<div class="subscription-widget-wrap-editor"><div class="subscription-widget show-subscribe"><div class="preamble"><p class="cta-caption">Thanks for reading Stock Analysis Compilation! Subscribe for free to receive new posts and support my work.</p></div><form class="subscription-widget-subscribe"><input class="email-input" name="email" tabindex="-1" type="email" /><input class="button primary" type="submit" value="Subscribe" /><div class="fake-input-wrapper"><div class="fake-input"></div><div class="fake-button"></div></div></form></div></div><p><em>Don't hesitate to send me any interesting research you come across.</em></p><p><em>You can also follow me on Twitter <strong><a href="https://twitter.com/StockCompil">@StockCompil</a></strong></em></p><p><strong>This article may be truncated by some email providers, so I suggest you read it directly on Substack for a better reading experience.</strong></p><div><hr /></div><h3><strong>Royce Invest on ESAB Corporation $ESAB US</strong></h3><p><strong>Thesis:<br /></strong>ESAB Corporation is a global leader in welding technology experiencing strong growth and transformation in a favorable market.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk">https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>ESAB Corporation is a global leader in fabrication technology for both welding equipment and consumables. It serves the broad and growing need for global infrastructure requirements while operating in a favorable oligopoly marketplace. Spun out from the public company Colfax in 2022, ESAB is somewhat new to the public markets and has embarked on a transformational journey of product innovation, streamlined operational efforts, new channel strategies, and footprint rationalization, all while being a price leader in its markets. In October, management reported strong results, with double-digit equipment growth—which was particularly impressive considering that 40% of its sales are tied to U.S. industrial activities—along with further pricing gains, geographic share gains, and continued margin improvement. The market appears to be recognizing ESAB’s significant transformation, as well as its product mix, product innovation, and the geographic expansion opportunities that lie ahead.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Royce Invest on Arcosa $ACA US</strong></h3><p><strong>Thesis:<br /></strong>Arcosa is poised for future growth due to solid Q3 results, pricing power in aggregates, increasing infrastructure spending, strong orders in its Engineered Structures segment, and a strategic acquisition of Stavola.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk">https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Arcosa, an infrastructure products provider, which posted solid third-quarter results despite the negative impact of inclement weather in several of the key operating regions where it sells aggregates. The company also expanded margins thanks to its ongoing focus of exercising the pricing power associated with the local monopoly nature of the aggregates business. We think that pricing actions taken in 2024 and an expected uptick in aggregates volumes in 2025 as U.S. infrastructure spending tailwinds persist both bode well for future growth. We also think that continued strong orders in Arcosa’s Engineered Structures segment—for example, rising utility spending on transmission and wind towers to meet higher load growth—are also promising for organic growth. Finally, Arcosa closed on its acquisition of Stavola, a leading aggregates and asphalt provider in the Northeast, which gives the company entry into a new geographic market with a high degree of less cyclical repair and replace spending that’s related to infrastructure.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Montaka on MongoDB $MDB US</strong></h3><p><strong>Thesis:<br /></strong>MDB is poised for potential growth as AI applications increasingly demand flexible database solutions for unstructured data, despite current market challenges.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk">https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>As a database provider for large production-ready applications, MDB has suffered of late because software developers have overwhelmingly focused on small, experimental AI-based ‘proof of concepts’ rather than production deployments. We expect this cycle to turn in 2025 and beyond, and it’s possible (though not certain) that demand for MDB accelerates materially.</p><p>There are strong arguments for why MDB should thrive in a world in which AI is infused into applications. These include:</p><ul><li><p>As one of the largest and well-established database offerings available for ‘unstructured data’, MDB should benefit from new AI applications on the basis that 80-90% of the world’s data is inherently unstructured.</p></li><li><p>Relational databases (e.g. Oracle) that handle structured data that align to a fixed schema, lack the flexibility required to handle the rapid changes and evolutions that are taking place in AI.</p></li><li><p>New AI coding agents can now automate the (previously too time consuming) transfers of data from a relational database to a more flexible MDB. Given MDB’s market share of the overall database market is only approximately 2% today, small changes in market share would likely translate into outsized percentage gains in MDB’s value.</p></li></ul><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Montaka on Floor & Decor $FND US</strong></h3><p><strong>Thesis:<br /></strong>Floor & Decor is well-positioned for accelerated growth as the US housing market recovers, benefiting from increased demand for home renovation inputs and expanding its store footprint.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk">https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>A recovery in the US housing market would be helpful for US consumption, and the health of the broader economy. And it would be particularly potent for big-box specialist hard-surface flooring retailer, Floor & Decor (FND), a top 10 holding in Montaka’s portfolio. As home sales increase, so too does demand for home renovation inputs, including hard-surface flooring. During the cyclical downturn of the last few years, FND has continued to build momentum in its 'flywheel' that builds and strengthens its scale advantages, while reducing prices and increasing value for customers. Over this period many competitors have suffered and ceded market share to FND. As the US housing market recovers, we believe FND is positioned for accelerated growth. Not only will existing stores do better, but new stores will be rolled out more quickly. And at just 240 today, there is ample room for FND to roll out new stores, with management targeting more than 500 stores over time. Importantly, the unit economics of each store are extremely favorable.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Royce Invest on Haemonetics $HAE US</strong></h3><p><strong>Thesis:<br /></strong>Haemonetics is a leading provider of plasma collection systems that is successfully improving operating margins and growing its vascular closure product line despite challenges.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk">https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>The third name is Haemonetics, a long-time holding that's the dominant provider of plasma collection systems, consumables, and software. It’s continuing to meet estimates as it navigates phasing out of a large customer and challenging plasma volume comparisons. Despite revenue pressure, the company delivered on its goal of improving operating margins via a business mix shift and share gains, as well as its Hospital-based segment increasing its contribution to profits. The company’s core vascular closure product continues to grow nicely, while a newly introduced larger closure product is seeing high usage even as it awaits an FDA label expansion, as it benefits from the rapid adoption of Pulsed Field Ablation to treat atrial fibrillation.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Hertford Capital on Nagarro SE $N4G GY</strong></h3><p><strong>Thesis:<br /></strong>Nagarro SE is a software development company that presents a rare and compelling investment opportunity following a recent decline in share price and a confirmed interest from potential bidders, prompting us to increase our position.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1vmuz5FvuReDFEhAxK0fYOZ1iDz0l35Po/view?usp=drivesdk">https://drive.google.com/file/d/1vmuz5FvuReDFEhAxK0fYOZ1iDz0l35Po/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>In October, we initiated a new position in Nagarro SE (Nagarro), a software development company, capitalizing on a sharp decline in share price following an anticipated profit warning. Shortly after, rumours surfaced about a potential bid for the company by private equity firm Warburg Pincus. A couple days later, the company confirmed the rumours, indicating that multiple potential bidders were interested.<br /><br />The confirmation of these rumours initially propelled the stock upward, but in the absence of any further news, the share price has recently retreated to our original purchase price, hovering just below EUR 80. In our view, this creates a rare and compelling special situation. The risk-reward dynamics are particularly appealing, prompting us to further increase our position. I now await further developments with keen interest.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Montaka on KKR $KKR US</strong></h3><p><strong>Thesis:<br /></strong>Blackstone and KKR are poised to significantly benefit from structural growth in Asian wealth, rising global private wealth allocations to alternatives, and increasing partnerships with insurers, alongside an expected acceleration in monetizations in 2025 that will enhance their profits and fundraising capabilities.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk">https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>With a collective US$1.7 trillion in assets under management, and with access to the best talent, capital, and deals all around the world, Blackstone and KKR, two of Montaka’s largest holdings, are highly advantaged alternative asset managers. They are uniquely positioned to benefit from three structural tailwinds that have commenced: The structural growth in Asian wealth combined with increasing allocation to alts in the region; The structural growth in US$85 trillion global private wealth allocations to alts; and The increasing strategic partnerships between insurers and alts managers, which unlocks access to manage the US$30+ trillion assets of the insurance industry. These dynamics will reliably underwrite the next decade of growth for Blackstone and KKR. But there is another favorable cyclical dynamic that we expect to accelerate in 2025: monetizations. Monetizations are simply when investments that have been made historically are finally converted to cash, typically via a sale. In October, KKR highlighted that ‘monetizations’ of historical investments had recently ticked up. Management expects these to accelerate in 2025 across the industry - a view that shared by Goldman Sachs and others. Monetizations turbocharge businesses, like Blackstone and KKR, in two ways: First, they boost the profits of the alts manager because performance fees are realized on investment gains. And second, as compounded capital is returned to clients, this gives the alts manager an important opportunity to raise this capital back for new funds. Capital ‘recycling’ is a primary source of funding for new vehicles and has been running at cyclical trough levels for the last two years. We believe this is about to change to the benefit of Blackstone and KKR.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Pernas Research on Haivision $HAI CN</strong></h3><p><strong>Thesis:<br /></strong>Haivision is a speculative investment opportunity, focusing on essential hardware and software for live monitoring and broadcasting, with a growing emphasis on defense applications and recent significant contracts boosting future growth prospects.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1VaJLeLyzzUaVhaMUdvTamOYOXO1heoJg/view?usp=drivesdk">https://drive.google.com/file/d/1VaJLeLyzzUaVhaMUdvTamOYOXO1heoJg/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Haivision (TSE:HAI) — mrkt cap $150mm; Price $5.26; EV/EBITDA 11<br /><br />SPECULATIVE POSITION INITIATED. Haivision provides essential hardware and software solutions for live monitoring and broadcasting. The company is renowned for its intuitive video management software, which integrates advanced analytics and remote access capabilities. Its solutions are optimized for low-latency, high-bandwidth environments. While historically recognized for commercial contracts, such as those with the NFL, Haivision is increasingly shifting its focus toward defense applications. The ability to ingest video and sensor data, process it for downstream applications, and rapidly share it with AI systems is in growing demand. Recently, Haivision secured a $60 million contract with the U.S. Navy and announced a strategic partnership with Shield AI. The capability to deliver real-time processed video feeds to AI models is critical for enabling object detection and autonomous operations, positioning Haivision to benefit from substantial growth in defense sector demand.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Montaka on Salesforce $CRM US</strong></h3><p><strong>Thesis:<br /></strong>Salesforce is poised for significant revenue growth in 2025 due to pricing increases and the launch of its new AI platform, Agentforce, which enhances productivity and expands its addressable market.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk">https://drive.google.com/file/d/1L3NEjSNu_9qxWBMQq6g_8-A9nT74119j/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Consider another of our top 10 holdings, Salesforce, for example. Its revenue growth is at a cyclical low. Indeed, at just +8% per annum, as reported in the company’s most recent quarter, its rate of revenue growth has never been lower. But in 2025, not only will price increases that were announced two years ago boost Salesforce’s revenue growth, but the year will also mark the early stages of adoption of the company’s new ‘Agentforce’ (released only weeks ago). This is a new platform that lets businesses build and deploy their own custom AI agents to automate tasks, improve efficiency, and enhance customer experiences. Agentforce is uniquely positioned to unlock big productivity gains for customers (e.g. the cost of a $100 human call can be reduced to a $2 agent call) by leveraging a system of large language models (LLMs) that interact with unique customer knowledge sets (>200 petabytes) built up on Salesforce over the last 25 years. Agentforce is likely to succeed across many customer use-cases, and this should substantially increase Salesforce’s total addressable market, and long-term value. Salesforce’s core business advantages are (i) their existing mission-critical position within an enormous enterprise customer base, combined with (ii) their enormous accumulation of customer knowledge built up on the platform over decades. Through this lens, AI is a ‘multiplier’ of existing business advantages for Salesforce.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Greenwood Investors on CTT $CTT PL</strong></h3><p><strong>Thesis:<br /></strong>CTT is poised for significant growth in the logistics sector due to its differentiated business model, strong cross-border customs and fulfillment capabilities, and competitive advantages over market rivals.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/15aCUJruMWA8z3LxugP9cqdTEmaKiBy_R/view?usp=drivesdk">https://drive.google.com/file/d/15aCUJruMWA8z3LxugP9cqdTEmaKiBy_R/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>That market share opportunity doesn’t even consider the highly differentiated business model CTT has built over the past few years. It has organically grown its cross-border customs and fulfillment offers, and has further reinforced these efforts by making a highly accretive acquisition of Cacesa, the dominant player in Spanish customs clearance. As the combined business model not only captures a higher portion of customer wallet while decreasing churn, it is able to offer cross-border e-commerce companies far more speed than any other competitor in the market. And it will do this with best-in-class service quality and market pricing.</p><p>We believe the best days for this fast-moving team lie ahead. While many investors are more enamored with non-industrial businesses, we are attracted to the very high dispersion of outcomes available in the giant global logistics industry. As one of our favorite Builders, Brad Jacobs, has shown, significant returns can be generated by firms in the logistics sector. While solid capital allocation has driven returns at both his businesses and CTT’s, the team and core business model are key.</p><p>When we see shares of InPost trading at 21x operating income (17x forward), we wonder why the market views this business model more attractively than CTT’s, which sports a ~7.3x operating income multiple using the bottom end of this year’s €100-120 million range provided at the 2022 capital market days.</p><p>Given CTT & DHL both announced they will lift the parcel locker network in Iberia from 1k today to ~10k in the coming years, lockers on their own have very low competitive advantages. However, taken together with the densest last mile in a fragmented market, best-in-class quality of service, expedient customs clearing and fulfillment in a turn-key offer, we believe CTT has a substantially more attractive business model. E-commerce infrastructure services have a long way to run as Iberian e-commerce remains significantly under-penetrated as a portion of retail sales.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Night Watch on Allfunds $ALLFG NA</strong></h3><p><strong>Thesis:<br /></strong>Allfunds is Europe's leading fund distribution platform, experiencing slowed growth and a significant drop in P/E ratio, but recent performance indicates a potential recovery despite lack of acquisition success.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk">https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Our other large holding is Allfunds (ALLFG NA), Europe’s most dominant fund distribution platform. Despite having historically grown revenue at 21% per year, 2022 and 2023 saw slower growth, causing a rerating from >40x P/E in 2021 to <12x 2025 P/E. Allfunds has seen acquisition interest at prices 50-70% above today’s price, but a deal has not materialized. Growth for the company also re-accelerated in Q2 2024, but the market has yet to catch on.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Black Bear value partners on Asbury Group $ABG US</strong></h3><p><strong>Thesis:<br /></strong>Asbury Group is a highly profitable automotive dealership operator leveraging a razor-razorblade model and an omni-channel sales approach, with potential for significant free-cash flow and stock buybacks.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk">https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Asbury Group (ABG) – 10% of AUM<br /><br />Asbury Group operates auto dealerships across the United States. The strength of the model comes from the back of the house in parts and services where more than 50% of the profits come from.<br /><br />When an auto dealer sells a car to a consumer, they capture both the trade-in (inventory to sell) and the relationship between parts and services. It is a razor-razorblade model in a highly fragmented industry (many dealerships are owned privately by families). The large dealer groups have transitioned to an omni-channel model where much of the selling/pre-buy activity can be done online, reducing the need for headcount and making the transaction smoother for their customers. The lower operating costs of the business are not appreciated by the market. They are appreciated by us and the management teams as most dealers, including ABG, have been buying in lots of stock with their free-cash flow.<br /><br />ABG should be able to earn $25-$35 in free-cash flow per share in a “normal” year. At year-end pricing that implies a 10-14% annual yield. I hope management continues to buy back a lot of stock at these levels!</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Night Watch on Marex $MRX LN</strong></h3><p><strong>Thesis:<br /></strong>Marex is a counter-cyclical investment benefiting from volatility, with a strong growth track record and attractive valuation despite recent gains.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk">https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>We added Marex (MRX) as a new counter-cyclical name during the year. Marex is the largest non-bank futures commission merchant (i.e., a broker in futures, mainly commodities). Apart from the long-term growth in traded futures, Marex benefits in times of volatility, when trading activity goes up. Marex has shown organic growth at a >15% CAGR since 2020, earns a >25% ROE, has additional growth from M&A and still trades at ˜10x 2025 P/E, even after a 60% run up since our original purchase.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Night Watch on Valaris $VAL US</strong></h3><p><strong>Thesis:<br /></strong>Valaris is positioned to capitalize on the offshore energy sector's recovery, despite a temporary market pause, offering an attractive investment opportunity due to its modern fleet and significant profit potential.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk">https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>We initially became interested in offshore energy after Valaris (VAL) emerged from bankruptcy in 2021. At the time, day rates for floating rigs were around $200k / day, compared to operating expenses per rig around the same amount. A tightening market has since pushed up day rates to around $500k. A rig has gone from operating at break-even, to being able to earn $100m per year. Valaris allows us to buy the industry’s most modern fleet for less than $150m per rig, providing really attractive returns once every rig has been put to work.<br /><br />However, H2 of 2024 saw a pause in the market’s recovery. The rapid increase in demand has tightened other parts of the offshore supply chain. There are temporary shortages in subsea equipment and FPSOs (the floating platform that you need for the production of oil). 2025 projects are therefore being pushed into 2026 and offshore energy companies such as Valaris sold off – hard. While we failed to predict this pause, we believe the thesis remains unchanged. Our call on offshore oil remains a high conviction bet.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>SVN Capital Fund on Dino Polska $DNP PW</strong></h3><p><strong>Thesis:<br /></strong>DNP is poised for significant growth as it resumes store expansion in Poland, capitalizing on favorable market conditions and an attractive valuation.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1Cl3wn2iR2E78bu6VmDtsrBsmXtefNcZJ/view?usp=drivesdk">https://drive.google.com/file/d/1Cl3wn2iR2E78bu6VmDtsrBsmXtefNcZJ/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>In my discussion with the company after the Q3 2024 earnings release, the management team said that, in retrospect, applying the brakes on store growth was a mistake. The consumers, while tight-fisted, didn’t change their behavior as much as initially feared. Having realized this, the focus has been on opening new distribution centers and stores. Store growth is expected to return to its historical pace, if not better. As such, growth has picked up steam over the last few quarters (32 new stores in Q1, 66 in Q2, 69 in Q3, and 115 in Q4, which is the highest number of new stores in a quarter in the company’s history), and I expect DNP to return to its historical trend. Also, the price war between the two grocery giants of Poland has cooled off and is expected to normalize over time.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Night Watch on United Airlines (UAL) $UAL US</strong></h3><p><strong>Thesis:<br /></strong>United Airlines is positioned to improve its EBIT margins and benefit from a tightened supply in the US airline market, making it an attractive investment despite the historical challenges faced by the airline industry.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk">https://drive.google.com/file/d/1kLddUaynDZvEXQdoX7lfLnK1giZyPk4h/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>During H2 we pivoted out of the aerospace supply chain, into United Airlines (UAL). We’re cognizant of the poor track record that airlines have in generating returns for their shareholders. At the same time, we saw clear catalysts for an improving US airline market: Southwest and American Airlines were struggling to make money and decided against further growing their fleet. A Jet Blue Chapter 11 filing will allow them to cancel their airplane lease obligations and would see further capacity disappear from the US. As a best-in-class airline, UAL now has a chance to reach their target of 14% EBIT Margins (versus 9% in 2024), which would lower the ~6x P/E we paid to something closer to 3x. UAL has moved up by roughly 6% since our acquisition price at $60 and we are happy to hold our shares as long as the tightened supply provides a tailwind.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>SVN Capital Fund on Bajaj Finance $BAF IN</strong></h3><p><strong>Thesis:<br /></strong>Bajaj Finance’s unmatched growth, robust balance sheet, and cutting-edge data analytics make it a standout tech-powered finance company.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1Cl3wn2iR2E78bu6VmDtsrBsmXtefNcZJ/view?usp=drivesdk">https://drive.google.com/file/d/1Cl3wn2iR2E78bu6VmDtsrBsmXtefNcZJ/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Bajaj Finance is a quality business characterized by significant growth and predictability. Since 2010, customers have surged about 48x, leading to a loan book growth of around 89x in the same period. Notably, it has managed to maintain exceptional credit quality with an average non-performing asset ratio of just 50 bps over the past decade. Operating costs are impressively low at approximately 30%, and the company operates on a conservative balance sheet with about 21% equity. Additionally, it leverages a vast data lake to analyze the rapidly growing middle-income consumer segment in India, enabling swift lending decisions. With a management team focused on organic growth, Bajaj Finance is positioned for sustained returns exceeding 20% on equity.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Black Bear value partners on Flagstar Financial $FLG US</strong></h3><p><strong>Thesis:<br /></strong>Flagstar Financial is a well-capitalized regional bank undergoing a successful turnaround under CEO Joseph Otting, with compelling valuation potential and minimal downside risk.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk">https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Flagstar Financial is the former New York Community Bank (a mashup of Flagstar Bank, New York Community Bank and assets from Signature Bank). Like our SHORT investments in Silicon Valley Bank and First Republic, FLG had a hole in their balance sheet (from soured multifamily and office real estate vs. long- duration securities). That is where the similarities end.<br /><br />FLG raised over $1BB in additional capital, led by former Treasury Secretary Steven Mnuchin. They revamped the management team and brought in a superstar CEO in Joseph Otting who successfully turned around OneWest Bank post GFC (formerly known as IndyMac Bank). In 9 months, the management team has accomplished more than most teams can do in 2+ years. They have reviewed nearly all the loans on the books, sold off non-core assets raising additional capital and are focused on delivering a narrowly-focused, well-capitalized boring regional bank. In this case boring is good. Importantly, they have taken a conservative view of their loan book and a large credit reserve. This contrasts with several bank/private credit lenders we are short who have taken minimal reserves. Mr. Otting and his team are my kind of managers – they are plain-spoken, hardworking and plan for the worst while hoping for the best.<br /><br />The valuation is extremely compelling. At year-end the bank was trading at ~51% of a conservatively marked balance sheet. This is in contrast with similar banks (who are NOT conservatively marked) trading at 140-160% of their tangible book value. FLG should complete working thru the bulk of their issues by the end of 2025 and approach “normal” during 2026. Given the conservative nature of the management team, I wouldn’t be surprised if it happened sooner. At 100% of TBV (still a discount to the market) the stock would roughly double. At these prices the downside seems minimal and could see this business up 50-150% over the next 1-3 years as it is more appropriately valued.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Black Bear value partners on Paramount Resources $POU CN</strong></h3><p><strong>Thesis:<br /></strong>Paramount Resources is a promising energy exploration and production company poised for growth after selling mature assets and distributing significant cash to shareholders, with a projected asset value of ~$18 per share against a stock price of $32.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk">https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Paramount Resources (POU.TO) – 14% of AUM<br /><br />Paramount is an ENP (exploration and production) in the energy space. In the 4th quarter the Company sold the bulk of their mature assets and will be making a large cash distribution of $15 CAD (~47% of the stock price at year-end) in Q1. I expect additional disclosure in the coming months after the sale goes through. The remaining Company will have liquid cash/investments to fund additional exploration for development.<br /><br />My rough breakdown for this investment is as follows and looks out 2-3 years once their investment cycle is more mature.<br /><br />(A) $14 of tax-adjusted dividend in Q1 or Q2<br />(B) Plus: $7 of cash/marketable securities on the balance sheet<br />(C) Less: $4-$5 of development costs over the coming 2 years<br />(D) Plus: $1-$2 of privately owned assets<br /><br />The total of the asset value is ~$18 per-share vs. a year-end stock price of $32, implying a $14 value for the future expected free cashflows. I roughly estimate, based on the current disclosure, that they will generate $2-$3 of annual free cash flow in a benign oil environment (or an unlevered 14-21% return). Our thoughts could change to the up or down as we get further disclosure. It is important to note management owns almost 50% of the Company and is fully aligned with us and has been excellent operators.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Bristlemoon Capital on Pinterest $PINS US</strong></h3><p><strong>Thesis:<br /></strong>Pinterest is facing decelerating revenue growth despite its initiatives to enhance lower-funnel ad products, leading to decreased confidence in its investment thesis.</p><p><strong>Source</strong> : <a href="https://drive.google.com/file/d/1142I9jrD-lyXMd8a1AornX9ICoiIhQ6k/view?usp=drivesdk">https://drive.google.com/file/d/1142I9jrD-lyXMd8a1AornX9ICoiIhQ6k/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>A recap of our Pinterest investment thesis Pinterest is a visual search and discovery platform; it is a high quality multisided network business with differentiated supply in the form of user-generated content. The company has 85% of the top 200 advertisers, and the majority of the top 500 internet retailers actively spending on its platform. Pinterest users have very high purchase intent: 50% of them go to Pinterest to shop. Previously the company didn’t have the capabilities to capitalise on its users’ commercial intent. Under the leadership of CEO Bill Ready, this has been changing with the company’s push towards lower-funnel ad products and more sophisticated ad measurement solutions.</p><p>Our thesis was that the development of the company’s lower-funnel solutions would help change the historical advertiser perceptions of Pinterest as being just a brand-awareness tool, and in the process would allow Pinterest to unlock larger pools of ad budget dollars. Advertisers typically segment ad budget dollars into two buckets: core and experimental. While Pinterest was historically pigeonholed into the experimental ad bucket (one that is smaller in nature), the strong returns on ad spend that advertisers are now achieving is causing advertisers to shift Pinterest into the core ad bucket. This is hugely significant as advertisers typically spend many multiples with a core advertiser than they will with one that is considered experimental. However, progress with this has been slow.</p><p>Our expectation was that these initiatives would combine to accelerate revenue growth into the mid-20 percent range, and perhaps beyond that in a “blue sky” scenario. However, the opposite has occurred, with revenue growth decelerating in recent quarters. In Q1 and Q2 of 2024, Pinterest was growing revenues at north of 20 percent year-over-year. That growth rate slowed to 18 percent in Q3 2024, and then has been guided to grow at just 15-17 percent in Q4 2024. The deceleration, in our opinion, has not been well explained by the Pinterest management team. CEO Bill Ready has talked a lot about various product improvements (with respect to both users and advertisers) but has not tied this back (or enabled investors to tie this back) to the potential revenue growth acceleration, or the lack thereof.</p><p>Pinterest management have referred to ongoing softness in the food and beverage category since Q4 2023. They quantified this as a one percentage point revenue growth headwind in Q4 2023, and we estimate that it was a circa 3 percentage point headwind in Q3 of 2024. We would have expected the benefit from Pinterest’s growth initiatives to have overwhelmed this weakness in the food and beverage category. The fact that we are unsure of why these initiatives are not translating into stronger revenue growth leaves us feeling less certain that our investment thesis will play out. In other words, we now have a lower level of conviction in the Pinterest growth story.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Hertford Capital on Moltiply Group SpA $MOLP IM</strong></h3><p><strong>Thesis:<br /></strong>Moltiply Group SpA is a promising investment opportunity in the recovering Italian mortgage market, backed by strong management and potential for significant growth through acquisitions and improved margins.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1vmuz5FvuReDFEhAxK0fYOZ1iDz0l35Po/view?usp=drivesdk">https://drive.google.com/file/d/1vmuz5FvuReDFEhAxK0fYOZ1iDz0l35Po/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>During the fourth quarter, I built a major new position in Moltiply Group SpA (Moltiply), formerly known as Gruppo MutuiOnline SpA. "Mutui online" translates into online mortgages. As you know, we are already invested in the UK mortgage market recovery theme, with positions in Mortgage Advice Bureau Plc and The Property Franchise Group Plc as well as a new undisclosed investment.</p><p>With Moltiply, I see a similar opportunity in Italy, where we have the chance to invest alongside one of the most accomplished founders on the Italian stock exchange, at a time when the Italian mortgage market data has just begun to improve. I feel privileged to have met with them on multiple occasions as well as other (major) shareholders during our due diligence process.</p><p>I believe it was an opportune time to invest, as Moltiply's online mortgage business, historically the highest-margin segment of the group, has been subdued. I see no reason why this segment cannot return to historical margin levels, which should positively impact the overall profitability of the group. As market conditions improve, this segment's recovery could act as a significant catalyst for the company's growth and long-term value creation.</p><p>After entering at an average price of around EUR 33, speculation regarding Moltiply's potential bid for ProsiebenSat 1 Media's Verivox led to a rise in the share price. Early indications suggest that this acquisition could be favourable for Moltiply's shareholders, but it remains too early to declare success. Notably, management has a strong track record of successfully integrating acquisitions, which bolsters my confidence.</p><p>I entered Moltiply at a reasonable valuation, offering an attractive normalized free cash flow yield. With a promising growth outlook, driven by the recovery in the Italian mortgage market and acquisitions, the company presents a solid opportunity for long-term compounding. We view it as a potential core holding, benefiting from both organic growth and strategic expansion, while improving margins and continued high cash-conversion.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Royce Invest on JBT Corporation $JBT US</strong></h3><p><strong>Thesis:<br /></strong>JBT Marel is a leading provider of food and beverage processing machinery, reporting strong 3Q24 results with significant sales growth and high recurring revenue, while also enhancing its market position through the recent acquisition of Marel.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk">https://drive.google.com/file/d/1VrdpNg5a4TwB8c-IY2b_9oZ-5MRD5rlA/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>The fourth is JBT Marel (“JBTM”), one of the world’s largest providers of food and beverage processing machinery. It also reported terrific 3Q24 results, which drove its shares higher in late October. Sales grew by 12%, EBITDA margins rose by 160 basis points, and free cash flow is on pace to exceed 100% of net income for the year. Equally promising was a 10% rise in orders, which showed strength not just from a rebound in demand in the global poultry market, but also strength in food and vegetables, pharmaceuticals, and pet food. Orders grew in all geographic regions, in part reflecting long-term drivers such as automation to improve efficiency and reduce labor costs. JBTM also continues to generate a high percentage of recurring revenue, with 47% of sales coming from parts and services from its broad installed base of equipment, which provides a consistent cash flow stream. Finally, JBTM closed on its acquisition of Marel (an Iceland-based food and beverage equipment company focused on primary processing) during the first week in 2025. The acquisition should enable JBTM to realize significant cost synergies and cross-selling opportunities going forward.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>REQ on Idun Industrier $IDUN SS</strong></h3><p><strong>Thesis:<br /></strong>Idun Industrier is a Swedish acquisition-driven compounder with strong management, significant insider ownership, and a resilient portfolio, demonstrating over 30% FCF per share growth since 2015.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk">https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Idun Industrier is a Swedish acquisition-driven compounder with c. SEK 2.2bn in sales and EBITA margin of 14%. Idun was founded in 2013 and listed in 2021. We believe Idun has a highly qualitative and capable management team with high skin in the game (>50% of shares and >80% of votes held by insiders). The company has delivered an FCF per share growth of >30% since 2015 and since its foundation, Idun has had zero turnover in the management team. The company has a high-quality portfolio of Swedish companies that has been resilient historically, as well as during the last couple of years, despite economic uncertainty. Although we prefer self-funded growth for companies with mature characteristics, Idun is still in the early phases and ticks many of our qualitative criteria. Therefore, we also participated in Idun’s share issue in September, which strengthened its balance sheet, and enabled the company to execute on an attractive acquisition pipeline. As Idun Industrier matures, we expect the company to become self-funded.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Vltava fund on Lam Research Corporation $LRCX US</strong></h3><p><strong>Thesis:<br /></strong>Lam Research is a leading wafer fabrication equipment manufacturer for the semiconductor industry with strong profitability and effective capital allocation through share buybacks.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1MfEJY3SGNbnfyTOuORHeg-elLf5bVxJJ/view?usp=drivesdk">https://drive.google.com/file/d/1MfEJY3SGNbnfyTOuORHeg-elLf5bVxJJ/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Lam Research manufactures wafer fabrication equipment for the semiconductor industry and also provides related services. The company is a market leader in plasma etching, thin film deposition platforms, photoresist systems, as well as wet and plasma-based cleaning products for individual wafers. Its main customers are the four major semiconductor manufacturers Micron, Samsung, SK Hynix, and Taiwan Semiconductors. Lam Research is a business with net margins of around 27% and ROCE of about 30%. Capital outlays are relatively small. The company has good capital allocation with a preponderance of share buybacks.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>REQ on Ametek $AME US</strong></h3><p><strong>Thesis:<br /></strong>Ametek is a highly successful company specializing in niche-engineered products with a decentralized structure and a strong track record of growth and profitability across various industries.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk">https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>In April, we added Ametek to the portfolio. Ametek manufactures niche-engineered products with 42 subsidiaries operating across a highly diversified range of industries, including aerospace, healthcare, energy, advanced technology, and more. With nearly a century as a public company and several name changes throughout its history, Ametek has undergone a remarkable transformation. Initially, 80% of its business was focused on commoditized electric motors, but over time it shifted to cutting-edge instruments, precision components, and specialty materials. Today, Ametek’s subsidiaries operate with substantial entrepreneurial autonomy, each holding its own profit and loss responsibility. Within this decentralized framework, a common thread unites them: niche market leadership. Many of these business units are leaders in their niche markets, typically within markets with a total size under $300 million. This positioning allows them to dictate terms and avoid aggressive competition—illustrating the beauty of small markets, a defining characteristic of our holdings.</p><p>A key factor in Ametek’s success has been its cultural continuity. Over the last 55 years, the company has had only four CEOs, all promoted internally, underscoring its focus on stability, internal growth, and alignment with long-term strategies. Similarly, 75% of its business unit managers are promoted from within, blending technical expertise with deep understanding of the company’s culture. This approach has driven remarkable growth, with sales rising from $30 million in 1955 to nearly $7 billion today and operating margins improving from 12% in the early 2000s to approximately 26%. We are impressed by Ametek’s long history of durable growth, its long-tenured management team, decentralized culture, and strong capital allocation mindset. With its proven track record of consistent margin improvement and a robust acquisition pipeline, we are confident in Ametek’s incremental compounding journey as a portfolio holding.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>REQ on Momentum Group $MMGRB SS</strong></h3><p><strong>Thesis:<br /></strong>Momentum Group’s disciplined focus on profitability and decentralized culture unlocks unparalleled growth potential.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk">https://drive.google.com/file/d/1eEFOVs1q0kSDj1-iguLxKpmozQQ-DQ7K/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Bergman & Beving has masterfully cultivated a unique corporate culture that has consistently generated impressive value over the years. This culture has become a proven formula for driving profitable growth—across decades and in a wide range of industries.<br /><br />What is truly remarkable is how these companies—regardless of their industry or growth stage—have achieved exceptional success by maintaining a laser-sharp focus on profitability. Their strategy revolves around two straightforward but powerful goals: driving 15% annual earnings growth and achieving returns on working capital that exceed 45%. This simple, unwavering approach has been the foundation of their continued success.<br /><br />Among the finest examples of this leadership are Ulf Lilius and Niklas Enmark, whose brilliance as capital allocators is matched only by their dedication to decentralized and self-funded growth. They have not just adhered to these principles but mastered them, delivering extraordinary value to shareholders year after year. By channeling their deep passion for business and applying the best lessons learned, Momentum Group now stands poised to continue this legacy of long-term value creation well into the future.<br /><br />The brilliance of the Bergman & Beving model—and the culture that drives it—lies in its versatility. This model is proven across industries and sectors for businesses large and small. Interestingly, although many companies target the same acquisitions, they rarely compete head-to-head in M&A processes because they prioritize sourcing deals internally over relying on brokers. This gives them the ability to apply the model consistently and spin-off business units when they grow too large.<br /><br />Momentum Group's embrace of Bergman & Beving's entrepreneurial and decentralized culture is a key differentiator. By empowering employees at all levels, they unlock value throughout the organization. The culture creates an environment where employees are accountable, motivated, and aligned with the company's broader goals. This approach drives performance, fuels growth, and ensures the organization’s success is shared.<br /><br />We believe Momentum Group's business model and Bergman & Beving's legacy provide a strong foundation for creating shareholder value. The company is in its early stages of growth and offers an attractive runway for scaling its acquisition-driven business model in the future.</p><p><strong><a href="https://www.google.com/url?q=https://finchat.io/?via%3Dtom&sa=D&source=editors&ust=1737060202383042&usg=AOvVaw1sVkZB0TxBe293A_LJwC0M">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Halvio Capital on Citizens Bancshares Corporation $CZBS US</strong></h3><p><strong>Thesis:<br /></strong>Citizens Bancshares Corporation is a highly overcapitalized bank with a strong deposit franchise, poised for significant EPS growth and potential stock rerating, offering an upside of 53%-140% due to its low valuation multiples compared to its earnings potential.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1e7-S_LsNCYB1DictSQjijUXXLuMYfb4Q/view?usp=drivesdk">https://drive.google.com/file/d/1e7-S_LsNCYB1DictSQjijUXXLuMYfb4Q/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Citizens Bancshares Corporation (CZBS) is a small $93m market cap bank that is extremely overcapitalized with a strong deposit franchise trading at an estimated 2025 7x P/E, 2025 0.62x Adjusted TBV with the potential to earn 17% adjusted ROE in 2025. As a result of the $95.7m ECIP funding received a couple years ago, I believe they are poised for large increases in EPS either through M&A or buybacks that will rerate the stock to reflect its underlying value. On top of that, there are also potential catalysts such as a stock exchange uplifting or more communication with the investment community to increase investor awareness in the stock.</p><p>I believe CZBS should trade at 11x – 13x 2025 earnings, offering a potential upside of 53% - 102% or 1x - 1.48x 2025 TBV offering upside of 61% - 140% with limited downside. These upside projections don’t take into account any potential M&A or stock buybacks to increase earnings even more.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Longriver on Wise $WISE LN</strong></h3><p><strong>Thesis:<br /></strong>Wise is a highly profitable fintech company that prioritizes customer value by continuously lowering fees and enhancing services, making it difficult for competitors to keep up.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1oJBUQ-OkbcVoNwdpY2vPuKdavFu6O--K/view?usp=drivesdk">https://drive.google.com/file/d/1oJBUQ-OkbcVoNwdpY2vPuKdavFu6O--K/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Two interconnected aspects of Wise stand out to me: how much money it makes and how much it wants to give back to users. Consider that Wise has grown to its current size without substantially diluting its Founders. CEO and co-Founder Kristo Käärman is a bootstrapper, not a ZIRP moonshooter, and still owns some eighteen per cent of the company. Wise is so profitable today because customer acquisition comes primarily from word-of-mouth referrals. There is no subsidising one part of the business with another; costs for every currency corridor are meticulously calculated and assigned. Wise went public via a direct listing to minimise fees and because it did not need to raise new capital.</p><p>Wise is a digital business with substantial operating leverage (build it once, scale it infinitely). However, Käärman and his colleagues committed early on to pass the surplus back to users through ever-lower prices and better service, kicking off a virtuous cycle of viral growth. This customer-first mindset is baked into Wise’s culture. They are committed to transparency: there are no hidden fees and you receive what you send. You can compare prices across providers on Wise’s website, even when Wise is not the cheapest. The Chief Marketing Officer told me he is careful with his budget “because it’s customers’ money”. I didn’t understand until I realised he meant it could be ‘spent’ instead on lower prices.</p><p>Investor Nick Sleep described this model as “scale economies shared”. It is exceptionally hard to compete against because it is a moving target moving very fast. The more extensive Wise’s network becomes, the more attractive it is for users and the more difficult it becomes for competitors to replicate. In addition to its direct connections, Wise currently has sixty-five regulatory licences and ninety-plus banking partners worldwide. How much further ahead would Wise be by the time a competitor could obtain the same? From FY20 H1 to FY25 H1, Wise lowered its average cross-border take-rate from sixty-nine basis points to fifty-nine basis points. How can a competitor hope to match Wise’s pricing without the same volumes?</p><p>Käärman elaborated on Wise’s direction of travel at a recent conference. It’s worth quoting him in full to appreciate Wise’s relentless focus and gravitational pull:</p><p>So the approach that we took in terms of our own unit economics is that of, I think, what’s called cost plus pricing., famous from Costco and many others, which means that we track our own costs and we charge a little bit beyond what we need to spend to facilitate those transfers and what we invest in for development. But what that means is over time, and we’ve established this setup already 6, 7 years ago, much before our listing, that as we make our infrastructure more efficient, we’re able to bring the fees down.</p><p>When we bring the fees down, we put competitive pressure on the banks, basically, or the competition, which means that it’s going to be even harder for them. It’s going to be harder for the customers to remain with the banks not to switch, and it’s going to be harder for the banks not to switch to Wise Platform if you kind of work through the options available.</p><p>So our strategy has always been remove the cost, and as we remove the cost, put the price pressure on because eventually, the service that we can provide cross-border will be so much more efficient compared to what it was 5 or 10 years ago…</p><p>And you can think of what’s possible because I’m pretty sure it’s almost the same dynamic with Moore’s law. If you are able to take half the cost out, you’re soon going to be able to take half the cost out again and then maybe again. So that’s probably the more exciting thing, looking forward, is how much pricing pressure we can extend to the -- into this environment.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Black Bear value partners on ARCH Resources, Inc. $ARCH US</strong></h3><p><strong>Thesis:<br /></strong>ARCH is well-positioned to benefit from a projected rise in met coal demand driven by economic growth in Asia, despite current valuation concerns, due to limited local supply and a looming shortage.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk">https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>ARCH is one of the leading U.S. producers of high-quality metallurgical coal (“met coal”). This is the kind of coal used for steelmaking. ARCH also has a thermal coal business that contributes ~20% of their earnings. CONSOL is a leading producer of thermal coal.</p><p>Met coal demand is projected to climb for the next 25 years, driven by the economic development and urbanization in India and the rest of Southeast Asia. ~60% of the world’s population lives in Asia, where met coal demand is centered and where local sources are limited. Over the coming years demand will likely outstrip supply, leading to higher prices. There has been a severe lack of investment in met coal due to ESG concerns with investment peaking in 2014.</p><p>Rough math on the combined companies looking out 2 years from now (vs. a $5.7BB combined market cap):<br />- Accumulated FCF (net of liabilities) of $300MM-$1.5BB<br />- The existing combined business generating between $500MM-$1BB per year<br />- Let’s presume non-heroic FCF yield of 15% which comes to $3.3BB-$6.7BB<br />- A marine terminal generating $50-$70MM in FCF that is worth $500MM-$900MM<br />- Synergies of $60-$100MM at a 15% yield = $400-$700MM in value<br />- $4.9BB - $10.8BB in market value – (down of 14% vs an upside of 90+%) using a 15% FCF yield</p><p>The above is a very rough calculation and shows the wide margin of safety baked into the price. I believe the operating business should command a better valuation implied by a 15% FCF yield…. but for now, we do not have to make any big leaps with respect to valuation. I wouldn’t be surprised to see these businesses surprise to the upside given the worldwide looming high-grade met coal shortage and cost-advantaged production/shipping.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Black Bear value partners on BLDR $BLDR US</strong></h3><p><strong>Thesis:<br /></strong>BLDR is a building materials manufacturer shifting towards value-added products, benefiting from a structural housing shortage in the USA and generating significant free cash flow while repurchasing over 40% of its stock.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk">https://drive.google.com/file/d/1V0j2OysEICtP_dSMKDAGp_yBi-IqaDuY/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>BLDR is a manufacturer and supplier of building materials with a focus on residential construction. Historically this business was cyclical with minimal pricing power as the primary products sold were lumber and other non-value-add housing materials. Since the GFC, BLDR has focused on growing their value-add business that is now 40%+ of the topline. The company has modest leverage and has been using their abundant free-cash-flow to buy in over 40% of the stock in the last 33 months.</p><p>Our long-term thesis remains intact as there is a structural shortage of housing in the USA. Higher mortgage rates reduce the supply of existing home supply as homeowners are locked into low-rate mortgages. As we have seen in recent history, the overall pie of housing activity may shrink, with new homebuilders capturing an increasing share of home sales. Homebuilders can buy-down the mortgage to a lower rate and accept a lower, yet still healthy margin on the home sale.</p><p>Past letters have commented that the coming 6-12 months could be rocky and BLDR (the stock) has not disappointed. The business continues to perform well, and I am optimistic that management took advantage.</p><p>The company has sustained higher gross margins as they have gained scale. I estimate normalized free-cash-flow per share to be $12-$17 per year implying a free-cash-flow yield of 8-12% with no growth priced in.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Protean Funds on Intea $ITEA SS</strong></h3><p><strong>Thesis:<br /></strong>Intea is a unique real estate investment opportunity, offering high-quality, stable properties with lower risk and significant growth potential, particularly in the correction of the Swedish penal system.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1DC_YySylzSlBfOwDjJR9ppSaOpR51pgg/view?usp=drivesdk">https://drive.google.com/file/d/1DC_YySylzSlBfOwDjJR9ppSaOpR51pgg/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Not your usual property stock - Richard’s Reflections. The real estate company Intea refused to follow the PR consultants’ playbook during the IPO process. Instead of showing up everywhere to tell us all about how great they are, about its rosy outlook and tempting financial targets, they chose to keep a low profile with few media appearances. After spending the last 15 years at Sweden’s business daily Dagens Industri, covering numerous IPOs, there is one conclusion: like with any pushy salesperson, it’s not the ones most eager to see their names in print that represent the best business opportunities. And it’s always better to let the numbers do the talking, rather than talking about numbers that never materialize. Intea kept a low profile because they could. Instead of squeezing the last penny out of the most price-insensitive investors (looking at you AMF), the owners accepted a somewhat lower price to smoothly inject 2 billion SEK of new equity into the business. The capital will generate more than enough to offset the dilution. Intea’s portfolio consists of high-quality specialized properties, primarily leased to public tenants on long-term leases. These include police stations, college facilities, and prisons. The operational risk is as low as it gets, with low vacancy rates and longstanding, stable counterparties. So far, it sounds like a reasonable defensive option in a sector where office owners are struggling due to both a weak economic cycle and structural factors. Meanwhile, perceived low-risk apartment companies don’t generate enough cash flow to impress anyone with their low-yielding asset base. Stable cash flow isn’t much fun if it’s stable at a low level. Intea offers higher yields than the office segment, but without the headwinds. And it’s more than just a reasonable defensive option due to its high project activity, with 3.7 billion SEK in ongoing developments. This gives our company a clear growth trajectory, with the project developments serving as the value driver. Based on company guidance, the 2 billion SEK will be deployed at a yield on cost of about 6.5 percent, in a business that values its properties at 5.2 percent. That gap translates into profits. And there is more to come. The Swedish Prison and Probation Service expects to increase the number of places in detention centers and prisons from 9000 in 2024 to 27,000 by 2033. "Such rapid and intense expansion will be challenging," as the Swedish Prison and Probation Service states in its capacity report. State-owned Specialfastigheter is the number one player when it comes to prisons, and apart from Intea, Erik Selin’s Skandrenting is the only private prison owner. For property owners in general, the glory days of the sub-zero interest rate era are gone. The Swedish 10-year yield is now a tad higher than when the Riksbank started lowering interest rates back in May. The US 10-year yield is up close to 100 basis points since the Fed’s first cut in September. This means you shouldn’t expect yield compression to do the trick - real estate companies must take the value creation into their own hands. Just as it should be. Over the coming three years, Intea will be among the few listed Swedish real estate companies posting double-digit compound annual growth rates in both NAV and cash earnings, adjusted for dividends. IPOs are tightly managed spectacles, but despite the highly orchestrated nature of these events, there hasn’t been much daylight for those who subscribed to the previous two real estate IPOs. Sveafastigheter, SBB’s rental apartment business, has yet to close above the issue price and is down 9 percent to date. Prisma Properties, a company with a focus on discount retailers and fast-food restaurants, stayed afloat on its first day in June but is down 12 percent since then. After two broken IPOs in the sector, the investment banks got a happy ending. Intea has gained a healthy, but not overwhelming, 10 percent since its IPO in mid-December. The shares still trade with a discount to NAV and an implicit yield of 5,3 percent based on next year’s numbers.</p><p>Both the CEO and CFO have bought more shares after the IPO. They know that Intea’s growth trajectory relative to its price bodes well relative to the sector.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Protean Funds on Bavarian Nordic $BAVA DC</strong></h3><p><strong>Thesis:<br /></strong>Bavarian Nordic is a Danish vaccine producer with strong growth potential in its travel vaccine franchise, driven by demand for rabies and TBE vaccines, alongside its more volatile smallpox and monkeypox elements.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1DC_YySylzSlBfOwDjJR9ppSaOpR51pgg/view?usp=drivesdk">https://drive.google.com/file/d/1DC_YySylzSlBfOwDjJR9ppSaOpR51pgg/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>We have initiated a mid-sized position in Bavarian Nordic. This Danish vaccine producer is mostly known for its Jynneos franchise, vaccines for smallpox and monkeypox. Rare diseases those, but the latter of the two has become a hot topic for the stock in recent years, and it often spikes (and subsequent declines) as outbreaks come and go with varying frequency. That adds an optionality to the story but is obviously difficult to build a case on. What attracts us is the strong performance Bavarian has shown in its travel vaccine franchise, where products against rabies and TBE are showing strong progress.</p><p>TBE – which has a certain ‘ick’ factor attached to it as it is spread by ticks – is getting more attention as it benefits from a warmer, wetter climate. To us, travel vaccine appears to be an attractive business for Bavarian to grow, also via acquisitions. It’s often a very small portion of the sales in big pharma companies, likely to be slightly neglected. Generic competition is not an issue. Through this, Bavarian has started to build a bread-and-butter business which reduces the overall risk level in the share. The company recently announced that its project to consolidate vaccine production is going as planned, and this will improve margins in 2025.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Praetorian Capital on The St. Joe Company $JOE US</strong></h3><p><strong>Thesis:<br /></strong>The company JOE is poised for significant growth due to its extensive land ownership and business operations in rapidly developing Florida counties, with the potential for a 67% appreciation in net asset value next year.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1h-7f188mpocNReM7aDBgqsz9SC6e7mye/view?usp=drivesdk">https://drive.google.com/file/d/1h-7f188mpocNReM7aDBgqsz9SC6e7mye/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Let’s look at the tailwinds. As JOE owns a disproportionate percentage of the undeveloped land in Southern Bay, Gulf and Walton Counties, in Florida, along with substantial business operations there, let’s discuss those counties’ growth briefly, as real estate is tied to population and economic activity. I believe that there is no better, nor cleaner metric for both population and economic growth, than the growth in passenger traffic at Northwest Florida Beaches International Airport (ECP). Since 2019 when 1,275,488 people flew through the airport, traffic is up by 30.1% as of 2023 when 1,660,479 people flew through ECP, with traffic up an additional 13.5% this year over 2023, as of November. Clearly, this is impressive growth, and it doesn’t even track the rapid growth of private planes, which tend to be core JOE customers. The Florida Panhandle is a rapidly growing part of the nation, and JOE is in the driver’s seat in terms of how it is developed. By developing it intelligently, JOE doesn’t only add value to each development, but they add value to their massive landbank and all future developments that they undertake. There is a real multiplier effect here and I think that many investors miss this.</p><p>As a value investor, I always ask myself what something is worth today, and what it can be worth tomorrow. Valuing JOE’s income producing properties is relatively easy. I can get deep into the math here, but for the sake of simplicity, let’s assume their existing business operations (including full and partial ownership in 12 hotels with 1,298 rooms, multiple multi-family and senior living properties with 1,383 units, 1,179,000 square feet of other commercial space, a clubs business, marinas and a bunch of other assets like self-storage, a gas station and a shooting range) are worth approximately $2 billion, net of the cash and debt on the balance sheet. Then, at the year-end market cap of $2.6 billion, you’re buying approximately 168,000 acres of land in Florida, much of it waterfront, for approximately $3,600 an acre, net of the commercial real estate. I can assure you that this is the wrong price. In fact, I think there’s a genuine agreement amongst investors that this is the wrong price—the disagreement is in regard to the correct price.</p><p>I like to think in terms of big numbers. If you assume the Net Asset Value (NAV) of the company today is between $200 and $300 a share, then you can work backwards and calculate that I’m valuing the land at between $57,500 to $92,200 an acre, if you assume that everything else on the balance sheet nets to $2 billion. Looking around at recent transactions on the County Clerk’s website, I have pretty good confidence that this range of outcomes is directionally correct and could be on the low side of things. Of course, JOE has plenty of acres that are worth less than $57,500, but they also have acres that are worth a few million each, which drag the average up rapidly. For the sake of argument here, let’s just accept that my math is correct, and using $250 a share as a midpoint of NAV is accurate.</p><p>Having lived in Florida for 17 years, I have seen land in Florida appreciate rapidly. Maybe not every year, and there were a few down years during the GFC, but for the most part, land in Florida, especially land near the water, appreciates rapidly. As a shareholder, I assume this remains the case as the population of Florida, and particularly Bay, Gulf and Walton counties grows. If you assume that this collection of land and operating assets appreciates at 10% a year, which would be roughly the sum of the percentage changes in population growth and the CPI in the counties where JOE has investments, then it would imply that the NAV should appreciate by $25 next year, before the company earns a cent from running their recurring cashflow businesses, or reinvests a cent into new development. Once you add in about two dollars of anticipated cash flow each year, and some value creation on the development side, I feel pretty confident in saying that the NAV can appreciate by $30 next year. Given the year-end share price of $45, that would represent an appreciation of 67%, which is quite attractive in my book. Naturally, this isn’t a one-and-done situation—I expect this sort of NAV appreciation to be an annual phenomenon, though it will be somewhat lumpy and track the economic cycle to a certain extent. Of course, as we’ve learned repeatedly over the past few years, the returns for the stock and the returns for the NAV can remain divergent. While frustrating to us in 2024, I’m trying to predict long-term value creation, and I remain confident that the shares will one day accrete towards NAV.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Praetorian Capital on Valaris $VAL AQ</strong></h3><p><strong>Thesis:<br /></strong>Valaris is a compelling investment opportunity due to its strong asset base, potential for significant cash flow growth, and downside protection from a robust backlog and balance sheet.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1h-7f188mpocNReM7aDBgqsz9SC6e7mye/view?usp=drivesdk">https://drive.google.com/file/d/1h-7f188mpocNReM7aDBgqsz9SC6e7mye/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Since Valaris is this Fund’s largest position, I thought it would be helpful to focus the rest of our offshore services discussion on it, though we also have substantial positions in Tidewater, the world’s largest player in Offshore Service Vessels (OSVs) and Noble, another owner of high-spec Drillships. At the close of trading on December 2024, Valaris had a market cap of $3.15 billion, and a net debt position of appx. $800 million (as of Q3 2024), for an Enterprise Value of approximately $3.9 billion. What do you get for this price?? You get 12 of the higher spec 7th Generation Drillships, and 1 of the better 6th Generation Drillships. You also get 5 Semi-Subs, 33 modern Jackups (JU) and a 50% ownership in a JU joint-venture with Saudi Aramco (ARO) that owns an additional 9 modern JUs. By our math, it would cost well in excess of $1 billion to build and activate each fully equipped 7G, and in excess of $250 million per JU. Not that anyone would try to recreate this selection of assets today through a newbuilding program, but you’d be hard pressed to do it for under $25 billion—making our $3.9 billion EV an interesting starting point for us value investors. I tend to be skeptical of management projections, but according to the Valaris, at a range of dayrates that roughly approximates today’s rates, the company should be able to earn between $560 million and $1.650 billion per year in free cash flow. While we have some quibbles with their math, we believe it is directionally accurate, albeit with a massive range of outcomes. At the same time, you can clearly see how small changes in dayrates lead to massive operating leverage, which is what gets me so excited in this thesis. So, what do we need for these results in Columns A to C to be achieved?? We need current dayrates on multiple active vessels to reset higher from prior contracts that were negotiated a few years ago at roughly half of today’s rates, and we need additional contracts to be procured for some of the highest spec sidelined vessels in the world.</p><p>Fortunately, there have been multiple contract signings over the past quarter that give me confidence that current dayrates are bounded by Columns A and C. To achieve these returns, Valaris simply needs to recontract existing vessels. In terms of sidelined vessels, this will take a bit longer, but I believe that an energy company would be foolish to contract a 6G vessel when there’s a 7G one available, even if it needs some time to fully mobilize. I think that both of these issues should resolve themselves by the end of 2026, as lower spec 6G vessels are swapped out for 7G ones. I also tend to believe that based on the number of offshore projects that begin in 2026, there’s a good chance that leading-edge dayrates will begin to exceed the Column C scenario, but I want to temper my enthusiasm. All we need to know is that returns may fall somewhere in this grid, and that provides a very attractive cash flow yield to us as equity owners.</p><p>More importantly, that cash flow is being used to retire stock, at a huge and amazingly accretive discount to newbuild cost. To date, Valaris has already repurchased 3.9 million net shares, or approximately 5.1% of the 75 million shares outstanding when it emerged from bankruptcy. As cash flows accelerate in the future, so should the pace of repurchases.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><h3><strong>Palm Valley Capital on Seaboard Corporation $SEB US</strong></h3><p><strong>Thesis:<br /></strong>Seaboard is a diversified global commodity-focused company with operations in hog production, renewable fuels, and more, currently trading at a decade low but positioned for potential recovery.</p><p><strong>Source</strong>: <a href="https://drive.google.com/file/d/1dnEvLPvgJGi6wfHDbcMYGY8eRhWdN1mL/view?usp=drivesdk">https://drive.google.com/file/d/1dnEvLPvgJGi6wfHDbcMYGY8eRhWdN1mL/view?usp=drivesdk</a></p><p><strong>Analysis:<br /></strong>Seaboard is a diversified global commodity-focused company that was founded in 1918 as a flour broker and miller. The firm is now engaged in hog production and pork processing, commodity trading and grain handling, cargo shipping, renewable diesel production, electric power generation, and sugar and alcohol production. Operations extend from the U.S. to Africa, South America, and the Caribbean—regions management deemed less competitive. Seaboard also owns 52.5% of Butterball, the leading turkey brand.<br /><br />Management has done a commendable job of building the net asset value per share of Seaboard over the years by reinvesting cash flows in its varied operations. In 2020, third-generation CEO Steven Bresky died suddenly, and for the first time, a non-family member was appointed to lead Seaboard. Since then, the Bresky family has sold a significant amount of their personal stakes back to the company. This, along with industry pressures on hog raising margins and Seaboard’s substantial investments in renewable fuel projects which have yet to pay off, has weighed on the share price. The stock trades at a decade low and for approximately 50% of tangible book value. Given improvement in the hog profit cycle, we believe SEB has a catalyst to move toward our valuation.</p><p><strong><a href="https://finchat.io/?via=tom">Check here for the latest results, quarterly call and analysts' estimates.</a></strong></p><div><hr /></div><p><br /></p><p><em>Everything you read here is for information purposes only and is not an investment recommendation.</em></p><div class="subscription-widget-wrap-editor"><div class="subscription-widget show-subscribe"><div class="preamble"><p class="cta-caption">Thanks for reading Stock Analysis Compilation! 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