Investment Pitches

Pitch Summary:
The change in administration is an obvious threat: it will be one of the most vulnerable projects; excessive cash burn and share dilution; very likely to fail;

BSD Analysis:
Gevo develops renewable jet and gasoline fuels, but commercialization remains elusive. Facilities are capex-heavy with no meaningful cash-generating ops. The model relies on subsidies, grants, and long-dated offtake agreements that may not translate to profitability. Bears argue economics are unfavorable: volatile inputs, uncertain credit pricing, and large upfront capex. Catalysts: Net-Zero 1 plant ramp-up, financing rounds, LCFS/RIN updates, contract execution. Counterpoints: aviation decarbonization is real, but shorts see GEVO as subsidy-dependent and uneconomic.

Pitch Summary:
The company's marquee agreement revenue is overstated by 90%, misleading investors $100 mil in spending; revenue is overstated by 25%, the company is facing a declining financial condition with a potential revenue miss; the directors have an unbroken record of failed businesses.

BSD Analysis:
Innodata provides data annotation, digital transformation, and AI services. Bears highlight customer concentration risk, exaggerated AI positioning, and inconsistent profitability. Enthusiasm around generative AI lifted shares, but revenue tied to AI labeling is modest and faces offshore pricing pressure. Limited disclosure on contract wins and cash flow raises skepticism. Catalysts: renewal rates with top 5 clients, margins in digital ops, evidence of scalable AI SaaS. Counterpoints: pivot into AI SaaS could help, but shorts see promotion-driven narrative dominating.

Pitch Summary:
Amplify Energy presents a compelling investment opportunity due to its strategic development of the Beta oilfield, which is expected to significantly enhance cash flow. The company is trading at attractive multiples, with a focus on low-decline, long-reserve-life assets. Recent drilling successes at Beta, particularly the second well exceeding production expectations, underscore the potential for substantial value creation. Despite challenges in monetizing the Bairoil asset, the decision to retain it amid volatile crude prices appears prudent. The market seems to undervalue Beta's potential, providing an opportunity for re-rating as the asset's cash flow generation becomes more apparent.

BSD Analysis:
Amplify Energy's valuation metrics, such as trading at 3.6x TTM EBITDA and 9.4x FCF, suggest a market premium compared to peers like BRY and REI. This premium likely reflects the market's recognition of Beta's potential. However, the intrinsic value of Beta could be significantly higher than the market's current assessment. Conservative assumptions about Beta's production life and decline rates may underestimate its cash flow potential. Management's indication of the possibility to scale up to 12 wells per year further supports a bullish outlook. If Beta's production can be sustained at higher levels with a slower decline, the asset could generate substantial free cash flow, potentially leading to a re-rating of AMPY's stock. Investors should watch for updates on reserve figures and further development plans as potential catalysts for stock appreciation.

Pitch Summary:
After multiple rounds of financing, the company is now dependent on a DOE loan; the company claims the loan is secured, in reality, it is less likely to be approved; upcoming shareholder dilution and a long history of promotional activity with little substance.

BSD Analysis:
Repeat entry — same bear case: delays, subsidy reliance, and heavy capital intensity. Key nuance: shorts emphasize repeated equity raises as evidence of unsustainable economics. Catalysts: DOE loans, plant construction updates, cadence of equity issuance. Counterpoints: SAF policy tailwinds may fuel speculative rallies, but economics remain challenged.

Pitch Summary:
Warrior Met Coal (HCC) is positioned as a strong investment due to its competitive cost structure and strategic focus on low-volatility coal, which commands higher prices. Despite current low met coal prices, HCC remains profitable and cash-flow positive, outperforming peers like AMR. The development of the Blue Creek mine, expected to be one of the lowest-cost met coal deposits globally, will further enhance HCC's production capacity and cash flow. The company's resilience in a downcycle and potential for significant gains as prices normalize make it an attractive investment.

BSD Analysis:
HCC's operational efficiency is evident in its ability to generate $78 million in EBITDA during a challenging quarter, surpassing larger peers like AMR. The company's strategic development of the Blue Creek mine is a key growth driver, expected to significantly boost cash flow by 2026/2027. While the current pricing environment is pressured by global steel market dynamics, including excess Chinese steel exports, HCC's low-cost operations provide a buffer against prolonged downturns. The potential for a medium-term recovery in met coal prices, supported by increased demand from India and possible effects of China's stimulus measures, could catalyze a re-rating of HCC's stock. Furthermore, HCC's valuation, when accounting for Blue Creek's future contributions, suggests a compelling investment opportunity with a potential EV/EBITDA multiple of around 5x, indicating room for price appreciation as market conditions improve.

Pitch Summary:
Logic Instrument is a manufacturer and integrator, distributor of rugged laptops, tablet and smartphones headquartered in Igny, France that has operated since 1987 (ALLOG.PA). Their product lineup includes durable laptops, tablets, and smartphones engineered to perform reliably in challenging and extreme environments. These devices are tailored for industries such as defense, industrial sectors, and field services, where robust and dependable equipment is essential. The company's offerings are known for their adherence to military and industrial standards, ensuring durability and reliability. Features of their products include outdoor-readable screens, long-lasting batteries with options for hot-swappable units, and customization capabilities to meet specific client needs. Their products meet a variety of standards such as MIL-STD-810, the U.S. Department of Defense Test Method Standard. The MIL-STD-810 standard, officially titled "Environmental Engineering Considerations and Laboratory Tests," is a United States Military Standard that outlines a series of tests to evaluate the environmental durability of equipment. It encompasses a wide range of environmental stresses and conditions to ensure that materials and products can withstand the rigors of their intended operational environments. The key environmental stresses and conditions covered by MIL-STD-810 include: • Temperature Extremes: High and low temperatures, including rapid temperature changes (temperature shock). • Humidity: Effects of high humidity and condensation. • Altitude: Low pressure conditions simulating high altitudes. • Rain: Exposure to rain, including wind-blown and freezing rain. • Sand and Dust: Resistance to sand and dust ingress. • Vibration and Shock: Mechanical vibrations and shocks encountered during transportation and operation. • Salt Fog: Corrosion resistance due to salt-laden environments. As an example the product Fieldbook P80 can operate at temperatures ranging from -20ºC to 60ºC, up to relative humidity of 95%, vibration resistance over a range of frequencies, rain exposure of 450 mm/hr, and dust concentrations up to 10.6g/m3, and withstands drops from 1.2m. The company is now growing its own products (in the Fieldbook range) over distribution/integration of other manufacturers lines, which is likely to expand margins in the near future. In terms of financials Logic Instrument has grown very quickly in the last twelve months. Partly this is due to the purchase of Elexo, which expanded their products, range of distribution and customer base with complementary business lines in rugged devices. But there is also healthy double-digit growth on internal sales prior to this purchase (revenue growth was 26% ahead of the purchase). This growth is still working through the financials, but revenue increased 136% in cumulative sales up to Q3 for 2024 as compared to 2023. Although the Elexo business has lower margins the leverage effect of the larger scale of the combine business has increased margins (from 5.3% to 7.1%). It appears likely that this trend will continue as the business grows. The valuation of Logic Instrument is very cheap given the growth and runway for the company. It trades at the current run rate and price (as of the time of writing) at 5.3x earnings and 4.9x enterprise value to earnings (even after the Elexo purchase). The valuation combined with growth and business opportunities, appear far too cheap to us. The CEO Loïc Poirier has also stated that the target for revenue for full-year 2024 is 32 million Euros and he is targeting 50 million Euros revenue for 2025. This may depend on internal growth as well as additional opportunistic M&A activity, but if he is only partially successful Logic Instrument is extremely mispriced.

BSD Analysis:
The manager presents Logic Instrument as a compelling growth story in the specialized rugged computing market, serving defense, industrial, and field service sectors with MIL-STD-810 certified devices. The investment thesis combines organic growth momentum with successful M&A integration, as evidenced by 26% internal growth prior to the Elexo acquisition and 136% total revenue growth in 2024. The strategic shift toward proprietary Fieldbook products from third-party distribution should drive margin expansion beyond the current improvement from 5.3% to 7.1%. At 5.3x earnings and 4.9x EV/earnings, the valuation appears deeply discounted relative to the growth trajectory and specialized market position. Management's ambitious revenue targets of €32 million for 2024 and €50 million for 2025 suggest significant scaling potential through both organic growth and additional M&A. The company's 37-year operating history and adherence to stringent military standards provide competitive moats in a niche market with high switching costs and specialized requirements.

Pitch Summary:
Another idea that has been overlooked outside of the gold sub-community is Serabi Gold (SRB.L), which is even cheaper at this point. This is a UK headquartered junior gold miner with operations in Brazil and listed in the UK (AIM) and US (OTC Markets). This company has been taking advantage of increasing gold prices and cashflow generation to accelerate production and bring forward growth capex, using free cashflow to expand. They are targeting increased production to 60,000 oz per annum from the current levels around 30,000 oz per annum. Another tailwind is the de-risking process the company has followed, with a lower-cost single processing plant at Palito being used, to the awaited decision on the Installation License at Coringa, where Serabi extended its current mining license by three years in January. If this permanent license is granted then Serabi's ownership of Coringa will be derisked and the implicit value to Coringa will increase by over $400 million. Serabi had earnings of $5.6 million in the last announced financial quarter (Q2) and announced they now have cash balances of $20 million as of the end of Q3. This is after the acceleration of growth capex which has allowed Serabi to build out their classification plant at Coringa (crusher and ore sorter) which will improve the grade or ore and reduce transportation volumes to their processing plant at the Palito complex. Serabi currently trading at C$1.63 (US$1.17) and market cap of C$124 million (US$ 89 million). Our estimate on a forward basis to 2025 this values the company at 3.5x and 2.3x (including cash). The company is on track to have over half its current market cap in cash in a little over a year with high levels of cashflow generation, and many avenues to grow production. Even if the price of gold was to fall significantly from current levels this business appears to us to be too cheap.

BSD Analysis:
The manager identifies Serabi Gold as an even more attractive value opportunity than Monument Mining, trading at compelling forward multiples of 3.5x earnings (2.3x including cash). The investment thesis centers on the company's aggressive growth strategy, targeting production doubling from 30,000 to 60,000 oz annually while self-funding expansion through strong cash flow generation. Key catalysts include the pending Coringa Installation License decision, which could unlock over $400 million in value, and operational improvements from the new classification plant that will enhance ore grades and reduce transportation costs. With $20 million cash and quarterly earnings of $5.6 million, the company demonstrates robust financial health despite growth investments. The manager emphasizes the company's trajectory toward accumulating cash equivalent to over half its market cap within a year. Multiple growth avenues and strong cash generation provide downside protection even in a declining gold price environment, making the current valuation appear significantly undervalued.

Pitch Summary:
We recently discussed a new idea for us in a new sector, Monument Mining Limited (MMY.V). Gold has been rising in price for over 8 years now, with an acceleration in the last two. Commodity companies are often difficult long-term investments and have typically been avoided by Value and GARP investors, but the situation here is highly unusual. The underlying commodity price has risen by 134% over the last eight years and the sub-sector of junior gold miners has underreacted. For example, the junior miner ETF GDXJ increased by 36% over the last five years whereas gold spot price has increased by 84%. In fact the discrepancy is even larger, because the profit and value of a producing junior gold miner is proportional to the difference between gold selling price and AISC: Profit($)production volume(oz) × (Gold selling price ($/oz) – AISC($/oz)2) Thus these companies have call option-like characteristics. Like a call option the upside is theoretically unlimited as the gold price rises, and the downside is limited to operating costs. The strike for the call option is where the gold selling price (the price of gold sales the company achieves) passes the AISC. The AISC is the company's estimate of all costs (including corporate) required to produce that gold. Multiplied by the production volume this gives a rough measure of profit before tax and then a multiple of this would imply the company value. Monument is one of the lowest cost junior miners, in part due to the local workforce at their mining operations in Malaysia. So, in the case of Monument mining in 2018 the AISC was $957/oz and gold selling price $1,320/oz, or a net of $363/oz. Q3 2024 this had increased to an AISC $1,273, gold selling price of $2,097/oz and net price of $824/oz. Estimating selling prices now for the gold price as of the time of writing would be a net price of $1,227/oz. This would imply profitability has increased by 440% since 2018. While the price of Monument has increased since we first discussed, we believe there is still more room to run and that at current prices it's trading at a forward value to earnings of 3x (also factoring some increases in production that will come through their refinement of gold sulphide processing which is underway). Monument also has a great capital structure with no debt and shouldn't need to raise debt or equity in the current environment. Commoditized businesses are disliked because of their lack of pricing power, but the flipside of this argument is the certainty of the selling price received. There will be no new competitor, change in technology or flood of product into the market (total gold production increases available gold by approximately 2%). And so the current gold price gives a guide to what is happening and what has already happened. Monument, and many other junior gold miners reporting up to 30 June, 2024 reported record cashflow generation. We already know that Q1 2025 (to September 30, 2024) saw gold prices 3% higher than the average in Q4 2024 (to June 30) and we are now halfway through Q2 2025 with gold prices even higher than Q1 (by approximately 5%). Our estimate of forward valuation is 3.0x (2.2x including cash balances). Part of this mispricing in our opinion is that the market is lagging the impact that gold prices will have in the last, current and future quarters, combined with increase in production. Monument mining has restarted mining production switching from gold Oxide to Sulphide production. This process is now largely complete and the next few quarters will see close to full production, which will highlight the level of cashflow production.

BSD Analysis:
The manager presents a compelling value opportunity in Monument Mining, capitalizing on a structural disconnect between rising gold prices and underperforming junior miner valuations. The investment thesis leverages the call option-like characteristics of gold miners, where profitability scales exponentially with gold price increases above all-in sustaining costs (AISC). Monument's competitive advantage stems from its low-cost Malaysian operations, with AISC of $1,273/oz versus current gold prices around $2,550/oz, generating substantial operating leverage. The company's profitability has surged 440% since 2018 as gold prices rose from $1,320 to over $2,000/oz. At a forward P/E of 3.0x (2.2x including cash), the valuation appears deeply discounted relative to record cash flow generation. The debt-free capital structure provides financial flexibility, while the transition from oxide to sulphide production should drive higher output. The manager views current pricing as lagging the impact of sustained higher gold prices on earnings.

Pitch Summary:
In terms of existing positions two good performers for us were McCoy Global (MCB.TO) which has continued to execute well. In spite of some reports from the company about additional requirements from the market, they have continued to innovate and have remediated versus these requirements and continued to improve sales and earnings (particularly earnings). We believe this company is a great long-term prospect and although it is a more capital intensive, hardware business it has highly valuable and largely untapped data assets in the form of the drilling data that it captures through some of its new technologies (such as the smarTR™ product suite). And their increasing de-correlation from oil prices is also becoming clearer to the market.

BSD Analysis:
The manager maintains a bullish stance on McCoy Global, highlighting the company's strong execution and ability to adapt to evolving market requirements through continued innovation. The investment thesis centers on the company's transition from a traditional hardware business to one with valuable data assets through technologies like the smarTR™ product suite. The manager emphasizes improving fundamentals with continued growth in sales and particularly earnings. A key catalyst is the company's increasing de-correlation from oil prices, which reduces cyclical risk and makes the business model more predictable. The data assets captured through drilling operations represent a largely untapped value driver that could command premium valuations. Despite being capital intensive, the company's innovation capabilities and evolving business model position it as a compelling long-term investment. The manager views the current market recognition of these value drivers as still developing, suggesting potential for further appreciation.

Pitch Summary:
Paywalled (The Bear Cave believes new competition led by SpaceX’s Starlink is stealing share from Viasat’s key markets and will continue to grow at Viasat’s expense. And with the election of President Trump, Elon Musk and Starlink have gained a powerful new ally in competing against Viasat.)

BSD Analysis:
Viasat provides satellite broadband and defense communications. Bears highlight execution missteps with ViaSat-3 (delays, failures) and high leverage from Inmarsat acquisition. Integration risk and capex create liquidity strain, while competition (Starlink, OneWeb, Amazon Kuiper) offers cheaper/faster constellations. Defense backlog helps, but consumer broadband faces secular disruption. Catalysts: ViaSat-3 utilization, leverage ratios, synergies, churn. Counterpoints: government contracts stabilize, but consumer economics look impaired.

Pitch Summary:
Global Payments Inc. (GPN) is positioned as a promising investment in the fintech sector, demonstrating robust financial performance and strategic growth initiatives. Despite recent stock price declines due to macroeconomic concerns and competitive pressures, GPN has shown consistent revenue and profit growth, supported by effective cost management and operational efficiency. The company's strategic acquisitions and focus on expanding its Merchant Solutions division provide a strong foundation for future growth. With a new CEO at the helm, GPN is streamlining operations and focusing on high-growth areas, making it a compelling opportunity for long-term investors.

BSD Analysis:
Global Payments Inc. has maintained a strong financial trajectory with a net income CAGR of 23.85% and a revenue CAGR of 22.72% from 2019 to 2023. The company's strategic acquisitions, such as EVO Payments and TSYS, have expanded its capabilities and geographic reach, contributing to consistent EPS growth. GPN's focus on small and medium-sized businesses (SMBs) and its operational transformation plan targeting $500 million in adjusted run-rate operating income benefits by 2027 are key drivers of future growth. The company's valuation appears attractive compared to peers, with a PE ratio of 18.92, suggesting potential upside. While challenges such as intense competition and integration of recent acquisitions remain, GPN's strong free cash flow generation and manageable debt levels provide a solid foundation for continued success in the dynamic fintech industry.

Pitch Summary:
WideOpenWest (WOW) presents a compelling investment opportunity due to an ongoing takeover bid by major shareholder Crestview Partners and DigitalBridge. The non-binding offer of $4.80 per share is considered low, given the company's potential for higher valuation based on industry transactions and peer comparisons. The recent Q3 results indicate that the takeover process is still active, and operational performance aligns with expectations, suggesting stability. The company's fiber build-out and improved customer retention further support the potential for a higher acquisition price.

BSD Analysis:
WOW is trading at a relatively low multiple of 5x 2024E and TTM EBITDA, which is below peer valuations. This suggests that the market may be undervaluing WOW's assets, particularly its fiber assets. The company's recent $200 million loan indicates financial stability and potential for future growth. Management's medium-term forecasts suggest significant EBITDA generation from fiber assets by 2028, which could justify a higher valuation. The ongoing takeover process, coupled with the company's strategic positioning in the telecommunications industry, makes WOW an attractive special situation investment. The market's anticipation of a price bump is reflected in the current share price, which trades at a 15% premium to the non-binding offer.

Pitch Summary:
Systematically scamming taxpayer-funded healthcare programs by abusing Covid waivers; booking excessive revenue compared to its competitors; used deceptive tactics to achieve Covid-level profitability (including billing thousands of unnecessary therapies); significant regulatory risk.

BSD Analysis:
PACS Group provides imaging workflow software. Bears argue the market is mature, commoditized, and price-sensitive, with hospitals entrenched with major vendors. Growth constrained by budget cycles, margins are narrow, and contracts limit pricing power. Catalysts: renewal rates, displacement by AI vendors, revenue from new modules. Counterpoints: healthcare digitization is growing, but shorts see structural low growth and margin pressure.

Pitch Summary:
MGP Ingredients is facing significant challenges due to a downturn in the American whiskey industry. The company is experiencing a decline in whiskey prices and volumes, which is expected to continue impacting its Distilling Solutions segment. With the industry coming off a supercycle, MGPI's revenues are projected to decline sharply, and the company is trading at multiples above its replacement cost. The potential for a re-rating to its tangible book value suggests further downside.

BSD Analysis:
MGPI's operational performance is under pressure from a supply-demand imbalance in the whiskey market. The company's management has indicated that whiskey inventories are at unprecedented highs, covering over 12 years of demand. This situation is exacerbated by limited visibility into future contracts, raising concerns about revenue stability. Despite a 70% decline in share price since the initial short pitch, MGPI's valuation remains above its tangible book value, suggesting room for further downside. The company's current EV of $1.3 billion compared to a tangible book value of $0.3 billion implies a potential 70%+ downside if re-rated. The ongoing industry headwinds and lack of contract visibility are likely to continue impacting MGPI's financial performance, making it a compelling short position.

Pitch Summary:
Boeing was the worst performer, falling by 16.5%. The company continues to struggle and recently raised cash through an equity offering to shore up its balance sheet. Now that there is a new CEO, Boeing's stock may have reached a bottom. They are very close to ending the workers' strike. The latest quarterly results were not impressive, but the stock has been holding around $150, roughly the price we bought it at in 2022. Boeing operates in a duopoly, with Airbus as its only true competitor. Boeing still has an order backlog valued at over $500 billion, which has also improved in recent quarters. I believe it will perform over time, and I see no need to exit the holding.

BSD Analysis:
The manager maintains a bullish long-term view on Boeing despite recent operational challenges and poor quarterly performance. The investment thesis centers on Boeing's duopoly position with Airbus in the commercial aviation market, providing significant competitive moats and pricing power. The manager highlights Boeing's substantial order backlog exceeding $500 billion, which has been improving and provides multi-year revenue visibility. Recent positive catalysts include new CEO leadership and the near-resolution of the workers' strike, which should improve operational efficiency. The manager views the current $150 price level as attractive, representing the original 2022 purchase price and potentially marking a bottom. While acknowledging recent struggles and disappointing earnings, the manager emphasizes the structural advantages of the duopoly and expects long-term outperformance as operational issues resolve.

Pitch Summary:
Kodak is presented as a potential value trap due to its inconsistent profitability, underperformance relative to peers, and uncertain growth prospects. Despite efforts to pivot towards digital printing and advanced materials, the company has struggled to maintain a competitive edge in a rapidly evolving industry. Historical management challenges and a significant debt load further complicate its turnaround efforts.

BSD Analysis:
Kodak's financial performance has been volatile, with recent improvements in net income overshadowed by historical inconsistencies. The company's P/E ratio of 8.82 might seem attractive, but it is based on a single year of improved performance, raising concerns about sustainability. Kodak's gross margin of 17% is lower than many competitors, indicating potential profitability challenges. The company's strategic initiatives, such as focusing on digital printing and packaging, have yet to yield consistent results, and its competitive position remains weak compared to industry leaders like Canon and Fujifilm. Leadership changes and a substantial debt burden further exacerbate the risks, suggesting that investors should approach Kodak with caution and conduct thorough due diligence before considering it as a value investment.

Pitch Summary:
Nice Ltd. develops software to run customer contact centers. The company's cloud-based software enables the implementation of greater functionality versus its on-premise competitors. Many of these on-premise competitors, which do not offer cloud-based products, have stopped rolling out new features. This has prompted their customers to switch to companies like Nice where they have wider access to new developments. Artificial intelligence is a large part of this shift and of our differentiated view. The market views AI as a threat to Nice's core operations; we view it as an enabler of additional revenue streams with improved economics.

BSD Analysis:
Broyhill initiated a position in Nice Ltd, taking a contrarian view on the company's artificial intelligence exposure in the contact center software market. The manager's thesis centers on Nice's competitive advantage through cloud-based solutions versus legacy on-premise competitors who have largely stopped innovating. This technology gap is driving customer migration to cloud providers like Nice, creating a structural growth opportunity. Broyhill's differentiated perspective on AI represents the core of their investment thesis - while the market perceives AI as a threat to Nice's traditional business model, the manager views it as an enabler of new revenue streams with superior unit economics. This suggests Nice can monetize AI capabilities rather than be disrupted by them. The cloud migration trend provides a foundation for growth, while AI integration offers potential for margin expansion and new product development. Broyhill appears confident in Nice's ability to leverage technological shifts to strengthen its competitive position and expand its addressable market in the evolving contact center industry.

Pitch Summary:
Evolution AB is a live casino supplier based in Sweden. Shares have come under pressure as online gaming legalization of additional US states has been slower than hoped, but we believe that the most important factor is the direction of progress more than the pace. The company is a high margin, high growth business trading at what we view to be an inexpensive valuation. With this set-up, we are willing to accept a wide range of potential outcomes, most of which we view to be positive.

BSD Analysis:
Broyhill established a position in Evolution AB, the Swedish live casino technology provider, viewing recent share price weakness as a buying opportunity. The manager acknowledges that US online gaming legalization has progressed slower than market expectations, creating near-term headwinds for the stock. However, Broyhill takes a longer-term perspective, emphasizing that the direction of regulatory progress matters more than the specific timing. The investment thesis rests on Evolution's attractive business model characteristics: high margins and strong growth potential in the expanding online gaming market. The current valuation appears compelling relative to the company's fundamental quality and growth prospects. Broyhill demonstrates conviction by expressing willingness to accept outcome uncertainty, suggesting confidence that most scenarios lead to positive returns. The position reflects a contrarian approach, buying during temporary pessimism while maintaining focus on the structural growth opportunity in online gaming. The manager appears to view current pricing as disconnected from the company's long-term value creation potential.

Pitch Summary:
Rentokil Initial is a UK-based pest control company that grew its US presence by acquiring Terminix in 2022. The industry is largely fragmented and has the tailwind of a warming environment, expanding the seasons and geographies where pests thrive. Trading at a steep discount to its nearest peer, Rollins, we see plenty of room for upside as activist investor Nelson Peltz holds management accountable during the Terminix integration.

BSD Analysis:
Broyhill initiated a position in Rentokil Initial, viewing it as an attractive value play in the pest control industry. The manager's thesis centers on the company's strategic expansion into the US market through the 2022 Terminix acquisition, which significantly enhanced its North American footprint. The fragmented nature of the pest control industry presents consolidation opportunities, while climate change trends create structural tailwinds by extending pest seasons and expanding affected geographies. The investment appears opportunistic, with shares trading at a meaningful discount to peer Rollins, suggesting potential multiple expansion. The presence of activist investor Nelson Peltz adds a catalyst element, as his involvement should drive management accountability during the critical Terminix integration phase. The combination of industry tailwinds, valuation discount, and activist oversight creates multiple paths to value creation. Broyhill appears confident in the integration execution and long-term market dynamics favoring the pest control sector.

Pitch Summary:
Xometry operates an online marketplace for custom-manufactured parts. Today, the company's network connects approximately 60,000 buyers with 3,500 suppliers. Xometry's digital platform allows buyers to quickly source parts and compare prices instead of having to negotiate with individual suppliers and deal with opaque pricing and inconsistent lead times. Customers seeking a custom part can simply upload a 3D model, specify the material, select the desired manufacturing process (such as 3D printing or CNC machining) and within moments, Xometry will generate quotes based off lead times and quantity requirements. Qualified suppliers gain access to a job board displaying available projects with preset prices and required ship dates. Suppliers who consistently deliver quality work are rewarded with opportunities for more complex, higher-value jobs. The company has a certification system for suppliers seeking to sell regulated aerospace or medical components. This enables suppliers to grow, diversify their business and optimize the utilization of their equipment. Xometry's margin on each part order varies. The company guarantees the quoted price and lead time to the buyer, so in theory, it could take a loss on a complex part if it's forced to increase the price offered to a supplier to incentivize them to accept the job. Xometry's unique access to data has driven continuous improvements in its AI-powered quoting engine and supplier matching algorithms. These improvements have led to a 10% improvement in gross margins since its IPO. We expect gross margins will continue to improve as the company improves its pricing of complex parts. Xometry's growth potential is substantial with the custom-manufactured parts market valued at around $200 billion. Customers, including government agencies like NASA and the US Army, as well as innovative startups like SpaceX, rely on Xometry for both prototyping and production needs. In response, Xometry has shifted its go-to-market strategy to prioritize larger accounts, a move that appears to be yielding results. As customers seek to consolidate suppliers, Xometry is capturing a greater share of their spending. The number of customers spending over $50,000 on a last-twelve-month (LTM) basis has been growing in-line with the company's overall growth rate. Like many 2021 IPOs, Xometry's stock dropped significantly from its peak (down ~80%). However, the company continues to meet its growth targets under the leadership of co-founder Randy Altschuler, who retains a significant ownership stake. Since 2021, the company's closest peers have had organic revenue declines while Xometry's marketplace sales have more than doubled in the same weak manufacturing environment. We anticipate Xometry will begin generating profits within the next year, and over the long term, we expect its revenue to exceed $1 billion and for the company to generate double-digit EBITDA margins. Using comparable specialty distributor or digital marketplace company multiples suggests substantial (>100%) upside from today's share price.

BSD Analysis:
Liberty Park presents a compelling bull case for Xometry as a digital marketplace disrupting the $200 billion custom manufacturing market. The manager highlights the company's network effects with 60,000 buyers and 3,500 suppliers, creating a powerful two-sided marketplace. Key competitive advantages include AI-powered quoting algorithms and supplier matching that have already driven 10% gross margin improvement since IPO. The shift toward larger enterprise accounts appears successful, with customers spending over $50,000 growing in line with overall growth. Despite the stock being down ~80% from peak like many 2021 IPOs, Xometry has outperformed peers with marketplace sales more than doubling while competitors saw revenue declines. Management execution under co-founder Randy Altschuler provides confidence, and the path to profitability within a year seems achievable. Long-term targets of $1 billion revenue and double-digit EBITDA margins suggest significant scaling potential in this fragmented market.