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EPS of 78c topped the 74c estimate, while revenue of $1.91B fell short of the $2.11B forecast. EBITDA of $1.08B missed by 1.4% and declined 14%. Revenue dropped 11% and cash flow decreased 4.5%. Guidance was unchanged. Results were clearly mixed, but investors are forward-looking, and consensus projections call for roughly 10% growth this year. The stock remains appealing, particularly in a declining interest rate environment. Unlock Premium - Try 5i Free

DCI is a solid mid-cap industrial with a strong long-term track record. Filtration isn't glamorous, but the company has performed well, with shares up 34% over the past year. It trades at 22x earnings with a 1.31% yield and maintains a healthy balance sheet. EPS growth is expected in the 10%+ range, though the recent quarter disappointed and weak guidance triggered the stock's largest single-day decline in six years. EPS guidance was lowered to $3.93-$4.01 from $3.95-$4.11. A modest reduction. The stock may drift near-term, but they would view it as a buy for long-term investors. Unlock Premium - Try 5i Free

Revenue jumped 45% year-over-year to $20.3M, driven primarily by the DS Consultants acquisition and increased activity in core markets, particularly mining and military-related WaterTech projects. Gross margins fell to 28% from 33% the prior year due to a revenue mix shift, and the company posted a small quarterly net loss. Shares declined following the release, though broader markets were also weak. With a small $64M market cap, growth has been robust but margin pressure is concerning. They would prefer to see the stock regain positive momentum before considering it. Unlock Premium - Try 5i Free

That's the $64k (or $64T ;) question that investors seem to have been grappling with for much of the past 3 months. 

The answer is that we don't exactly know. We do see markets starting to price some 2-way risk around the AI theme. Previously, between its inception (which you can roughly date from when ChatGPT went live) to November of last year (when Michael Burry sounded the alarm about circular financing and an overbuild), it had been all one way on anything that looked, smelled, or felt like AI.

But now starting to see markets parse winners and losers. Since November, we've seen an acceleration in selling everything that could be disrupted by AI -- notably software stocks, but also white collar in all its forms (certainly engineering, construction, and IT consulting).

His team were never really all-in AI cheerleaders, nor were they skeptics. They feel you need to take a case-by-case, company-by-company approach as you price in AI risks and opportunities. They're starting to sniff out opportunities in the "baby thrown out with the bathwater" category.

At the front end of the trade, it was all about the semiconductor, designer, and foundry sectors and names like AVGO, NVDA, and TSM. He's taken partial profits in a couple of those names. It's now time to turn to the picks and shovels.

An example of the baby and the bathwater is SHOP; owned for years, sold off, picked up more a couple of weeks ago for his firm's momentum mandate. 

Some business models are on shaky ground. Other business models will endure, and they're being unduly sold off. The businesses of those companies may actually be enhanced by AI, rather than disrupted by it.

Digital alternative to payday lenders. Disruptive fintech, AI-enabled to assess credit. In US, UK, and Canada. Discounted valuation of ~6.5x PE, cheap on surface.

Here's the rub:  credit losses are very high (50% of the loan book, compared to banks' average of 0.7-1% or so). Analysts like the name, growing profitably. Very limited institutional participation. Low barriers to AI entry. He's wary, but you can keep it on your radar. Yield is ~4%. 

Oil pipelines. Sold around $38-39, simply because it was in his dividend growers mandate and its prospects on this were meager. Juicy yield, but you need to look at total return.

Received shares as spinoff from TRP, a name he still holds and prefers.

Good total return. Spun off it oil pipelines as SOBO, so now it's a more focused play on clean energy.

Big US electric utility. Thesis:  demand for power in US outstrips supply for all kinds of reasons (especially data centres). Well diversified geographically. Good nuclear fleet. Contracts with hyperscalers.

Results were mixed, but outlook remains pretty good. Pullback is buyable.

Wouldn't be surprised if there were hostilities in the near term. That's already being priced into the commodity with a significant move in bids. Geopolitical tension is what's moved the price of oil about $10 YTD. Absent geopolitical tension, the oil market is pretty well supplied.

Risk (and opportunity) management is about probability and severity. Probability of a strike seems to be increasing, but we don't know the severity. In particular, we don't know if Iran will respond in a scorched-earth way (which it didn't do after last summer's strike on nuclear sites). Attacks on oil production and infrastructure in the region could disrupt the global oil demand balance, which could cause the price to skyrocket.

Geopolitical tension tends to be sharp and fleeting. US action in Iran shouldn't be the reason you put oil in a portfolio. Any company you choose should have more going for it than just the commodity price. For his firm, that's XOM.

Has more going for it than just the price of oil. Lots of internal catalysts. Pretty compelling organic growth prospects, especially Guyana production.

Q4 results last week were very good -- earnings stronger than expected, underwriting was fantastic, combined ratio was very strong. Big hit of catastrophe losses. You need to look at the long-term improvements the company's made, which he expects to continue.

Unlike most P&C companies, makes acquisitions the way BRK does. Big footprint in India, and looking to make a banking acquisition there (good chance of success, and this would add another trophy asset).

A few weak quarters in a row after Covid. Not a homerun-type stock, but a way to add ballast to your portfolio. Dominant operator in fragmented industry, serial acquirer. Financially strong. Growing dividend.

Still off all-time highs, but recovering nicely. Added more in the past year. US manufacturing finally turned the corner last month. Dynamic earnings for next 2-3 years. Shares not fully valued, and buybacks are ongoing instead of M&A.

In both his momentum and dividend growers mandates. Gold price was rocket fuel to earnings and cashflows. Still a fairly undemanding valuation based on prolific FCF.