Update on $CAMB.LN. Co is on the tape w/ another extension (1mo) for CEO to formalize bid at 80p...this marks the second extension. CFO etc are dropping out of bid for 'technical considerations'. Some quick thoughts...
1) chance of real, and higher, bid should be higher. Stock has traded north of 80p for a while and results were 🔥since bid first mooted. CEO must know 80p isn't get it done but is still asking for extension (again)...i think chance bid is made now is prob 70% (vs 50/50 prior)
2) Timing. Every extension plays in favor of minorities given reopening/progression of business. CEO must know this ofc so this affects likely bid px. Ie there's no point coming w/ 80p in a mo that is automatically rejected. I think 100+ is somewhat likely now (for first bid)...
3) CFO etc dropping out for 'technical considerations.' This is odd. Not sure why they would deal themselves out of getting rich. Methinks Lavery's holdco is the one taking all the leverage and banks only want to lend to one entity? For some reason CFO etc can't join. Theories?
All in all another delay but still like this. Again time is on our side here. Will check back in in a month 👌👌
$CAMB.LN 🇬🇧🇬🇧
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There has been a lot of talk about copper lately (esp w Chile and Peru likely incr in taxes). I am hardly an authority but here is how I think about it.
TL;DR the setup for copper prices is about as attractive r/r you’ll see in commods in the mid-term imo.
Let’s start w the basics. Copper is almost in structural deficit today (and will certainly be in a cpl yrs). Basically every major mining house CEO is saying this. GS is saying this, etc.
Miners have been high-grading for years; not making large scale new discoveries...
The problem in commods markets is when an ancillary use case for a commod develops much faster than mine supply can be brought online. In this case that use case is EVs.
OK this is super illiquid (AIM-listed 💩) so of limited relevance perhaps. but it is - as they say in the business - 'compelling'
$CAMB.LN Cambria Automotive is a high-end car dealer. stock is 75p as i type. Entirely UK.
~45% owned by founder/CEO and his compadres...
..obvi the biz got hit by COVID but this is a strong mgmt team. they acquired two dealers during 2020 at land value only (paying nothign for the businesses). long history of strong execution here too.
CEO steps in a month ago w a potential bid at 80p to take $CAMB.LN private...
Interesting timing to say the least. You all know I love looking at UK COVID stat charts....
Here we see COVID is OVER in the UK. It's obvious the biz will bounce hard once people can actually go to showrooms...
UPDATE - I am exiting my position in $CTT.AX, Cettire.
When I wrote it up CTT, it was $1.18 and it is now $1.86, so its +58% in < a month...obvi the px is higher and now ~12x EV/GP, ~3.5-4x EV/S (fwd) on my numbers...still not really too expensive on the numbers but...
...the majority of the comp set has compressed (as growth names have traded off); brokers have initiated coverage/non-Aussie funds have started to get involved (which was key catalyst here); and importantly my thread prompted lots of good analytical feedback re the biz...
...some of which I could answer but some of which I could not. I still don't totally understand why $CTT.AX has to win...and I am at least incrementally concerned that a good chunk of the outsized growth was COVID-related...
...they treat tailings from El Teniente (Codelco mine) in Chile, a v good jurisdiction for copper (obvi)...
Per the co's own slide deck at current spot ($4.25/lb) this is a $65mm+ EBITDA biz...altho I think this guidance is conservative...
...anyway this $65-70mm EBITDA turns into >$50mm of FCF ($6mm maint capex, $5mm int expense etc which will decline post refi; ~5-10mm more in corp G&A and some W/C reversal)...all against a $155mm mkt cap and (now) no net leverage. So 3x unlevered FCF basically...
@OtterMarket hits nail on the head, pre-COVID this was a $9mm EBITDA biz w 20% EBIT margins and pretty decent historic FCF generation.
Makes sense - they own their own content and just take a piece of casino hold on tables where they're games are installed...
iGaming is kind of a hidden tailwind, post PGP acquistion its maybe 20% (?) of the rev pool but growing rapidly. They are plugged in w some REAL heavy-hitters like $EVO tho and in general its kind of a stealth play on iGaming adoption...
I took a deep dive into Cettire, $CTT.AX, after reading this interesting tweet from @SharogradskyM.
You all know I'm not a 'growth bro' but for the life of me I can't work out why $CTT.AX is so cheap. It seems mispriced, by a factor of 50-100%....here's why 👇👇
Cettire is an online platform for luxury goods. They connect w/ offline suppliers (dept stores, wholesalers, etc - NOT the brands directly) to sell products online. $CTT.AX holds no inventory; their ERP connects directly w their suppliers. They function just as the shopfront...
...whilst all product/inventory risk remains w the supplier.
The biz operates worldwide (in 53 countries), w/ 90% of revs being outside Aus (despite the Aussie listing)...here's the main page: