Random $BWMX update. This is still my 2nd largest position, despite the rally. What has changed? Not much. Still a 30%+ grower at ~10x 21E P/E, ~8% div yield...
They presented at ICR today. Nothing new really but more eyeballs = more 'normal' valuation (read - a lot higher) for a high-growth co w/ many irons in the fire (new products, new geographies, online transition)

Google trends + app downloads + catalog engagements continue to print v high levels...expect Q4 to be another blowout (top and bottom line)...
...and Mexican relisting prob happens sometime 2021 too. Good to see the co clarify the Forteza owners long-term intentions too:

The co is still a bit 'rough around the edges' (comms could be better; website/IR function etc could be better) but w/ growth runway intact and stock still blindingly cheap, I can't see how direction of travel isn't MUCH higher.

Still think this is a $50 stock waiting to happen
At $34-35 I have it basically at 11x 21E P/E, and 8.5-9% div yield w no debt...far too cheap. Post ICR I expect growth-hungry investors to do the work and load up before blowout Q4 (am guessing report in 7 weeks?)

DYODD. Good luck to all. $BWMX

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More from @puppyeh1

23 Dec 20
Merry Xmas to all my followers! My stocking stuffer idea 🎄is $CCRC, a Chinese small-cap special sit that I think has 40-50% near term upside.

Obvi this is a 'big boy pants' type situation, so 🎅reminds you to always DYODD...

$CCRC is an outsourced call center operator in 🇨🇳. It is your typical Chinese ADR 💩in many respects:
- horrible offshore/onshort VIE structure
- non-big 4 auditor
- some related party issues (tho minor)
- controlled co
- big A/R balance which raised a few red flags...
All that said, the biz itself - if the nos are real - is pretty decent. It's growing (call centers in China!!), and turns mid-20s GMs into single digit OPMs and 20-30% ROICs:
Read 17 tweets
18 Dec 20
Random small-cap merger arb idea - $TNK.AX, a childcare center operator in Aus

There is a disclosed $1.35/shr indic bid on the table from PE. Board committe was formed in mid-Nov to deliberate on it, have until Dec18:
Note that this shop (Alceon) is a local Aussie PE firm and are purely financial buyers. They were bidding ~5.6x normalized EV/EBITDA.

Note also that COVID was/is basically a non-issue in Oz, this EBITDA number is basically unimpaired and the co has been growing fast thru M&A
A week later, a strategic - Busy Bees - comes over the top w a big premium - $1.75/share indicative, non-binding, bid.

It says 'indic' but there's no financing condition...and the other terms look pretty boiler plate. See for yourself:
Read 9 tweets
5 Dec 20
I've been asked if I'm back involved in $UMDK given the apparent improvement in financials in the 1H PnL.

The short answer is NO. Of course this is not investment advice, DYODD, and I have no position in the stock either way but...

I dumped this and moved on when the lack of disclosures + impossible to understand W/C moves made this simply a 'too hard' bucket for me. Post 1H, the qs remain...
I originally thought this biz was levered to rising adoption of Payback, through a licensing/low-touch take-rate type model. That apparently is not the case. Instead most of the growth is from the new 'consulting' segment - but there is no disclosure of what that entails...
Read 9 tweets
11 Nov 20
People are asking what I think about $AER earnings so here goes. The TL;DR version is amongst reopening trades I still think one of the superior risk rewards out there (zero impairment risk vs easy to see $50-60 in new normal)

I won't go too much into nitty gritty. There are two ways to look at it: what are you paying for $AER earnings today; and what multiple are you paying for the asset base.

On current run-rate earnings (ie annualizing this qtr) you're paying ~7x EPS and the biz is doing $500mm NI
Ofc the equity base is ~$8.8bn so a ~5.7% RoE isn't exciting and deserves a book value discount.

But how 'normal' is 3q earnings? They moved $100mm of revs to cash accounting (to account for stressed c/ps), that prob returns in new normal + had zero cap gains thru asset sales
Read 8 tweets
28 Oct 20
I've been thinking a lot about what the quick spiral into second lockdowns in Europe means for how you want to invest...and I'm actually incredibly bullish on the opportunity set from here. Why?

There's a whole host of perceived COVID beneficiaries - gambling, gaming, homebuilders, stock trading, etc - where the market has decided not to capitalize current earnings at much of a multiple (since the boom is perceived as 'one-time'). That may have been fair until now...
...but with the rolling lockdowns coming back and (to my mind) much higher likelihood we simply oscillate from some form of lockdown to another for the foreseeable future it seems much likely current behaviors (and spending) gets ingrained....
Read 7 tweets
9 Oct 20
Buckle up for another deep value nano cap idea. The last one - $EVE.LN - tripled in six weeks (see below) so this is well worth your time 🤑

All that said, remember to DYODD, this is an illiquid security + also a bankrupt equity so BIG BOY PANTS ON + caveat emptor....

I am long shares of Vivus ($VVUSQ) - a bankrupt orphan equity currently in Chpt 11 reorganization. Shares last traded for 33c...

B/K stocks are normally garbage/worthless but $VVUSQ is an extremely asymmetric + interesting situation...

Let's examine the fact pattern...
$VVUSQ is a pretty crappy pharma co with 3 approved drugs, a torrid history of destroying boatloads of capital, and a $960mm+ NOL.

Yes, that's right, almost a BILLION in NOLs (still preserved to this day through a trading limitation...)
Read 24 tweets

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