth and a four-fold increase in free cash flow in the next five years.

BSD Analysis:
RiverPark maintains a bullish stance on Eli Lilly despite Q3 2024 revenue disappointment in the tirzepatide franchise (Mounjaro/Zepbound). The fund attributes the $1+ billion revenue miss to temporary supply chain issues including wholesaler stocking patterns, refrigerated logistics constraints, and international launch timing rather than fundamental demand weakness. The manager emphasizes the enormous addressable market for diabetes/obesity treatments and strong underlying demand for GLP-1 drugs. RiverPark's investment thesis centers on Lilly's diversified pharmaceutical portfolio spanning diabetes, oncology, immunology, and neuroscience, with global reach across 110 countries. The fund is particularly optimistic about the tirzepatide franchise recovery and the potential contribution from newly approved Alzheimer's drug Kisunla. Management projects high-teens revenue growth and a four-fold increase in free cash flow over the next five years, driven by the combination of stable franchise products and high-growth pipeline assets.

Pitch Summary:
Uber was our top detractor in the fourth quarter after reporting what we perceived to be a strong 3Q24. The company reported gross bookings of $40.9 billion were up 16% year-over-year (20% in constant currency). Mobility gross bookings of $21.0 billion grew 17% over last year (24% in constant currency) driven by a combination of product innovation and driver availability. Delivery gross bookings of $18.7 billion were up 16% from last year (17% in constant currency) and continued to be strong throughout the quarter. 4Q Adjusted EBITDA of $1.7 billion, up $598 million year-over-year, was better than management's guidance of $1.6 billion, and the company generated $2.1 billion of free cash flow, up from $905 million last year. Management guided to continuing growth in 1Q Gross Bookings (18% growth) and Adjusted EBITDA (of $1.8 billion). Despite these strong operating metrics, the stock was pressured throughout the quarter by fears of autonomous cars (RoboTaxis) potentially taking ride share market share in the coming decade. UBER remains the undisputed global leader in ride sharing, with a greater than 50% share in every major region in which it operates. The company is also a leader in food delivery, where it is number one or two in the more than 25 countries in which it operates. Moreover, after a history of losses, the company is now profitable, delivering expanding margins and substantial free cash flow. We view UBER as more than a ride sharing and food delivery service; we also see it as a global mobility platform with 161 million users (by comparison, Amazon Prime is thought to have 200 million members) and the ability to penetrate new markets of on-demand services, such as package and grocery delivery, travel, and hourly worker staffing. Given its $9 billion of unrestricted cash and $7.9 billion of investments, the company today has an enterprise value of $130 billion, indicating that UBER trades at 16x and 12x our estimates of 2025 and 2026 free cash flow respectively.

BSD Analysis:
RiverPark maintains a strong bull thesis on Uber despite Q4 stock pressure from autonomous vehicle concerns. The fund emphasizes robust Q3 2024 fundamentals with $40.9 billion in gross bookings growing 16% year-over-year, driven by strong performance in both mobility (17% growth) and delivery (16% growth) segments. The manager highlights Uber's transformation to profitability with $1.7 billion in adjusted EBITDA and $2.1 billion in free cash flow, more than doubling from the prior year. RiverPark views Uber as a dominant global mobility platform with over 50% market share in ride-sharing across all major regions and leadership positions in food delivery across 25+ countries. The investment thesis extends beyond current services to Uber's potential expansion into adjacent on-demand markets including package delivery, travel, and staffing services. With 161 million users and attractive valuations of 16x and 12x estimated 2025/2026 free cash flow, the fund sees significant upside despite near-term autonomous vehicle headwinds.

Pitch Summary:
Amazon was a top contributor in the fourth quarter following third quarter results of slightly better than expected revenue and much stronger than expected operating income. 3Q operating income of $17.4 billion exceeded company guidance of $11.5-15 billion (and Street estimates of $14.7 billion), driven by margin expansion across all three major segments, including gross/net margins of 38% at AWS, up from 30%. In addition, the company reported an acceleration in e-commerce demand both domestically and internationally, and accelerated growth of Prime paid memberships. The company guided to 4Q operating income of roughly $18 billion driven by the same positive factors that impacted 3Q. With its ability to continue its market share gains in its three leading businesses (e-commerce, web services and online advertising), plus a multi-year operating margin expansion opportunity (from improved e-commerce margins and greater contribution from the faster growing, higher margin AWS and advertising segments), we believe Amazon remains one of the best-positioned global growth companies in the world.

BSD Analysis:
RiverPark presents a compelling bull case for Amazon based on exceptional Q3 2024 operating leverage that significantly exceeded expectations. The fund highlights operating income of $17.4 billion, well above guidance of $11.5-15 billion and street estimates of $14.7 billion. AWS margins expanded dramatically to 38% from 30%, demonstrating the profitability potential of Amazon's cloud business. The manager emphasizes accelerating growth across all three core segments: e-commerce, web services, and online advertising, with Prime membership growth providing additional momentum. RiverPark's investment thesis centers on Amazon's dominant market positions and multi-year margin expansion opportunity as higher-margin AWS and advertising segments contribute more to overall results. The fund views Amazon as uniquely positioned among global growth companies, with sustainable competitive advantages across its diversified business portfolio and continued market share gains driving long-term value creation.

Pitch Summary:
NVDA was a top contributor in the fourth quarter following blowout 1Q results and guidance driven by strong data center sales (+427% year-over-year). The company reported revenue of $26 billion, up 262% year-over-year, and EPS of $6.12, up 462% year-over-year and 9% ahead of expectations. Revenue guidance for 2Q of $28 billion was 5% above very high expectations. The artificial intelligence arms race, kicked off by ChatGPT and Alphabet's Bard, among others, has generated tremendous demand for Nvidia's next generation graphic processors. NVDA is the leading designer of graphics processing units (GPU's) required for powerful computer processing. Over the past 20 years, the company has evolved through innovation and adaptation from a predominantly gaming-focused chip vendor to one of the largest semiconductor/software vendors in the world. Over the past decade, the company has grown revenue at a compound annual rate of over 20% while expanding operating margins and, through its asset light business model, producing ever increasing amounts of free cash flow. Following recent results, Jensen Huang, founder and CEO of NVIDIA stated in the company's press release, "a trillion dollars of installed global data center infrastructure will transition from general purpose to accelerated computing as companies race to apply generative AI into every product, service and business process."

BSD Analysis:
RiverPark maintains a strong bull position on NVIDIA, driven by the company's dominant position in the AI revolution. The fund highlights explosive Q1 results with 262% revenue growth to $26 billion and 462% EPS growth to $6.12, both exceeding expectations. Data center sales surged 427% year-over-year, demonstrating NVIDIA's leadership in AI infrastructure. The manager emphasizes NVIDIA's successful transformation from a gaming-focused company to a diversified semiconductor giant with over 20% annual revenue growth over the past decade. The investment thesis is anchored on the massive AI adoption wave, with CEO Jensen Huang projecting a trillion-dollar transition in global data center infrastructure. RiverPark views NVIDIA as uniquely positioned to capitalize on the generative AI boom, with its asset-light business model generating substantial free cash flow growth alongside expanding operating margins.

Pitch Summary:
Shopify was our top contributor in the fourth quarter following a strong 3Q earnings report that included better than expected revenue growth and continued margin expansion. GMV growth of 24% was three percentage points above investor estimates, revenue of $2.2 billion was $40 million better and free cash flow of $421 million was $80 million better. A combination of new merchants to the company's platform, increased adoption of SHOP's offerings by existing merchants, and e-commerce market share gains are driving this revenue growth and profitability. In 2023, 10% of US retail e-commerce sales flowed through SHOP, second only to Amazon, and the company is still enjoying significant tailwinds as retail merchants of all sizes adopt SHOP's software tools to display, manage and sell their products across a dozen different sales channels. We believe that the overall growth of e-commerce, combined with the development of new products and services, such as its digital wallet Shop Pay, should continue to drive revenue growth of more than 20% per year over the next several years, accompanied by re-acceleration of operating margin growth and FCF generation.

BSD Analysis:
RiverPark presents a compelling bull case for Shopify based on strong Q3 2024 earnings that exceeded expectations across key metrics. The fund highlights Shopify's impressive 24% GMV growth, $2.2 billion in revenue, and $421 million in free cash flow, all beating estimates. The manager emphasizes Shopify's dominant position as the second-largest e-commerce platform in the US with 10% market share, trailing only Amazon. The investment thesis centers on multiple growth drivers including new merchant acquisition, increased adoption by existing merchants, and overall e-commerce market expansion. The fund is particularly bullish on new product development like Shop Pay digital wallet and expects sustained 20%+ annual revenue growth. Management anticipates continued operating margin expansion and free cash flow acceleration, positioning Shopify to capitalize on the ongoing digital transformation of retail commerce.

Pitch Summary:
We initiated a position in Equifax (EFX), which is a leader in the credit bureau and income and employment verification industries. These are data-intensive, asset-light businesses that enjoy high barriers to entry and scale advantages. Given the fixed cost structure of these markets, EFX enjoys strong operating leverage and expanding returns on capital. Although the credit bureau market is relatively mature, EFX continues to invest in new product development, geographic expansion and in acquisitions that grow its addressable market, which we believe should support above industry average growth. EFX's Workforce Solutions, the income and employment verification segment, is its largest and fastest growing business. The economic moat of the Workforce Solutions segment is tied to the ~125 million unique, non-farm payroll records it maintains, which provide a differentiated and comprehensive dataset. EFX continues to expand the Workforce Solutions offering to address multiple end markets that include mortgage, credit card, auto, government and employee background screening. We believe these investments, coupled with EFX's market leading position and a normalization in the mortgage market, will support 20% intrinsic value growth over our investment horizon.

BSD Analysis:
Mar Vista initiated a new position in Equifax, viewing it as a leader in credit bureau and employment verification with compelling structural advantages. The manager emphasizes Equifax's data-intensive, asset-light business model that benefits from high barriers to entry and significant scale advantages. The company's fixed cost structure enables strong operating leverage and expanding returns on capital as revenue grows. Workforce Solutions represents Equifax's largest and fastest-growing segment, anchored by approximately 125 million unique payroll records that create a differentiated competitive moat. The comprehensive dataset enables expansion across multiple end markets including mortgage, credit cards, automotive, government, and background screening services. Mar Vista believes continued investment in product development, geographic expansion, and strategic acquisitions will drive above-average industry growth despite the mature credit bureau market. The combination of market-leading position, expanding addressable markets, and expected mortgage market normalization supports the manager's projection of 20% intrinsic value growth over their investment horizon.

Pitch Summary:
Amazon's profitability was the key highlight of the third quarter financial results, with AWS and International Retail achieving record operating margins, and North America Retail posting its second-best margin in five years. Even more impressive was the fourth quarter operating income forecast, projecting up to $20 billion, significantly exceeding the expected $16 billion and suggesting a record 11% margin. This exceptional performance was driven by economies of scale, logistics efficiencies, successful AI implementations, increasing ad revenue, and accelerated AWS growth. We keep our investment in Amazon due to several factors: AWS growth has further potential, Amazon Prime Video monetization is in its initial stages, and the company is expanding into promising sectors like Pharmacy and Logistics. Furthermore, with strengthening profitability and cash reserves exceeding $100 billion, the possibility of substantial capital returns increases. By continuing to innovate and invest in technologies like AI and cloud computing, Amazon is well-positioned to keep its competitive edge.

BSD Analysis:
Mar Vista maintains a strong bullish position on Amazon, emphasizing the company's exceptional profitability improvements across all business segments. The manager highlights record operating margins in AWS and International Retail, with North America Retail achieving its second-best margin performance in five years. Amazon's Q4 operating income forecast of $20 billion significantly exceeded expectations, suggesting an 11% margin that demonstrates the company's operational leverage. The profitability gains stem from economies of scale, logistics efficiencies, AI implementations, and growing advertising revenue streams. Mar Vista sees multiple growth drivers including continued AWS expansion, early-stage Prime Video monetization, and expansion into high-potential sectors like pharmacy and logistics. With over $100 billion in cash reserves and strengthening profitability, Amazon is well-positioned for potential capital returns to shareholders. The company's continued innovation in AI and cloud computing technologies reinforces its competitive moat and long-term growth prospects in the evolving digital economy.

Pitch Summary:
Investors cheered a solid fiscal year Q3 performance from Salesforce, with results driven by strength in subscription revenues, current remaining performance obligations (CRPO), and operating margin. Both the Sales and Service Clouds returned to double-digit growth, fueled by strong adoption of multi-cloud and vertical-specific solutions. These results highlight Salesforce's ability to address diverse customer needs and sustain growth across its core offerings. Management expressed significant excitement about Agentforce, an organically developed generative AI product that is garnering enthusiasm from both system integrator partners and customers alike. This innovation underscores Salesforce's commitment to delivering innovative solutions that enhance customer engagement and drive productivity. While Agentforce's contributions to subscription revenues and CRPO bookings are still immaterial for now, the growing pipeline provides a solid foundation for optimism around Salesforce's ability to productize and monetize its generative AI offerings.

BSD Analysis:
Mar Vista expresses bullish sentiment on Salesforce following strong Q3 results that demonstrated robust subscription revenue growth and expanding operating margins. The manager highlights the return to double-digit growth in both Sales and Service Clouds, driven by successful multi-cloud and vertical-specific solution adoption. Salesforce's ability to address diverse customer needs while maintaining growth across core offerings demonstrates the platform's resilience and market position. The introduction of Agentforce, an organically developed generative AI product, represents a significant innovation catalyst that's generating enthusiasm from partners and customers. While Agentforce's revenue contribution remains immaterial currently, the growing pipeline suggests strong monetization potential for Salesforce's AI initiatives. The company's commitment to innovation and ability to enhance customer engagement through AI-driven productivity solutions positions it well for continued growth. Mar Vista views Salesforce's combination of stable core business performance and emerging AI capabilities as a compelling investment thesis for sustained value creation.

Pitch Summary:
Broadcom reported a strong fiscal year Q4 2024, exceeding expectations and reinforcing its leadership in custom AI accelerator solutions. Investors reacted positively to the company's robust performance and outlook, particularly for its AI semiconductor-related revenues and its long-term growth potential. The outlook for continued demand for Broadcom's custom AI accelerator products surprised many who expected a slowdown ahead of its new product, which is set to ramp in the second half of fiscal year 2025. The announcement of a long-term service addressable market (SAM) of $60-to-$90 billion further highlighted Broadcom's significant growth runway and market opportunity in the custom AI accelerator market. Broadcom's software business continues to deliver stable results, with the VMware acquisition integration performing ahead of plan. The stability in software business, coupled with Broadcom's strong execution and promising outlook in high-growth areas like AI semiconductors, should position the company for continued shareholder value creation.

BSD Analysis:
Mar Vista maintains a bullish stance on Broadcom, highlighting the company's leadership position in custom AI accelerator solutions and strong Q4 2024 performance that exceeded expectations. The manager emphasizes Broadcom's significant growth runway with a $60-90 billion long-term service addressable market in AI accelerators, positioning the company to capitalize on continued AI demand. The successful VMware acquisition integration demonstrates management's execution capabilities while providing stable software revenue streams. Broadcom's dual exposure to both high-growth AI semiconductors and stable software businesses creates a balanced growth profile. The company's strong execution in AI-related products, combined with new product launches expected in H2 2025, should drive continued revenue growth. Mar Vista views the combination of AI market leadership, successful M&A integration, and expanding addressable markets as key drivers for sustained shareholder value creation. The pitch reflects confidence in Broadcom's ability to maintain its competitive position in the rapidly evolving AI infrastructure market.

Pitch Summary:
We initiated a position in ASML Holdings (ASML) due to its unmatched leadership in semiconductor lithography equipment and its pivotal role in enabling the next generation of chip production. ASML's extreme ultraviolet (EUV) technology remains unrivaled in the industry, leading to dominate market share and strong customer relationships with leading foundries like TSMC & Samsung. ASML's wide economic moat is derived from its proprietary technology in the lithography market where its product offering is required to manufacture the most advanced semiconductors. We believe this monopoly like position should allow ASML to generate consistent long-term growth at very high returns. ASML's stock came under pressure after management provided a softer-than-expected 2025 outlook, which created a favorable risk-reward, in our opinion. We believe the issues driving the softer than expected 2025 outlook are transitory and continue to expect ASML to benefit from growing demand for advanced semiconductors that are critical to power artificial intelligence, cloud computing, and mobile devices. We expect ASML will compound intrinsic value high-teens as semiconductor device manufacturers continue to development more advanced and energy efficient semiconductors which rely on ASML's mission critical technology platform.

BSD Analysis:
Mar Vista initiated a new position in ASML, viewing the company as having an unassailable competitive position in semiconductor lithography equipment with its proprietary EUV technology. The manager emphasizes ASML's monopoly-like position in advanced chip manufacturing, with its equipment being essential for producing cutting-edge semiconductors used by leading foundries like TSMC and Samsung. The investment thesis centers on ASML's wide economic moat and ability to generate high returns from its mission-critical technology platform. Management's softer 2025 outlook created an attractive entry point, which Mar Vista views as a temporary headwind rather than a structural concern. The long-term growth drivers remain intact, with increasing demand for advanced semiconductors powering AI, cloud computing, and mobile devices. Mar Vista expects high-teens intrinsic value compounding as semiconductor manufacturers continue developing more advanced and energy-efficient chips. The combination of technological leadership, customer dependency, and secular growth trends in advanced semiconductors supports the bullish investment case.

Pitch Summary:
Amazon's profitability was the key highlight of the third quarter financial results, with AWS and International Retail achieving record operating margins, and North America Retail posting its second-best margin in five years. Even more impressive was the fourth quarter operating income forecast, projecting up to $20 billion, significantly exceeding the expected $16 billion and suggesting a record 11% margin. This exceptional performance was driven by economies of scale, logistics efficiencies, successful AI implementations, increasing ad revenue, and accelerated AWS growth. We keep our investment in Amazon due to several factors: AWS growth has further potential, Amazon Prime Video monetization is in its initial stages, and the company is expanding into promising sectors like Pharmacy and Logistics. Furthermore, with strengthening profitability and cash reserves exceeding $100 billion, the possibility of substantial capital returns increases. By continuing to innovate and invest in technologies like AI and cloud computing, Amazon is well-positioned to keep its competitive edge.

BSD Analysis:
Mar Vista maintains a strong bullish position on Amazon, emphasizing the company's exceptional profitability improvements across all business segments. The manager highlights record operating margins in AWS and International Retail, with Q4 operating income projections of $20 billion significantly exceeding expectations and suggesting an 11% margin. Multiple growth drivers support the investment thesis, including continued AWS expansion potential, early-stage Prime Video monetization, and expansion into high-growth sectors like pharmacy and logistics. The company's massive $100+ billion cash position provides significant optionality for capital returns and strategic investments. Amazon's successful AI implementations and logistics efficiencies demonstrate operational excellence and competitive moat expansion. The combination of margin expansion, diverse growth opportunities, and strong balance sheet positions Amazon for sustained value creation. Mar Vista views the company's continued innovation in AI and cloud computing as key differentiators that will maintain its competitive advantages across multiple business lines.