Geberit AG

“Geberit is a structurally superior sanitary infrastructure business with a deeply entrenched installer-loyalty moat, 22–28% ROIC sustained over two decades, and near-zero risk of permanent capital impairment. The problem is entirely valuation: at 29x trailing earnings and 11.5x book, the market has already capitalized the quality, leaving a probability-weighted 10-year return of roughly 5–6% annualized — insufficient for long-term investors requiring 8–10%. The current cyclical trough in European construction does not alter the thesis but does not create a margin of safety either. This is a TRACK situation: maintain a target entry zone of CHF 420–450, representing 20–22x normalized earnings, where the return profile becomes genuinely compelling. For existing holders, hold — don't sell a franchise at the bottom of a cycle, but don't add at these levels.”