RESEARCHINVESTMENT CASES

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In our 2Xideas Investment Cases, we provide a detailed analysis on how and why we expect the respective stock to double.
We constantly monitor our Investment Cases and publish a Case Update whenever there are material developments.

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Amadeus

Information Technology

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Amadeus is a software company serving the global travel industry, with a focus on the airline sector. The Company runs the leading business-to-business market for airline ticket sales, a so-called Global Distribution System ("GDS"). Amadeus generates 62% of its revenues in the GDS business and 38% in IT Solutions. The IT Solutions division's main activity is to provide Passenger Service Systems ("PSSs") to airlines and airports.
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Coloplast

Health Care

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Coloplast is the global leader in the ostomy and continence care markets. The Company also participates in the urology and wound-care markets, where it is less significant in size. In general a nurse or doctor decides which branded product the patient will be using and once comfortable with the product, patients hardly ever switch. In the fiscal year to September 2018, Coloplast generated DKK 16.4bn (USD 2.6bn) of sales.
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Masimo

Health Care

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Masimo is an American medical technology company that designs, develops, and markets noninvasive patient monitoring solutions. The Company's monitors are used to measure blood oxygen concentration and the pulse rate, among other vitals. The Company has over 4,500 employees and reported sales of USD 858mn in 2018, generating an operating margin of 24.5%.
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Ctrip

Consumer Discretionary

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Ctrip is the leading Online Travel Agent (OTA) in China. The Company provides customers with an online booking platform for travel related services, including transportation, accommodation, and packaged tours. In 2016, Ctrip generated revenue of CNY 19.2bn (USD 2.8bn). Ctrip operates primarily as an agent rather than a merchant. In an agency model, an OTA acts as an intermediary and does not take inventory risk.
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ASML

Information Technology

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ASML is one of the world’s leading manufacturers of microchip- making equipment. The Company specializes in lithography systems and the corresponding process control technology. Currently, the industry is at the start of a transition from the well-established "immersion deep ultra violet" (DUV) lithography to "extreme ultraviolet" (EUV) lithography, which is a key technology for future shrinking transistor size. ASML is the leader in both technologies.
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Log Book - ASML Investor Day November 2019

PolyOne

Materials

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PolyOne Corporation is the world's largest provider of specialized polymer mixes used by processors of plastic materials. PolyOne’s business model is driven by product innovation and highly specialized technical expertise in the compounding of polymers. The Company produces color and additive mixes, and engineered materials for a wide range of end-markets such as transportation, consumer, healthcare and packaging.
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ResMed

Health Care

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ResMed is a US-based global medical device manufacturer. The Company revolutionised the treatment of sleep apnea with the development of the continuous positive airway pressure ("CPAP") device. ResMed was founded in Australia in 1989 by the current chairman Peter Farrell, along with Dr Colin Sullivan, the inventor of CPAP. With a 45% market share, ResMed is the global market leader in treatment of sleep apnea.
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Thermo Fisher Scientific

Health Care

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Thermo Fisher Scientific ("TMO") is the world's largest company in the analytical and life science tools industry. These tools are used in laboratories to perform analyses of materials, compounds and life science ingredients in scientific, research and development, as well as testing and quality control environments. Servicing the instruments and providing consumables represents a major source of recurring revenues for TMO. In 2017, 65% of the Company’s revenues were recurring.
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Verisign

Information Technology

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Verisign is a global leader in Domain Names and Internet Security. The Company operates key parts of the Internet Infrastructure and is the world's largest registry operator. Registry operators are the "wholesalers" of the Internet domain names, while domain name registrars act as the "retailers", working directly with businesses and consumers to register domain name addresses.
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Tsuruha

Consumer Staples

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Tsuruha is a domestic Japanese drugstore retailer, operating 1,700 retail outlets selling non-prescription drugs, cosmetics and various household products. In addition, Tsuruha also offers prescription pharmaceuticals through 417 in-store and standalone pharmacies.
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MSCI

Financials

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MSCI provides performance and risk tools to both money managers and financial asset owners. The Company operates the “MSCI” brand for its equity indices and its ESG data offerings. The “RiskMetrics” and “Barra” brands are used for its analytics offering. MSCI’s business model is very robust with a high level of recurring revenues. Combining the various business lines, MSCI generates recurring subscription revenues that amount to 74% of total revenues with recurring asset-based fees contributing a further 24%.
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Markel

Financials

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Markel is a US-based property and casualty ("p/c") insurance company with a focus on complex and hard-to-place specialty p/c risks. In addition to its insurance activities, Markel owns a portfolio of non-insurance businesses and invests a major portion of its capital base in equity securities. The Company is exceptional because of its ability to allocate capital rationally between insurance underwriting, non-insurance acquisitions, and equity investments.
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Fastenal

Industrials

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Fastenal is the largest distributor of fasteners in the US. With 2016 sales of USD 4.0bn, the Company is three times the size of its closest competitor. It is far more profitable than its peers with an EBIT margin in 2016 of 20% and a RoAIC of 25%. In 2016, Fasteners accounted for 38% of total sales and non-fastener industrial supplies (“non-fasteners”) sales for 62%.
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Fastenal Log Book
November 2015

Compass

Consumer Discretionary

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Compass is the world's largest contract caterer. Contract catering is business-to-business catering on a large scale, such as for schools, hospitals, entertainment venues and nursing homes. Sales in the Company’s fiscal year 2017, ending in September 2017, amounted to GBP 23bn. The Company is based in the UK and employs more than 550,000 people in around 50 countries.
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Analog Devices

Information Technology

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Analog Devices is a world leader in the design, manufacturing and marketing of a broad portfolio of products based on high-performance analog, mixed-signal and digital signal processing technologies. The Company's products include integrated circuits, algorithms, software, and subsystems. Analog Devices is focused on solving the engineering challenges associated with signal processing in all types of electronic equipment.
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IPG Photonics

Information Technology

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IPG Photonics ("IPG") is the global leader in fiber laser technology. Fiber lasers produce laser light within speciality optical fibers, and are an alternative and superior technology to traditional crystal and gas lasers such as YAG (Yttrium Aluminum Garnet) and CO2 lasers. The key market for IPGP’s fiber lasers is materials processing, which includes a diverse range of processes such as cutting, marking, engraving, welding, brazing, hardening and 3D-printing of metals and other materials. Overall, materials processing accounts for over 80% of IPGP’s revenues.
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Ansys

Information Technology

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Ansys develops and markets the globe's leading engineering simulation software. The Company's software allows R&D engineers to predict the performance and real world behavior of components and products at an early stage of development, typically before building a first prototype. The Ansys software package is an integrated platform with a broad set of simulation capabilities.
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Ansys Log Book
September 2017

McCormick

Consumer Staples

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Founded in 1889, McCormick is a global leader in flavor manufacturing, distribution and marketing. The Company produces a variety of spices, seasoning mixes, and herbs and distributes them in over 150 countries. McCormick is divided into two segments: Consumer and Industry. The company’s two largest customers are Wal-Mart and Pepsi Co, each representing 11% of group revenue. In the Consumer segment, McCormick has over 25 different brands in its product portfolio. McCormick is the Groups largest and most popular brand.
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Company Log Book

Wabtec

Industrials

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Wabtec is one of the world’s largest providers of engineered components for the rail transportation market. The Company will double in size in Q1 2019 as the merger with GE Transportation closes, generating sales of USD 8bn. Wabtec will also become the global leader in the manufacturing of diesel-electric freight locomotives. Wabtec continues to grow the highly profitable aftermarket business, derived from a captive installed base. Furthermore, Wabtec is a successful industry consolidator. Thanks to high barriers to entry, we believe that Wabtec’s outstanding profitability is sustainable.
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Huazhu

Consumer Discretionary

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Founded in 2005, the Huazhu Group ("Huazhu") is a leading multibrand hotel group operating in China. The Company is focused on the economy and midscale segments and does not compete directly with the well-established four- and five-star international chains in the upscale and luxury segments. The Company operated 11 branded hotel chains totaling over 3,700 hotels with 379,000 rooms in 2017.
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Novozymes

Materials

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Novozymes is the world’s largest developer and producer of industrial enzymes, with a market share of almost 50%. In addition to enzymes, the Company also supplies microorganisms and biopolymers. Novozymes sells its proprietary enzyme and microbial solutions to food producers, detergent manufacturers and pharma companies.
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