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Now, let’s get into this week’s selection of fund ideas 👇
Amazon.com (AMZN US) by Tsai Capital
Apple (AAPL US) by Tsai Capital
Ascentech K.K. (3565 JP) by Stone Sentinel Capital
Avation PLC (AVAP LN) by East 72 Dynasty Trust
Bajaj Finance (BAF IN) by SVN Capital
Berner Industrier (BERNERB SS) by REQ
Brookfield Corporation (BN US) by Tsai Capital
Builders FirstSource, Inc. (BLDR US) by Tapasya
Constellation Software (CSU CN) by REQ
Copart (CPRT US) by SVN Capital
Corpay, Inc. (CPAY US) by Vltava Fund
D’Ieteren Group (DIE BB) by East 72 Dynasty Trust
Domino’s Pizza Group plc (DOM LN) by Palm Valley Capital
Endava (DAVA US) by Night Watch IM
Enova International, Inc. (ENVA US) by Blue Tower Asset Management
F.I.L.A. SpA (FILA IM) by Halvio Capital
Flowers Foods, Inc. (FLO US) by Palm Valley Capital
Georgia Capital PLC (CGEO LN) by Blue Tower Asset Management
Hansa Investment Company (HANA LN) by East 72 Dynasty Trust
HEICO (HEI US) by SVN Capital
IMCD (IMCD NA) by REQ
Ingredion Incorporated (INGR US) by Palm Valley Capital
Kelly Services, Inc. (KELYA US) by Palm Valley Capital
Kinsale Capital Group (KNSL US) by SVN Capital
KKR & Co. Inc. (KKR US) by SVN Capital
Lululemon Athletica Inc. (LULU US) by Tapasya
Miami International Holdings (MIAX US) by Horizon Kinetics
PagSeguro Digital Ltd. (PAGS US) by Middle Coast Investing
QXO (QXO US) by Tsai Capital
Röko AB (ROKO SS) by REQ
Tesla (TSLA US) by Tsai Capital
TOC Co., Ltd. (8841 JP) by Halvio Capital
Triveni Turbine (TRIV IN) by SVN Capital
Utz Brands, Inc. (UTZ US) by Palm Valley Capital
WaterBridge Infrastructure LLC (WBI US) by Horizon Kinetics
Thesis:
Amazon.com is a dominant e-commerce and cloud leader using a scale-economies-shared model and AWS profitability to drive durable growth with EPS expected to more than double.
Source: https://drive.google.com/file/d/1KWi6onABJTSAfeAYpBCD_EHUWmEPOeKO/view?usp=drivesdk
Analysis:
Established in 1994 by Jeff Bezos within the humble confines of his garage, Amazon has evolved into a colossus that commands unparalleled dominance across its diverse markets. Despite its immense scale, the company’s e-commerce arm continues to capture additional market share with remarkable agility. Meanwhile, its cloud computing powerhouse, Amazon Web Services (AWS), stands as the undisputed leader in its domain. We estimate that AWS currently accounts for more than 50% of Amazon’s aggregate operating profits. Both the retail operations and AWS have significant competitive advantages and offer exceptional value to customers. Eschewing the temptation to exploit its vast stature for immediate profit maximization, Amazon embraces a scale-economies-shared business model, generously redistributing a substantial share of its margins back to consumers. This strategic benevolence ignites a virtuous flywheel, perpetually strengthening the company’s ecosystem. By channeling substantial investments into its operations today to create even greater shareholder value tomorrow, Amazon obscures the true magnitude of its latent earnings potential. As shoppers increasingly pivot from brick-and-mortar retail to digital marketplaces, and as vast troves of data transition from local servers to cloud environments, we anticipate that Amazon’s revenues will expand at a compound annual growth rate of approximately 10% over the next five years, with earnings per share poised to more than double during that timeframe.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Apple is a hardware-software ecosystem powerhouse with 2.4 billion devices and expanding high-margin services driving steady EPS growth.
Source: https://drive.google.com/file/d/1KWi6onABJTSAfeAYpBCD_EHUWmEPOeKO/view?usp=drivesdk
Analysis:
We initiated our Apple investment in 2016 and elevated it to a core holding in 2018, the same year the company unveiled its redesigned 13-inch and 15-inch MacBook Pro models. Under Tim Cook’s far-sighted leadership, Apple has continually redefined innovation across hardware and software. Today, Apple’s ecosystem powers about 2.4 billion active devices, bolstered by a rapidly expanding subscription services base. This approach has supercharged customer engagement and spending. In fiscal 2025 (ended September), the high-margin, stable subscription services segment accounted for roughly 42% of total gross profits, up from about 39% the previous year. The September 2025 iPhone 17 launch—featuring the iPhone 17, iPhone 17 Pro, iPhone 17 Pro Max, and the new ultra-thin iPhone Air (replacing the Plus)—has posted one of the strongest early sales cycles in recent years. Key drivers include the A19 chip, larger displays, and 120Hz refresh rates across all models. We expect rising revenues from new product launches, services, margin expansion, and share repurchases to fuel approximately 10% annual growth in earnings per share over the next several years. A decade after we first purchased shares, we believe Apple remains one of the highest-quality businesses on the planet.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Ascentech K.K. is Japan’s exclusive Citrix operator with higher-margin recurring revenue, proven execution, and durable VDI-driven hybrid work demand, while trading at attractive forward multiples.
Source: https://drive.google.com/file/d/12OR1erb0f3tsjGPNveT4TDEQe4QbTGmq/view?usp=drivesdk
Analysis:
The most recent addition is Ascentech K.K.. Listed in the Tokyo Stock Exchange, Ascentech is the first Japanese stock in your manager’s career. Ascentech caught your manager’s attention when it elevated its business model in March 2025. Before March 2025, Ascentech was a tier-1 distributor and systems integrator (SI) for Citrix. It bought Citrix licenses wholesale which were sold to other SIs and enterprise clients. After March 2025, Ascentech became the Citrix operator in Japan. Revenue-share with higher margins (25-35% gross margins) replaces fixed distributor margins (8-15%). Multi-year recurring subscriptions reduce working capital risk. Access to the entire slate of Citrix products and bundling opportunities increase revenue growth potential. However, the transformation entailed upfront payments (tied to projected sales) payable to the Citrix parent. Missing projected sales is an obvious risk. What may cause a miss in sales are Ascentech missing on execution and poor demand for Citrix products. Your manager is comfortable with Ascentech’s execution. It has demonstrated world-class competence in Japan (~19% ROE, ~38% ROIC over past decade) for it to become an operator. For the other risk, Citrix is one of two leaders in VDI (Virtual Desktop Infrastructure). The post-pandemic hybrid work tailwind is unlikely to dissipate. Risk-averse customers in the highly-regulated industries (city governments, finance, healthcare) that Ascentech targets are unlikely to abandon hybrid work arrangements, even with back-to-office mandates. The demand for more secure and efficient hybrid work will only increase. AI is also unlikely to disrupt Citrix like it may for other software. Citrix is the control-plane infrastructure within which AI runs. The stock has risen 70% over the past year but it’s still trading at forward multiples (9.5x PBT and 13.5x PE) that seem to undervalue its position as the exclusive operator of leading VDI software.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Avation PLC is improving its balance sheet and visibility while trading at a discount to NAV, with clear fleet growth and cash flow optionality.
Source: https://drive.google.com/file/d/1MvXaDVUrYT07XBB4tOek8S7XWJV-2hFa/view?usp=drivesdk
Analysis:
Avation PLC is an aircraft leasing company that operates in the context of significant growth in global passenger numbers. With a favorable environment, the company has been navigating financial risks effectively. It has improved its financial metrics, including reducing net debt and enhancing cash flow, while still maintaining a competitive fleet. Additionally, positive trends in the market provide a promising outlook for continued growth, even as equity holders remain cautious due to past volatility.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Bajaj Finance is India’s best-in-class lender transforming into an AI-driven platform to lower costs, sharpen risk, and expand to 200–220 million customers while compounding through disciplined underwriting.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
If India compounds, then Bajaj Finance compounds faster. That leverage to formalization, credit deepening, and rising household balance sheets is why Bajaj sits at the center of our India exposure.
Bajaj Finance was one of the few holdings that worked in 2025. In rupee terms, the share price rose roughly 45% in 2025. Earlier this year, I travelled to Pune for the company’s investor day. It reinforced my view of Bajaj as the highest-quality lender in an under-penetrated and rapidly formalizing credit market. It combines a long runway for growth with a culture that is obsessed with risk, underwriting, and operating discipline—a rare mix in financial services.
More interesting is how deliberately the company is remaking itself as “FinAI”—a financial services platform built around deep technology and artificial intelligence rather than a traditional branch-and-paper mindset. Management walked through concrete AI initiatives at the investor day, from conversational bots that already handle a meaningful share of loan disbursals and service interactions, to vision and content systems that automate document checks and marketing, to an internal “AI pod” structure that embeds data science across product lines.
The goal is a structurally lower cost-to-serve, sharper risk discrimination, and the ability to cross-sell more products to each customer. Looking out over the next several years, the company expects to more than double its customer franchise, from just over 100 million customers today, to 200–220 million by 2030, while increasing its share of India’s overall “system credit” (the total stock of loans in the economy) and retail credit from today’s still-modest single-digit levels.
If Bajaj can execute on that plan while maintaining its conservative credit standards, FinAI could become a royalty on the growth of Indian consumption and small-business formation. Given the quality of the franchise, the depth of the technology and data stack, and the long runway for profitable reinvestment, I added to the position this year and continue to view Bajaj Finance as one of the core long-term compounders in the portfolio.
The caveat is an obvious one—none of this matters if credit standards slip. So, I watch the boring things: delinquencies, underwriting discipline, and whether growth is being bought rather than earned. Thus far, Bajaj has prioritized durability and discipline over maximizing short-term growth.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Berner Industrier is executing a decentralized, cash-flow-focused strategy under strong leadership, initiating acquisitions and offering compelling long-term potential.
Source: https://drive.google.com/file/d/1aFJagtD7Jh48v34tw5-x_aeYDI41Zfdj/view?usp=drivesdk
Analysis:
In June, we also initiated a position in Berner Industrier. We had the opportunity to meet its CEO, Caroline Reuterskiöld, even before she assumed the role in early 2022, and the strategic direction she outlined at that time has since been fully executed. The first acquisition took somewhat longer than initially anticipated, but we have been impressed by Berner’s operational execution. By the time we established our position, the company had delivered a meaningful improvement in cash flow, strengthened its balance sheet, and decentralized its operations. The company has now completed its second acquisition during Caroline’s tenure, and we continue to see strong long-term potential.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Brookfield Corporation is a leading alternatives platform with permanent capital, cultural moat, and secular tailwinds positioned to deliver 15%+ long-term returns.
Source: https://drive.google.com/file/d/1KWi6onABJTSAfeAYpBCD_EHUWmEPOeKO/view?usp=drivesdk
Analysis:
Brookfield Corporation, headquartered in Toronto, Canada, stands as a preeminent global alternative asset manager and operator, harnessing a vast permanent capital base of over $180 billion to invest in and scale high-quality businesses across infrastructure, renewable power, private equity, real estate, and beyond. With more than $1 trillion in assets under management through its majority-owned asset management arm (Brookfield Asset Management) and a growing $135 billion insurance solutions platform, the company deploys patient, opportunistic capital into real assets that power the global economy—delivering resilient, inflation-protected returns in an era of accelerating energy transition and digital infrastructure demand. Brookfield’s culture of disciplined value creation and long-term stewardship serves as its bedrock competitive moat, fostering a collaborative ecosystem where operators, investors, and entrepreneurs thrive under a unified philosophy of prudent risk-taking and operational excellence. This ethos not only attracts top-tier talent and proprietary deal flow but also amplifies the flywheel of compounding insights and relationships, positioning the firm to capitalize on market dislocations with unmatched agility and insight. We are confident that Brookfield is on track to achieve its ambitious five-year targets, supported by robust fundraising, accelerating fee-related earnings growth, and disciplined deployment of capital at attractive internal rates of return. This positions the company to deliver its stated goal of 15%+ annualized total returns for shareholders through the cycle, driven by expanding recurring fee streams, strong investment performance across its platforms, and the powerful secular tailwind of institutional investors shifting trillions of dollars into alternative assets in the coming years. Under the steady hand of CEO Bruce Flatt and a world-class management team, we are profoundly optimistic about Brookfield’s positioning as a generational compounder. The company’s masterful capital allocation—reinvesting float-like permanent capital into undervalued opportunities while maintaining fortress-like balance sheets—has consistently unlocked outsized value, and we believe it will continue to do so amid a favorable macro backdrop for real assets. A cornerstone of enduring quality in our portfolio, Brookfield exemplifies the rare blend of scale, sophistication, and shareholder alignment that defines exceptional businesses.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Builders FirstSource is a high-ROIC, FCF-generative consolidator using buybacks and acquisitions in a fragmented market with tailwinds from a U.S. housing deficit.
Source: https://drive.google.com/file/d/1FQJyyO3Xe1B_VrckSPTVTgce5sbOSofB/view?usp=drivesdk
Analysis:
Builder FirstSource (BLDR) is positioned as a strong long-term holding, demonstrating excellent capital management with a Return on Invested Capital exceeding 20%. As a key manufacturer and supplier in the building materials sector, the company generates substantial free cash flow. This cash is strategically allocated to acquisitions within the fragmented market and significant stock repurchases, having already retired approximately a third of its outstanding shares.
Despite the current housing market recession, the outlook remains positive. The U.S. faces a persistent housing deficit of 3 to 5 million homes. A strong recovery and subsequent performance are anticipated for BLDR once the underlying housing affordability crisis is addressed, leading to a broader industry rebound.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Constellation Software is a decentralized VMS acquirer with durable culture and leadership continuity, prompting the fund to be net buyers at attractive valuations.
Source: https://drive.google.com/file/d/1aFJagtD7Jh48v34tw5-x_aeYDI41Zfdj/view?usp=drivesdk
Analysis:
Accordingly, we were comfortable with our VMS exposure prior to the drawdown and are even more comfortable today, which is why we have deployed capital opportunistically and have been net buyers of Constellation Software, Topicus, and Lumine throughout this period. At current valuations, and based on our thesis on how AI may play out for CSI broadly throughout the group, we believe the risk- reward is more compelling.
Mark Miller replacing Mark Leonard
Back in September, just three days after CSI hosted its AI seminar, Mark Leonard announced his resignation as President for health reasons, creating short-term uncertainty. Although the timing was abrupt, he will remain on the board, and likely continue to oversee many of his long-standing responsibilities. In practice, his role had already shifted in recent years away from day-to-day operations and toward shaping cultural norms, guiding experimental initiatives, and contributing to the most complex transactions — rather than the operating-level work and routine M&A activity handled by the groups.
In our view, the structural impact of this leadership change is limited. CSI has never operated as a traditional top-down organization; its five operating groups function independently within broad frameworks set by headquarters. Each group has its own CEO, culture, and approach to M&A. Daily operations, capital deployment, and acquisition processes continue unchanged. This is the strength of a deeply ingrained decentralized model — a “culture of cultures” refined over decades of trial and error. As a result, the organization does not rely on any single individual.
Leonard’s successor, Mark Miller, further reinforces this continuity. A more than 25-year veteran of CSI, he joined through the acquisition of Trapeze — the company’s very first purchase in 1995 — and most recently served as Chief Operating Officer. Within the Volaris group, the largest of CSI’s operating units, he has played a central role in driving a significant portion of its acquisitions. Miller also holds a significant personal equity stake, underscoring his long-term alignment with shareholders. His experience, historical involvement, and alignment send a strong signal of stability.
The cultural foundations Leonard helped shape have been passed down through multiple generations of managers, to the point where there is effectively no key-man risk. CSI is, by design, a culture of cultures: each operating group functions as its own “kingdom,” with its own methods, incentives, and acquisition philosophies. There is nothing homogeneous about how CSI operates — and this diversity in decision-making is one of its core strengths. It is also a nuance the market often overlooks.
Ultimately, CSI was deliberately built so that no single individual — including its founder — is indispensable. That design is what underpins its durability.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Copart is the leading salvage vehicle marketplace with irreplicable land, insurer relationships, and auction technology, benefiting from secular tailwinds and supported by a fortress balance sheet.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
Turning to Copart first, it is the leading global marketplace for damaged and end-of-life vehicles, sitting between insurance companies that need to dispose of total-loss cars and a fragmented, worldwide base of dismantlers, rebuilders, dealers, and exporters. The business benefits from long-lived structural tailwinds: Americans are driving more (vehicle miles traveled in the U.S. have risen from roughly 3.0 trillion miles a decade ago to a record 3.3 trillion miles in 2024), the vehicle fleet keeps aging (the average U.S. light vehicle is now about 12.8 years old versus roughly 8–9 years in the mid-1990s), and rising repair complexity and costs mean more vehicles are totaled rather than repaired. Together, those trends steadily increase the supply of vehicles that need to be processed through the system. Capturing that flow at scale is Copart’s advantage. Over decades, the company has built hard-to-replicate strengths in land, insurer relationships, technology, and operational execution, enabling it to handle everything from routine claims to large catastrophes.
Against that backdrop, the last four quarters have been stronger in the business than in the stock. Revenue and operating income have continued to grow, helped by steady fee-per-unit gains, higher international contribution, and ongoing expansion of yards and services, even as unit volumes have been softer, partly due to weather, partly mix, partly the simple reality that total loss counts do not move in a straight line.
At the same time, a more competitive narrative has taken hold: that competitor RB Global/IAA (RB Global acquired IAA in March 2023) is poised to “catch up” in North American salvage. Public data, however, still show Copart as the structurally stronger player: over many years, Copart has consistently gained share versus IAA and has invested far more heavily in land and infrastructure, leaving IAA with a capital and service-quality gap to close. These concerns about near-term volume and a supposedly resurgent competitor have weighed on sentiment, and the share price has reflected that—Copart is down roughly 30% in 2025.
My long-term optimism is unchanged. Copart still enjoys a wide moat built on its real-estate footprint (nearly 19,000 acres of owned or controlled land), its dense buyer/seller network (more than 750,000 members across ~170 countries), and its proprietary auction technology (called VB3), all supported by a fortress balance sheet with no net debt. Management and directors own meaningful stock (more than 8.0% of the outstanding shares) and have a long history of rational capital allocation, including an open-ended share repurchase authorization under which roughly 326 million shares remain available for repurchase, about one-third of the current shares outstanding. RB Global/IAA remains the major competitor in North America, but given Copart’s scale advantages, deeper yard network, and long record of out-executing rivals, today’s worries about a few soft quarters and a more visible competitor will look small on a 10-year chart.
What would truly concern me is evidence that the business itself was losing ground. A sustained decline in unit economics, signs that Copart’s advantages are eroding, or capital being deployed without care would force a reassessment. Short of that, I’m content to sit through price swings while the company strengthens its position.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Corpay is a global corporate payments platform with recurring revenue, high switching costs, scale and data advantages, and proven M&A execution, offering long-term growth and cash generation that the fund believes is undervalued.
Source: https://drive.google.com/file/d/1E65X0CuV-EJCVALSxGgp7QTdTJ07MflF/view?usp=drivesdk
Analysis:
In the past quarter, Corpay shares were added to Vltava Fund’s portfolio. Corpay is a US based global technology company focused on corporate payments, expense management, and cross-border transactions with the goal of simplifying and automating business payment flows. Its customers – typically medium and large companies – utilize the Corpay platform to centralize payments, control costs, and streamline administration, all of which are time-consuming and capital-intensive tasks in traditional payment processes. The essence of this business is to replace fragmented, manual, and often nontransparent processes with a digital solution that provides companies better visibility into their cash flows and greater operational discipline. An important component of Corpay’s business consists in commercial and fleet payment programs that cover specific expense categories such as those for fuels, travel expenses, tolls, and other operating outlays. These segments are characterized by a high degree of repeatability, long-term customer relationships, and relatively stable margins. Corpay benefits from its scale, data, and ability to offer customers not only payment itself but also analytics, reporting, and control mechanisms that increase their willingness to stay with a single provider. A rapidly growing pillar of the group consists in international payments and currency conversion services, where Corpay helps companies execute cross-border transactions while managing exchange rate risk. This segment benefits from the ongoing globalization of business, the growing complexity of payment flows, and companies’ efforts to reduce costs associated with bank transfers. For Corpay, this is an attractive area with higher added value, where the company combines payment infrastructure with FX margins and specialized services. Overall, Corpay’s business is built on a combination of recurring transactions, its technology platform, and high costs of switching between suppliers. Once a customer is integrated into the system and has its payment processes set up, switching to a competitor is complicated and unappealing. This enables the company to grow over the long term, increase efficiency, and generate strong cash flows that it can reinvest into further product expansion, acquisitions, and technological leadership. Corpay’s management has many years of experience in identifying, integrating, and improving the operations of acquisitions, which, since 2009, have contributed to more than 20% annualized profitability growth. In our view, the present share price does not reflect the company’s current financial metrics, efficient asset allocation, and long-term potential, which combines a structural growth trend with high-quality, recurring business and strong capital discipline.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
D’Ieteren Group trades at a large sum-of-the-parts discount despite high-quality assets and has initiated buybacks after reducing parent debt.
Source: https://drive.google.com/file/d/1MvXaDVUrYT07XBB4tOek8S7XWJV-2hFa/view?usp=drivesdk
Analysis:
D’Ieteren: Gearing, opacity and reported profit decline obscuring value of Belron.
As a reminder, D’Ieteren is a Belgian family controlled auto-related holding company with five businesses as follows:
50.3% of Belron, the world’s largest vehicle glass repair, replacement and recalibration business and the jewel in D’Ieteren’s crown;
100% of D’Ieteren Automotive, the VW distributor for Belgium with an approximate 23% market share in the country, together with servicing and resales;
91% of Parts Holding Europe, a French based vehicle parts distributor in six countries;
40% of TVH, a parts distributor for material handling, construction, industrial and agricultural equipment;
100% of Moleskine, an up-market stationary business.
The company also has a property subsidiary which owns and manages group sites, mainly for the automotive business but has its own third-party developments.
We covered D’Ieteren in QR#5 (March 2024) which details each of the five businesses and QR#7 (September 2024). The latter piece was a preliminary assessment of the change to capital structure brought about by the D’Ieteren branch of the family acquiring most of the stake held by the Perier-D’Ieteren branch. Since that time, the shares have advanced ~28% adjusting for the special dividend of €74/share paid in December 2024, excluding any tax impacts, but have peeled back around 20% from the August 2025 highs of ~€191.
Investors in D’Ieteren have faced a quandary since the group, in total, is now subject to significantly greater leverage with individual units paying hefty dividends and capital returns to the parent to facilitate the ~€4bn special dividend payout at a time when some of them are coming under greater cyclical pressure.
Consequently, reported profit across the group and at individual units is well down on prior periods reflecting this environment and higher financing costs. Our assessment of D’Ieteren is very much based around a sum of the parts analysis and treats the company as an “investment entity” despite the automotive retail/resale/servicing business being fully owned, together with Moleskine and the >90% ownership of Parts Holding Europe (PHE).
In our opinion, these adverse cyclical issues are bringing other negative aspects of D’Ieteren to the fore, such as:
Opacity and complexity – D’Ieteren does a respectable job of segmental reporting but uses numerous alternative metrics, doesn’t give clear pre and post IFRS16 EBITDA measures, attributes significant “abnormal items” (in fairness, mainly non-cash goodwill or contract amortisation) on a divisional basis;
Very opaque “Corporate and Unallocated” which does not properly segment property income or assets or corporate costs or how charge backs (if any) are made to D’Ieteren Automotive;
Investors’ disbelief in the private equity valuation of Belron.
As a guide to the latter point, if our valuations of the non-Belron assets are deemed reasonable, the notional full value of D’Ieteren per share (before tax) assuming the October 2024 equity valuation of Belron (see below) would be ~€273/share comprised of €63 of other businesses, €220 of Belron and (€10) of debt. This suggests the shares trade at a 45% discount to a full valuation.
Clearly management have a more optimistic view than us. Aside from positive comments regarding Belron on a recent conference call (see later), on 22 December 2025, the company announced a €100million stock buyback program which at prevailing prices would retire around 1.2% of equity or 3% of current free float. This reflects the parent company having reduced its debt from €1billion post the special dividend to €500million.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Domino’s Pizza Group is the UK pizza delivery leader with strong cash generation, market share gains, and a record-low valuation offering attractive income and upside despite slower growth.
Source: https://drive.google.com/file/d/1MYzSabl48ZgJgf39101ipU2m-5VeYg2e/view?usp=drivesdk
Analysis:
Domino’s Pizza Group is the undisputed leader for pizza delivery in the United Kingdom, holding an estimated market share of 54%. The company has nearly 1,400 locations. Domino’s earns revenue primarily from its commissary activities (selling dough and cheese to franchisees), which account for approximately two-thirds of sales and a slightly higher portion of EBITDA. Over the last two decades, Domino’s has significantly increased its store footprint, driving earnings higher through supply chain sales and royalties from franchisees. However, a pressured UK consumer, combined with a maturing business, has reduced the company’s growth rate. Same store sales were barely positive in 2025 and were driven entirely by pricing, representing a material slowdown in the top line.
The firm’s CEO recently announced he would step down due to a disagreement with the board over the company’s M&A strategy. He wanted to acquire a second major brand to supercharge growth; they apparently did not. We’re glad their preference prevailed. The cash-generative company recently reiterated its full year EBITDA forecast. Despite ongoing gains in pizza delivery market share while industry sales are down, the heavily shorted stock is trading at a record low valuation below 9x earnings and offers a dividend yield exceeding 6%. In a fitting display of nominative determinism, the U.S. over-the-counter ticker for the stock is DPUKY (we own the local UK shares). Domino’s Pizza Group is priced like it’s dying, when in reality it’s holding its own in a challenged economy for the UK consumer.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Endava is an IT services firm that could return to growth as AI projects ramp, with potential 10% margins and a valuation implying about 3x P/E upon stabilization.
Source: https://drive.google.com/file/d/1bo55Yao1G_cH42ihqpHXPrpamzHjy__H/view?usp=drivesdk
Analysis:
Endava (DAVA) is an IT services provider, which the market perceives as an AI loser. Since this industry bills by the hour, the amount of billable work goes down if programming becomes more efficient. The alternative view is that this lower cost enables different kinds of IT projects for DAVA’s customers and the lower price per project will be compensated for by higher volumes. When AI just came onto the scene, large corporates delayed their IT investment decisions to figure out how to apply AI to their business. Earlier in 2025, we started seeing the first signs of companies beginning to commit to large AI-related IT spending. Unfortunately, the business uncertainty following the Liberation Day tariffs postponed this recovery. We think 2026 will be the year when Endava returns to growth. Unfortunately, DAVA has also underperformed its peers because of less-than-stellar execution. The company now trades at 0.3x sales, versus 1-2x for peers. We think that normalized Net Income margins are around 10%, putting the company around 3x P/E once the business stabilizes and rationalizes its headcount. It’s even cheaper if they manage to return to growth.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Enova International, Inc. is a data-driven fintech lender compounding through automated underwriting, buybacks, and a transformative Grasshopper Bank acquisition that lowers funding costs, expands products, and is expected to be EPS accretive while trading around 9x FY2027 consensus earnings.
Source: https://drive.google.com/file/d/1qyVlFYUeOGvOvTHc5Uh0H6aoIgQD1WT_/view?usp=drivesdk
Analysis:
Enova continued growing organically in 2025. Year-over-year originations grew by 22% in Q3 2025. They have added new retail and business borrowers and their underwriting algorithms are continuously updated. Machine learning models are retrained frequently (in some cases daily), and these models drive their underwriting decisions (85% of which are completely automated). Their models materially improve repayment predictability versus bureau scores alone. And most importantly, the information in their customer databases continues to accumulate, which is the fuel for their data-driven underwriting process. They also continued with their share buybacks, reducing share count more than 5% over 12 months from 26.27M in Q3 2024 to 24.88M shares in Q3 2025. These buybacks have been ongoing for several years. At the beginning of Q3 2021, they were at 36.87M shares. The biggest jump in stock price came in December after Enova announced the acquisition of Grasshopper Bank. This acquisition has the potential to be particularly transformative due to the synergies between the two companies. Enova is paying Grasshopper $369M in cash and stock for the acquisition (Enova ended the year with a market cap of $4.4B). Despite the increased share count, the transaction is expected to be accretive to EPS. The guidance from Enova is that once the synergies are fully realized beyond the first year, they expect EPS increase attributable to this acquisition to be greater than 25%. Founded in 2019, Grasshopper is full-service digital bank with more than $1.4 billion in total assets as of September 30, 2025. Through its direct and Banking-as-a-Service (BaaS) product offerings, Grasshopper holds approximately $3 billion in total deposits as of September 30, 2025. These deposits are low-cost and sticky compared to Enova’s current funding, significantly reducing the financing costs for Enova’s lending and therefore boosting their net interest margin. Enova is acquiring Grasshopper Bank primarily to pair Enova’s online consumer and SMB lending business with a full-service digital bank and national bank charter, creating a diversified and more vertically integrated financial services platform. This merger will open up many new lines of business for Enova and will allow them to offer new banking and lending products in many of the states where they operate. Enova is a rapidly growing fintech that has returned capital through buybacks and has a long runway of future growth ahead of it. It is amazing that even after the recent share price increase, the stock can still be purchased for 9x the consensus estimate of their FY2027 earnings.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
F.I.L.A. SpA is a durable stationery business exploring value-unlocking options around its DOMS stake, executing strategic M&A/JVs, and trading at attractive valuation metrics.
Source: https://drive.google.com/file/d/1draZzctV3g0UY1VjcWrnTQRqj89CMYak/view?usp=drivesdk
Analysis:
F.I.L.A. SpA (FILA.MI) has recently been evaluating various strategic options regarding its stake in DOMS. A Bloomberg article reported in November stated that several potential transactions are being considered, including selling a part or all of DOMS, or having F.I.L.A. reacquire DOMS. During the Q3 conference call, the CEO acknowledged that they are assessing different levers for their DOMS investment while aiming to “increase the strategic participation between F.I.L.A. and DOMS, it doesn’t matter the direction.” Notably, to potentially exempt themselves from U.S. tariffs, F.I.L.A. is exploring options such as having DOMS take a stake in its U.S. subsidiary Dixon or even in F.I.L.A. itself, thereby indirectly impacting Dixon. Following the article, F.I.L.A. bolstered its strategic involvement with DOMS by acquiring Seven SpA, a leading Italian backpack and pencil case company, for €53.7m, and subsequently announcing a JV with DOMS for the Indian market. Seven SpA fits seamlessly into F.I.L.A.’s existing product lineup and provides additional revenue growth channels. They managed to pay off some higher cost debt while financing the acquisition with new lower cost debt at around 2.5%. The core F.I.L.A. business has demonstrated remarkable stability and consistency this year, with only a 7% decline in revenues and a 10% decrease in EBITDA for the first 9 months, despite facing erratic U.S. tariffs impacting their supply chain and a strong dollar devaluation affecting 50% of their U.S. business. In raw figures, revenues are estimated to be around €600m, with EBITDA at €100m and FCF at €40m. all this for a market cap of €497m and an enterprise value of €235m. Given the company’s ongoing strategic assessment of its DOMS stake and a renewed focus on its growth by acquisition mandate, the outlook remains compelling.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Flowers Foods is pivoting toward better-for-you brands while maintaining strong free cash flow and an attractive 10x earnings valuation despite margin pressures.
Source: https://drive.google.com/file/d/1MYzSabl48ZgJgf39101ipU2m-5VeYg2e/view?usp=drivesdk
Analysis:
While Flowers Foods met earnings guidance and reaffirmed its outlook for the year, the operating environment remains challenging. Volume trends have improved but are still negative as consumers continue to trade down to private-label and shift away from traditional loaf bread. Flowers is responding by emphasizing growth in its better-for-you offerings, including Dave’s Killer Bread and Simple Mills snacks. While year-over-year comparisons should become easier in 2026, the company plans to step up innovation and new product launches. These initiatives should support sales growth but will likely pressure margins due to higher operating expenses. As Flowers transitions its business to meet changing consumer tastes, we expect it will continue to generate strong free cash flow. Most of the company’s free cash flow has been used to fund a very generous dividend, currently yielding 9%. While we would support a dividend cut and a greater emphasis on debt reduction, we appreciate the board’s commitment to returning capital to shareholders. Trading at 10x earnings, we continue to view Flowers Foods as attractively valued and increased our position during the quarter.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Georgia Capital PLC is a Georgian conglomerate with strong portfolio earnings growth, deleveraging and improving insurance ROEs, and it still trades at a discount to NAV despite significant NAV per share gains.
Source: https://drive.google.com/file/d/1qyVlFYUeOGvOvTHc5Uh0H6aoIgQD1WT_/view?usp=drivesdk
Analysis:
Georgia Capital, a conglomerate of several high-quality businesses in the Republic of Georgia, had a truly outstanding year. The net asset value (NAV) of their portfolio companies rapidly increased and shares were aggressively repurchased, increasing NAV per share by 41% (in GEL) in just the first 9 months of 2025. Additionally, the Georgian Lari (GEL) gained against the USD by 4.36% in 2025. Overall, the economy of Georgia has been extremely strong this year with rising standards of living and high GDP growth.
A little over half of CGEO’s portfolio is comprised of private businesses that are valued in their NAV calculation based on net income or EBITDA multiples. As their private portfolio companies had rapid earnings growth in 2025, this also increased the NAV. Their only publicly-traded holding is the Lion Finance Group PLC (formerly Bank of Georgia Group PLC), which doubled in share price in 2025 on strong growth and earnings.
The management company pursued aggressive deleveraging and executed early redemption of $100M USD of its $150M USD local bonds.
Their healthcare operations purchased a local firm, Gormed LLC, which had 3 clinics in central Georgia. Their insurance business exited loss-making contracts, improved underwriting, increased premiums, and achieved better combined ratios and returns on equity in the high 30s.
Despite the dramatic share price increase in 2025, Georgia Capital still trades at a discount to its most recent NAV calculation (share price is £31.15 vs £40.93 NAV) and remains cheap relative to the operating cash flow of their underlying businesses.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Hansa Investment Company trades at a deep discount to NAV with substantial pro-forma cash and buybacks offering significant value accretion.
Source: https://drive.google.com/file/d/1MvXaDVUrYT07XBB4tOek8S7XWJV-2hFa/view?usp=drivesdk
Analysis:
In our view, 44% discount to NAV is excessive. Until the merger with Ocean, Hansa’s NAV had returned 38.8% cumulative plus ~1%pa dividends for the period from 31 December 2022 to 9 December 2025 – below global indices – but in the higher reaches of the table on page 4. This was despite the drag of Ocean – making up over 20% of net assets for all the period, and the diversified nature of the portfolio. The merger of the two - given that Ocean itself perennially traded at a large discount to NAV – provides a significant one-off boost of some £0.70 (~17%) per share despite the scrip-based merger. Hansa shares have not priced this uplift at all, nor: The significant flexibility for capital management afforded by taking full control of Ocean’s cash pile; The reduced risk premium from the divestment of Brazilian assets, in favour of a more conventional portfolio; Far greater effective exposure – in time – to listed assets, albeit on a see-through basis. On a pro-forma basis, equity fund or direct equity assets make up ~46% of NAV, cash ~35% and the residue in unidentified other funds with only 3% being private equity investments. We caution that this composition may have changed significantly when the first new investment update is released in January 2026 depending upon the manager’s disposition to put the Ocean Wilson cash to work. Disclosed NAV at 31 December 2025 is £4.89 giving Hansa just on a £1billion portfolio; the shares at ~ £2.73 trade at a 44% discount. However, adjusting for pro-forma cash, equivalent to £1.70/share effectively means on an ex-cash basis, investors are likely accessing £3.19 of investments for £1.03: a near 68% discount. Most encouragingly, Hansa commenced repurchasing shares on-market the day after the Ocean merger was completed; NAV accretion is significant with every 1,000,000 shares (~0.5% of total capital) adding 0.22% in NAV accretion. Hansa had facilitated this level of equity retirement between 10 December 2025 and the year end. So despite this quiet capital management initiative, equity investors appear to regard control within Hansa to be pernicious in the extreme, and that the family control is a negative. We disagree. In common with many of our other holdings (eg E-L Financial) Hansa are extremely parsimonious with new share issuance; other than for the merger with Ocean, we can find no record of Hansa issuing new equity in over 46 years, other than through share splits – a very desirable and unacknowledged attribute.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
HEICO is a PMA parts and specialized electronics leader with strong cash generation, disciplined acquisitions, conservative balance sheet and enduring family-led culture enabling steady compounding.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
HEI is a U.S. aerospace and electronics company that operates in the unglamorous world of replacement parts and mission-critical components. Through its Flight Support Group and Electronic Technologies Group, it supplies FAA-approved Parts Manufacturer Approval (PMA) replacement parts for aircraft components and a range of specialized electronics used in defense, space, medical, telecom, and other demanding applications. In particular, it is the world’s largest independent supplier of these PMA parts, typically offering airlines 20–50% cost savings versus OEM spares while matching certified performance. HEICO gets paid whenever aircraft are maintained, overhauled, or upgraded, and whenever customers need highly reliable electronics in harsh environments. That position was reflected in the stock: shares rose roughly 17% in 2023, 33% in 2024, and were up about 36% in 2025.
Operationally, 2025 was another record year. Net sales, operating income, and earnings all reached new highs, with double-digit growth in both major segments driven by strong organic demand in commercial aviation, defense, and space, augmented by a steady stream of bolt-on acquisitions. Cash generation remains excellent, and even after significant M&A spending, net debt sits at comfortably low levels relative to EBITDA, leaving ample capacity for future deals.
The way this compounding machine was built matters. Over more than three decades, Laurans Mendelson (recently deceased) and his team turned a small aviation-parts business into a global aerospace and defense supplier, growing it steadily and without drama. Over time, that history produced a culture of family ownership, disciplined capital allocation, and conservative balance-sheet management. The leadership transition (to Eric and Victor Mendelson as co-CEOs) in 2025 followed a well-telegraphed plan, with continuity in strategy and culture. That combination is why HEICO remains one of the portfolio’s most reliable compounders, doing its job year after year.
The way this story goes wrong is also simple: acquisition discipline slips, culture gets diluted, or the core organic engines stall. HEICO has earned the benefit of the doubt by avoiding those mistakes for a long time. I watch for them regardless. Long-duration compounders fail when discipline gives way to impatience.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
IMCD is a diversified specialty chemicals distributor with high incremental margins and a steady bolt-on M&A strategy, poised for operational leverage and cash flow growth as volumes recover.
Source: https://drive.google.com/file/d/1aFJagtD7Jh48v34tw5-x_aeYDI41Zfdj/view?usp=drivesdk
Analysis:
IMCD is a global leader in the distribution of specialty chemicals. It has experienced macroeconomic pressure due to tariffs over the last year. The current environment is viewed as fundamentally different from past market cycles, characterized by “shock waves” such as the tariff discussions rather than a normal market cycle. The underlying results have been weaker than usual over the last two years. In the first nine months of 2025, operating EBITA decreased 2% compared to the same period of 2024. Since listing in 2014, EPS is up 28% annually, free cash flow per share is up 21% annually and dividend per share is up 27% annually. IMCD maintains a strategy of growing through small bolt-on acquisitions. The company completed six acquisitions and signed two additional transactions in the first nine months of 2025. IMCD’s diversification across geographies and end-markets offers resilience. IMCD’s business model offers high incremental margins. As volumes return, we expect high operational leverage and strong earnings and cash flow growth.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Ingredion is a mature ingredient producer shifting toward specialty and emerging markets with improved hedging and balance sheet, trading at 10x earnings and a 3% yield.
Source: https://drive.google.com/file/d/1MYzSabl48ZgJgf39101ipU2m-5VeYg2e/view?usp=drivesdk
Analysis:
Ingredion produces food and beverage ingredients, primarily starches and sweeteners, and serves other markets including animal feed, paper, pharmaceutical, beauty, and home. Founded in 1906, a typical American uses products impacted by Ingredion two to three dozen times daily. As a mature company, its core business grows at low single-digit rates, challenged by weak volumes in developed markets, including a downward trend in high fructose corn syrup, contributing to obesity with annual declines of 1% to 2%. Production was also affected by a June fire at its Chicago plant. However, the company drives growth by offering modified ingredients catering to specialty markets and wellness trends. It shows a robust presence in emerging markets, especially Latin America, and has reduced earnings exposure to corn price fluctuations through improved hedging. With a significantly enhanced balance sheet, Ingredion is currently trading at its lowest valuation multiple since the lockdowns, representing a good buy at 10x earnings with a 3% dividend yield.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Kelly Services is a staffing firm whose shares have been hit hard but trade at deep value metrics and below tangible book despite solid recent profitability.
Source: https://drive.google.com/file/d/1MYzSabl48ZgJgf39101ipU2m-5VeYg2e/view?usp=drivesdk
Analysis:
Kelly’s stock was slammed after it failed to achieve its third quarter guidance and provided a weak outlook for the coming quarters. Kelly’s business had significantly outperformed the staffing industry the past two years. Now, its fortunes are reversing right as overall demand for temporary labor may be stabilizing, with the ASA Staffing Index reporting year-over-year gains in hours and the SIA Bullhorn Staffing Indicator’s comparisons shrinking to low single-digit declines versus a year ago. Although some investors believe AI will keep its boot on the neck of staffers in the coming years, we believe AI is being used frequently as a scapegoat when firms reduce headcount for other reasons. Amazon recently announced 30,000 corporate job cuts aimed to reverse pandemic over hiring. Kelly, like many companies, is guilty of removing the red from its results by carving out discrete items, including recent customer impacts from federal government contractors experiencing DOGE-related staffing cuts. However, unlike many other firms, Kelly’s stock was punished swiftly for its guidance miss. The shares are trading for a meaningful discount to our cash flow valuation, 4x trailing operating profit, and at a 30% trailing free cash flow yield. However, even if we’re massively wrong about our normalized margin assumption, Kelly’s shares are also selling for less than half of tangible book value. They’re at their lowest price in 15 years, even though Kelly has produced solid profitability over the last twelve months, posting its highest-ever margins.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Kinsale Capital Group is a tech-enabled E&S insurer with a structurally low expense ratio, consistent underwriting profits, conservative capital and buybacks, prioritizing pricing discipline over volume.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
Kinsale Capital Group operates in a large and steadily expanding corner of the U.S. insurance market. The excess and surplus (E&S) segment has grown steadily for years, and AM Best now estimates that direct premiums written are approaching $130 billion, accounting for more than a quarter of all U.S. commercial-lines premium. Within that market, Kinsale has built a focused underwriting business designed for speed, discipline, and cost efficiency. Founded in 2009, the company built its own integrated technology platform from the ground up, allowing underwriters to respond quickly, capture data cleanly, and operate with a structurally lower expense base. Over the past several years, its expense ratio has consistently been in the low-20s, among the best in specialty property-and-casualty (P&C) insurance. Strong operating performance has not translated into a smooth stock chart. From its early-2024 peak, shares are down roughly 25%, including a decline of about 16% during 2025.
Warren Buffett has written more clearly than anyone about what makes P&C insurance work. He has been just as direct about what makes it fail. I still use his framework as a check on my own thinking when evaluating insurers. In his 2011 letter, Buffett distilled the insurance business into four simple underwriting rules. They read less like finance theory and more like coaching notes: simple, practical rules that tend to matter most when conditions are least forgiving. I think about those rules in reverse, since the hardest ones to follow tend to be tested first when pricing pressure rises.
1. Be willing to walk away if the appropriate premium can’t be obtained.
Kinsale chose selectivity over volume when competition intensified and pricing became less generous. Premium growth slowed by design. The conditions that built the franchise are still present. In insurance, the easiest way to look good for a quarter is to write business you shouldn’t. The bill always arrives later.
2. Set a premium that will deliver a profit, on average, after both prospective loss costs and operating expenses are covered.
Pricing discipline is the one Buffett has returned to most often, because it sits at the center of the insurance equation. Kinsale has reported an underwriting profit every year since its founding, with an average combined ratio in the low-80s and recent results in the mid-70s. Its roughly $3 billion of float today has come not just “free,” but accompanied by substantial underwriting profit.
3. Conservatively evaluate the likelihood of any exposure actually causing a loss and the probable cost if it does.
Kinsale has worked hard to ensure no single event threatens the franchise, using reinsurance, limits, and portfolio construction to bound catastrophe and large-loss exposures. The goal isn’t to avoid losses; it’s to avoid the kind that change the company’s destiny.
4. Understand all exposures that might cause a policy to incur losses.
Kinsale has deliberately confined itself to a focused set of E&S commercial lines, avoiding heavily commoditized personal lines, and keeping underwriting authority in-house. This narrow circle of competence has allowed Kinsale to grow faster than the overall E&S market while maintaining better-than-sector loss ratios.
Underlying all four commandments is a capital position that gives Kinsale room to operate without compromise. As mentioned earlier, net written premiums are running at roughly one times statutory capital and surplus, a conservative level for a fast-growing E&S carrier, so the balance sheet is not being stretched to chase growth. Financial leverage is modest, the investment portfolio is liquid and high quality, and operating cash flow has been ample. On top of that, given what management and the board view as an attractive valuation, they recently authorized a new $250 million share repurchase program. For a long-term owner, that combination of disciplined underwriting, growing (low-cost) float, conservative premium leverage, a durable technology-enabled cost advantage, and rational capital allocation is exactly why Kinsale remains a core, long-duration holding in the portfolio, even if the stock price occasionally tells a more dramatic story than the underlying business.
In that 2011 letter, Buffett observed that many insurers pass the first three tests and fail the fourth (being willing to walk away). Kinsale’s results suggest a company that has, so far, resisted that temptation, and passed all four disciplines.
The risk worth respecting here is the only risk that ever really matters in insurance—behavior. If Kinsale ever starts chasing volume at inadequate prices, relaxing underwriting to keep growth optics intact, or letting catastrophe exposure creep beyond what the balance sheet can comfortably absorb, then the thesis changes. Short-term premium growth will always wobble; underwriting discipline is nonnegotiable.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
KKR & Co. Inc. is a diversified alternatives platform with growing fee and insurance earnings positioned to benefit from the secular shift into private markets and expand recurring operating income.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
Over the prior two years, KKR was one of the Fund’s strongest contributors. From the end of 2022 through the end of 2024, the shares more than tripled, rising roughly 80% in 2023 and another 80% in 2024, as the market began to recognize the earnings power of its asset-management and insurance platforms. KKR is a global alternative investment firm with three reinforcing engines: asset management, insurance, and strategic holdings. Through its funds and capital-markets platform, it invests in private equity, credit, infrastructure, real assets, and growth equity around the world, and it manages a large insurance balance sheet through Global Atlantic which provides a long-duration, recurring stream of investment float. In effect, KKR earns a “royalty” on the continued migration of assets from public markets and banks into private markets. This year, the stock told a different story: in 2025 it was down about 13% and was roughly 23% below its January peak.
Over the last four quarters, the business has materially outperformed the share price. The underlying earnings engine has continued to grow, even as market sentiment has turned more cautious.
Strip away the stock-price swings, and the business itself has continued to grow. Fee-related earnings, insurance earnings, and long-dated capital have all moved higher, even as market sentiment toward rates, credit, and capital flows into alternatives has become more cautious.
The long-term case for KKR rests on the structural forces behind those numbers. The alternative-asset industry is still in the early stages of moving from the margins into the mainstream, both for institutions and particularly for private-wealth clients, and KKR’s three-engine model is designed for that world. At their 2024 investor day, the management summarized their ambition in simple terms: build a business that can “double and then double again,” taking adjusted net income per share from $3.42 in 2023 to more than $15 within roughly 10 years, with the majority of those earnings coming from recurring operating sources. Whether or not that precise figure is reached matters less than the direction of travel—a business increasingly driven by recurring operating earnings. Interim volatility is the price paid for owning what I view as a long-duration royalty on the growth of alternative assets worldwide.
Concerns around private credit are cyclical and familiar. Credit cycles are part of the job; permanent impairment comes from leverage, liquidity mismatches, or incentives that encourage growth at any cost. My focus is simple: keep watching the durability of fee-related earnings, fundraising momentum, realized performance, and balance-sheet conservatism across the platform. As long as those remain intact, market anxiety does little to alter the underlying investment case.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Lululemon is a long-term compounder with international expansion, especially in China, expected to drive growth despite U.S. competition and tariffs.
Source: https://drive.google.com/file/d/1FQJyyO3Xe1B_VrckSPTVTgce5sbOSofB/view?usp=drivesdk
Analysis:
We view Lululemon as a long-term compounder and a relatively recent addition to our portfolio. We established our position during a market pullback stemming from issues with merchandise execution. While the company faces the headwind of tariffs and increased competition in the US from rivals like Vuori and Alo Yoga, our investment thesis is predicated on continued international expansion, particularly in China, which we expect to drive earnings growth. However, we would need to reassess our investment decision if Lululemon fails to achieve positive mid-single-digit comparable sales growth in the US.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Miami International Holdings operates a modern U.S.-licensed exchange with durable industry dynamics, rapid revenue growth, and significant runway versus much larger incumbents.
Source: https://drive.google.com/file/d/1gXWHY-f4VF_0GsyfM7ZYiyNUJ5puRp6T/view?usp=drivesdk
Analysis:
Today, most Horizon Kinetics clients own shares of a development-stage company in which HK did participate as a private-market insider long before its August 2025 IPO. This is Miami International Holdings (MIAX). HK’s involvement grew out of our participation in a much-earlier set of private securities exchange investments, through various LP funds. MIAX, like most IPOs, has yet to achieve normalized scale economies. But unlike most IPOs, it is of a blue-chip character with near-perpetual expected longevity. Securities exchanges—a critical mechanism for capital formation and liquidity—are the very oldest continually operated publicly traded companies in the world; they don’t fail, dwindle away or get displaced. MIAX is, colloquially, the Miami Stock Exchange, which includes the array of domestic equities and international listings, futures, options, and clearing. As the first significant new U.S.-licensed securities exchange in almost two decades, it has the competitive advantage of a latest-technology, built-to-suit trading and information platform, and so is expanding very rapidly. Revenue through September 2025 is well over 20% above last year. The company has a long growth pathway ahead: its $3.5 billion stock market value is a small fraction of the $90 billion-plus market caps of the CME Group Inc. and Intercontinental Exchange, Inc.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
PagSeguro is a Brazilian payments and fintech platform building a digital bank with strong EPS growth targets, a cheap valuation, and an 8–9% upcoming dividend.
Source: https://drive.google.com/file/d/1d0G8DRRmmXO3_AiUwTL55y1EriVdX62S/view?usp=drivesdk
Analysis:
PagSeguro (PAGS), a payment and fintech business based in Brazil, is working on creating a comprehensive digital bank. Brazil, as a large and developing nation, is witnessing an increase in banking participation among its population. The advent of the Pix payment system, a free peer-to-peer money transfer service created by the central bank, presents both challenges and opportunities; it could compress margins for payment companies while simultaneously expanding the total addressable market (TAM) for PagSeguro. Although the stock experienced growth in 2025, it still trades at a low valuation. Analysts often emphasize traditional payment platform metrics like total payment volume (TPV), while PagSeguro prioritizes gross profit, which has seen an uptrend. The company aims for impressive EPS growth of over 16% and plans to distribute an 8-9% dividend next year, which is not fully reflected in most platforms (showing only a 1.4% yield).
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
QXO is consolidating building products distribution under Brad Jacobs with operational improvements and high-ROC targets following the Beacon acquisition.
Source: https://drive.google.com/file/d/1KWi6onABJTSAfeAYpBCD_EHUWmEPOeKO/view?usp=drivesdk
Analysis:
In 2024, we initiated a position in QXO at approximately $11 per share. Under Brad Jacobs’ leadership, the company is in the early stages of executing a bold plan to consolidate and disrupt the $800 billion building products distribution industry. Having previously invested in two of Brad’s highly successful ventures—United Rentals and XPO Logistics—Tsai Capital is excited to back his latest endeavor.
Our strategy focuses on partnering with exceptional capital allocators. Having followed Brad’s remarkable career for nearly three decades and spent countless hours in discussions with him, I rank him among the very best. His personal commitment of $900 million to QXO further aligns his interests with ours.
In August 2025, QXO completed its first acquisition: Beacon Roofing Supply, Inc., purchased in an all-cash deal valued at approximately $11 billion and funded with a mix of equity and debt. With 8,000 employees and 110,000 customers, Beacon is North America’s largest roofing products distributor, also offering complementary building products and waterproofing materials.
Beacon stands to benefit directly from a four-million-unit housing shortage in the U.S. and from the country’s aging housing stock. We view this acquisition as comparable to Brad’s 2015 purchase of Con-way for XPO, which doubled cash flow in just 3.5 years.
Brad and his talented management team have already implemented operational changes at Beacon, including streamlining its nine-level legacy organizational chart. We expect the team to expand Beacon’s EBITDA margins by about 500 basis points and to double cash flow within four years. Ultimately, we envision QXO achieving over $50 billion in revenue with returns on capital of 17-23%.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Röko AB is a disciplined, well-capitalized acquirer with strong management and a long runway, offering attractive valuation and the potential to compound intrinsic value around 15% annually.
Source: https://drive.google.com/file/d/1aFJagtD7Jh48v34tw5-x_aeYDI41Zfdj/view?usp=drivesdk
Analysis:
During March, we made a significant investment as a cornerstone investor in the IPO of Swedish-based acquisition-driven compounder Röko AB. Our three most important considerations when considering new investments are track record, management, and growth prospects. We find Röko delivers strongly across all these aspects. The stock price since the IPO is down 19%, despite delivering a strong EBITA growth of 11% for the first 9 months of 2025. We believe the stock is down due to fewer than expected acquisitions since IPO. Röko is highly disciplined in the prices it pays for acquisitions, and we do not see a lack of deals as a negative in the short run. During the year, Röko announced three acquisitions and since 2019, it has acquired over 30 companies across Europe. Röko’s financial position remains strong with interest-bearing net debt to EBITDA of only 0.3x (2.1x including minority debt), which allows for high capacity to grow the business through acquisitions going forward. Despite a 5% upward revision to 2026 EBITA estimates during the year and underlying EBITA growth of 11%, the company’s share price has declined. As a result, the valuation has fallen to an even more attractive level, now trading at 20x EV/EBITA on 2026 consensus estimates. Market expectations remain modest, assuming EBITA growth of only about 5% in 2026. In our view, this reflects an overly cautious assessment of both the company’s near-term earnings power and the durability of its business model. We believe the business possesses the characteristics required to compound capital at attractive rates, and we see a reasonable likelihood that it can achieve its long-stated ambition of growing intrinsic value by approximately 15% per year over the long run.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Tesla is an AI-driven EV leader leveraging scale and cost advantages to expand share while unlocking high-margin autonomy and robotics revenues.
Source: https://drive.google.com/file/d/1KWi6onABJTSAfeAYpBCD_EHUWmEPOeKO/view?usp=drivesdk
Analysis:
Tesla is a leading artificial intelligence (AI) company that has formidable competitive advantages across various sectors, including electric vehicles, software, and energy storage. Our investment in Tesla traces its origins to February 2020, when we acquired shares at an average initial cost of $41.66 per share. Tesla stands as a profound anomaly in the corporate landscape, charting an utterly unconventional course that frequently engenders bewilderment in the markets and draws sharp rebukes from short sellers and skeptics alike. Guided by Elon Musk, a controversial yet highly skilled capital allocator, Tesla has embraced a scale-economies-shared business model, strategically reducing prices to amplify the allure of its offerings, accelerate widespread adoption, and broaden the horizons of its total addressable market. With its distinctive innovations, vast operational scale, and impressive cost efficiencies, Tesla is steadily eroding the foundations of entrenched legacy automakers, burdened as they are by hundreds of billions of dollars in obsolescent infrastructure amid the inexorable shift toward electric vehicles—and, in due course, fully autonomous mobility. Although competition is destined to escalate, we foresee Tesla significantly increasing its vehicle production and deliveries as the overall market for electric vehicles expands. We also believe Tesla’s AI capabilities remain underestimated—and consequently undervalued. In fact, we think the company is at the beginning of a hypergrowth phase. We anticipate that it will eventually operate millions of autonomous vehicles and will own the majority of the autonomous market; that it will extend licenses for its self-driving software to rivals, generating recurrent revenues with 70-80% margins from those licenses; and that it will scale substantially in robotics.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
TOC Co., Ltd. owns significantly undervalued real estate with improving occupancy and operating leverage, supported by a strong cash/investment position and prior insider interest.
Source: https://drive.google.com/file/d/1draZzctV3g0UY1VjcWrnTQRqj89CMYak/view?usp=drivesdk
Analysis:
One company I’m bullish on that I wrote up in the last letter is TOC Co., Ltd. with their vastly undervalued real estate worth ¥184B against a market cap of ¥75B. Oh ya and throw in a cash and investment portfolio for ¥55B. Earnings have also started to inflect as real estate occupancy has increased to 75% from 68%, taking operating profits up nearly 100%, highlighting the fixed operating leverage inherent in the real estate business. Insiders attempted to take the company private years ago at nearly 2x book value but were ultimately thwarted.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Triveni Turbine is a dominant small industrial turbine maker with a record order book, high returns, and an asset-light model, with 2025 weakness driven by timing not demand.
Source: https://drive.google.com/file/d/1DbgqDJBH0J0hS8D1H90pzACO_Nlbg4hF/view?usp=drivesdk
Analysis:
Triveni Turbine tested my patience this year. It is India’s leading manufacturer of industrial steam turbines for captive power and co-generation across process industries such as sugar, paper, textiles, chemicals, cement, and steel. It dominates the sub-100 MW segment (2nd biggest in the world in this category), with thousands of turbines installed in more than 50 countries and a growing, high-margin aftermarket business in service and spares. The manufacturing base is in Bengaluru, with corporate headquarters near New Delhi. Earlier this year, I visited the headquarters, which confirmed my view of Triveni as a technically deep, execution-focused manufacturer with a long runway. The share price reversed course in 2025. Triveni gave back a meaningful portion of its earlier gains and ended the year lower, caught in a broader de-rating of Indian mid- and small-cap industrials and rising investor caution toward export-oriented engineering businesses. The issue was timing, not demand. Several finished export orders could not be recognized as revenue because customers were unable to travel to India to witness testing and formally accept delivery. Management attributed the delays to regional geopolitical disruptions earlier in the year. The turbines were built, tested, and ready to ship. Those sales moved to later periods; they were not lost. The order book continued to grow. Triveni ends the year with a record order book, very high returns on capital, and a debt-free, cash-rich balance sheet, with exports representing an increasing share of revenue. Tariff noise between the U.S. and India has complicated the near-term outlook for exporters, but the company’s competitive standing remains intact. For an asset-light manufacturer with a defensible position in small and mid-sized turbines, 2025 reads as a pause within a longer arc of compounding value.
Check here for the latest results, quarterly call and analysts’ estimates.
Thesis:
Utz Brands is a leading salty snacks producer with market share gains, improving free cash flow, and deleveraging potential at a reasonable valuation.
Source: https://drive.google.com/file/d/1MYzSabl48ZgJgf39101ipU2m-5VeYg2e/view?usp=drivesdk
Analysis:
Founded in 1921, Utz Brands, Inc. is a leading U.S. manufacturer of salty snacks, including potato chips, tortilla chips, pretzels, cheese snacks, and pork skins. Its portfolio includes brands such as Utz, Zapp’s, On The Border, Golden Flake, and Boulder Canyon. Utz has invested heavily in productivity initiatives and geographic expansion. As a result, capital expenditures have been elevated, averaging $100 million annually over the past two years. High investment spending and growth have contributed to above average financial leverage as well. Looking ahead, management expects capital expenditures to normalize in 2026, declining to $60-$70 million per year. Combined with the proceeds from facility sales, the reduction in spending should allow for debt to decline soon.
As a salty snack business, Utz enjoys attractive margins, consistent demand, and strong free cash flow potential. Utz is well positioned with several brands delivering healthy organic growth that are gaining market share. Boulder Canyon chips, in particular, have performed exceptionally well over the past year, benefiting from consumer demand for “better-for-you” snacks made with non-seed oils. We are attracted to Utz’s steady business, improving free cash flow, and a balance sheet that we believe will improve considerably over the next year. At the time of purchase, the shares traded at approximately 12x our 2026 free cash flow estimate and offered a 2.6% dividend yield.
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Thesis:
WaterBridge Infrastructure LLC is a major Permian landowner positioned to enable and monetize water infrastructure growth via easements and pore space.
Source: https://drive.google.com/file/d/1gXWHY-f4VF_0GsyfM7ZYiyNUJ5puRp6T/view?usp=drivesdk
Analysis:
WaterBridge Infrastructure LLC, via a September 2025 IPO, is a slightly more recent portfolio holding than MIAX. Our ability to participate in the offering was likewise borne of private market relationships and localized expertise. The WaterBridge connection followed from HK’s successful “anchoring” (along with participating HK clients) of the July 2024 IPO of LandBridge Company LLC as an $80 million cornerstone investor. LandBridge, it might be recalled, had recently assembled over 275,000 acres in the western Delaware Basin portion of the Permian Basin, making the firm one of the largest landowners in the region, along with TPL. One of its strategic aims was to support the rapid growth of WaterBridge, which is one of the Delaware’s largest water handling companies, by providing preferential access to critical surface land easements and underground water storage (“pore”) space. It is an absolute necessity for oil producers in the region to be able to dispose of the several barrels of “produced” water that arrive with each barrel of oil; without takeaway capacity, the drilling simply must stop. This limiting-factor element of water and land is a profitable and growing business independent of any data-center campus development that might arrive in the region (and for which water would likely manifest even greater limiting-factor economic value). As part of assembling its land position, LandBridge, along with WaterBridge, entered into agreements with TPL to combine 64,000 semi-contiguous acres that would provide WaterBridge with a “land bank” to develop large-scale water infrastructure. Located amidst some of the densest areas of drilling activity in the region, this joint TPL/LandBridge property would also enhance WaterBridge’s competitive position versus standalone water handling companies lacking similar scale or land assets. Like just about all other activity in the Permian, a water pipeline and management infrastructure can’t exist without being placed upon or crossing land. Unless that land is self-owned, there is some form of rent to be paid. In preparing for the WaterBridge IPO, its owners could appreciate that HK, through its long involvement with TPL and other property transactions in the Permian Basin (more of which below), was one of the very few investment firms that could fully appreciate the value of a strategically placed land perpetuity in west Texas. Land, that is, featuring water supply and disposal resources—and with ready nearby natural gas supply. In this second such instance in our history (the first being LandBridge), HK was again an “on-cover” cornerstone IPO investor. In these cases, HK was included in the so-called founders’ circle—earlier participation in the capital mobilization and value creation chain that should exhibit higher asymmetric optionality than later-stage investments.
Check here for the latest results, quarterly call and analysts' estimates.
Everything you read here is for information purposes only and is not an investment recommendation.
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