Core Insights - Coliseum Capital Management increased its stake in NCR Atleos by nearly 1.1 million shares in Q3, raising its investment by approximately $60 million, bringing the total position to 2.7 million shares valued at $106.3 million as of September 30 [2][3][7] Company Overview - NCR Atleos operates in the financial technology sector, focusing on self-service banking solutions, including ATMs and payment network services, with a global presence [6][9] - As of the latest market close, NCR Atleos shares were priced at $37.07, with a market capitalization of $2.7 billion and a revenue of $4.3 billion for the trailing twelve months (TTM) [5] Financial Performance - NCR Atleos reported $1.1 billion in revenue for Q3, reflecting a 4% year-over-year increase, while net income rose by 24% to $26 million [12] - The company's ATM-as-a-service business saw a nearly 40% growth, indicating rising demand and the addition of new customers in the Middle East and Latin America [12] Investment Implications - Coliseum's increased stake represents 10.4% of its reported equity assets, making NCR Atleos the fund's third-largest holding, which reflects a significant allocation in a high-conviction portfolio [4][11] - The timing of the investment is notable as NCR Atleos stabilizes post its 2023 spin-off from its digital commerce business, with recent growth and service momentum providing a clearer outlook for the standalone company [10]

Core Viewpoint - Visa is positioned as a strong investment opportunity due to its inflation resilience, high margins, lack of credit risk, and significant growth potential in digital payments [2][3][9][10]. Group 1: Inflation Resilience - Visa operates in a manner that allows it to benefit from inflation, as its transaction fees are a percentage of the transaction amount, leading to increased revenue during price rises [4]. - The company has a history of growing its dividend by 379% over the past decade, with a conservative cash payout ratio of 21.5%, indicating room for further increases [4]. Group 2: High Margins - Visa maintains a gross margin exceeding 70%, with net earnings of approximately $0.50 for every dollar earned, showcasing its high-margin business model [5][7]. - The company's payment network, which required significant upfront investment, allows it to handle vast transaction volumes with minimal marginal cost increases [7]. Group 3: Lack of Credit Risk - Visa does not issue credit or debit cards, thus avoiding credit risk associated with lending, which is a common issue for banks, especially during economic downturns [9]. Group 4: Growth Opportunities - There remains a substantial opportunity for Visa to convert trillions of dollars in cash and check transactions to digital formats, expanding its ecosystem [10]. - The growth of the e-commerce sector presents another long-term growth avenue, as online transactions typically do not utilize cash [11].

Core Viewpoint - Visa's Q2 performance exceeded analyst expectations despite macroeconomic uncertainties, showcasing strong resilience in payment network transaction volumes [1] Financial Performance - Net profit increased by 6% year-over-year to $5.44 billion, with adjusted earnings per share reaching $2.76, surpassing market expectations of $2.68 [1] - Revenue grew by 9% to $9.6 billion, with payment volume increasing by 8% year-over-year in fixed dollars [1] - Cross-border transaction volume rose by 13%, and total processed transaction volume grew by 9% [1] Management Commentary - CEO Ryan McInerney emphasized the company's diverse business model's ability to maintain resilience across various environments, as evidenced by the latest quarterly performance [1] Market Context - Visa's performance aligns with assessments from multiple financial institutions regarding the current strength of U.S. consumer demand, although challenges from tariff wars initiated by Trump are beginning to surface [1] - American Express also reported better-than-expected results earlier this month, while Mastercard is set to release its quarterly earnings soon [1] Stock Buyback and Market Performance - Visa's board approved a new $30 billion multi-year stock repurchase plan, leading to a more than 2% increase in stock price after earnings release [2] - Year-to-date, Visa's stock has risen over 8%, outperforming Mastercard's 2.5% increase and American Express's 10% decline [2] Strategic Initiatives - Visa is actively expanding its share of overall transaction volume as payment methods evolve, with stablecoin transaction volume growing by 40% over the past two years [2] - The company anticipates that value-added services, including anti-fraud technologies, will contribute over half of total revenue in the coming years [2] Guidance - Visa maintained its fiscal year performance guidance, expecting low double-digit percentage growth in earnings per share and net revenue growth to remain in the low double-digit range [2]