Patience is required.

The good news is that my investment period runs until 2037, so what has happened in the past 6 months might not matter much in a few years, and definitely not in over a decade. I still believe that consistently (i) putting aside emergency funds, (ii) investing excess in high-quality companies, and (iii) staying invested through tough times will help me build a reasonable capital and knowledge base for my daughters’ future.

Today, I am putting money where my mouth is - I will initiate a starting position in SWI Pick #24 and add more over the next few quarters.

Learning from my mistake, this is a more predictable business and will be a smaller starting position.

• #24 is a technology leader whose alternatives are legacy solutions and AI as an accelerator instead of a competitor.

• The product is mission-critical to top-tier hospitals, 100% of whom renews long-term contracts lasting 5+ years.

• Durable growth opportunity with a large whitespace and a market cap of under $10B.

• Clean financials and prudent accounting, no debts, 50% of cash allocated to dividends, and capex-light.

• Risks include high valuation, looming succession planning, legacy solutions fighting back, and AI still bringing uncertainties.

• Why now? The business has been perennially expensive, but it has been bundled with the ‘AI SaaSapocalypse’, pulling the stock down by nearly 60% in the last 7 months from its peak, giving it a good time to buy in stages (dollar-cost-average) into a position, or at least to do the work now before we get a better entry point.

If you are new to SWI, here is the link to all write-ups.

What is Sleep Well Investments?

1. Deep research on a few exceptional niche leaders.

2. Patiently waiting and thoroughly following up for buying opportunities.

We will go through:

• Investment Thesis

• Why does it help us sleep well?

  • Mission-critical product, slow-changing customers

  • Founder-led management

  • Solid moats and barriers to entry

  • Organic growth opportunities

• Limited competition

• Risks - legacy fighting back, key man

• Valuation

• Sleep Well Scores

Read more

Build your Sleep Well Portfolio today

Summary of March 2026

It’s been three months of relentless decline of software stocks due to the ‘AI kills software’ narrative, and of course, recently, the Iran war.

The impact of wars is broad and deep when they're prolonged and out of our control; however, AI-fear narratives are defensible, particularly for businesses with high switching costs and are hard to operate, even if AI could replicate the software. In February, our detailed AI risk assessment found that 10 out of 12 holding businesses are AI-immune.

As a result, in March, I cut the most vulnerable - SPS Commerce and used the proceeds to add to the three most immune. I am planning to add to my latest pick, Intuitive Surgical #23, and my new pick #24, which I will have the write-up for in a week's time.

The challenge, of course, is that I will continue to look wrong. The market can remain irrational longer than my patience. The last time software companies had a prolonged decline was the Ukraine war, which coincided with the post-COVID SaaS business hangover. It lasted a year and a half for some of our business. But then they rebounded spectacularly between mid 2023 and mid 2025.

Today, the valuation of all these businesses is also at its lowest since their IPOs. They could still fall further; however, looking beyond 5-10 years, I believe they will benefit from AI, and I will be more prepared to capture the gains once it rebounds again.

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Busy March, bought more AI-immune businesses

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Hi everyone,

Yesterday, I bought a sleep well business that:

• Scored 15/20 points on my sleep well checklist.

• Possesses all four moats - scale/cost, network effects, switching cost, and brand.

• Competition is the best thing that has happened to this company, as FCF has compounded at 41% since this player entered its market over 10 years ago.

• On track to grow at least 20%+ for 5-10 years and available at <15x FCF and <3x Sales with a net cash balance sheet.

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I am buying more shares in the most AI-beneficiary businesses, one of which is trading at ~17x FCF (>5% free cash flow yield) and with a 15-20% free cash flow CAGR over the next 5 years. That means the expected return is at least 15-20% in the next 5 years.

The proceeds will come from the sale of SPS Commerce, the least AI-insulated business in the Sleep Well Portfolio.

Before we dive in, a few smarter people have already made the call about the current SaaSocalypse:

One of whom is NVIDIA CEO Jensen Huang, he said:

‘Wall Street has got it wrong’. - Q4’2026 earning call.

He argued that it was ‘the most illogical thing in the world’ to sell enterprise software based on AI-increased demand and utility. Jensen Huang said AI will not replace software but will increase demand for platforms like ServiceNow, as agents will run on them to boost productivity.

The Trade Desk CEO, Jeff Green, echoed with a few details.

Right now, Wall Street has an unprovable bear thesis — “software is dead.” There is fear that Claude and tools like it will enable developers to duplicate Salesforce or The Trade Desk. During a time when the market can’t prove that thesis wrong, the market and the sector go down. What I think they’re missing is that the best companies in the world work hard every day looking for an edge. We’re all looking for every possible practical application of AI, new tools and every other possible advantage. AI changed a lot, but it didn’t evaporate integrations, moats, trust, customers and tools — let alone people with esoteric expertise and obsessive passion to improve things.”

But are these views applicable to our businesses?

Absolutely. They also support my findings that AI is a net positive, particularly for businesses that possess proprietary & regulated data, platform solutions, operate a mix of physical and software operations, and are actively using AI to improve operations.

Link to detail findings in this article

TLDR (too long didn’t read):

For nine of my twelve positions, AI is actively expanding the value these businesses deliver. CrowdStrike benefits because more AI means larger attack surfaces. Veeva benefits because AI agents operating in biopharma need a validated, compliant data infrastructure. Cellebrite benefits because digital evidence becomes more voluminous and complex. GTT benefits because it is the only viable technology for the LNG infrastructure that powers the AI data center buildout. Dino Polska, Sea Limited, Meli, and Grab operate in physical-world markets where AI is a logistics optimizer, not a competitor. SWI’s AI Risk Assessment

Let’s dive into why I bought more Veeva Systems, and have ordered to buy more Mercado Libre, Cellebrite, and Sea Limited.

This trade alert write-up replaces my monthly Best Buys edition to remove duplications.

1. Why am I buying Veeva Systems?

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Sea Limited (SE) holds a special place in my portfolio. The central thesis has always been a three-headed technology company growing more heads, leveraging the growing scale and data richness. When I first bought the company for my daughters (Sleep Well Portfolio), it had just risen (posting $1.5B in free cash flow) from the crushing depths of post-COVID. The group was burning $2B a year, the e-commerce arm, Shopee, was still loss-making; the gaming arm, Garena, was not seen as evergreen; and Monee (SeaMoney at the time) was still a ‘promising’ fintech venture.

Today, three years later, the company generated ~3.5B in free cash flow. Impressively, across the ~700M people in Southeast Asia (and +200M in Brazil), ~400M unique buyers and ~20M sellers are on Shopee, ~37M take credit (BNPL, personal loans, SME loans) on Monee, and ~100M play games daily on Garena. Half of the sellers were reported to earn their main income on Shopee (per Q1’25). And, 20% of total GMV was generated by just ~2% of buyers (VIPs). Incredible. Ah, then the current loan book is just $9B (growing at 80% rate), or <10% of a typical bank's loan book in Southeast Asia. Finally, only 10% of quarterly active gamers pay on Garena.

When you internalize the sheer impact of Shopee on sellers’ lives, the sheer purchasing power of VIP members (similar to Amazon Prime members), and the number of gamers spending time on the platform. I don’t see any issue with Sea's decision to invest in increasing the wallet share and penetration. Of course, it depends, but we will see what they have invested in (FY2025) and what they are going to focus on, which makes a stronger company.

To me, this is a multi-year, decade-long story, as the business's lifecycle is still in its early stages.

At the helm, Forest Li, CEO and founder, is a rare breed. I admire him for the ability to pivot (2015) to a platform, grow the company at the speed of light (2016-2021), then brake hard to rebalance and change course as soon as things didn’t work out (2022-2023). Every quarter, I listen to his call and see a humble, eager-to-improve CEO. So when he said that AI would help Sea become a $1 trillion company (15x its current size). I tend to believe in the story.

So, that’s the lens I use when I read the quarterly results. With shares declining to ~$88/share after the Q4’25 announcement, the road I am walking may not be shared with the majority of the market, but I am totally ok, as my additions will be more meaningful at these levels.

But let’s get one thing out of the way: why were shares down by -16%?

Shopee's Adj.EBITDA margin was guided to be

• FY2027: ~0.55%, compared to

• FY2025: 0.7% in 2025, and

• FY2024: 0.2% in 2024.

Further away from the 2-3% long-term goals.

But that’s not what I am focused on. There is an enormous underserved community in Southeast Asia and Brazil that Shopee monetizes on, but the time isn’t now.

Let’s go through

• 1. Brief FY2025 results

• 2. Shopee - where are the investments?

  • SPX Express

  • VIP program

  • Shopee Live + Youtube + Meta

• 3. Monee

• 4. Garena

SWI’s SE coverage: [deep dive, 4th buy, 3rd buy, 2nd buy, 1st buy, AI risks, Sum-of-parts Valuation, tariff review, Q3’25, Q2’25, Q1’25, Q4’24, Q3’24, Q2’24 update]

**Links to thesis updates, buy-and-sell, and deep dives—all in the Sleep Well Portfolio spreadsheet above.

If you are new, start here. Please use the FAQ alongside the SWI Manual to get the most out of your subscription.

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Summary of Feb 2026

In January, I defended SaaS from AI risks for its incredible high switching costs and then further explained in the Best Buy series why they were also hard to operate even if AI can replicate the software part.

In Febuary, software continued to decline in Febuary. I have conducted a detailed AI risk assessment for all holdings. The finding showed AI is largely immaterial to 10 out of 12 businesses. However, I need to cut one holding - SPS Commerce (this week) and monitor one closely. I’ll also add more to two (patiently).

I could be wrong, of course! Valuation is at its lowest since IPO, and this particular business has also implemented its own AI capabilities.

However,

Its data structure is the problem! Deterministic, rule-based, and repetitive. SaaS with the same data structure, and with limited switching costs and network effects advantages, is likely to suffer the same fate.

Let’s look at the details of why I am trimming before we report the portfolio performance.

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Cutting SPS Commerce (SPSC)

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Hi sleep well investors,

As long-term owners, I get excited when there are indiscriminate sell-offs. This is when good deals are found. Last year, I conducted a tariff risk review across all holdings and, as a result, cut MIPS from the portfolio.

This time, I see a lot of AI-related disruptions across all businesses. And with the rapidly changing context, I need to act quickly and decisively. I found one in which one of twelve holdings is highly disrupted (a Sell candidate) and two that require close observation; the rest are highly insulated.

Before we dig into the analysis, I’ll present the framework and the context.

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Hi, sleep well owners,

I am very excited for this month’s Best Buys. This is the first time since last April that we have seen a broad, indiscriminate market sell-off in our global quality businesses. Last time was due to Trump’s tariffs; this time, it’s the risks AI may pose to software companies. Many call it the ‘SaaS’magedon. I briefly discussed which software companies are most likely to be disrupted during the January SW Portfolio review.

Nevertheless, stock decline in popular names can be unsettling.

• Fico (FICO) is 30% off high,

• Salesforce (CRM) is 43%

• Intuit (INTU) is 46%

• Service Now (NOW) is 53%

• Axon Enterprise (AXON) is 54%

• Constellation Software (CSU.TO) and the many vertical software serial acquirers are >50% off high

• Even Netflix (NFLX) and Microsoft (MSFT) are at 38% and 28%, respectively.

If you are playing the short game, it must be painful. Here, SWI is calm. I see an opportunity to assess which sleep well picks are truly enduring in an AI-first world.

No doubt, AI is disruptive to incumbents. It helps build software much faster and at a lower cost, lowering barriers to entry. However, that’s only 1% of building enterprise software.

The other 99% is scaling, maintaining, iterating, and adding features. These tasks are a whole different ball game. That 99% of the work also requires years of proprietary data, changes to workflows, and an internal team for maintenance, compliance, and audit trails.

Just imagine building another Veeva Systems, which Salesforce has been trying to do for years with IQVIA (a leader in life science data) and has yet to patch up a competing product.

In addition to the points above, you would be closely monitored by regulators for handling sensitive, non-standardized health data. This leads to limited interoperability and poor data quality, which means incorrect or harmful clinical decisions by AI.

In the January portfolio review, I also alluded to the high cost and complexity of switching away from (and/or migrating to) an entrenched cloud solution as an additional layer of protection for some of our picks. For context, Gartner reports 55% of companies encounter data quality issues in system moves.

As such, the first Buy Buy this month is Veeva Systems (VEEV), the 10th SW pick. We have four others. Let’s find out the rest after a brief introduction about the Best Buys series.

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Every month, Best Buys highlight which of my 23 sleep well picks I consider worth adding or trimming. It complements my quarterly thesis-tracking updates, in which I essentially ask, “Is the thesis intact?” for each company.

I also discuss my growing research list of ~40 businesses. In this series, I want to discuss Axon Enterprise (AXON) and General Electric (GE), both leaders in their own industries, and today, I am comfortable sharing my first notes.

Previously, I discussed Rubrik, FILA, and a leader in Food Safety (a direct competitor to SPS Commerce). Particularly, the decision to avoid Rubrik last October when we saw a host of bullish theses about it is very interesting to read again. The stock is now tracking a 50% decline from peak, far steeper than peers (CRWD, FTNT, PANW).

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Best Buys for Jan 2026

1. Life science leader - 5.2% free cash flow yield with a decade of 15% growth

2. Public Safety SaaS leader - 5% yield with at least 20% 3-year forward growth guided

3. Commerce Infrastructure in South East Asia - 7% yield with a decade of 20% growth

4. Global logistics SaaS leader - 3% yield with a decade of growth runway

5. Robotic-assisted surgery leader - 1.5% yield with a decade of guaranteed revenue and many decades of 10% growth

Trimming candidate - none

Before we dive in, please be reminded that the average ‘investors’ holding period has shortened to just a few quarters, from 30 months in the 1990s. My holding period runs until 2037, when the portfolio passes to my daughters. As a result, my decisions are based solely on fundamental reasons.

The endgame of best buys

is to highlight high-quality, enduring businesses that trade at a slight premium to peers (they rarely trade cheaper, unfortunately).

My strategy -

• Add to those with unique anti-fragility for specific events.

• Balance the portfolio with businesses at different life stages.

• Add to the winners who experience short-term setbacks.

For example, I have

• 17% of the portfolio that performs well in ‘security crisis’ [CrowdStrike, Fortinet, and Cellebrite], 27% does well in global logistic complexity [Wisetech, SPS Commerce, and Grab], 7% to buffer the portfolio if we have another health crisis - [Veeva Systems], 32% to navigate the digitalized world [Sea Limited and Mecardo Libre].

• 30% of the portfolio is in a more mature stage of its life cycle, 6/13 are US domiciled, and 12/13 have a net cash balance sheet (average of 6% of market cap).

The list is not based on the positive/negative newsflow for the following quarters. It is also not deliberately trying to be ‘active / beat’ the market; if it does, that’s the icing on the cake. It’s more about building knowledge and positioning in businesses that I think will yield stable and growing returns on capital through 2037.

Hence, best-buy lists are personal; to apply them according to your needs, I encourage you to review the deep dives and updates before taking action.

Disclaimer: As a reader of Sleep Well Investments, you agree to our disclaimer. Full details here.

If you are new to SWI, check out our FAQ and Owner Manual.

Build your Sleep Well Portfolio today

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Summary of Jan 2026

January continued the decline from the end of 2025. Software continued to be sold off amid rising concerns about AI’s disruption. Constellation Software (CSU.TO), the poster child for high-quality software names, fell 52% since June 2025.

Sleep Well Portfolio owns 13 names, of which 2 have suffered a similar 50% decline from peak last year, like CSU. But I argue the share price decline is an opportunity for long-term owners. I’ll explain.

The lens I am viewing through is, first and foremost, fundamental. Then I give the time that the business needs to prove itself. Even when dissecting the steepest-declining stocks in the portfolio (Wisetech or Cellebrite), I get more excited than worried. Why?

Both provide solutions with no comparable alternatives that require thousands of customer iterations to reach where they are today. Employees and stakeholders require extensive training and adjustments to company-wide workflows to adopt the solution. Add to that the customers are slow-moving governments/large entities; they will not be willing to spend years migrating away from what they have been using for years, if not decades. Their business trajectory is on track to compound at a 15-20% CAGR in free cash flow per share, while the stock price has declined by 50%.

No doubt, AI is a risk - an existential risk to simple, UI only, point-based software, but not to Wisetech / Cellebrite / Veeva; they own the data, the workflow, the platform. Hence, during January, I have added to Cellebrite (and Wisetech in November) and have published my intention to buy the 23rd Sleep Well Pick - Intuitive Surgical (ISRG), the least likely software/hardware business to be replaced by AI.

The next few sleep well picks will be of a similar quality to ISRG, and 2026 may prove to be the best year to accumulate more shares of the best businesses. Performance may not turn right away, but I am excited for 2037.

Now, let’s skim through the January 2026 performance.

• Return from inception was 17% vs. S&P500 58%: ~40% underperformance. Sharp decline from September 2025, when SWI was >60%, due to the high concentration in SE/WTC.

• Picks’ annualized return is now 9% compared to 16% in December 2025, 21% in November, 27% in October, 47% in Sep, 50% in Aug, 46% in July, 61% in June, 64% in May, 51% in April, and 38% in March.

• 4 losers, 9/13 making money, and 21/36 transactions were correct decisions.

• Monthly Best Buys and research list - will be posted separately. The latest edition is here.

  

• If you are new to SWI, check out our FAQ and Owner Manual.

If you are already an annual member, you can access the Sleep Well Portfolio and Thesis Tracker via the link below.

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What’s in store for 2026?

We will continue to own leaders in niches and allocate capital concentrated on a few names. SE, MELI, GRAB, WTC, FTNT, and VEEV are over 70% of the portfolio. When they rebound, it will be spectacular, but in the interim, I will have to stomach the large swings and focus on the fundamentals.

In 2026, you can expect more deep dives like Intuitive Surgical and shorter profiles of watchlist companies in my Best Buys series.

SWI Performance since inception 17% vs S&P500 58% - Interactive Brokers:

Current portfolio - 4 losers

Previously - December 2025

Previously - November 2025

Previously - October 2025

Previously, Sep 2025 - 2 losers

Previously, Aug 2025 - 1 loser

Previously, July 2025 - 2 losers

Previously, June 2025

Previously, May 2025

Previously, April 2025

Previously, Mar 2025

Transactions with notes below:

Expanding investment universe

You will only see me buying businesses that I thoroughly understand (see the deep dives below). I’ll expand the list when I find ones that pass the Sleep Well Investments checklist.

Sleep Well Portfolio reviews

How can Sleep Well Investments help you?

1. High success rate stock picks—9% annualized time-weighted.

2. High-quality research and detailed follow-up. Buy and verify.

3. Free samples of deep dives, tracking updates, and buy alerts.

4. Free knowledge of the investment framework to help find quality companies, and the lessons I have learnt.

5. Free book reviews on Pulak Prasad’s, Terry Smith's (15% CAGR), Scott Fraser's (19% CAGR), Ralph Wanger's (16% CAGR), and Peter Lynch's (29% CAGR) teaching.

Disclaimer:

As a reader of Sleep Well Investments, you agree to our disclaimer. You can read it in full here.

To start 2026, I have selected the best of the best. The bar is incredibly high, and by 2037, I would like my daughters to own only businesses like this. This deep dive will help you understand the business like an owner.

If you are new to SWI, please read our manual and FAQ.

A sleep well business, to me, is irreplaceable. Its existence elevates the lives of end users and customers and operates in harmony with suppliers and regulators. When it’s gone, the community it builds around it would feel deep pain. Importantly, competitors can’t quite figure out a way to break in. Therefore, the business enjoys the advantage of generating consistent, growing free cash flow per share. However, what makes the business sleep well is also its ability to adapt, and the excess it purposely puts away to withstand the inevitabilities of external shocks and competition.

Intuitive Surgical (ISRG), a $185B leader in the robotic-assisted surgical market, ticks many of those boxes. However, there are serious emerging risks, and the price we pay (~80x FCF) today may only yield satisfactory returns over 10+ years if certain growth opportunities are realized.

Content of the deep dive

• Executive summary

• How is it a sleep well investment for 2037?

  • irreplaceability - product relevance

  • business model - predictability

  • moats and barriers to entry - early ‘lock-ins’

  • competition - old and new

  • anti-fragility - endurance

  • opportunities

  • management

• Risks - what can go wrong

• Valuation and execution

• Sleep well scores

Executive summary

I am eyeing owning part of Intuitive Surgical because:

• It has been a poster child for the industry as a pioneer since its founding and is now a standard of care in multiple complex surgical procedures.

• 60%-80% market share in total robotic-assisted surgeries, with at least a decade's head start compared to imitators.

• The market position is nearly impenetrable thanks to multi-layered switching costs cultivated very early in the customer acquisition phase, a vertically integrated business, and high barriers to entry—perhaps the most ‘moaty’ businesses I have come to learn.

• High predictability of revenue, as every robot system sale brings 7-10 years of recurring consumables and service revenue.

• Multiple ways to prolong its double-digit FCFPS growth, including expanding procedures, system and instrument categories, geography, and occasionally breakthrough technologies.

• Highly AI-proofed and has $5B of cash with another $4B in long-term investments and no debts to buffer unknowns.

Most importantly, Intuitive Surgical's success enhances the quality of life for people around the world.

I have spent months in the hospital with my daughter and gone through surgeries. I see why robotic surgeries are the preferred choice, not only better outcomes for us but also for the surgeons, hospitals, and the healthcare system.

Intuitive Surgical creates value for all parties involved.

Let’s dive into the company and why it could be a sleep well investment.

If this is not for you, all other write-ups are here:

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• Scores 14/20 points on my sleep well checklist. (vs. 12.8 average)

• 30% free cash flow margin with over 10% of market cap in cash (net debt).

• Possesses deep and widening moats - scale/cost, switching costs, brand, and incredibly high barriers to entry.

• This SaaS platform has multiple growth levers (organic, product cross-sell, geography, M&A)

• Due to the recent CEO transition, budget delays, and procurement process issues in government contracts, the market is underappreciating the quality and expecting a free cash flow growth of just 7.5% CAGR over the next decade, compared to an achievable 15% CAGR.

I am buying this business for the second time today because it adds a unique defensive angle (an anti-fragility quality) to the Sleep Well Portfolio. Together with CrowdStrike (SWI #1) and Fortinet (SWI #12), form a highly defensive utility for the portfolio (15% of the portfolio) in the event the world goes into chaos (I hope not).

In case you missed it, recently, I reviewed the FY2025 Sleep Well Portfolio. A good place for you know what to expect.

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Let’s examine what I bought today and how it fits the Sleep Well Portfolio.

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I am honored to be building a Sleep Well Portfolio with all of you. Sharing every ownership decision, along with my thoughts and the lessons behind them, has been very humbling. 2023 and 2024 were near-perfect, and in 2025, we hit a minor roadblock, but I am certain we are on the right path - owning irreplaceable monopolies and focusing on the right aspects - enduring growth.

2025 was not perfect, with a 70% win rate, after 92% in 2024 and 100% in 2023.

• 🕵️ 22 sleep-well picks yielded 14% return on average.

• ☑ 37 thesis tracking reports that deepen knowledge of our 22 picks.

• 🎯 37% vs. 60% of the S&P500 since inception, underperformance from Sep 2025.

• 📚 learned from Pulak Prasad, Mistake in Intellego, Navigating Tarriff Headlines.

A striking and recurring theme I experienced this year was that investors tend to overreact to short-term stock movements and underestimate the long-term drivers of the underlying businesses. Simply put, an investor’s average holding period is 6 months (and shortens each year), while mine is at least until 2037, when my daughters will take control of this portfolio. I am not under stress about this year’s underperformance. My patience and my focus on the long-term drivers of value are my edge and the reason why I sleep well. Any mistakes I make this year or next will be crucial to the performance of the next 10-20 years.

An example I want to key in is my ~20% position in Sea Limited (55% in my PA). Its share price dropped ~40% from its peak at $200/share over just two months, starting in September, as margins in its core ecommerce business division - Shopee, contracted.

Yes, that alone displaced the portfolio from outperformance over the past few years to underperformance (more on that later).

However, every day, I wear the business owner’s hat. I focus on the product, the supplier, the competitor, and what investment the business makes to create value. Vastly different from someone with a 6-month view.

Therefore, I am not concerned about Sea’s stock decline.

The following chart means little.

I dived deep into why margin dropped from 5% in Q1 to 2.6% in Q3 here, among competitive dynamics, if you are interested, and the rest are [deep dive, 4th buy, 3rd buy, 2nd buy, 1st buy, tariff review, sum-of-parts, Q3’25, Q2’25, Q1’25, Q4’24, Q3’24, Q2’24 update]

As a business owner, I examined and understood why the margin dropped.

Sea Limited’s mission is to create greater value for customers, a prerequisite to being in a position to capture that value over the next 10-20 years.

That requires building the best experience at the lowest cost for merchants and customers to exchange goods and payments, and then positioning it to capture most of the value created:

1. create value to the ecosystem (better than competition) —>

2. capture value / cash flow

3. reinvest to create and capture more value

= longevity.

The ending is still unfolding for Sea Limited, as the market's competitiveness has yet to reach equilibrium. Therefore, it’s essential to step back, look beyond immediate news flows, and consider how industry/customer trends affect the business over the long term, as well as the rationale for the company's and competitors’ actions.

Sea Limited is creating real customer value, beginning to extract value from customers, and appears to defend well against competitive market conditions. I say ‘appears’ because at 50%+ market share, you need to start overstating the competitiveness to avoid anti-monopolistic regulations. The reality is that when the whole industry is raising the take rate, that means excess value is being created and extracted.

So, when Sea’s value should drop by 40% because its margin drops by a few basis points, I examine why and zoom out.

Case in point: Amazon and Mercado Libre, the first and second proven iterations of e-commerce, one created in 1994 and the other in 1999, have shown time and time again that their path to market leadership was broad SKU at low prices. Meli’s road is the most similar to Sea’s, and Amazon’s path is the most different. But their journeys all required consistent and substantial investment in infrastructure. Amazon still spent nearly ~$100B in logistics last year, 30 years later, and plans to invest $40B in the UK alone in the coming years. Meli also spent ~$13B last year, the workforce increased by 30% in 2025, and it plans to continue investing in rural regions and markets outside Brazil.

So for Sea, it’s still early days. To capture and retain more customers, Sea will not stop at investing in logistics. It must continue to hyper-localise its services and increase customer touchpoints to differentiate itself. Every move reduces the investment risk. Hence, I am happy with temporary margin compression due to higher expenses and investments in VIP programs, Shopee Live, and credit/loans to customers through its fintech services (Monee). In a region where e-commerce and digital banking are still left to be desired, I see these continued investments as future value creation, and the recent drop in the stock price is highly welcome for cheaper buybacks ($1B program authorized) and for my further buys.

Finally, at ~$120/share and under 20x free cash flow, my estimates indicate the market expects only 7% free cash flow per-share growth through 2037. The market is underestimating Sea's ability to evolve and create value for the increasingly demanding 700M population in Southeast Asia, of which 300M (mostly in SEA) are active Shopee buyers, 45M are already active Fintech users, and 66M are paying gamers.

The above sums up my view as a part-owner of the businesses. A 40% price dip does not reflect the value Sea can capture and extract in the future; hence, my additions in November and December at $122 and $136/share.

Key lessons and improvements in 2025.

With a focus on deep fundamental research and long-term ownership, I am reasonably comfortable with the advice: ‘bet big when the odds are in your favour’. However, selling and cutting winners remains my weakness.

Last year, I learned that when selling, I should ‘sell my least loved business’. This year, I realized that no matter how good the business is, I need to be more ‘critical of my most loved stocks’, dissect them, and be ready to part ways (not clinging to stocks that I have spent considerable time on) for better opportunities. It’s a balancing act, given I don’t want to mistakenly ‘cut my flowers’.

During the year, I started the Best Buys series to force me to consider every position in the portfolio as if I were starting from scratch each month. As a result, I was able to trim CrowdStrike by half, a position I have held for over 5 years, from <$90/share (vs $525/share - sell alert).

So, no stock is ‘not for sale!’.

Together with CrowdStrike, Sea Limited, Mercado Libre, and Veeva were held for over 5 years. All have suffered 30% drops multiple times, 50% once, and 80%+ once (Sea).

I am glad I didn’t sell then, but this year CrowdStrike’s stock has ventured into unimaginable valuations. The sale also pushed me into uncharted territory and set a precedent for all my future sales decisions.

From now on, all stocks are candidates for trimming; to capture better opportunities or for cash until valuations come down to warrant further additions. Even Warren Buffett is sitting on nearly $360B cash (36% of the $1T market cap).

During the year, Wisetech also traded at close to 100x FCF (Q1 2025). CrowdStrike traded at 120x recently. In hindsight, Sea Limited trading over 30x FCF would have warranted a slight trim or a discussion of selling, given the 20% holding.

Avoid highly debated stocks - Intellego.

My next lesson is about my mistakes with Intellego. I have already written multiple articles on this (mistake; cautioned others about the risk), but I add here that greater attention should be paid to working capital management. Quality of the revenue isn’t just about recurring revenue (89% of sales are from existing customers for Intellego), but I should also demand stable inventory days and receivable days. In other words, I demand that my business has inventory that sells and customers that pay. I relaxed these parameters for Intellego, given its early stage in the business/technology, where it needed to offer incentives (extended payment terms) to attract early, large international customers. Additionally, investing in smaller-cap companies will require more stringent parameters, as outlined in this article.

Now, my Intellego’s shares are treated as if I own a private unlisted business. Regardless of whether it is relisted on the Nordic Nasdaq, I hope that only a few actors are bad apples and that the company can continue to serve real hospitals and save lives. Even if all else fails, Intellego’s 10.5% ownership stake in one of its partners, HAI Solutions, may be worth something. HAI Solutions has the first and only FDA-approved UVC Technology for Microbial Reduction on Needleless IV Connectors, a $1.5B global market, and has the exclusive right to distribute the product in China and to receive royalties on global sales. This thriller continues….but will be the last I watch before bed.

Even better businesses and engagement.

In the past, I have shared my sleep well picks only after conducting research and writing up everything. But with the lessons above, I have started sharing research in the Best Buys series to get early feedback from you, many of whom are experienced fund managers. This will help us avoid more pitfalls like Intellego. So far, we talked about Rubrik, Fila, and ReposiTrak, and crossed out Airbnb, Evolution AB, Teqnion, and LVMH, all of which have yet to prove to be high-quality businesses (yet).

In 2026, I’ll continue to profile my early research monthly.

Next are three incredible businesses that I intend to dig deeper into and buy when their valuations take a break (every stock dips at some point). You will see that they will significantly improve the quality of the Sleep Well Portfolio companies.

Company A:

• Oligopoly with ~35% market share, over a century of history of operation, a company with the longest revenue visibility I have come across, which is up to 25 years, and 70% of it is recurring. Demand has never been an issue, and growth is well supported by high barriers to entry, driven by the business's near-natural moat (regulations) and high switching costs. Management is incentivised based on their performance in ROIC (return on invested capital) and growth in free cash flow. They want what investors want. The business has simplified significantly in recent years, and opportunities to acquire shares at a lower valuation could be on the horizon.

Company B:

• A monopoly of general surgery with a 90% high-margin recurring revenue. The company aims to increase the installed base by 5x by 2035, with no competition and a strong contender to counter AI risks. High regulatory hurdles, a long sales cycle, and high switching costs protect the company’s market share. The company is highly resilient to health crises, has a substantial cash buffer, and is AI-embedded.

Company C:

• A leader in 2D, 3D, and 4D medical imaging. An aging population, ongoing cloud adoption, and a massive skill shortage are driving extremely long-term growth. Additionally, most of the US market still relies on legacy systems, and other geographies remain largely untapped. High-margin revenue is extremely defensible, as customers are guaranteed contracted revenue for five to eight years.

FY2025 Performance 😴

Caveat emptor: Our finish line is in 2037, not 2025. Judge my performance in a few years, not today. That said, let’s celebrate crossing our third year together!

Since the inception of Sleep Well Portfolio (October 2023), my self-reported result is 16% money-weighted per pick (32% in 2024).

For more details and all transactions since inception, please refer to the Sleep Well Portfolio spreadsheet (available only for the annual subscription). One of the sheets you can see is the thesis tracker below, which includes links to all write-ups, sorted by quarter and name.

As per Interactive Broker’s automated report, the Sleep Well Portfolio (blue) returned 37% since inception, compared to ~60% for the S&P 500 (Sep 2023 - 24 December 2025). You can see the underperformance began after the September decline, which coincided with the declines in Sea Limited and Intellego. As per the commentary on both businesses above, I am optimistic Sea will come back and drive positive contribution to the portfolio in 2026, and Intellego might come out less than the current 70% loss as a private company.

Year to date, SWI returned 5% vs. SP500 at 16%.

Meanwhile, my Personal Portfolio (PA) returned 0% this year, compared to 16% for the S&P500 (01 January 2025 - 24 December 2025).

My PA’s underperformance is attributable to holding much larger positions in Sea Limited, Mercado Libre, and Grab, all of which I have held for over five years and underperformed this year.

But 2025 has already passed. What is most important is the health of the portfolios beyond 2026. I am very excited to learn from the mistakes of 2025 and share our success as the year progresses!

Don’t hesitate to comment, help me improve, and contact me through trung.nguyen@sleepwellinvestments.com, LinkedIn, or twitter/X@SleepWellTrung

Happy holidays with your loved ones!

Trung 🙏

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Build your Sleep Well Portfolio today

Every month, I publish a Best Buys list to highlight which of my 23 sleep well picks I consider worth adding or trimming. It complements my quarterly thesis-tracking updates, in which I essentially ask, “Is the thesis intact?” for each company.

I also discuss my research list of ~40 businesses. In this series, I want to discuss a leader in Food Safety (a direct competitor to SPS Commerce’s small line of revenue - tracability, partnership with iFoodDs ~$7M annual revenue). It has been doing well but is suffering a temporary setback due to a delay in FSMA 204 becoming law. Prices are becoming very interesting and, if one is patient, this company could be a big winner.

Best Buys for December 2025

1. Public Safety SaaS leader - 4% yield with at least 20% 3-year forward growth guided

2. Commerce Infastructure in South East Asia - 5% yield with a decade of 20% growth

3. Commerce Infastructure in Latin America - 5% yield with a decade of 20% growth

4. Retail Supply Chain SaaS - 5% yield with at least 10%+ growth

Trimming candidate

1. CrowdStrike (CRWD), an 8% position, with a P/FCF of ~120x, is outside my comfort zone.

Before we dive in, please be reminded that the average ‘investors’ holding period has shortened to just a few quarters, from 30 months in the 1990s. In contrast, my holding period runs until 2037, when the portfolio will pass to my daughters. As a result,

The endgame of best buys

is to highlight enduring businesses at reasonable prices and own more shares incrementally.

My strategy -

• Add to those with unique anti-fragility for specific events.

• Balance the portfolio with businesses at different life stages.

• Add to the winners who experience short-term setbacks.

For example, I have

• 17% of the portfolio that performs well in ‘security crisis’ - CrowdStrike, Fortinet, and Cellebrite, 27% does well in global logistic complexity - Wisetech, SPS Commerce, and Grab, 7% to buffer the portfolio if we have another health crisis - Veeva Systems, 32% to navigate the digitalized world - Sea Limited and Mecardo Libre.

• 30% of the portfolio is in a more mature stage of its life cycle, 6/13 are US domiciled, and 12/13 have a net cash balance sheet (average of 6% of market cap).

The list is not based on the positive/negative newsflow for the following quarters. It is also not deliberately trying to be ‘active / beat’ the market (S&P 500); if it does, that’s the icing on the cake. It’s more about building knowledge and positioning in businesses that I think will perform sustainably through 2037.

Hence, best-buy lists are personal; to apply them accordingly to your needs, I encourage you to review the deep dives and updates before taking action.

Disclaimer: As a reader of Sleep Well Investments, you agree to our disclaimer. Full details here.

If you are new to SWI, check out our FAQ and Owner Manual.

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Build your Sleep Well Portfolio today

Summary of November 2025 - 2nd tough month

• The Intellego MISTAKE lingers on for the second month. The founder and CEO has now been detained and is likely to be charged with gross fraud. The business is real, but management is rotten. Deloitte, the Swedish Credit Agency (EKN), Nordea Bank, and investors have all been misled. The stock will likely be delisted, and I won’t know the ending for many years. The SWI portfolio for October and November was impacted significantly. My PA saw a near 7-figure loss, too.

• I stuck my neck out and stepped out of my comfort zone with Intellego and got my head chopped. The situation was also compounded by the historic flooding of my new home in Hoi An and the failure of my extended family’s business, which I stepped in to help. Investment decisions during September and October were made under intense pressure. But I am not one to shy away from mistakes; they need to be minced, experienced, and learned.

• Onwards, I am excited to grow a new head and turn the portfolio around. The fundamentals of the rest of the portfolio are strong; it requires patience.

• Declines in core positions SE (20%), WTC (9%), MELI (15%), and KSNL (5%) dragged the portfolio down from overperformance to underperformance for the second month. These are temporary.

  

• I expect a rebound. SE and MELI are trading at ~20x FCF for mid-term 20%+ growth and a very low chance of being disrupted from their 50%+ and 30% leadership position. Monetization is just starting from years of building moats around the ‘castle’. I believe those two alone will turn my current underperformance around. A detailed study of SE’s valuation was conducted here on 17th November. Next, I also have strong reasons to think WTC will do well in 2026, but the transition for the new CEO and commercial revenue model will take time. Hence,

• The two additions in the month (no sales) were WTC at AUD 66/share and SE at $136/share. Sentiments are low for these two quality businesses and I believe, its’s a good time to add more of its stock.

• Return from inception was 2% vs. S&P500 32%: ~30% underperformance.

• 2025 Year-to-date return was -9% vs. S&P500 16%: ~25% underperformance.

• Picks’ annualized return is now 21% compared to 27% in October, 47% in Sep, 50% in Aug, 46% in July, 61% in June, 64% in May, 51% in April, and 38% in March.

• 3 losers, 10/13 making money, and 23/33 transactions were correct decisions.

• Best buys and research list - will be posted separately. The latest edition is here.

  

• If you are new to SWI, check out our FAQ and Owner Manual.

If you are already an annual member, you can access the Sleep Well Portfolio and Thesis Tracker via the link below.

Take me to the Sleep Well Portfolio

Safety first, returns later.

We saw that avoiding losers is crucial to overperformance. Avoiding future Intellego will help the portfolio perform again.

Next, bet big when the odds of being right are high. We have a high concentration on SE, MELI, GRAB, WTC, VEEV, and CRWD; the success of these four will determine the end of SWI in 10 years.

The downside is that there will be large swings, particularly when you run a concentrated portfolio [current portfolio in the next section].

For now, one WTC is one of the three losers (Intellego, Wisetech, and SPS Commerce). This is the second month we have had three.

As the situation at Wisetech has been self-inflicted [unforced errors] and improved, but the price has remained 50% off peak, I added shares.

I am eying an addition to Cellebrite and SPS Commerce, as both haven’t done much wrong to warrant an 8% and 24% decline in the month.

On SPS Commerce, shares declined by 20% post Q3’25 earnings due to Q4 softness. For me, it’s more about the management’s inability to set a medium-term growth target. While I believe it can continue at ~15% growth, including acquisition, management leaned towards 7-8% organic growth and leaving the inorganic growth for the market’s imagination. The 20% drop is a significant overreaction. I put the business on the last Best Buy list and may add shares down the line. You can follow the thread here.

Since we launched the Sleep Well Portfolio in 2023, we have had:

• two losers over 5 months, and

• three over 2 months.

• one or no losers over 17 months.

With more time to monitor the businesses, we can be more comfortable with betting big on our winners and avoid future Intellego.

Sea Limited and CrowdStrike are examples. Our returns on Sea Limited and CrowdStrike have increased by 100% and 150%, respectively. We added to Sea 5 times in the 17 months, and it now accounts for 21% of our portfolio. Wisetech will do very well, and I am optimistic about closing the gap with the S&P500 by adding more to Wisetech over time. Next, headwinds at Cellebrite and SPSC will be tailwinds in the coming quarters. Time is on my side; my horizon is at least a decade. The course will correct.

To close the commentary section, I am leaving Intellego’s loss on the portfolio as a good reminder, while eyeing additions to my future winners - WTC, CLBT, and SPS Commerce.

SWI Performance since inception 2% vs S&P500 32% - Interactive Brokers:

Current portfolio - 3 losers

Previously - October 2025

Previously, Sep 2025 - 2 losers

Previously, Aug 2025 - 1 loser

Previously, July 2025 - 2 losers

Previously, June 2025

Previously, May 2025

Previously, April 2025

Previously, Mar 2025

Transactions with notes below:

Expanding investment universe

You will only see me buying businesses that I thoroughly understand (see the deep dives below). I’ll expand the list when I find ones that pass the Sleep Well Investments checklist.

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I am buying more Wisetech (WTC). Best of class business (86% gross margin, ~35% free cash flow margin, growth at ~20% expected mid-term), trading at the low end of the last 10 years p/fcf valuation at ~40x.

Read my past writeups for full context: deep dive, buy alert 2, buy alert 1, FY24 update, H1 FY25 update, CEO shake-up, E2Open acquisition, Back to basics. (tracking sheet below)

And in case you missed it, WTC was featured in my November Best Buys, and a few days before buying WTC, I also bought Sea Limited (SE) for my PA at $136/share.

What’s going on with the stock?

The stock has declined 55% to AUD 60 from AUD 134, primarily due to the ‘loss of focus’, to put it mildly, by the co-founder and current executive chair, Richard White (30%+ owner of shares). He has led the business for the last thirty years. Still, the sex scandal and power-grabs saga undoubtedly derailed business momentum, delayed key product releases, and slowed revenue growth.

I am a bit annoyed as it was an unforced error (more here), but as someone who wants to own the Wisetech business forever, I am a happier buyer here.

What’s going on with the underlying business?

But it’s been a year since the news broke, and I feel vindicated as I am still holding and now in a position to add more. My thesis-breaking event has always been that if a key top large freight forwarder (e.g., UPS, DHL) leaves, then something more rotten is going on, and that means I would have to reconsider my position.

Yes, growth slowed in the last 3 quarters, but instead of losing clients, WTC has continued to onboard large clients, and the last two top 25 LFF wins are going to produce 3x the wins of 2024. They are Nippon Express, a $20B revenue company and the most prominent logistics logo in Japan, which signed CargoWise due to losses from internal software failures, and LOGISTEED, a $6B revenue company with a presence in 100 countries.

What changes are being made?

Read more

Absolutely—founder Richard White’s power grabs, sex scandal, and share-trading probes, in my view, not only caused the 2nd most significant stock decline after the 2020 crash but, fundamentally, (i) caused significant key product delays and (ii) eroded shareholder trust.

Today, the market cap stands at AUD $21B ($13.6B), and the stock hovers in the AUD $60s.

You could say the moderating top-line growth since Q4’2024 caused the fall.

So, we’ll dig in to see why and if this situation is permanent. And if the multiple contraction to P/FCF of 41x? And 37x Proforma EV/FCF (with E2Open) attractive?

We are going to ask the same questions we asked when we deep dived in the company in January 2024, including:

• Who are the customers? How do customers use CargoWise? Why do they choose it over alternatives?

• Have the moats eroded or widened?

• How does CargoWise + E2Open extend product and market penetration?

• What free cash flow growth can we expect from here vs. what the market is expecting?

• What are direct peers and top businesses trading at?

To understand the context, read my deep dive, buy alert 2, buy alert 1, FY24 update, H1 FY25 update, CEO shake-up, and E2Open acquisition.

First principle thinking

Read more

Garena’s cash and mobile UX / UI built Shopee, an online marketplace for merchants and customers to exchange goods. Monee facilitates payments and adds credit to build more trust and enable more transactions. Logistics further improve convenience and trust. Emerging subsegments, such as advertising and VIP programs, add value to power-sellers and buyers.

Garena is perhaps the odd one out, but it provides stability for management to build Shopee and lay the foundation. Hence, if you remove any segment, the Sea’s ecosystem suffers.

As a result, this valuation is merely an estimate of the value of each segment if sold as a whole. I don’t think the value is worth as much if they are sold separately.

Let’s start

Sea Limited, a 55% position in my PA and 21% of the Sleep Well Portfolio, continued to perform, yet shares dipped 30% from their peak for reasons not aligned with my time horizon and thesis. As a result, I have given extra time to look into valuation to help me and SW investors know why they should be adding shares.

SWI’s SE coverage: [deep dive, 4th buy, 3rd buy, 2nd buy, 1st buy, tariff review, Q3’25, Q2’25, Q1’25, Q4’24, Q3’24, Q2’24 update]

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Hedgeye analyst Felix Wang’s short call at $190/share in September is correct in this time frame, and I am thankful to him, as I can add more shares at a 25% discount today.

Why am I bullish on the business long-term? I’ll go through:

1. KPIs (operations, financials, peers, market share)

2. Other highlights (Brazil, Argentina)

3. Why is it the largest position of SWI

4. Valuation - $145/share, market expectations vs. SWI’s expectations

SE coverage: [deep dive, 4th buy, 3rd buy, 2nd buy, 1st buy, tariff review, Q2’25, Q1’25, Q4’24, Q3’24, Q2’24 update]

I use all my financial data and charts on Fiscal.ai. Get a 15% discount while supporting SWI, the following affiliate link should work.

Don’t miss out on the November Best Buy List.

For everything else, start here. Please use the FAQ alongside the SWI Manual to get the most out of your subscription.

KPIs (operations, financials, market share)

As a group, this was a blowout reacceleration of growth.

Management’s focus remains the same:

“continuing to deliver high and profitable growth across all three of our businesses. With e-commerce and digital finance penetration in our markets still low but increasing, strong growth lays the best foundation to maximize our long-term profitability,” - Forrest Li, Sea’s Chairman and Chief Executive Officer.

Q3 saw 38% growth as a group, with Monee growing the fastest again at 60% YoY.

All still profitable with Monee investing heavily in increasing the loan size (marketing up 140% to $157M and provision for credit loss up 76% to $373M)

Let’s dive into all the segments. I’ll focus on the long-term trajectory.

Garena - back to hyper growth, best Q since 2021

Garena, once a hyper-growth cash cow pre-COVID, then a struggling division post-COVID, is back in hyper-growth mode, posting 31% revenue growth and 51% bookings growth.

The trend is well supported by the 670M Quarterly Active Users and 66M Quarterly Paying Users. Numbers are yet to hit peak Covid, but it doesn’t have to. I view this segment as a cash cow and expect little growth onwards.

Booking per paying user was at ~$13/user, an increase of ~20% from the bottom two years ago.

As such, EBIT has remained strong at ~$300M and Adj.EBITDA at $456M (operating cash flow). Annualized, this is almost a $2B operating cash flow segment!

Why the strong performance may continue.

Read more

Intellego, a position acquired in September, just before the storm of bearish reports, is down 50%. Am I wrong? Yes, it’s not a sleep well pick (I admitted my mistake on 10th October here), but am I wrong about the business? I am not sure!

I need at least another quarter to know.

Before you read my Intellego’s Q3’25 review, please read the 29-page report first.

I am biased. But in my opinion, the disclosure has improved significantly.

Content:

• Q3’25: Expectations

• What was delivered?

• Q3’25: results, including EKN and Moveomed

• Future expectations

SWI’ writeups on INT: [mistake, deep dive, 1st buy, 2nd buy, 3rd buy, risk management, 1st live event, mispriced]

If you are new, read more about us here, our latest portfolio review here, and best buys here.

Q3’25: Expectations pre result.

I wanted better disclosure. Details:

i) sales composition, including from subsidiaries, and payment terms

ii) more information on the business model

iii) cash flow conversion from operating income (EBIT),

iv) working capital needs, and capex.

v) progress of the partnership with Henkel and Likang.

vi) capital allocation from recent cash build-up.

What was delivered?

i) sales composition, including from subsidiaries (Yuvio & Daro) - YES - page 10 and more, the top 10 customers composition was provided

ii) more information on the business model - YES - page 5, prior quarters focused more on the ‘What are the technologies’, this one explained the ‘Why it matters to customers’. It also clearly shows that the strategy is to sell/lease disinfection devices at minimal profit to up-sell the dosimeters, which are high-margin and recurring.

iii) cash flow conversion from operating income - YES - page 22-24, page 8 (EKN)

iv) working capital, including a breakdown of day sales outstanding (DSO) - YES - page 10

v) partnership with Henkel and Likang. YES, but limited—pages 3 and 6 show how and why the dosimeter is essential in the curing process. Page 3 also discloses what to expect in 2026 when all hospitals in China must use products like Intellego to validate their disinfection runs.

vi) capital allocation from recent cash build-up. YES

Q3’25 Results

Let’s skim through the income statements and cash flow statements.

• Sales was ~300M SEK increased ~300%, 87% from existing customers (recurring). To date, the Group has sold hundreds of devices globally. It has 331 active customers (who bought once in the last 12 months). Millions of dosimeters were sold and could double in 2026. Dosimeters are becoming an integral part of daily routines across the healthcare sector. It helps to improve workflow efficiency and disinfection results for users.

  Below are the top 10 customers. There is a high concentration, but it’s common in hyper-growth companies. Likely the 13% from China was from Likang? The 1.5% from a medical device is likely HAI Solutions, which is very interesting. Do check it out.

  Importantly, the top customer is likely to be Moveomed’s €22M deal announced on 4th October. I find this one a little strange, as the deal was announced just after the Q3 cut-off dates. Smarter investors can shed light here, but as long as the orders were delivered and ‘in the customer’s control’, Intellego is allowed to recognize the sales in full under IFRS 15. I would argue that would be for Q4. Why was it recognized in Q3? I don’t know.

  

  Below is the sales broken down by country, with the US and Europe accounting for the majority.

  

  Disinfection is still 98% of sales in Q3 and 93% YTD.

  

  In disinfection, the company expects a significant tailwind in 2026 when the national regulations take effect. Likang’s connections to 30,000+ hospitals MUST use products like Intellego. Given the development, it’s now likely that it’s just a matter of time before the EU, the US, and other markets implement the same regulations.

• EBIT was 171 SEK, increased by ~700%.

• Cash flow from operations was SEK 37M, increased from a cash burning position of SEK -5 M. So, the conversion from EBIT to cash is just 22%, low but not out of the ordinary for a hyper-growth company.

The key thing to see here is the reduction in accounts receivable, indicating customers have paid more of their invoices.

However, it will still be a slow grind, as day sales outstanding were 142 days, so the company still has to wait over 6 months to receive cash from customers. The good news is that the DSO has improved from 173 last year.

Below is the company's context.

Since 2023, Intellego has offered extended payment terms as part of a deliberate strategy to increase market share. Over the past year, we have gradually begun shortening these terms to improve cash flow and strengthen the company’s financial position. The transition is taking longer than expected, as customers have become accustomed to longer payment periods and the associated liquidity benefits.

The other core thing to understand is also the following disclosure:

The extended collaboration with The Swedish Export Credit Agency (Exportkreditnämnden, EKN) has enabled the Group to receive SEK 52 313 thousand in financing, after deductions for transaction costs, during the third quarter. Leading to totally received funds during January to September 2025 of SEK 128 645 thousand, after deductions for EKN and financing partner transaction costs. The financed invoices are not considered in the accounts receivable per 30 September 2025 as they are financed without recourse. The total EKN guaranteed invoices per 30 September 2025 conclude to SEK 132 996 thousand (0) when EURO is converted to SEK currency.

Read more

Build your Sleep Well Portfolio today

November is offering us many opportunities within the sleep-well universe. SaaS, compounders, and even Constellation Software (below) are getting hammered. On the other side is anything related to AI.

With the average ‘investors’ holding period shortened to just a few quarters, from 30 months in the 1990s, corrections are a good time to accumulate shares in good businesses. I will be adding 2 to 3 positions listed in this 2nd Best Buys edition. Just a little bit, but my investing horizon is until 2037 (when my daughter takes over the portfolio), so every add at today's prices will make a big difference.

Let’s explore what's good to add and what's good to research further.

Best buys for November 2025

Aims of best buys

The monthly best buys aim to highlight opportunities to strategically build the portfolio with a clear endgame: ‘starting capital’ for my daughters. I can not draw liquidity from this portfolio, and every dollar invested is a dollar of extra opportunity for them.

My strategy - balance preservation and growth

To achieve the endgame, I prioritize avoiding losses by adding to winners, then diversifying into growth opportunities to ensure a balanced approach across the business lifecycle. Why? Time-tested companies tend to perform well in bear markets, while younger, promising businesses tend to thrive in bull markets.

Additionally, the list is not based on the positive/negative newsflow for the following quarters. It is also not deliberately trying to beat the market (S&P 500); if it does, that’s the icing on the cake. If not, I am entirely okay with it.

Hence, best-buy lists are personal; to apply them to your needs, I encourage you to review the deep dives and updates before taking action.

1. Public Safety SaaS leader - 4% yield with at least 20% 3yr forward growth guided

2. Global logistics SaaS leader - 2.5% yield with a decade of growth runway

3. Commerce Infastructure in South East Asia - 5% yield with a decade of 20% growth

4. Commerce Infastructure in Latin America - 5% yield with a decade of 20% growth

5. Retail Supply Chain SaaS - 5% yield with at least 10%+ growth

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