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Feb 21 • 4 tweets • 2 min read
Brookfield Asset Management $BAM and Mike Cannon-Brookes $TEAM lobbed an unsolicited bid for AGL $AGL $AGL.AX - which the board quickly rejected. So, let's unpack some of the valuations they're both using.

raskmedia.com.au/2022/02/21/unp…
Since writing that article the market has opened, the board has announced their position, and the shares have surged by 10%. The ~$8bn is now looking like it'll need to be closer to ~$10bn - a lot of heroic assumptions to get there.

theage.com.au/business/compa…
Last year I also wrote up a deep dive on utilities and what I look when deciding to invest in them. Mind you, the bid for AGL is more of an asset play with the hope of a policy change, rather than looking for the next stalwart.

@YahooFinanceAU There is a difference between market cap, enterprise value and net asset value. It'd be useful to let your audience know that when analysing takeover bids. The bid was above MC, near EV but well below NAV due to $3.5bn debt.

au.finance.yahoo.com/news/why-this-…

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Value Downunder Profile picture
Feb 21
Genex $GNX $GNX.AX a renewable energy play with battery, pumped hydro and firming capacity has gone into a trading halt to raise capital at a 40% discount to 52-week highs.

Let's take a quick look 👇
You can find the original deep dive and updates here.

And don’t forget, if you click on my profile and then go to moments/index, you will see the full library of deep dives and updates.
To be honest I was pretty happy with their recent report.

Revenue ahead of schedule for Kidston Solar ($11.5m annualized vs $10.6 expected) and Jemalong ($11.7 vs $10m ).
Read 9 tweets
Value Downunder Profile picture
Feb 17
Lark $LRK LRK.AX is an award winning whiskey distilling company based out of the beautiful Tasmania that’s been in the news for all the wrong reasons. Does yesterday's 20% drop in the share price give us a buying opportunity?

Let’s take a deep dive. 👇
1. Investment thesis: Asset play.
✅Award winning whiskey
✅Growing asset base through acquisitions
✅Growing revenues with positive earnings
✅Valuations at or below net tangible assets
❓Risk of new management & Bill Lark
2. Lark was set up by Bill Lark, the ‘Godfather of Australian Whiskey’ who was inducted in the Hall of Fame in 2015.

Only 1 of 7 people outside of Scotland to claim that feat.
Read 26 tweets
Value Downunder Profile picture
Feb 16
Treasury Wine Estate $TWE $TWE.AX 1H22 results have come in well above consensus, popping +10% today despite:
🚨Revenue -10.1%
🚨EBITS -6.7%
🚨NPAT -5.3%
Let’s take a look 👇
1. TWE was a Classic case of heads I win (China not so bad, find alternative markets), tails I don’t lose ($8-9 asset values incl. under reported land and inventory).
Here’s the previous earnings updates and original deep dive:👇
2. The 1H22 results look terrible.

Look, every number is down down down. Yet, stock price up +11.39% right this moment 🤷
Read 17 tweets
Value Downunder Profile picture
Feb 15
Tassal $TGR.AX $TGR half year results out and they didn’t disappoint 🤯
✅Revenue +43%
✅EBITDA +25%
✅NPAT +31%
✅FCF +137%

Let’s take a look 👇
1. But first, you can find my previous updates and the original deep dive all linked through here.

If you don’t want to look at the entire thread, the original is in my index of deep dives on my pinned tweet.
2. The three components of my investment thesis
✅Cyclical (salmon) – peaking now but expecting to stay elevated
✅FCF conversion (prawns) – on track as CAPEX reduces
✅Valuation – remains cheap relative to peers
Read 22 tweets
Value Downunder Profile picture
Feb 14
The global water and wastewater industry was worth US$260bn in 2020, growing at a healthy 7% CAGR. Australian technology is well positioned to benefit, but are Australian companies?

Let’s take a look at Fluence $FLC $FLC.AX
Phoslock $PET $PET.AX and Calix $CXL $CXL.AX 👇
1. Tl;dr – De.mem $DEM $DEM.AX is still my #1 pick. The sector passes my baked beans hurdle (growing +4% CAGR), and De.mem have a good business model. Just not sure on their operating leverage?
You can check out the most recent deep dive here:👇
2. Fluence $FLC $FLC.AX builds decentralized water treatment plants around the world. With over 300 projects under its belt, it has a proven track record in delivering.
Read 23 tweets
Value Downunder Profile picture
Feb 12
Things are about to get reel interesting in the Salmon World.🐟

European inventories are depleted, demand keeps increasing, and supply is contracting. We're up ~40% from the start of the year, and prices have hit 100NOK in China! Image
"The salmon price is speeding away - towards the highest level of all time"

"Faroe islands, Scotland, Chille, Norway - they all have shortages. It is a perfect storm". <-Music to my ears. Image
They're all up 10%, 15%, 20% over the past month:
👊Mowi $MOWI
👊Bakkafrost $BAKKA
👊Leroy $0GM2
👊SalMar $SALM Image
Read 6 tweets

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