DIVYS Q2 24 Recap: Navigating Megatrend Titans

The firm completely sold its holdings in APD due to concerns undermining sustained growth and profitability versus peers like Linde, project delays, and escalating capital expenditures creating uncertainty around future free cash flow.

“We made the decision to completely sell our holdings in Air Products & Chemicals (APD) due to several concerns that undermine the company’s potential for sustained growth and profitability in comparison to its peers, notably Linde (LIN). Moreover, continued delays in projects coupled with escalating capital expenditures introduced significant uncertainty regarding future free cash flow generation.”

The portfolio sees material gains in its semiconductor holdings due to AI tailwinds; AMAT was trimmed to limit concentration risk, maintaining a 2% position.

“On the Technology front, we continue to see material gains in our semiconductor holdings due to AI tailwinds, however, to limit concentration risk, we trimmed Taiwan Semi (TSM) and Applied Materials (AMAT) to maintain a 2% position for each respective holding.”

The firm initiated on BWXT, citing its leadership in nuclear components/fuel, strong position in naval nuclear propulsion, and consistent financial execution via solid revenue growth and margin expansion.

“Within Industrials, we initiated on BWX Technologies (BWXT), a leading supplier of nuclear components and fuel to the US government and commercial customers. We are compelled by the firm’s strong position in naval nuclear propulsion systems and consistent financial execution through solid revenue growth and margin expansion.”

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