2025 September Idea: A Premier Compounder on a Cyclical Pullback
One great idea each month
This month’s idea features a world-class, blue-chip leader that has been a model of consistent growth and profitability, delivering a revenue and EPS Compound Annual Growth Rate (CAGR) of 8.5% and 10.5%, respectively, over the last decade. However, recent macroeconomic uncertainty has slowed enterprise spending, fueling investor concerns about future growth and causing its stock to trade at a forward EV/EBITDA of just 10.7x, a significant discount to its 10-year average of 14.8x. We believe this has created a compelling opportunity to invest in a high-quality business at a price that fails to reflect its long-term potential.