3 knockout growth stocks from Munro's Qiao Ma

Please note that this interview was recorded on Wednesday, 4 March 2026. Munro Global Growth Small & Mid Cap Fund performance referenced in this video is shown net of fees for calendar year to date to 3 March 2026.

Global growth investors have had a turbulent couple of years. The rise of large language models (LLMs), shifting capital cycles, and changing technology dynamics have upended some of the sectors that once defined the growth playbook.

Few investors have navigated that shift more thoughtfully than Munro Partners’ Qiao Ma. As a specialist in global small and mid-cap growth companies, she spends her time searching for the businesses that can ride the next wave of structural change, rather than the last one.

In our latest conversation, it quickly became clear that while some areas of the market are under pressure, the opportunity set has rarely looked richer.

“In terms of opportunities, frankly, the opportunity set has never been greater,” Qiao says.

She argues that while parts of the technology ecosystem, particularly software, are grappling with disruption from artificial intelligence, entirely new industries are being built at the same time. Massive data centre construction, reshoring of manufacturing, and rising defence spending are creating new winners across the global economy.

In this interview, Qiao explains how Munro manages risk when markets shift, where she sees the most exciting growth opportunities emerging, and three stocks she believes are particularly well positioned today.

For the full experience, I recommend watching the video above. Alternatively, you can read a summary below. 

INTERVIEW SUMMARY

Risk management comes first

The strong recent performance of the Munro Global Growth Small and Mid-cap strategy has not come from predicting market moves. Instead, Qiao says it comes from a disciplined risk-management framework designed to identify problems early.

“Our philosophy is that very few stocks actually work out. The stock market is made of very few winners and lots and lots of losers,” Qiao says.

To manage that reality, Munro uses a structured review process whenever a holding falls significantly. If a stock drops 20% from its peak, it triggers a full reassessment in front of the investment team.

“A trigger demands a review. The review is a detailed re-pitching of the idea in front of the entire team, and you only get to keep the stock if the entire team agrees with you,” Qiao explains.

This framework proved particularly valuable in 2025 when many software companies began declining simultaneously. Multiple holdings triggered the review process, forcing the team to revisit the underlying thesis.

Eventually, the conclusion became clear: the rapid progress of large language models posed a genuine risk to many traditional software companies.

“The dots connected for us. These large language models, the rapid advancement of them and how each one is leapfrogging the other one, is going to be a real problem,” Qiao says.

Munro ultimately exited its software exposure entirely, which helped the portfolio avoid much of the subsequent sell-off in the sector.

At the same time, capital was redirected toward industries experiencing strong earnings acceleration, including aerospace, connectivity infrastructure, and high-performance computing.

A new opportunity set is emerging

While parts of the technology sector face disruption, Qiao believes investors are underestimating the scale of the opportunity emerging elsewhere in the global economy.

She compares the shift underway in the software industry to the transition from horse-drawn transport to railways.

“Before large language models, software was like a bunch of guys driving pedicabs… now the steam train has just been invented,” Qiao explains.

Rather than focusing on the disrupted industries, Qiao believes investors should instead look at the companies enabling the next phase of infrastructure.

“Massive data centre projects are being built at a scale we have never seen in human history, and they are being built faster than anything we have seen", Qiao says.

For small and mid-cap investors, this is particularly fertile ground. Because physical supply chains involve multiple specialised suppliers rather than winner-take-all platforms, many smaller companies can participate in these growth trends.

Stock pick #1: TKO Group Holdings (NYSE: TKO)

One company Munro has owned for some time is TKO Group Holdings, which owns both the UFC and WWE franchises. Qiao sees the company as a scarce asset benefiting from powerful demand dynamics.

Mixed martial arts, in particular, continues to gain popularity among younger audiences, while the supply of comparable sports assets is extremely limited.

“You have rising demand and very little supply, because there is only one group that owns the two dominant assets,” Qiao explains.

Financially, the business is also attractive.

“This is basically a cash flow machine… revenue is contractually growing at about 10-15% per year for the next five years,” Qiao says.

At the same time, she argues the company trades at an appealing valuation.

“It is trading at about 18 times free cash flow for this year,” Qiao notes.

The shift away from pay-per-view toward streaming distribution could further expand the sport’s reach. When UFC fights moved onto streaming platforms, viewership increased dramatically.

“A best UFC fight might generate between 800,000 and one million viewers on pay-per-view. The first fight on Paramount attracted five million viewers,” Qiao says.

For Qiao, live sport also has a crucial advantage in the AI era - “AI or not AI, human beings really value live sports,” Qiao says.

Stock pick #2: Howmet Aerospace (NYSE: HWM)

Qiao also holds Howmet Aerospace, a specialised manufacturer of highly engineered metal components used in jet engines.

The company produces turbine blades and other parts capable of withstanding extreme heat and pressure - components that are essential to modern aircraft engines.

“Howmet’s specialty is to make very highly engineered metal parts that can withstand incredible heat and pressure,” Qiao says.

These components are mission-critical for aerospace manufacturers, giving the company strong pricing power.

“This is the nice thing about being the choke point for the whole industry. Howmet is the only supplier that can really do what they do,” Qiao explains.

Demand is being driven by several structural trends. Commercial aviation continues to grow globally, defence spending is rising, and large gas turbines used in power generation also rely on similar blade technology.

Importantly, the company’s growth is not heavily dependent on new aircraft deliveries.

“Global travel demand continues to grow at 7-8%. If there are fewer new planes, the existing engines just have to fly longer and hotter,” Qiao says.

That increases demand for replacement parts, another key revenue stream for the business.

Stock pick #3: Coherent (NASDAQ: COHR)

The third company Qiao highlights is Coherent, a leader in optical networking technology. The firm produces high-performance laser components used to transmit massive volumes of data across fibre networks.

“Coherent makes incredibly high-power laser chips that can blink a hundred billion times a second,” Qiao says.

Historically, the company primarily served telecommunications networks, a cyclical and relatively low-margin market. But the rise of artificial intelligence and hyperscale data centres has transformed the opportunity.

“All the copper connections in the data centre are running into a physical limit. Over time, they have to be replaced with optical connections,” Qiao explains.

This shift dramatically expands the addressable market for optical networking equipment. The strategic importance of the technology was reinforced recently when Nvidia invested directly in the company.

“Nvidia invested directly into Coherent and became a shareholder. That basically cemented the future of Coherent,” Qiao says.

Capacity constraints also support the outlook. “There are very few wafer fabs [fabrication facilities] that can produce these laser chips. That is why this bottleneck exists,” Qiao adds.

With demand surging and limited supply, Qiao believes Coherent sits at a critical chokepoint within the AI infrastructure build-out.

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