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Value Downunder Profile picture
Value Downunder
@DownunderValue
Part-time researcher and analyst. Value orientated. ASX focused. Turning over unusual stones. I do regular deep dives (see my pinned tweet) and company updates.
Olaf Profile picture Craig Bobbin Profile picture James Taylor Profile picture 3 subscribed
Sep 30, 2022 • 24 tweets • 9 min read
The global salmon industry is in turmoil as fears of contagion of the Norwegian resource tax hits the Faroe Islands.🐟

P/F Bakkafrost $BAKKA is down another 12% overnight, while the big Norwegians $MOWI $SALM $LSG continue to slide.

Let's take a look at the Faroe Islands 🧵👇 Image 1. Yesterday I looked at Norway's resource tax and figured it was too difficult to find a good risk/reward bet. Right now the best forecasters of European monetary and fiscal policy seem to be a random number generator. Today I'm looking at Faroe Islands.
Sep 29, 2022 • 23 tweets • 8 min read
Norwegian salmon stocks have collapsed overnight, with the Government threatening a 40% super-resource tax.

$SALM.OL Salmar -30%
$LRY.OL Lerøy -28%
$GSF.OL Grieg -26%
$MOWI.OL -19%

This would destroy the industry. Maybe.

Time to take a look 👇
thefishsite.com/articles/norwa…. Norway produces over 50% of the world's Atlantic salmon. So this is kind of a big deal. Image
Aug 31, 2022 • 19 tweets • 6 min read
Delorean's $DEL $DEL.AX update to the market has left a fair bit to be desired. Engineering division has been decimated, financing remains out of reach, though retail is doing alright. Time to hit the panic button? 🚨

Let's take a closer look 🤏🧵👇 Image If you don't know what Delorean is, please don't @ me, just look at the original deep dive.
Aug 31, 2022 • 11 tweets • 4 min read
Clean Seas $CSS $CSS.AX FY22 results look really good. I recently spoke with Rob Gratton (CEO) and got to understand more of their business model and strategic direction.

Here's a short thread on my thoughts and why I don't hold 🤏🧵👇 The FY22 results look very strong. Volume growth (3.7kt), ~20% increase in pricing, ~37% revenue increase, 19% reduction in production costs, etc. And for the first time, profitable! 🎯
Aug 29, 2022 • 16 tweets • 6 min read
Lark Distilling Co. $LRK $LRK.AX FY22 results have come at the top end of guidance.

Asset base is growing rapidly, revenues increasing, though sales expenses are ramping up too. Meanwhile, no news on the search for a CEO.

Let's take a look🧵👇 But before we jump in, if you want to see the original deep dive you can find it on my pinned tweet along with all the others.

Or here 👇
Aug 18, 2022 • 14 tweets • 5 min read
Treasury Wine Estates $TWE $TWE.AX FY22 results came out, and they're good considering the China wine-ban is still being flushed out. Total revenues down, but margins and NPAT are both up 🍷😋

Let's take a quick look 👇 You can find my original thread here where I outlined TWE as an asset play, with the hope that profits may return in due course.

Aug 18, 2022 • 4 tweets • 2 min read
Ridley $RIC $RIC.AX results are out and the share price has jumped +5%.

Headline results look very good with +13% revenues, +16% EBITDA and +70% NPAT. But, can this be repeated, or is this just a one-off? The P&L has some very good results in there for Ridley. The fact they are benefiting from commodity prices and the previous CAPEX cycle shows. 🤠
Aug 17, 2022 • 4 tweets • 2 min read
Amcor $AMC $AMC.AX $AMCR shows another strong performance with pricing power and earnings growth. Buybacks & dividend growth, but not quite as strong as some might expect.

Check out the thread link here if you want to see my deep dive and updates:👇
The adjustments make things look a lot better. But to be honest, the 4Q was heavily impacted by the Russian aggression to Ukraine and the subsequent impact on Amcor's Russia's operations (withdrawing?)
Aug 15, 2022 • 6 tweets • 2 min read
Duxton $D20 $D20.AX (basically a water-REIT) is facing some difficult times. Asset values are going up, but AFFO are drying up (pun 100% intended). Image Looks to me like they are losing long-term leases, and that means they need to sell more of their water on the spot market. Image
Jul 12, 2022 • 26 tweets • 9 min read
Genex $GNX $GNX.AX is a renewable energy company with long-duration assets. Not a fun place to be in an increasing rate environment, where the assets are treated essentially as a bond proxy.

Genex is down ~50% yoy, so time for a quick update 👇 Image The investment thesis is simple: buy renewable energy assets that are cheaper than the market's current acquisition price. Genex has risks, but it's also been de-risking.
Here's the thread of my original deep dive, also found in my pinned tweet🧵👇
Jun 1, 2022 • 25 tweets • 10 min read
Ridley $RIC $RIC.AX is Australia’s largest “provider of high-performance animal nutrition solution” a.k.a they own feedmills for animals.

After years of capital restructuring, are they now ready to reap the rewards of a booming agriculture sector?

Let’s take a deep dive.👇🧵 Image 1. Investment thesis: Stalwart
✅Growing revenue base
✅Livestock and aquaculture tailwinds
✅CAPEX pulling back
✅Economies of scale / efficiencies
✅Capital allocation framework
❓Cyclical vs trend ?
❓Too late for value ?

They even have a flywheel👇 Image
May 20, 2022 • 25 tweets • 8 min read
CSL $CSL $CSL.AX $CSLLY has been Australia’s best quality healthcare company with a massive moat of blood. But, does its growth prospects justify today’s valuations?

With my mum becoming a subject in the Phase3 CSL112 clinical trials, it's time to take a deep dive 👇
🧵 Image 1. Investment thesis: Stalwart.
✅Winners keep winning
✅R&D Investments to maintain moat
✅CSL112 a game changer
✅Strong balance sheet
✅Cash flow positive
❓Vifor and CSL112 approvals
❓Valuation?
May 10, 2022 • 9 tweets • 4 min read
If you're wondering how far we got pushed up the risk curve, look no further than Dairy-as-a-Service (DaaS) by Terragen Holding $TGH $TGH.AX

Let's take a tongue-in-cheek dive at a a fast-growing DaaS fueled by milo 👇 Image Terragen is an ag-tech company focused on improving dairy outcomes for the environment and farmers.

Recently @EquityMates had a great episode talking about ag-tech driving productivity in our rural economy. It's the topic de jour in the rural circles, that's for sure! Image
Apr 28, 2022 • 25 tweets • 9 min read
Soft commodities are all the rage. Fintwit is filled with🍞Wheat bulls,🌽Corn bulls,🥛Milk bulls,🐟Salmon bulls, and regular 🐂bull bulls.

Prices are high, but when will the party end?

Today I’m deep diving into how long different commodities may be on the mooooove for👇 Image 1. Investment thesis: Cyclical
✅ Increasing demand for food
✅Increasing ability to pay for food
❓ Varied levels of inventories
❓ Varied timeframes of supply constraints
⚖️ High commodity prices vs current stock prices
Apr 22, 2022 • 25 tweets • 7 min read
Global agricultural commodity prices are going berserk. One way to gain exposure is Elders $ELD $ELD.AX, a diversified agricultural goods and service company with offices around Australia.🧑‍🌾

But with backwardation across many soft commodities, is it still a buy? Image 1. Investment thesis: Cyclical or Stalwart?
🥇Best in class ag company
🌽History of strong performance
🐄High commodity prices, profit
❓Backwardation of soft commodities
🚨Valuations of super profits into perpetuity
Apr 12, 2022 • 6 tweets • 3 min read
With all the news of Covid lockdowns in China and ships backing up at every port filled with raw materials, it's time for an update from the fan-favourite Midway $MWY $MWY.AX 😬

h/t @puppyeh1 @charliesamuelk You may be aware that Midway has been queried by the ASX for not disclosing trading updates (results pending). During the query they flagged to ASX that the outlook for FY22 won't be met. At least they now are aware that is the case, and are disclosing it.
Apr 12, 2022 • 24 tweets • 9 min read
If you've anchored your portfolio with utilities and long duration asset plays, you mightn't have noticed the recent volatility. However, no doubt you've heard the commentary of increasing inflation and interest rates, and wondered what these risks mean?

Let's take a deep dive👇 1. Investment Thesis: Basket of stalwarts
🍃 Renewables/electrification megatrends
🛣️ Long runway for CAPEX / M&A
⚓️ Anchor +10% IRR for the portfolio
🫰 Inflation and interest rate risks for earnings and valuations
⚠️ Regulatory risk
Mar 24, 2022 • 24 tweets • 9 min read
Today I’m turning over rocks using a popular heuristic to find hidden gems from the illiquid microcap universe to add to my watchlist.

I'll go through my process and the three companies:
🛵V-Moto $VMT
♻️Close the Loop $CLG
🩸Cryosite $CTE

Let's turn over some rocks 👇 @iancassel recently discussed with @TreyLockerbie his strategy to microcap investing, which I am butchering here in my investment research process. Worth the listen.

His framework includes:
📋Tailwinds
📋Scarcity
📋Story
📋Undiscovered theinvestorspodcast.com/episodes/the-b…
Feb 21, 2022 • 9 tweets • 4 min read
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.
Feb 21, 2022 • 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…
Feb 17, 2022 • 26 tweets • 8 min read
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