Welcome to Broyhill's Equity Highlights, where we share a few quick takes on recent news across the portfolio every month.
We aim to make these highlights easy to read and easy to repeat. Feel free to share our work!
BAT's US writedown puts tobacco transition in spotlight. Shares of former portfolio company British American Tobacco tumbled this month after management announced a $31.5 billion write-down of its US cigarette business. BATS' write-down acknowledges that the cigarette business is a melting ice cube. It also recognizes that the market is quickly transitioning to reduced-risk products. This article highlights the intensely competitive vaping industry and, importantly, Philip Morris’s first-mover advantage in heated tobacco.
EPAM Releases AI-powered DIAL Platform for Open Source. AI Insanity has weighed on the IT Services sector as the market believes AI will eliminate the need for many IT solutions. We think that’s an oversimplification. We believe AI will increase demand for many IT solutions as companies lean on best-of-breed IT providers like EPAM for AI implementation, training, and maintenance.
FIS eyes small acquisitions. In an investor conference held by UBS, FIS's CFO, James Kehoe, mentioned he has an appetite for small acquisitions under $1 billion. Following the spinoff of Worldpay in Q1 2024, FIS will have plenty of cash to pay down debt, buy back stock, and make a few small purchases. We hope they stay focused on items one and two on that list.
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In this episode of Behind the Balance Sheet with Stephen Clapham, BAM President and CIO Chris Pavese talks about how investing straddles left and right brain thinking, about whether the advantage of...Read More
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