Core Insights - Optimist Fund reported a return of +9.1% in Q3 2025, outperforming the benchmark return of 7.9% [1] - The fund is focusing on cyclical holdings that have been in multi-year downswings while also paying attention to developments in AI [1] Company Summary: Medpace Holdings, Inc. (NASDAQ:MEDP) - Medpace Holdings, Inc. is a clinical research-based drug and medical device development services provider [2] - The stock of Medpace Holdings, Inc. had a one-month return of 8.99% and gained 81.62% over the last 52 weeks, closing at $580.37 per share with a market capitalization of $16.348 billion on October 30, 2025 [2] - Optimist Fund initiated a position in Medpace in April, viewing it as a market leader with significant long-term growth potential that is currently underappreciated [3] - Medpace reported revenue of $659.9 million in Q3 2025, reflecting a year-over-year increase of 23.7% [4] Investment Perspective - While Medpace is recognized for its potential, the fund suggests that certain AI stocks may offer greater upside potential and less downside risk [4]

Core Viewpoint - Thermo Fisher is acquiring Clario, a privately held data management company, for up to $9.4 billion, which will enhance its clinical trial research business amid a strong rebound in demand [1] Company Summary - The acquisition of Clario is aimed at strengthening Thermo Fisher's position in the clinical trial research sector [1] - The deal reflects a strategic move to capitalize on the increasing demand for clinical trial services [1] Industry Summary - The clinical trial research industry is experiencing a significant rebound in demand, which is driving companies like Thermo Fisher to pursue acquisitions to enhance their service offerings [1]

Core Insights - Medpace reported another strong quarter with significant sales and profit growth, leading to a guidance hike for the full year [2][7][9] Financial Performance - Medpace achieved adjusted earnings of $3.86 per share, exceeding expectations of $3.37, marking a growth of over 28% [7] - Revenue increased nearly 24% to $659.9 million, surpassing forecasts of $641 million, representing the third consecutive quarter of accelerating sales growth [7] - The company secured $789.6 million in new business awards, a 48% increase, resulting in a book-to-bill ratio of 1.2x, outperforming analyst expectations of 1.1x to 1.13x [3][4] Guidance and Outlook - Medpace raised its full-year earnings guidance to a range of $14.60 to $14.86 per share, an increase of approximately 59 cents at the midpoint from previous guidance [9] - The sales forecast was also adjusted to $2.48 billion to $2.53 billion, up from the previous range of $2.42 billion to $2.52 billion [9] Analyst Commentary - Analysts described the quarter as "flawless," with strong pull-through on revenue and new bookings exceeding expectations [2][3] - The significant increase in bookings over the last couple of quarters surprised analysts, indicating a positive trend in the biotech funding environment [5][6]

Core Insights - Headwaters Capital Management's third-quarter 2025 investor letter focused on AI and reported a portfolio return of -2.7% compared to a +5.3% gain for the Russell Mid Cap Index [1] Company Performance - Medpace Holdings, Inc. (NASDAQ:MEDP) was highlighted as a top contributor with a return of +64% in the quarter, driven by strong bookings despite a challenging biotech funding environment [3] - Medpace's stock closed at $527.40 on October 13, 2025, with a market capitalization of $14.816 billion, and it experienced a one-month return of 7.46% and a 49.28% increase over the last 52 weeks [2] - The company reported revenue of $603.3 million in the second quarter of 2025, marking a 14.2% year-over-year increase [4] Investment Strategy - Headwaters Capital Management noted that Medpace's disciplined capital allocation and market share gains make it a core long-term holding, despite the cyclical nature of its end markets [3] - The firm indicated that while Medpace has potential, certain AI stocks may offer greater upside potential with less downside risk [4]

Group 1 - Illumina's stock has dropped by 11% in a week due to increased competition from China's MGI Tech, which is gaining market share in DNA sequencing [2] - MGI Tech's global market presence remains strong despite a recent decline in international sales due to U.S. sanctions [2] - IQVIA presents stronger revenue growth at 5.3% compared to Illumina's decline of 4.8%, indicating a potentially better investment opportunity [3][6] Group 2 - Illumina offers solutions for genomic analysis and sequencing, serving research and clinical markets globally [4] - IQVIA provides advanced analytics and clinical research services, including cloud applications and project management for the life sciences sector [4] - IQVIA's revenue growth for the last 12 months is 3.6%, surpassing Illumina's -3.3%, and IQVIA's average margin is 13.7% compared to Illumina's 6.7% [6]