Core Viewpoint - Pool Corp. is showing signs of a potential turnaround in revenue growth after a challenging period, influenced by favorable market conditions such as decreasing interest rates and high retirement account values [2][4][6]. Company Overview - Pool Corp., established in 1980, has grown to be the largest distributor of pool products in the U.S., generating $5.3 billion in annual revenues [2]. - Historically, about 15% of its revenues come from new pool construction, which has faced challenges recently [2]. Recent Performance - After nine consecutive quarters of negative revenue growth, Pool Corp. reported a 0.8% growth in quarterly revenues in Q2 2025, indicating a possible recovery [2][4]. Influencing Factors - The growth of Pool Corp. is affected by new home construction, interest rates, and retirement account values [3]. - New pool construction typically lags behind new home construction by 2 to 3 years, suggesting a delayed impact on Pool Corp.'s revenues [3]. Market Conditions - With interest rates decreasing and the market reaching all-time highs, there is optimism for a new growth phase for Pool Corp. if these conditions lead to increased new pool construction [4][6]. - The recent positive revenue growth, although modest, suggests that the company may be emerging from a difficult period [4]. Investment Sentiment - The stock has appreciated by 7.0% since previous bullish coverage, reflecting confidence in the company's consistency and financial rigor [5]. - Pool Corp. is not among the 30 most popular stocks among hedge funds, with 44 hedge fund portfolios holding POOL at the end of Q2, up from 39 in the previous quarter [7].

Core Thesis - Grocery Outlet Holding Corp. (GO) is viewed positively due to its unique business model and growth potential, with shares trading at $16.71 as of September 17th, and a trailing P/E of 222.12 and forward P/E of 18.15 [1][2] Business Model - GO operates as an extreme-value grocery retailer with 533 stores across 17 states, primarily on the West Coast, utilizing a "treasure hunt" model similar to TJ Maxx, offering branded consumables and fresh items at significant discounts [2] - The inventory is sourced from manufacturer overruns and closeouts, creating a sense of urgency for customers and encouraging repeat visits [2] - Stores are managed by independent operators (IOs), which aligns incentives, reduces corporate overhead, and ensures strong unit economics [2] Operational Challenges and Leadership Changes - Despite having a competitive advantage in supplier relationships and logistics, GO has encountered operational issues, including a failed ERP rollout, high shrinkage rates, and underperformance in new markets [3] - These challenges have led to leadership changes and a strategic shift towards disciplined expansion and system stabilization [3] - Early indicators under new CEO Jason Potter show positive progress, with raised guidance and reduced restructuring costs [3] Growth and Financial Outlook - The company aims to open 30–35 net new stores annually, with expected store-level returns exceeding 20% by year four, potentially reaching 30% as execution improves [4] - GO's normalized free cash flow is projected to be between $140 million and $170 million, with an additional potential of $100 million FCF from 150 new stores, indicating attractive long-term returns [4] - Valuation appears reasonable at a 20x forward P/E and 12–13x FY25 adjusted EBITDA, considering growth opportunities and margin recovery potential [4] Risks and Resilience - Risks include execution challenges, competition from Aldi and Lidl, and difficulties in recruiting independent operators, but improved systems and inventory visibility could lead to significant upside [5] - GO has a history of resilience during economic downturns and potential for capital allocation through buybacks and M&A, presenting a favorable risk/reward scenario [5] - The bullish thesis remains intact, emphasizing leadership changes and ERP stabilization as key factors for future growth [6]

Group 1: L3Harris Technologies, Inc. Overview - L3Harris Technologies, Inc. shares were trading at $281.86 as of September 17th, with trailing and forward P/E ratios of 31.49 and 22.83 respectively [1] - The company is highlighted for its diversified segments, strong free cash flow, and visible backlog, making it an attractive investment opportunity [5] Group 2: Leidos (LDOS) Financial Performance - Leidos has a market capitalization of approximately $52–53 billion and a backlog of $35.4 billion, indicating a strong investment profile supported by scale and cash flow generation [2] - In Q2 2025, Leidos reported revenue of around $5.4 billion, reflecting 6% organic growth, with operating margins of 10–12% and net margins near 8% [2] - Free cash flow is expected to reach $3 billion in FY26, showcasing the company's robust internal capital generation [2] Group 3: Valuation Metrics and Market Position - Leidos' valuation metrics include an EV/Sales of 2.5–2.7×, EV/EBITDA of 15–16×, and a forward P/E of approximately 25×, suggesting balanced pricing relative to growth and profitability [3] - The company's portfolio combines scale with a highly visible backlog, providing reliable revenue streams and making it a stable core holding within the aerospace and defense sector [3] - While 76% of sales are U.S.-dependent, this exposure is mitigated by long-term government and defense programs, creating durable relationships and recurring contracts [3] Group 4: Investment Appeal - Leidos' combination of diversified high-tech segments, predictable cash flow, and strong backlog positions it as a central anchor for investors seeking stable, mid-to-long-term exposure to aerospace and defense [4] - The company's financial strength and operational scale provide resilience against market volatility, while forward-looking cash flow generation offers flexibility for strategic initiatives or shareholder returns [4]

Core Thesis - Fiserv, Inc. is positioned for growth with a focus on its Clover platform, which integrates payments, software, and cash management for small businesses, despite recent stock price declines due to slower GPV growth [2][3][4] Company Overview - Fiserv serves 10,000 financial institutions across over 100 countries, including 3,000 U.S. banks, and is a leader in financial technology [2] - The company has achieved 40 consecutive years of double-digit EPS growth, indicating strong financial performance [2] Clover Platform - Clover's long-term value is driven by revenue growth from merchant signups, hardware sales, and higher-margin value-added services (VAS), rather than just gross payment volume (GPV) [3] - Clover remains underpenetrated in the U.S. market with less than 3% market share and under 10% VAS penetration domestically [3] Growth Strategy - Fiserv aims to expand into new verticals such as hospitality and healthcare, as well as international markets like Brazil, Mexico, and Europe, supporting a revenue target of $3.5 billion for 2025 and $4.5 billion for 2026 [4] - Management has accelerated buybacks to 130% of free cash flow at historically low valuations, suggesting potential for significant returns if free cash flow growth continues [4] Market Performance - Despite beating Q1 and Q2 earnings estimates, Fiserv's stock experienced a sharp decline of up to 23% due to investor concerns over slower Clover GPV growth [4] - The stock price was trading at $132.75 as of September 16th, with trailing and forward P/E ratios of 22.20 and 11.20 respectively [1][2] Historical Context - Previous bullish theses on Fiserv highlighted its strong fundamentals and the value-enhancing First Data acquisition, although the stock has depreciated approximately 34.39% since then [5]

Core Thesis - International General Insurance Holdings Ltd. (IGIC) is viewed positively by investors, with a current share price of $24.15 and trailing and forward P/E ratios of 8.66 and 7.74 respectively, indicating potential undervaluation [1] Financial Performance - IGIC experienced a miss in Q1 with declines in Return on Equity (ROE) and combined ratio, but management anticipates normalization by year-end, suggesting that current issues are largely one-off [2] - The company has historically delivered a tangible book value (TBV) CAGR in the high teens over the past decade, reflecting consistent performance and disciplined capital management [2] Capital Management - Recent share repurchases and special dividend payouts demonstrate management's commitment to returning capital to shareholders, with potential for further distributions in the future [3] - IGIC's current price-to-book ratio of 1.6x indicates it is undervalued compared to peers with similar ROE and growth profiles [4] Market Position - IGIC specializes in the Middle East market, which provides a unique niche and enhances its appeal for private investors despite a low-float, small-cap structure that limits institutional participation [3] - The company's focus on specialty insurance, which constitutes approximately 80-85% of its portfolio, supports higher valuation potential compared to traditional reinsurers [3] Valuation Outlook - A fair value target of around $34 per share by year-end is considered reasonable, with upside potential as the market recognizes the company's operational resilience and niche specialization [4] - The stock has appreciated approximately 32% since previous coverage, maintaining robust free cash flow and capital discipline, reinforcing the bullish thesis [5]

Core Thesis - Enterprise Products Partners L.P. (EPD) is viewed positively due to its strong market position, governance, and financial metrics, with a current share price of $31.65 and P/E ratios of 11.85 trailing and 10.68 forward [1][4] Company Overview - EPD operates a comprehensive, vertically integrated system of pipelines, processing plants, storage, and export terminals across various energy sectors, providing significant market access and reliability to major oil companies [2] - The company has a strong presence in the U.S. petrochemical industry, serving all domestic ethylene crackers and 90% of refining capacity east of the Rockies, with a focus on the low-cost Permian Basin [3] Financial Performance - EPD offers a 7% yield, supported by a distributable cash flow (DCF) coverage of 1.7x, allowing for reinvestment at attractive returns [4] - The company has achieved a 12% pre-tax return on invested capital (ROIC) since 2005, with 26 consecutive years of distribution growth [4] - EPD's balance sheet is conservative, with a leverage ratio of 3.1x and long-term fixed debt averaging 17.7 years at a 4.7% coupon [4] Future Prospects - Upcoming projects worth $6 billion are expected to come online in 2025, potentially adding $700 million in EBITDA [4] - EPD is projected to deliver annual returns exceeding 10.5%, driven by its durable assets, disciplined capital allocation, and strong governance [4][5]

Group 1 - XPEL, Inc. is a global leader in protective automotive films and coatings, generating revenue primarily through paint protection films (PPF), window tint, ceramic coatings, and supporting software and tools for installers [2][3] - The company benefits from recurring revenue driven by ongoing demand for PPF on new vehicles, repeat business from dealerships and installers, and an expanding global distribution network [2][3] - XPEL's strong brand reputation in premium PPF and tint solutions, along with high-margin products, positions it favorably in the automotive aftermarket sector [2][4] Group 2 - The growth potential of XPEL is enhanced by its ability to expand into new regions and verticals, leveraging trusted brand and established dealer relationships [3][4] - The company's products not only protect vehicles but also enhance resale value, improve aesthetics and durability, and provide comfort and energy efficiency [3] - XPEL's integrated approach, balancing high-quality products, strong customer relationships, and strategic expansion, creates a compelling investment case with predictable revenue growth [4][6] Group 3 - The company's stock price was trading at $38.48 as of September 8th, with a forward P/E of 21.87 [1] - Previous analyses indicated that the company's stock price had depreciated approximately by 11.25% as of January 2025, amid macro and regional challenges [5] - The current bullish thesis emphasizes recurring revenue, scalable distribution, and the integrated approach to dealer and customer relationships [6]

Core Thesis - The bullish thesis on Topgolf Callaway Brands Corp. (MODG) highlights the investment opportunity created by the upcoming spin-off of its TopGolf Entertainment business, which is expected to enhance the valuation of the remaining company focused on premium golf clubs, active-lifestyle apparel, and the TopTracer platform [2][5]. Financial Metrics - As of September 4th, MODG's share price was $9.12, with trailing and forward P/E ratios of 98.91 and 156.25 respectively [1]. - The remaining company trades at approximately 5× the projected 2027 EPS of $1.57 and 1.2× EV/Sales, indicating a valuation significantly below peers like TaylorMade and Titleist, suggesting substantial upside potential [2]. Market Dynamics - The core golf business is benefiting from COVID-era demand tailwinds, an impending club replacement cycle, and increased golf participation, particularly among women and juniors, which expands the addressable market [2]. - TopTracer, a gamified ball-tracking technology, is installed in over 24,000 bays and represents a high-margin recurring revenue stream, with potential for a 15% EBIT uplift through incremental sign-ups and pricing power [3]. Operational Strengths - Callaway's core brands, including TravisMathew, Ogio, and Callaway apparel, maintain strong market positioning and premium perception, supported by solid consumer demand despite temporary inventory challenges [3]. - The recent sale of Jack Wolfskin for $290 million has improved the company's balance sheet, enhancing financial flexibility for debt reduction or reinvestment [3]. Growth Catalysts - Multiple catalysts for growth include the impending TopGolf separation, macro golf tailwinds, and under-monetized TopTracer revenue, which could offer potential upside of 70%–125% over the next two to three years [4]. - Even without the spin-off, Callaway's core business presents attractive value and a clear deleveraging path, positioning it as an underrecognized opportunity in the golf and active-lifestyle sectors [4].