Since the mutual fund’s inception on Oct. 29, 2021, it has an annualized total return of 3.56%, considerably higher than -0.04% for the benchmark Russell 2000 Index.I must confess, the 52-week low that SYZ hit yesterday isn’t real at least, not in the truest sense. The ETF was converted from a mutual fund to an ETF on Sept. 12 after the close of trading. It’s had 17 days of trading as an ETF.Not only is SYZ worth considering if you’re interested in owning small-cap stocks, but these three stocks in its top ...

Group 1 - Perimeter has increased approximately 6% since the last recommendation three weeks ago, indicating positive market performance [1] - The quarterly results and management commentary provide further support for the initial investment thesis, highlighting operational leverage in Fire Safety and continued growth in Specialty Products [1] - The focus is on small and midcap companies with asymmetric upsides, suggesting a strategic investment approach in these sectors [1] Group 2 - The analyst has a diverse background, having worked in the Industrials and chemicals sector, as well as in finance and technology at a Canadian charity, which enriches the analysis [1] - The combination of execution experience and analytical skills is emphasized as a key factor in enhancing investment insights [1]

Core Insights - Perimeter Solutions reported a net loss of $32.2 million for the second quarter of 2025, with an adjusted net income of $57.1 million, indicating a significant shift from the previous year's net income of $21.7 million [1][4][27] - The company's adjusted EBITDA for the second quarter increased by 41% to $91.3 million, driven by strong performance in both Fire Safety and Specialty Products segments [1][4][22] Financial Performance - Net sales for the second quarter rose by 28% to $162.6 million compared to $127.3 million in the same quarter last year [4] - Fire Safety net sales increased by 22% to $120.3 million, while Specialty Products net sales surged by 47% to $42.4 million [4] - Year-to-date net sales increased by 26% to $234.7 million, with Fire Safety sales up 27% to $157.4 million and Specialty Products sales up 23% to $77.2 million [4] Earnings Metrics - Loss per diluted share for the second quarter was $0.22, compared to earnings per diluted share of $0.14 in the prior year [4][27] - Non-GAAP adjusted earnings per diluted share increased to $0.39 from $0.25 in the previous year [4][27] - Year-to-date adjusted earnings per share rose to $0.41 from $0.23 in the prior year [28] Segment Performance - Adjusted EBITDA for the Fire Safety segment increased by 40% to $77.7 million, while the Specialty Products segment saw a 48% increase to $13.7 million [4][24] - The Fire Safety segment's strong performance is attributed to its role as a manufacturer of fire management products and services [9] Capital Allocation - The company repurchased 2.9 million shares of common stock at an average price of $11.13 per share during the quarter [12] - In May 2025, the company settled trade secret litigation and acquired related assets for $20 million in cash [12]

Company Announcement - Perimeter Solutions will release its financial results for the second quarter of 2025 on August 7, 2025, before the market opens [1] - A conference call to discuss these results will be held at 8:30 AM ET on the same day, led by CEO Haitham Khouri, CFO Kyle Sable, and Head of Investor Relations Seth Barker [2] Company Overview - Perimeter Solutions is a leading global solutions provider for the Fire Safety and Specialty Products industries, headquartered in St. Louis, Missouri [3] - The company operates in two segments: Fire Safety, which provides fire retardants and firefighting foams, and Specialty Products, which includes non-fire safety products such as phosphorus pentasulfide-based lubricant additives [3] - The Specialty Products segment also encompasses IMS, a manufacturer of electronic or electro-mechanical components for various end markets, focusing on aftermarket repair and replacement [3]

Core Insights - Perimeter Solutions reported a strong financial performance for the first quarter of 2025, with a net income of $56.7 million compared to a net loss of $82.6 million in the same quarter of the previous year [1][5][26] - The company achieved an adjusted EBITDA of $18.1 million, reflecting a 49% increase from $12.1 million in the prior year quarter, driven by strong execution and early season fire activity [1][5][21] - Net sales increased by 22% to $72.0 million, with the Fire Safety segment experiencing a significant 48% growth [5][11] Financial Performance - First quarter net income was $56.7 million, or $0.36 per diluted share, compared to a net loss of $82.6 million, or $0.57 loss per diluted share in the prior year [5][26] - Adjusted earnings per diluted share were $0.03, an improvement from an adjusted loss per share of $0.01 in the previous year [5][27] - The Fire Safety segment's net sales rose to $37.2 million, while Specialty Products net sales increased to $34.9 million [5][11] Capital Allocation - On March 28, 2025, Perimeter acquired certain product lines for $10.0 million, which will be integrated into its IMS business within the Specialty Products segment [3] - The company repurchased 0.9 million shares of common stock at an average price of $9.19 per share during the quarter [6] Segment Performance - Fire Safety adjusted EBITDA increased to $10.1 million, compared to a loss of $0.2 million in the prior year quarter [5][21] - Specialty Products adjusted EBITDA decreased by 35% to $8.0 million from $12.4 million in the previous year [5][21] Cash Flow and Balance Sheet - Cash and cash equivalents at the end of the quarter were $200.1 million, up from $198.5 million at the end of the previous quarter [19][18] - The total assets of the company were reported at $2.4 billion, with total liabilities at $1.2 billion [18][17]

Core Points - Perimeter Solutions will release its financial results for Q1 2025 on May 8, 2025, before market opens [1] - A conference call to discuss these results will be held on the same day at 8:30 AM ET, led by CEO Haitham Khouri, CFO Kyle Sable, and Head of Investor Relations Seth Barker [2] Company Overview - Perimeter Solutions is a leading global provider in the Fire Safety and Specialty Products industries, headquartered in St. Louis, Missouri [3] - The company operates in two segments: Fire Safety, which includes fire retardants and firefighting foams, and Specialty Products, which focuses on non-fire safety markets, including phosphorus pentasulfide-based lubricant additives [3] - The Specialty Products segment also encompasses IMS, a manufacturer of electronic components for various end markets, emphasizing aftermarket repair and replacement [3]

Financial Data and Key Metrics Changes - Fourth quarter orders reached $817 million, an increase of approximately 8% on a reported basis and up 5% organically [21] - Fourth quarter sales were $863 million, up 9% reported and up 3% organically compared to the prior year [23] - Fourth quarter net income was $123 million, resulting in GAAP diluted EPS of $1.62, while adjusted net income was $155 million with an adjusted EPS of $2.04, up $0.21 or 11% [28] - Full year sales totaled $3.3 billion, flat overall and down 2% organically [24] - Full year adjusted net income was $599 million, generating an EPS of $7.89, down $0.33 or 4% from last year [28] Business Line Data and Key Metrics Changes - Health and Science Technology (HST) segment experienced 8% organic growth in Q4, driven by blanket order activity [21] - Fire Safety and Diversified Products (FSDP) had mid-single digit organic growth, while Flow Control (FMT) experienced low single digit growth [21] - For the full year, HST contracted by 7% on an organic basis, driven by life sciences and semiconductor cyclical market headwinds [24] - FSDP drove low single digit growth bolstered by North America Fire OEM and Fire Integrated System Solution demand [24] Market Data and Key Metrics Changes - The U.S. market saw a noticeable uptick in industrial day rates at the beginning of 2024, but this changed with high inflation rates later in the year [10] - The semiconductor capital equipment market is expected to recover in the second half of 2025, following a challenging first half [33] - The Intelligent Water Platform is expected to grow due to continued municipal water market investments and aging infrastructure improvements [35] Company Strategy and Development Direction - The company is focused on integrating Mott and leveraging its filtration technologies into new innovative solutions [19] - IDEXX aims to build scale through thematic integration and has pruned smaller, less growth-advantage businesses [14] - The company is applying an "80-20" strategy at the enterprise level to drive power, scale, and focus through its portfolio of high-quality businesses [12] Management's Comments on Operating Environment and Future Outlook - Management expressed a climate of uncertain optimism as they enter 2025, with stable business bases and recalibrated inventories [11] - The company anticipates organic growth of 1% to 3% for 2025, with HST expected to be the highest growth segment [32] - Management highlighted the importance of pricing power, targeted growth initiatives, and customer intimacy in driving above-market growth [32] Other Important Information - The fourth quarter gross margin declined by 20 basis points to 42.5% on a reported basis, but adjusted gross margin expanded by 40 basis points [25] - Free cash flow for the quarter was $157 million, a decrease of 12%, with a conversion rate of 101% of adjusted net income [29] - The company expects to take $21 million to $25 million in restructuring charges during 2025, primarily related to severance [37] Q&A Session Summary Question: What are the reasons for the soft Q1 guidance? - Management explained that the softness in Q1 is due to the absence of $40 million in project shipments that occurred in Q4 and a $0.22 impact from share-based compensation [53][54] Question: How does the platform optimization impact growth and margins? - Management indicated that platform optimization will lead to improved gross margins and SG&A leverage, contributing positively to EBITDA margins over time [91][92] Question: What assumptions are made regarding potential tariff impacts? - Management stated that there are no material assumptions in the guidance regarding tariffs, emphasizing a localized model for sourcing and production [69][70]