Perimeter Solutions Surges 111% as a Fund Makes a Calculated Exit

In the grand theater of high-stakes finance, where everyone’s trying to look as composed as a cat at bath time, East Coast Asset Management decided to cut its losses-or perhaps just rearrange its deck chairs-by trimming its stake in Perimeter Solutions. Five hundred ninety-seven thousand, eight hundred forty-seven shares vanished like a bad date, costing the fund roughly $6.4 million, according to some SEC paperwork that I’m pretty sure I’ll need a magnifying glass to decipher.

What Happened

During the third quarter, a typically discreet act of stock trimming took place-like snipping a strand of hair just before a first date, hoping no one notices. This fund, which manages nearly $320 million in U.S. stocks, decided to unload almost 3% of its position in Perimeter Solutions, leaving behind a little over 1.5 million shares valued at about $35.24 million. This modest redistribution makes you wonder if they’re trying to dress their portfolio for a cocktail party rather than a fireworks show.

What Else to Know

After this haircut, Perimeter Solutions still comprises roughly 11% of the fund’s U.S. holdings-the financial equivalent of a guilty pleasure that you hide from your friends but secretly admire. It’s the second-largest crusty piece of their pie, just behind Google (or Alphabet if you prefer keeping it fancy). Post-trimming, their top holdings are a smorgasbord of tech giants, with Google leading the charge at about 15.7% of assets under management, followed by a stable lineup of other familiar faces like Tesla and Meta. Meanwhile, shares of the company were trading at $28.08-upward of 111% in a year, which, in my book, is like watching your investment go to a party and come home with a new tattoo.

What’s most amusing about this surge is not just that Perimeter Solutions skyrocketed but how it outperformed the S&P 500’s modest 15%. It’s like showing up at a family gathering and discovering your cousin’s been secretly training as a sumo wrestler. The company, a specialty chemicals outfit with fancy brands like PHOS-CHEK and FIRE-TROL, specializes in firefighting foams, retardants, and a sprinkle of lubricant additives for good measure. Their reach extends far beyond the American borders-think Germany, the U.S., and perhaps a few places I’ve never heard of but imagine are very serious about fire safety.

Company Overview

Metric	Value
Price (as of Friday)	$28.08
Market Capitalization	$4.15 billion
Revenue (TTM)	$636.34 million
Net Income (TTM)	$78.03 million

Company Snapshot

Offers fire retardants, firefighting foams, and lubricant additives that, unless you’re very unlucky, probably save lives and property.
Gains most of its cash through the Fire Safety and Oil Additives segments, supplying industrial and government clients, which sounds grand but mostly involves waiting for emergencies and hoping you never have to use them.
Runs a global operation that extends beyond Uncle Sam, reaching into Germany and beyond-making it look like a very serious (and slightly intimidating) player in the specialty chemicals arena.

Perimeter Solutions is a typical story of a small-to-medium enterprise playing a big game-protecting the world one chemical compound at a time, all while trying not to set itself on fire. Its diversified portfolio and international reach give it a sturdy, if slightly smoky, edge in the field of specialty chemicals.

Foolish Take

Now, here’s the part where the irony deepens. Even after the fund’s modest purging of approximately $6 million worth of stock, the remaining position still constitutes over 11% of their portfolio-a reminder that “trimming” is often code for “making sure I don’t look too enthusiastic about this runaway rocket.” The business itself continues to hum along nicely-revenue rose 9% with a bit of the old EBITDA magic, up 9% as well, thanks to fire safety products. It’s like maintaining a car that’s just a little too shiny, so everyone thinks you’re doing great-or maybe just trying not to notice the creaking beneath the surface.

In essence, this is not about retreating but recalibration-like a golfer adjusting their stance after a bad shot. Selling a slice of your winners isn’t proof you’re wrong; it’s proof you’re paying attention. Long-term investors get this. The market’s chaos is its own kind of theater, and sometimes it pays to step back and remind yourself that you’ve seen the fireworks before-and the aftermath can be equally mesmerizing.

Glossary

13F reportable assets: Securities institutional managers must unveil quarterly, that is, revealing their disguises in a report to the SEC. Think of it as the financial equivalent of showing your ugly sweater at a holiday party.

Assets under management (AUM): The total market value of your savings tucked away in some shiny, mysterious fund.

Position: The amount of a particular security you’re pretending to understand.

Trailing 12-month (TTM): The last 12 months, always an awkward period to review because your life-like your investments-has probably changed a lot since then.

Forward price-to-earnings ratio: The fancy way of saying, “What do people think this stock will make in the future?” Typically a gamble with everyone’s fingers crossed.

Enterprise value/EBITDA: A ratio of “How much is this thing worth versus how much it’s probably making?” Typically used to decide if someone is trying to sell you a lemon.

52-week high: The highest price the stock has seen in a year-kind of like bragging about your latest mail order hobby.

Stake: How much of this company you own, which may be more or less than you realize after a few drinks.

Specialty chemicals: Chemical products made for very specific needs-like duct tape or a Swiss Army knife, but for industries.

Fire retardants: Substances that sluggishly refuse to catch fire, unlike your patience during tax season.

Lubricant additives: Chemicals mixed into oils that make your engines run smoother or possibly explode, depending on your luck.

Outperforming the S&P 500: Beating the market-like winning a race you weren’t even aware you entered.

2025-12-27 02:18