Night Watch Investment Partners LP on Universal Technical Institute, Inc.
Thesis
Universal Technical Institute was the fund's largest detractor during the quarter, but Night Watch continues to maintain its long position. Demand for UTI's vocational programs remains strong across areas such as welding, automotive and jet-engine mechanics, electrical work and HVAC. The current challenge is the shift from traditional Google Search toward Agentic Search, which is forcing businesses to rethink how they acquire customers. Night Watch does not expect this issue to be resolved immediately but believes it is solvable and therefore has not exited the investment.
“While this won’t be resolved overnight, we think this is a solvable issue and we are maintaining our long position.”
Key risks
- The shift from traditional search toward Agentic Search could disrupt customer acquisition.