Weekly Update #4 - Week Ending 2/22/26
Studs & Duds | Featuring $BURCA, $BQE.V, $IFA.TO, $VELO, $BOF, $SIF and others.
We’re trying something new on our Substack to help you manage, navigate, and know what’s going on with stocks in our Microcap Quality Index (MSMqi). We’ve already been writing some weekly updates. So far, these have been well received.
However, we want to experiment with changing the format into specific sections, when relevant:
Special Highlights
Studs & Duds
News releases from stocks in the MSMqi using a research tool we built.
Information Arbitrage Tear Sheets on stocks in the MSMqi, using another tool we built to find info hiding in earnings calls.
Please let us know if this post helps you or if you have any suggestions on how to make it better. Don’t worry, we’re not going to bombard you with “noise” updates. Our plan is to send updates when we believe it will be beneficial to you.
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Special Highlights
Notable Accomplishments
BOF | Dehydrated Fruits & Vegetables | New Multibagger: A couple of days ago became the 67th stock to reach multibagger status in our MSMqi. We added the stock to the MSMqi when it was trading at $1.91, and it recently reached $4.18. This decision was partly based on the CEO’s presentation at our March 2025 Virtual Conference. BOF recently announced Q4 2025 results with a very strong 2026 outlook driven by multiple distribution agreements and improving gross margins. We estimate the company will double sales and reach breakeven in 2026; however, we think they could announce a small offering to prepare for scaling manufacturing to meet increasing demand from top retailers, like Walmart, Costco and BJ’s Wholesale Club.
SIF | Aerospace | New Cliff Note: A few weeks ago, we added SIF 0.00%↑ to the index, and it has already risen by more than 30% since being added to the index due to strong quarterly results. Gross margins improved drastically, and the company printed $0.29 in EPS vs. a loss, which results in around $1.16 in run-rate EPS. We see more upside.
New Cliff Notes
[NEW] Cliff Note # 137: High-Growth Microcap Diagnostics on the Brink of Profitability
[NEW] Cliff Note #136: Mission-Critical Technology Leader Entering a Multi-Year Defense Tailwind
Studs
1) BURCA | Boilers and heating equipment manufacturer
Quarterly Results
BURCA posted Q4 2025 results with Q4 sales of $91.1 million vs. $80.1 million in the prior year and Q4 2025 adjusted EPS: $1.62 vs. $0.96 in the prior year. The revenue and EPS numbers are impressive, but the big highlights are:
Divestiture of Asbestos-Related Subsidiaries: BURCA divested subsidiaries with legacy asbestos liabilities and recorded a $23.5 million loss on divestiture. These divestments significantly reduce legal/litigation risk.
Transfer of Pension Obligations: The company transferred $90.4 million of pension obligations and recorded a $23.0 million non-cash pension settlement charge. Although a non-cash loss was recorded, this improves their balance sheet and reduces long-term financial risk.
Investors should note that Q4 is typically the company’s strongest seasonal quarter. We expect Q1 to be down sequentially, but we will look for continued YoY improvements. If the company continues to grow and is viewed as less risky, we could see the stock trading at a P/E of 15, implying a near-term price target of $38.
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