Thread by @Adam_Wyden

I have taken some time to collect my thoughts on our favorite Swedish stock... $CDON..... a🧵with our updated thoughts:

1/ 1) This Company has literally had everything thrown at it. A sick CEO, fraudulent merchant(s), a marketing "guru" who knew nothing about e-commerce, and then an e-commerce market that was then down 20 pct... That pretty much feels like the kitchen sink....
$CDON

2/ The Board empowered the CFO into an operational roll late last year and reduced headcount by nearly 50 pct. As we expected the leaner team performed BETTER! most recent company conference call, they called out the fact that they were profitable in Jan. $CDON

3/ On our math... if the Company is profitable in Jan then on the same GMV levels (Company said the expect GMV to grow throughout the year), we would expect EBITDA to be 30-40 mm....More if GMV grows throughout the year. $CDON

4/Furthermore, the Company announced a take rate increase of 15 pct or approximately 1.5 pct gross on 2bn of GMV.... This is another 30mm of EBITDA that we are not taking into account. This could put EBITDA around 60-70mm potentially for core $CDON

5/ So why do Fyndiq.. .Fyndiq has 25-26 pct take rates and based on our research of what AMZN is charging in Nordics of excess of 20 pct..... we think another 3.5 pct take rate increase is in the bag... This is another 70mm of EBITDA to the combined company. $CDON

6/ FYNDIQ also has very good S&M efficiency and with combination could like improve our costs and efficiency as well. This could also be 30,40,50 mm of costs. $CDON

7/ Let us not forget the duplicative G&A, R&D, and compliance costs that will be removed across both companies. Could this be another 30+ MM? $ CDON

8/It is easy to see this doing 200 million of EBITDA on a combined basis WITHOUT any future GMV growth.
$CDON

9/ Sweden has had negative e-comm comps all year bc of energy prices and Russia (22). Industry data implies comps will turn positive in the spring. $CDON has a history of winning market share (even last year). What happens when the "market" is a tailwind and not a headwind.

10/ If the mkt. grows 10 percent per year (slower than historical) its not crazy to think this grows 20..board and mgmt demand more. ....Under those circumstances, $CDON is trading at 7x EBIT... These businesses which are growing and profitable trade 1-3 pct FCF yields...

11/If the path to our synergies are realized that is 600 SEK by the end of this year on 2024 numbers... or this is 3 pct FCF yield growing topline 20 and FCF growing 30 pct... $CDON

@pbcinc @Prof_Kalkyl @SharogradskyM @Assaf_Nathan