Donville Kent Asset Management January 2025 Commentary

2025-02-09 22:30:00 ET

Summary

• The DKCI Fund returned 102.75% in 2024 and is positioned for continued growth in the next 5-7 year bull cycle for small/mid-cap stocks.
• Despite concerns about tariffs, inflation, and interest rates, the fund remains insulated, focusing on knowledge-based industries and company-specific impacts.
• Earnings growth is the primary driver of market performance, and the fund's investments are poised for significant earnings and revenue growth in 2025.
• Stock market volatility will persist, but the outlook for earnings growth is strong, particularly for small caps, presenting long-term investment opportunities.

Frame of Reference

The DKCI Fund returned 102.75% ¹ in 2024. The fund has performed well since bottoming in October 2023 and we are now just over a year into what we believe is the next 5-7 year bull cycle for small/mid cap growth stocks. The Fund’s performance has continued in 2025, and the Fund was up 1.04% in January ¹ .

The largest contributors to our performance in 2024 were investments in Zedcor ( ZDCAF ), VitalHub ( VHIBF ), Propel ( PRL:CA ), Cipher, Vertical Scope and Kraken ( KRKNF ). Our notable negative performers were Converge & Decisive Dividend ( DE:CA ). Another contributor in 2024 was that our long positions outperformed our shorts every single month....

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