Vitec Software Group AB (publ)

“Vitec is a disciplined Nordic serial acquirer of vertical market software with structural switching costs, 80%+ recurring revenues, FCF conversion above 90%, and a 15-year track record of above-WACC capital allocation. Trading at ~20x forward earnings near the bottom of its historical multiple range and ~48% off its 52-week high with no fundamental deterioration, the stock offers a rare combination of high business quality and genuine valuation margin of safety. The primary permanent-impairment risk — acquisition multiple inflation eroding ROIIC — is real but manageable at current pace; the reinvestment runway across Nordic and nascent international markets remains long. Initiate with a 3-4% portfolio position in two tranches, with the second reserved for weakness below SEK 230.”