Group 1: Fund Performance - Hotchkis & Wiley Global Value Fund outperformed the MSCI World Value Index in Q4 2025, returning 3.80% compared to 3.34% for the Index [1] - The Fund achieved a year-to-date return of 23.77%, exceeding the Index's 20.79% [1] - Positive stock selection was a key driver of the Fund's performance in both Q4 and the entire calendar year [1] Group 2: Non-US Equities - In 2025, stocks outside the US significantly outperformed those within the US, although the valuation gap remained largely unchanged [1] - The Fund maintained an overweight position in non-US equities [1] Group 3: Key Holdings - Telefonaktiebolaget LM Ericsson (publ) (NASDAQ:ERIC) was highlighted as a leading contributor to the Fund's performance [2] - Ericsson's stock closed at $10.89 per share on January 29, 2026, with a one-month return of 14.63% and a 52-week gain of 45.39% [2] - Ericsson has a market capitalization of $37.097 billion [2] Group 4: Ericsson's Business Outlook - Ericsson is a major vendor of hardware and software for wireless networks outside China, but its earnings are currently below normal due to low demand in Japan and India [3] - The company is working on turning around its Cloud Software and Services business, and its stock has shown improvement as management indicated a shift towards returning more capital to shareholders [3] - Recent results for Q3 2025 were modestly better than expected, with improvements in gross margins and the Cloud Software and Services business [3] Group 5: Market Sentiment and Competition - Ericsson is not among the 30 most popular stocks among hedge funds, with 16 hedge fund portfolios holding its stock at the end of Q3 2025, down from 17 in the previous quarter [4] - While Ericsson shows potential as an investment, certain AI stocks are perceived to offer greater upside potential with less downside risk [4]

Key Takeaways ATRO is benefiting from rising defense spending and airline investments in connectivity and cabin upgrades.ATRO reported preliminary 2025 revenues near $860M, with strong bookings supporting growth into 2026.AAR is benefiting from solid MRO demand, facility expansion and Trax technology upgrades.Rising global aircraft deliveries, expanding airline fleet and growing demand for maintenance, repair and overhaul services are driving growth across the aviation services industry. These trends, suppo ...

Financial Data and Key Metrics Changes - Consolidated net sales for fiscal year 2025 increased by 9.5% to $73 million compared to $66.7 million for fiscal year 2024 [15] - Gross profit grew by 24.1% to $22.6 million in fiscal 2025 compared to $18.2 million for fiscal 2024, with gross profit margin increasing to 30.9% from 27.3% [16][19] - FC&A expenses as a percentage of net sales decreased to 31.4% in fiscal year 2025 from 32.2% in fiscal year 2024 [18] Business Line Data and Key Metrics Changes - Sales increases were noted in both enterprise and specialty markets during fiscal year 2025 [15] - In the fourth quarter of fiscal year 2025, consolidated net sales increased by 1.8% to $19.8 million compared to $19.5 million for the same period in the prior year [16] Market Data and Key Metrics Changes - The sales order backlog and forward load at the end of fiscal year 2025 was $7.3 million compared to $5.7 million as of October 31, 2024 [15] - The company is optimistic about growth opportunities in the data center market, particularly due to the demand for cloud computing and artificial intelligence applications [8][12] Company Strategy and Development Direction - The company entered into a strategic collaboration with Lyttera to expand product offerings and solutions, particularly for the data center and enterprise sectors [9][10] - OCC aims to leverage its core strengths and capabilities to drive long-term value for shareholders, focusing on expanding its presence in targeted market sectors [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for future growth in fiscal year 2026, driven by successful execution of growth strategies [5][13] - The company anticipates that the data center market will provide significant revenue growth opportunities in fiscal year 2026 [21][23] Other Important Information - OCC recorded a net loss of $1.5 million for fiscal year 2025, an improvement from a net loss of $4.2 million in fiscal year 2024 [19] - SG&A expenses increased to $23 million in fiscal year 2025 compared to $21.5 million in fiscal year 2024 [17] Q&A Session Summary Question: Update on the data center opportunity - Management believes the data center markets are strong and will continue to grow, with expectations of revenue growth in fiscal year 2026 [21] Question: Improvements in OCC and markets - OCC continues to see strength in most targeted market sectors, with some project delays but no significant negative impact on growth [22] Question: Potential sales for 2026 and 2027 - Management is optimistic about potential increases in sales based on expected opportunities in fiscal 2026, particularly in the second half [25] Question: Focus on tier two data centers - OCC's products are best suited for tier two or multi-tenant data centers, with significant growth opportunities expected in this segment [29] Question: Capacity constraints - OCC believes it has the capacity to capture expected growth opportunities in fiscal year 2026 [30] Question: Hiring and operational expenses - OCC has open positions primarily in manufacturing, with no significant increase in operating expenses expected [31] Question: Progress of the Lyttera collaboration - The collaboration is going well, with expectations of growing opportunities in fiscal year 2026 [32] Question: Lyttera's investment and demand for OCC - OCC cannot comment on Lyttera's specific business plans or announcements [33]

Core Insights - Credo Technology Group's stock surged over 10% following the announcement of significant growth metrics, driven by high demand for its high-speed connectivity solutions in AI data centers [1][2]. Financial Performance - Credo's revenue increased by 272% year-over-year, reaching $268 million in the second quarter of fiscal 2026, marking the strongest quarterly results in the company's history [2][4]. - The company's adjusted net income soared more than tenfold to $128 million, translating to $0.67 per share, exceeding Wall Street's expectations of $0.50 per share [4]. Future Outlook - Management projects revenue for the fiscal third quarter to be between $335 million and $345 million, indicating a year-over-year growth of 148% to 156% [5]. - The CEO emphasized the critical nature of reliability, power efficiency, signal integrity, latency, reach, and total cost of ownership for customers, positioning Credo to meet these challenges effectively [5].

Core Viewpoint - Astera Labs experienced a significant stock sell-off, with a 19.3% decline, amid broader market valuation concerns despite no specific business news [1][2]. Group 1: Stock Performance - Astera Labs stock fell 19.3% during the week, contrasting with minor declines in the S&P 500 and Nasdaq Composite, which dropped 0.3% and 0.7% respectively [1][2]. - Despite the recent sell-off, Astera Labs' stock is still up 49% in 2025, indicating strong performance over a longer timeframe [6]. Group 2: Valuation Concerns - The decline in Astera Labs' stock price is attributed to general valuation concerns in the market, exacerbated by comments from Federal Reserve Chair Jerome Powell regarding high stock valuations [2][4]. - Powell's remarks about equity valuations being potentially stretched led to widespread selling of growth-dependent stocks, including Astera Labs, resulting in a significant valuation contraction [5]. Group 3: Financial Guidance - Astera Labs provided guidance for Q2 sales to be between $203 million and $210 million, suggesting a year-over-year growth of approximately 83% at the midpoint of the range [7]. - The company is currently valued at about 42 times this year's expected sales, indicating a high degree of risk despite its strong growth momentum [7].

Financial Data and Key Metrics Changes - Net sales increased by 22.8% in Q3 2025 to $19.9 million compared to $16.2 million in Q3 2024, and increased by 12.8% to $53.2 million for the first nine months of fiscal 2025 compared to $47.2 million in the same period last year [6][9] - Gross profit rose by 61.2% to $6.3 million in Q3 2025 from $3.9 million in Q3 2024, with gross profit margin increasing to 31.7% from 24.2% [10][11] - The company recorded net income of $302,000 or $0.04 per share in Q3 2025, compared to a net loss of $1.6 million or $0.20 per share in Q3 2024 [12][13] Business Line Data and Key Metrics Changes - Sales increases were noted in both enterprise and specialty markets, contributing to the overall growth in net sales [9][40] - SG&A expenses increased to $5.7 million in Q3 2025, but as a percentage of net sales, it decreased to 28.8% from 32.3% in the prior year [11][12] Market Data and Key Metrics Changes - The sales order backlog at the end of Q3 2025 was $7.1 million, slightly down from $7.2 million in Q2 2025, but higher than previous quarters [10][21] - The company is experiencing broad growth across both U.S. and international markets [40] Company Strategy and Development Direction - The company entered a strategic collaboration with Laterra to expand product offerings in the enterprise and data center sectors, with Laterra holding a 7.24% stake in OCC [7][28] - The focus remains on disciplined execution and capitalizing on growth opportunities to drive shareholder value [7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in the industry and the strength in targeted markets, despite not being directly involved in hyperscale data centers [42][44] - The company is not currently planning significant investments in additional capacity but is filling open positions to meet anticipated demand [25][56] Other Important Information - The gross profit margin is heavily influenced by product mix and operating leverage, which has improved due to higher sales volumes [11][52] - The company is in the process of improving its website to better showcase its data center products [61] Q&A Session Summary Question: Can you comment on what you're seeing in your traditional markets? - Management noted strength in targeted markets, benefiting from a strong market position reflected in top-line results [15] Question: Can you comment on the impact of AI? - AI is positively impacting the industry, particularly in the growth of hyperscale data centers, although OCC's products are more suited for tier two and tier three data centers [16][18] Question: Does the decline in backlog indicate weaker demand? - Management described the decrease in backlog as minimal and not indicative of weaker demand, attributing it to timing of shipments [20][22] Question: Why was the gross margin lower despite higher sales? - The gross profit margin varies based on product mix, which impacted the comparison between quarters [23] Question: Will you need to increase capacity? - The company believes it has sufficient capacity to meet anticipated demand without significant new investments [25] Question: Is the current OpEx level sustainable? - Management indicated that operating expenses should be sustainable at current and higher sales levels due to operating leverage [26] Question: How will Laterra add value to OCC? - The collaboration is expected to expand product offerings and solutions, benefiting both companies [29] Question: What is the typical ticket size for tier two or tier three data centers? - Management did not provide specific forecasts but noted that opportunities vary widely [33] Question: Will Laterra invest in sales and marketing for the partnership? - Laterra has begun marketing efforts, including participation in trade shows, but specific strategies were not disclosed [30][31] Question: How is the collaboration with Laterra expected to drive production volume? - The collaboration is anticipated to create more production volume, leveraging OCC's existing capacity [55]

Core Insights - The company is focused on providing highly reliable and energy-efficient connectivity solutions to meet the exponential demand for bandwidth driven by data centers, particularly in the AI infrastructure space [1][2] Company Mission and Vision - The mission of the company has been consistent over the years, aiming to break bandwidth barriers and deliver effective connectivity solutions [1] - The vision was established over a decade ago, anticipating the growing need for bandwidth in data centers, which has now accelerated significantly [1] Industry Context - The current market is experiencing a surge in demand for connectivity solutions, especially related to AI technologies, where the focus is not only on GPUs but also on the connectivity between them [2]

Industry Overview - Rising global aircraft deliveries, expanding airline fleet sizes, and increasing demand for maintenance, repair, and overhaul (MRO) services are driving growth in the aviation services industry, supported by the recovery in global air travel and defense modernization programs [1] - Investor interest is growing in aerospace service providers like Astronics Corporation (ATRO) and AAR Corp. (AIR) due to these trends [1] Company Profiles - Astronics focuses on advanced aircraft electrical systems, lighting technologies, and connectivity solutions, which are crucial for enhancing passenger experience and cockpit modernization in both commercial and military aircraft [2] - AAR operates as a diversified aviation services provider, offering aftermarket support, parts supply, and integrated solutions to airlines, governments, and defense contractors globally [2] Financial Performance - Astronics ended March 2025 with cash and cash equivalents of $26 million and long-term debt of $160 million, indicating a solid solvency position [4] - AAR's cash and cash equivalents were $96.5 million as of May 31, 2025, with long-term debt totaling $968 million, also reflecting a strong solvency position [6] - Astronics reported an 11.3% year-over-year sales improvement in Q1 2025, driven by a 13.3% surge in sales to the commercial transport market [7] - AAR experienced a 12% increase in sales to commercial customers during its fiscal fourth quarter, supported by strong demand for new parts distribution [7] Growth Drivers - The recovery in air passenger traffic post-COVID-19 has been a primary growth catalyst for both ATRO and AIR [7] - Sales growth in defense-related aerospace parts has also contributed to the top-line performance of both companies, with ATRO seeing a 94.8% improvement in sales to the military aircraft market [8] - AAR benefits from rising MRO activity due to aging aircraft and increased fleet utilization, while Astronics is driven by demand for advanced avionics and aircraft electrification [9] Stock Performance - Over the past three months, ATRO has outperformed AIR with a stock increase of 50.5% compared to AIR's 38.1% [17] - In the past year, ATRO's shares surged 50.4%, while AIR rose 17.8% [17] Valuation and Debt Analysis - Astronics is trading at a forward price/earnings ratio of 20.49X, which is higher than AAR's 16.83X, indicating that AAR may offer a more attractive valuation [18] - A comparative analysis shows that ATRO has a lower long-term debt-to-capital ratio of 37.51% compared to AAR's 44.41%, suggesting ATRO is less leveraged [22][23] Conclusion - Both companies are positioned to benefit from long-term aerospace trends, but Astronics appears better positioned for near-term outperformance due to stronger stock performance and financial discipline [24][25]

Financial Data and Key Metrics Changes - Sales for Q1 2025 reached $152.2 million, reflecting an 18.9% increase from Q1 2024 [10] - Gross margin improved to 38.6% in Q1 2025, up from 37.5% in Q1 2024, driven by a favorable product mix and cost reduction programs [11][12] - Total backlog of orders reached $395.7 million, an increase of $14.1 million or 4% compared to December 31, 2024 [20] Business Line Data and Key Metrics Changes - Aerospace and defense (A&D) end markets accounted for 38% of global sales, making it the largest segment [7] - Power solutions and protection sales amounted to $83.1 million, a 37.9% increase year-over-year, largely driven by A&D exposure [13] - Connectivity solutions sales for Q1 2025 reached $50.7 million, a decrease of 6.5% compared to Q1 2024, primarily due to a decline in commercial air applications [16] - Magnetic Solutions Group recorded sales of $18.5 million, representing a 36.1% increase compared to Q1 2024 [18] Market Data and Key Metrics Changes - AI contributed $4.6 million in revenue during Q1 2025, with double-digit growth compared to Q1 2024 [8] - Sales into the consumer market decreased by $2.8 million due to trade restrictions on a Chinese supplier [13] - eMobility sales saw a $1.6 million year-over-year decline in Q1 2025 [14] Company Strategy and Development Direction - The recent acquisition of Enercon has diversified the company from an end markets and geographic perspective [7] - The company is focusing on supplier diversification and regional sourcing strategies in response to rising geopolitical tensions and tariff increases [36] - Plans to shift more products from China to India to mitigate tariff impacts and enhance operational flexibility [85] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth in defense, space, and AI markets, while acknowledging challenges in the power segment [25][26] - The company anticipates that Q2 will be impacted by customer push-out requests related to tariffs, but expects to navigate through these challenges [32] - Management emphasized the importance of building a nimble and resilient organization to adapt to changing market conditions [34] Other Important Information - R&D expenses reached $7.2 million in Q1 2025, higher than Q1 2024 due to the acquisition of Enercon [20] - Selling, general, and administrative expenses totaled $29.5 million, representing 19.4% of sales, with increases attributed to Enercon expenses [21] - The company is actively working to amend its credit facility to increase capacity and extend maturity [39] Q&A Session Summary Question: Impact of tariffs by product segment - Connectivity is largely unimpacted by US tariffs as most manufacturing occurs in the US and UK, while approximately 60% of Power and Magnetic segments are also not subject to tariffs [50][52] Question: Decline in Connectivity sales - The decline was primarily driven by reduced commercial air production levels, with some softness in the industrial area [55] Question: AI revenue details - AI revenue is largely from GPU manufacturers, focusing on private next-gen companies rather than large public firms [62] Question: Enterprise business growth - The enterprise business is performing better than expected, with strong growth and alignment with customers [72][76] Question: Facility consolidations and operational changes - The company has fully exited a facility in China and is shifting more production to India to mitigate tariff risks [84][86] Question: Design activity and market dynamics - Design activity is stabilizing, with a focus on second and third-tier customers to drive growth [110][111]

Core Insights - Comcast Business has launched new client services teams in Florida to enhance connectivity solutions for local enterprises [1][2][3] - The expansion targets communities including Clearwater, Lakeland, Kissimmee, Orlando, St. Petersburg, and Tampa [1][2] - The new teams will provide a range of technology solutions such as global secure networking, advanced cybersecurity, and unified communications [1][3] Company Commitment - Comcast Business emphasizes its commitment to empowering businesses of all sizes by providing exceptional connectivity and comprehensive cybersecurity solutions [3][4] - The company aims to build lasting relationships with local businesses and deliver tailored technology solutions to fuel growth and innovation [4] Client Impact - Community Health Centers, a recent client, operates over 16 locations in Central Florida and handles more than 217,000 visits annually [4] - Comcast Business provides robust connectivity services to these facilities, ensuring fast, reliable, and secure internet to support essential operations [4][5] - The tools provided by Comcast Business help clients maintain clear communication and manage records efficiently, enabling comprehensive care for thousands of patients [5] Service Offerings - Comcast Business offers a full suite of solutions including fast, reliable connectivity, secure networking solutions, and advanced cybersecurity [6] - The company has been recognized for its growth, innovation, and leadership in the technology solutions sector [6]