Portfolio Holdings

What does it do?

Alphabet is the holding company which owns the world's leading internet search provider, Google. Google is the world's most visited website and the largest global advertising platform by advertising revenue.

Why do we own it?

Alphabet has wide moats arising from its dominant position in online search, significant intellectual property and a strong brand. We believe Alphabet is well-positioned to grow strongly as global advertising budgets gradually shift away from television to digital formats.

What does it do?

Amazon is the dominant e-commerce platform in the Western Hemisphere. Alongside the e-commerce platform, the company offers marketing services to vendors and subscriptions to customers, which includes everything from free shipping to music and video. Amazon’s AWS (Amazon Web Services) business is the largest global cloud computing platform, helping clients with data storage and computing power.

Why do we own it?

Amazon.com sits at the crossroads of powerful megatrends. These include growth in e-commerce, migration of advertising spend online and the increasing adoption of public cloud. The company has significant scale and network advantages. With a long growth runway, Amazon is in a prime position to monetise these opportunities.

What does it do?

ASML is the leading manufacturer of lithography machines used to produce semiconductor chips. Described by some as the most complex machines ever built, these lithography machines can be as large as a bus, contain over 100,000 parts and cost hundreds of millions of dollars.

Why do we own it?

ASML has 100% market share in the cutting-edge lithography machines that are used to manufacture the most advanced semiconductor chips such as those used in smartphones and laptops. Advances in areas such as AI and autonomous driving will require increasing amounts of these advanced semiconductor chips, which will drive ongoing demand for ASML’s lithography machines.

What does it do?

Boston Scientific is a leading manufacturer of innovative medical devices used to treat a range of medical conditions to over 30 million patients each year. Boston Scientific focuses on minimally invasive therapies, which generally improve patient outcomes versus traditional surgery and reduce the overall cost of treatment for health systems.

Why do we own it?

Boston Scientific is well positioned with market-leading positions in a number of fast-growing medical device markets. With a strong pipeline of new product launches and a track-record of investment in innovation, we expect Boston Scientific to sustain its above-market growth and increase its market share.

What does it do?

Capital One is a leading US credit card issuer. Capital One has grown market share from 4% in 2010 to 14% today, and following the recent merger with Discover, Capital One is the third largest credit card issuer in the US. Since day one, Capital One has been an information and data focussed company. It operates almost entirely as a digital bank with limited branches; and is the only bank fully operating in the cloud.

Why do we own it?

US credit cards are an attractive segment within banking, with high barriers to entry and strong returns. Capital One’s digital technology advantage drives strong credit card underwriting and cost advantages versus traditional banks. The merger with Discover will strengthen its moat, deliver meaningful earnings growth, and support higher capital returns to shareholders.

What does it do?

Danaher is a leading player in the Lifesciences and Diagnostics industries where it provides its customers with the cutting-edge tools to help them to diagnose disease; and discover and manufacture new drug therapies to treat those diseases.

Why do we own it?

An aging population and growing healthcare spend are driving the need for increased innovation in the diagnosis and treatment of chronic disease. With a leading portfolio of tools and services in these end markets, Danaher is well-positioned to benefit from this investment in healthcare innovation. Driven by a well-renowned culture of continuous improvement and investment, we expect Danaher to grow its market share as it becomes an increasingly essential partner to its customers.

What does it do?

Dexcom is a leading player in continuous glucose monitoring (CGM) devices for people with diabetes, which impacts hundreds of millions of people globally.

Why do we own it?

Dexcom benefits from high barriers to entry in CGM devices due to high upfront investment and specialist know-how. It takes years to innovate and develop a new sensor before receiving regulatory clearance. Compared to finger pricking, CGM devices achieve better health outcomes from continuous glucose readings vs. a static one-off, similar or better accuracy, and more convenience. Only ~6-7% of the diabetic population globally use a CGM device, so Dexcom is well positioned for many years of growth.

What does it do?

Edwards Lifesciences is the global market leader in the treatment of heart valve disease, which impacts millions of people worldwide and carries a poor prognosis if left untreated. Edward’s main product allows for the treatment of this disease without the need for risky open heart surgery.

Why do we own it?

Edwards Lifesciences continues to lead the industry in innovation, investing in the development of new products which both improve medical outcomes for patients and help doctors treat a wider range of previously untreated patients using a lower risk approach. With a dominant market share and continued investment in research and development, Edwards Lifesciences is well positioned for long term growth.

What does it do?

Equifax is one the three largest credit agencies globally, collecting data from multiple sources to form a database of individual consumers and small businesses, including credit history, employment history, payment history, and other identity information. This data and associated analytics are then sold to businesses such as financial institutions to make decisions such as whether, and on what terms, to approve auto loans or credit card applications; or whether to allow a consumer or a business to open a new utility or telephone account; or providing background checks for potential employers.

Why do we own it?

Following a multi-year and multi-billion-dollar investment in cloud capability, we believe Equifax is well set to boost innovation and drive higher sales from new products. Equifax should also benefit from falling interest rates. Current mortgage applications are currently well below historic levels. As rates fall, the level of applications is expected to increase, all of which require credit data from Equifax.

What does it do?

Floor and Décor is a leading specialty retailer in the US. The company warehouse format stores, which are roughly the size of a Bunnings, only offer hard surface flooring. The company offers the industry’s broadest in-stock assortment at everyday low prices. Floor and Décor has 123 stores across 30 states.

Why do we own it?

The company has potential to dominate the niche hard surface flooring category, which has been growing mid-single digits year over year. There is significant runway for future store growth with the potential to quadruple its footprint to around 400 stores. Given the company’s size and scale, Mom and Pop retailers, which have 50% market share, cannot compete on price or service with Floor and Décor.

What does it do?

Greggs is a vertically integrated food-on-the-go operator in the UK. The company operates more than 2,000 stores and is the leader in the UK take-away sandwich and savoury market.

Why do we own it?

Greggs continues to be an attractive long-term growth story with the potential to gain share of a fragmented market given the strength of Gregg’s value proposition. We see plenty of opportunity for Greggs to continue rolling out stores, while also implementing strategic initiatives (e.g. evening trade, delivery, click and collect) to increase sales turnover at established stores.

Company information still to come.

What does it do?

Hermès is a French family-owned luxury design brand that sells leather goods, clothes, silk scarves, homeware and jewellery. The company is known for its iconic Birkin and Kelly bags where resale values often exceed retail.

Why do we own it?

High quality (controlled through a vertically integrated supply chain) and product exclusivity give Hermès a strong MOAT. The company is run by a long-term oriented management team and has a long growth runway, making Hermès an attractive investment.

What does it do?

Known as a contract research organisation (CRO), Icon provides specialised services in clinical trial management for pharmaceutical and biotechnology companies.

Why do we own it?

The increasing complexity and regulatory requirements of clinical trial management are forcing pharmaceutical and biotechnology companies all over the world to seek the help of specialist CROs such as Icon. Icon’s global footprint and broad strengths in clinical management make it one of only a few companies qualified to provide these services. Growth is being driven by this increased shift to outsourcing, the increase in drugs being tested and larger trials required by regulatory bodies such as the FDA.

What does it do?

Intuitive Surgical is the pioneer and leading manufacturer of soft-tissue surgical robotics, used to assist surgeons to perform minimally invasive surgical procedures. Since Intuitive first launched its ‘da Vinci’ robot over twenty years ago, there are now over 8,000 systems placed around the world, performing over two million procedures annually.

Why do we own it?

Robotic systems aid and enhance the surgeon’s capabilities, and both increase comfort and reduce fatigue as the surgeons can sit at a console versus standing over patients for hours a day. This enhanced capability of robotics creates better clinical outcomes than the equivalent open surgery. We expect that as robotic technology continues to evolve, penetration will further increase. Since launching its first robotic system around twenty years ago, Intuitive has enjoyed the market to itself. Barriers to entry for robotic surgery are high and we expect that Intuitive will maintain a high market share in the future.

What does it do?

Keyence is a leader in the development of industrial automation and inspection equipment globally. It develops advanced cameras, sensors, and microscopes that help manufacturers improve productivity and ensure quality control across end markets such as automotive and food production.

Why do we own it?

Keyence’s large direct salesforce, intellectual property portfolio, broad product range, and disciplined culture underpin its competitive moat. This positions the company well to benefit from increasing factory automation globally.

What does it do?

MasterCard is the second largest payment network in the world, operating in 210 countries and supporting more than 2 billion cards across its network.

Why do we own it?

MasterCard's growth outlook is underpinned by the secular shift to electronic payments and away from cash, particularly in emerging markets where MasterCard has significant presence. These structural growth drivers combined with increasing margins and high cash flow generation (allowing for substantial share buybacks) supports a strong growth outlook over the medium to long term.

What does it do?

MercadoLibre is the largest e-commerce player in Latin America, while also offering payments solutions for retailers and credit for consumers and business via its fast-growing fintech business.

Why do we own it?

It is taking market share off incumbents in e-commerce given its faster shipping and lower product prices, underpinned by the largest distribution centre network. It leverages its moat in the e-commerce business to acquire under-served customers efficiently in the fintech business. This strong competitive position, combined with a long growth runway (given ecommerce and banking penetration in Latin America lag other developed markets) makes MercadoLibre an attractive investment.

What does it do?

Previously known as Facebook and has rebranded to Meta Platforms Inc who is the parent organization of Facebook. Facebook owns four of the most dominant social networking and messaging platforms in the world – the Facebook App, Instagram, Messenger and WhatsApp. It monetises these platforms by selling advertising slots to millions of businesses globally.

Why do we own it?

The average US user spends over an hour a day on Facebook and Instagram combined. This high user engagement, combined with Facebook’s unparalleled ability to deliver an audience of over 2 billion users to advertisers, has created one of the most valuable advertising platforms in the world. We see significant growth ahead as Facebook captures a significant share of advertising dollars as media budgets move away from TV and towards digital platforms.

What does it do?

Microsoft is a dominant software business that develops, manufactures, licenses, sells and supports software products, and is viewed by many IT departments as their most critical vendor. Products and services include many well-known franchises such as the Windows operating system, Office productivity applications, Azure cloud services, LinkedIn and Xbox.

Why do we own it?

Microsoft is poised to benefit from the global trend of enterprises shifting their computing storage and power to the cloud. Microsoft’s Azure business unit is helping customers all over the world of all sizes make this transition to the cloud and should benefit from this secular trend for many years to come.

What does it do?

MSCI is a leading provider of indices, benchmarks, index data and analytics tools for the financial industry, and is known for their global and emerging market indices. Customers use the company’s indices to define the investment universe for their products, benchmark their performance and construct ETFs. MSCI serves over 6.6k clients in 95 countries and has over $13tn in assets-under-management benchmarked to their various indices. MSCI’s flagship indices include the All-Country World Index (ACWI), the World Index (all Developed Markets), and the Emerging Market Index.

Why do we own it?

MSCI has attractive growth tailwinds such as the growth of ETFs, increasing investment which aligns to specific themes (for example robotics or space exploration), indexation of other asset classes (such as fixed income), and greater focus on ESG & climate. MSCI is the most innovative index provider and has market leading products to capture each of these tailwinds. MSCI benefits from competitive advantages driven by strong brand, switching barriers, scale, and network effects which all results in high customer retention rates. MSCI has long-tenured management team with material ownership in the business, aligning them well with shareholders.

What does it do?

Netflix is the world’s leading streaming service with 222 million members in over 190 countries. Members pay a monthly subscription fee to access TV series, documentaries, feature films and mobile games across a wide range of genres and languages.

Why do we own it?

Netflix’s scale in creating original content and ability to spread this cost over a huge global audience base gives it a significant cost advantage versus peers. We believe this advantage will only get stronger with time, and ensure Netflix continues to gain subscribers for many years to come – there are 750 million potential subscribers globally (ex-China). We are also confident in the company’s ability to continue raising prices at a rate that lags the value of the content it delivers. Netflix has raised prices regularly since 2015, while maintaining best-in-class churn rates, and a standard Netflix subscription – equivalent to one or two movie tickets a month for countless hours of entertainment – still presents incredible user value compared to satellite or cable TV.

What does it do?

Nvidia is a computer chip designer specialising in GPUs (graphics processing units), of which it is the world’s largest supplier (circa 85% market share). Its GPUs are used in datacentres (circa 90% of its earnings), robotics, gaming, professional visualisation and autonomous driving. Demand for its GPUs in the datacentre is driven by an increasing proportion of high performance or accelerated computer processing e.g. simulations, machine learning, training and inferencing large artificial intelligence models.

Why do we own it?

Nvidia’s ten-year head start developing its ecosystem of chip hardware, software and networking creates a lock-in effect for customers and underpins the MOAT. The demand for accelerated compute will remain structurally high for some time. The company’s co-founder continues to run the company along with a highly talented management team.

What does it do?

Old Dominion Freight Line (ODFL) is the second largest less-than-truckload (LTL) carrier in North America. LTL is defined as shipments that don’t fill a whole truck. Due to having multiple customers, requiring additional handling and sorting, LTL operators can charge higher prices than the more commoditised full-truck-load (FTL) industry.

Why do we own it?

ODFL’s reputation as the industry standard is underpinned by unmatched service quality: its on time delivery rate consistently exceeds 99% and damage claims rates are impressively low (0.1 %). For an unprecedented 15 consecutive years, ODFL has been named the #1 national LTL carrier in quality by Mastio & Company—based on 28 customer satisfaction metrics. This, plus the strong corporate culture of “helping the World Keep Promises”, or going the extra mile for the customer, has driven strong market share gains and industry leading profit margins. The freight sector is experiencing the worst recession in decades, following significant COVID over-earning. This gave us an opportunity to start building a position.

What does it do?

Salesforce is the dominant provider of cloud customer relationship management (CRM) technology globally. 90% of Fortune 500 companies use Salesforce’s business-critical software offerings, such as Slack (communications) and Tableau (data visualisation).

Why do we own it?

Salesforce is well-positioned to continue capturing market share in the fast-growing software-as-a-business (SaaS) and platform-as-a-business (PaaS) markets. It benefits from customer switching costs, high customer lifetime value, and brand reputation as a reliable partner for Fortune 500 companies which assuages adoption concerns for new customers. We see a long growth runway ahead for Salesforce as businesses continue to digitise and move to the cloud.

What does it do?

Taiwan Semiconductor (TSMC) is the world's largest and most advanced semiconductor chip manufacturer, producing the cutting-edge semiconductors that power AI, smartphones, self-driving cars, and robotics for customers like Apple and Nvidia. TSMC has over 90% market share in the manufacturing of the most advanced chips.

Why do we own it?

We own TSMC because its scale, technical know-how, and deep customer relationships have created a wide moat, with competitors’ years behind on the leading-edge manufacturing processes. The rising cost and complexity of each new generation of chips makes the gap increasingly harder to close. The result is an exceptionally high-quality business with strong returns on capital and a long runway of profitable growth ahead as the world consumes ever more advanced chips.

What does it do?

Tencent is China’s largest online gaming company with over 50% market share and also owns WeChat, the leading social network and messaging platform with over a billion users. The WeChat app is deeply ingrained into daily life in China with the average user spending an hour a day on the platform doing everything from messaging, social feeds, news feeds, e-commerce, hailing cabs, ordering food, booking travel, paying utility bills and watching videos. Tencent also has leading positions in a range of adjacencies including digital payments (WeChat Pay), music & video streaming, and cloud computing.

Why do we own it?

While Tencent’s core business is its gaming business, the WeChat platform is allowing it to create significant value in adjacent areas such as advertising and payments which we do not think is fairly reflected in the current share price. The digital advertising opportunity in China is large and rapidly growing, and WeChat is ideally placed to capitalise given its share of online time and ability to connect businesses with users. Payments is also a large opportunity in a market where credit and debit cards aren’t widely used and cash is rapidly being displaced by WeChat Pay and AliPay.

What does it do?

Tradeweb is a leading electronic trading platform that facilitates more transparent, efficient, and liquid trading of fixed-income securities across global rates and credit markets.

Why do we own it?

We own Tradeweb for its dominant position in a structurally growing, oligopolistic market where accelerating electronic adoption, strong network effects, and a proven track record of innovation support a long runway of sustained revenue and market share growth.

What does it do?

Tyler Technologies is the leading provider of essential software to over 15,000 local and state governments in the US. Tyler is the only company that can offer a full suite of products covering property tax systems and court management systems through to 911 dispatch systems.

Why do we own it?

It is estimated that two-thirds of local governments use in-house systems or outdated software that is no longer supported. Security issues and rising maintenance costs are driving a shift to modern systems, creating a long growth runway. We previously owned Tyler and took advantage of the indiscriminate sell-off in software names to add it back to the portfolio.

What does it do?

Uber is the dominant ride-share player globally, operating in over 70 countries with 189 million customers. Its scale and self-reinforcing network effects (more riders -> more drivers -> more riders) underpin its moat.

Why do we own it?

Autonomous vehicles (AVs) pose both a risk and an opportunity for Uber. We initiated a position in late December after a 20% fall in the share price due to concerns that AV companies like Tesla and Waymo will reduce reliance on Uber’s demand aggregation platform. We think AVs will be a fragmented market and AV fleet owners and AV car manufacturers will require Uber’s dominant platform to drive volume.

What does it do?

Zoetis is the global leader in animal health, owning many of the leading brands of drugs used to treat cats, dogs and livestock.

Why do we own it?

Zoetis has a dominant position in several of the fastest growing therapies, including dermatology and osteoarthritis pain. Coupled with a strong pipeline of new drugs, we expect Zoetis to continue gaining share in the animal health market.