Core Equity Alpha — July 2026 Update

Core Equity Alpha is a systematic, equal-weighted equity strategy that selects holdings by a composite rank blending growth, value, and quality. Each month the portfolio rebalances, and this note summarizes the resulting turnover and the factors behind it.

On June 29, 2026, the monthly rebalance replaced 11 stocks out of 100.

Spotlight Addition — CF Industries (CF)

CF: CF Industries posted the strongest composite-rank improvement among this month’s additions, driven primarily by an attractive valuation. The stock continues trading at a modest earnings multiple despite a sharp step-up in profitability.

Shares recently traded near $108, putting the stock at a trailing price-to-earnings ratio below 10x as of July 1. This level is inexpensive relative to the company’s own earnings trajectory.
First-quarter 2026 net sales rose to $1.99 billion, up roughly 20% year-over-year.
Diluted earnings per share of $3.98 more than doubled the prior-year period, aided in part by a roughly $170 million litigation settlement.
The company continues returning capital to shareholders under its $2 billion share-repurchase program, with roughly $1.7 billion still available as of quarter-end.

Spotlight Removal — Certara (CERT)

CERT: Certara saw the sharpest composite-rank deterioration among this month’s removals, driven primarily by a weakening profitability profile. Margin and earnings pressure has been building beneath modest top-line growth.

In its most recent quarter, revenue grew just 1% year-over-year to $106.9 million
The company swung to a net loss of $8.8 million from net income of $4.7 million a year earlier, and adjusted EBITDA fell to $31.7 million from $34.8 million.
In May, the company completed the sale of its regulatory and medical-writing business to Veristat for $85.0 million in cash, plus $15.0 million in escrow and up to $35.0 million in earn-out payments. That unit had generated $50 million of revenue and $17 million of adjusted EBITDA in 2025, shrinking the ongoing revenue base and adding uncertainty.

Other Monthly Turnover

Turnover in the strategy is driven by changes in each stock’s composite rank, which blends multiple factors including growth, value, and quality. While trades reflect a combination of shifts across all three factors, we attribute the single factor that moved most decisively in the list below.

Additions

Value: 10
Quality: 1

Removals

Value: 6
Quality: 2
Growth: 1
Other: 2 (see below)

*This period’s “Other” trades: One removal due to the effect of acquisitions on a quality metric; one removal due to a quality metric falling out of reasonable bounds.

Disclaimers

Note on examples. The securities discussed are shown only to illustrate the systematic ranking process underlying the strategy. They do not represent all securities added or removed this period and are not necessarily the most significant, best-performing, or most profitable of those trades; it should not be assumed that any were or will be profitable. Nothing herein is a recommendation to buy or sell any security.

This document is informational and educational. It is not an offer to sell, a solicitation to buy any security, or investment, tax, or legal advice. Receipt of this document does not establish an investment-advisory relationship between Magnifina and the reader.

The strategy relies on third-party fundamental and analyst data for security selection. The continued availability, methodology, and quality of that data is not guaranteed; changes by data providers or errors in third-party data could affect strategy behavior.

All investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. No representation is made that the strategy will or is likely to achieve results comparable to any discussed.