Harbor AlphaEdge Small Cap Earners ETF (EBIT)
ARCA ARCA Primary 
Engie: Data Center Tailwinds And Higher 2025 Guide - Buy Reiterated
Engie's Q3 was supportive, with 2025 EBIT (ex-nuclear) guided to the upper half of €8–9bn, with 2026 earnings set to accelerate. ENGIY's infrastructure division delivered 33% EBIT growth, providing downside protection and recurring earnings amid energy market normalization. Renewable and battery storage capacity expansion, plus data center partnerships, are expected to drive significant EBITDA growth over the next three years.
Ralph Lauren: Trend Reverting North American EBIT Makes The Stock Attractive
In FY 2025, Ralph Lauren saw appealing financial results, with revenue up 6.75% and operating income surging 23.2%, supported by increasing margins. Despite long-term North American sales declines, in FY 2025, the trend reverted, and operating income grew higher than 15% in that region. The trade agreement between the United States and Vietnam is a tailwind for the apparel industry, particularly for RL, as it is its major sourcing destination.
Harbor AlphaEdge Small Cap Earners ETF Q1 2025 Commentary
During the first quarter, the Harbor AlphaEdge Small Cap Earners ETF (“ETF”) returned -6.99% (NAV), slightly underperforming the Harbor AlphaEdge Small Cap Earners Index, which returned -6.92%, and outperforming its benchmark, the Russell 2000® Index, which returned –9.48%. Harbor's Business Cycle Regime indicator continues to signal late-cycle conditions with market sentiment remaining in risk-seeking mode at the end of the first quarter. As our base case, we expect risk assets to experience continued positive returns in the coming quarters, with economic growth remaining resilient.
Orkla: High Momentum, Modest Risk, And More Upside
Orkla's strategic shift to focus on core business and divest non-core assets has led to a 66% stock appreciation over the past year. The sale of hydropower assets and Pierre Robert Group resulted in an extraordinary dividend, with plans for stable and growing future dividends. Operational efficiency has led to better profitability and strong cash flows despite modest top-line growth.Orkla is guiding 8–10% EBIT growth and 1.5–2.0 pp EBIT margin improvement over the next two years.
Amazon: R&D + EBIT Demonstrate Hidden Earnings Power
Amazon appears undervalued amid the market sell-off, with significant potential across e-commerce, cloud, and advertising sectors. Recent quarters show Amazon's real earnings power, with $157B in 2024, driven by AWS and substantial R&D investments. An improved balance sheet with reduced long-term debt and an increased cash position enhances financial flexibility for future investments.
J D Wetherspoon: Don't Expect Fizzy Returns Any Time Soon
J D Wetherspoon's share price has plummeted from its 2021 peak, with a P/E ratio of 10.5 suggesting a buying opportunity, but we remain cautious of a potential value trap. Despite a 3.9% rise in revenue and 4.8% LFL sales growth in H1, Spoons's core segments like food and drinks saw modest gains, while EBIT margins fell 115bps. Higher costs and taxes with volatile commodity prices will continue to squeeze margins, with EBIT margins not expected to recover to pre-pandemic levels until FY29.
Berkshire Hathaway: 3 Reasons To Buy
Berkshire Hathaway's large cash mix offers an opportunity for value addition during a market downturn, especially if the dry powder is deployed well. The insurance business is thriving, with revenues growing in the double digits and EBIT margins above 25%. The outlook is bright, driven by pricing and volume tailwinds. Expansionary manufacturing and servicing PMIs bode well for Berkshire's wholly owned subsidiaries that make up more than half of operating EBIT.
Vestas Wind Systems: A Buying Opportunity Amid Market Pessimism
Vestas reported strong 2024 performance with €17.3 billion in revenue, up from €15.38 billion in 2023, and EBIT before special items rising to €741 million from €231 million. The company delivered robust Q4 results, posting €5.2 billion in revenue and a 12.9% EBIT margin before special items, surpassing market expectations. Vestas' shares, once buoyed by ESG-driven investor enthusiasm, are now trading at the low end of their historical valuation. Market predicts muted growth and no return to double-digit EBIT margins.
Heineken: Positively Impressed, Buy Confirmed
Heineken's Q4 results exceeded expectations with +4.7% top line sales growth, driven by volume growth in Africa and APAC and a strong EBIT acceleration. Heineken's fiscal 2024 Net debt-to-EBITDA ratio improved to 2.2x, with a €500 million positive delta due to higher free cash flow generation. The company forecasts 2025 organic EBIT growth of +4/8%, with a higher DPS and a €1.5 billion share buyback announcement. The valuation remains attractive. Our buy is confirmed.
RH: Rating Downgrade On Expensive Valuation
RH's 3Q24 earnings showed 8.1% y/y growth, improved adj. EBIT margin, and strong demand trends, but adj. EPS missed consensus estimates. Growth drivers include the Waterworks initiative, new gallery openings, and a shift to Design Galleries, enhancing RH's long-term growth potential. Despite positive factors, RH's current valuation is high, and I doubt it will sustain the 23x forward EBIT multiple, making the upside less attractive.
Correios De Portugal: Still Great Value, But Holiday Season And Rate Questions
The express and parcels business showed strong YoY growth in Q3, with mail aided by legislative elections, despite secular declines in mail volumes. Financial services logged a 6.2 million EUR performance, with Banco CTT achieving 2.5% YoY revenue growth despite ending the Universo card partnership. Higher depreciation costs in logistics limited recurring EBIT growth, but excluding just software investments, EBIT growth would have been around 12%.
DHL Group: Delivering Value Once Again
DHL Group shares have declined due to higher costs, weakening demand, and potential U.S. tariffs, but long-term investors may find a good entry point. Q3 results showed flat year-over-year EBIT, improving from previous declines; Q4 EBIT expected to rise 8% year-over-year, despite weak conditions in Europe. Strategy 2030 aims for 50% higher revenue by 2030, driven by e-commerce growth, life sciences logistics, and efficiency improvements through automation and optimization.
