Diamond Hill Capital Management, LLC / Mid Cap Strategy on Veralto Corporation
Thesis
Diamond Hill initiated Veralto after concluding that the market was underappreciating the resilience of its water-testing and treatment business. The company combines a resilient business model with strong profitability and disciplined capital allocation. The fund contrasts those attributes with the market's heavy focus on faster-growing data-center-related industries. Diamond Hill believes the relative lack of excitement around Veralto has created a more attractive long-term risk-reward profile.
“We initiated a position as we believe the market has underappreciated the company’s resilient business model, strong profitability and disciplined capital allocation”