Meridian Hedged Equity Fund on GlobalFoundries Inc.
Thesis
GlobalFoundries provides geographically diversified semiconductor manufacturing capacity across the U.S., Europe and Singapore, with exposure to automotive, industrial and hyperscale data-center demand. The company benefited from significant gross-margin expansion and more than 30% revenue growth in its Communications Infrastructure and Data Center segment during the quarter. Meridian also highlighted the introduction of a quarterly dividend and a capital-allocation framework targeting the return of up to half of free cash flow to shareholders.
“The company's performance was bolstered by a significant structural gross margin expansion of 300 basis points year-over-year.”