Summary

• Every boom that has exalted a narrow group of companies, from the ‘Nifty 50’ to the recent mega-cap tech rally, has eventually come to an end as equity markets broadened out.
• While the Russell 3000 Index trades at 17.5 times next year’s estimated earnings, the Heartland Value Fund portfolio’s multiple is just 11.3X.
• In the first quarter, the Heartland Value Fund gained 7.46%, compared with the 4.96% return for the Russell 2000 Value Index.
• Allegiant Travel Company shares rallied significantly from the lows, driven by a refocus on the core business, improved execution, and the carrier’s low cost model.
• Despite the broader narrative that AI will upend software models, the cash flow characteristics and sticky customer base of i3 Verticals do not seem to be fully reflected in current valuations.

Those who cannot remember the past are condemned to repeat it. — George Santayana

Small caps outperformed large stocks by a wide margin at the start of the year, as AI-skepticism crept in and the outlook

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