Top stock ideas (Thu, Mar 21)

Author

Connor Van Ooyen
March 21, 2024

👋 Good Morning!

This is the Yellowbrick Road where I share the best stock pitches from billion-dollar hedge funds, professional analysts, millionaire investors, and more!

Our AI read and summarized 155 stock pitches, 1312 news articles, and 309 insider trades and found:

  • A shipping services company with 100% upside and 4.5% dividend (stock pitch)

  • Fed holds rates steady and the market loves it (news)

  • An insider with 180% one-year returns bought the stock (insider trade)

  • and more…

I’ve added back the Links You’ll Love section after a bunch of people asked for it to come back. This also means that I do read all of your feedback! If you ever have questions or feedbacks, please share them!

Connor (follow the Yellowbrick Twitter account - @joinyellowbrick)

* If you missed yesterday’s email, don’t forget to read it here

This stock pitch is up over 30% since we featured it!

$MU jumped 16% last night and is now up over 30% since this stock pitch a few months ago (link).

You can see all of the stock pitches we have in our database for $MU at https://www.joinyellowbrick.com/?ticker=MU.

If you aren’t using the Yellowbrick website, you are missing out on killer stock pitches!

STOCK PITCHES

BLOG POST

Future Prospects of Danaos Corporation

Danaos Corporation, together with its subsidiaries, provides container and drybulk vessels services in Australia, Asia, and Europe. The company offers seaborne transportation services by operating vessels in the containership and drybulk sectors of the shipping industry

Ticker: DAC | Price: $70.09 | Price Target: $140 (+100%)
Market Cap: $1.36B | Timeframe: 2026

⛴️ Shipping | 💰 4.6% Dividend | 📈 Bullish Idea

Danaos Corporation (DAC) trades at a market capitalization of $1.39 billion with a free cash flow of $539 million, earnings per share of $28.95, and a fleet of 68 ships with a backlog of $2.3 billion extending to 2028. The company has deleveraged, with a net debt to EBITDA ratio of 0.2x. Potential risks include an economic downturn, fuel price volatility, geopolitical instability, and overcapacity in the shipping industry. Insider ownership is high, and management has focused on reducing debt, although share buybacks have been limited. If charter rates rebound, a price target of $140 per share by 2026 is possible. This year, the stock could reach $90 at a price-to-earnings ratio of 3x if earnings surprise by 8%, as they have historically.

Read the full article here. Read time: 8 min

VALUE INVESTORS CLUB

OneMain Holdings, Inc. - $OMF

OneMain Holdings, Inc., a financial service holding company, engages in the consumer finance and insurance businesses in the United States. It originates, underwrites, and services personal loans secured by automobiles, other titled collateral, or unsecured

Ticker: OMF | Price: $48.11 | Price Target: $141 (+193%)
Market Cap: $5.8B | Timeframe: N/A

🏦 Financial Services Holding Company | 💰 8.3% Dividend | 📈 Bullish Idea

OneMain Financial: An underappreciated subprime lender with a 20% EPS CAGR since 2014, earning 25%+ ROEs even in recessions. The company trades at 3.5x normalized EPS and is accelerating growth in auto loans and credit cards. There is upside potential from charge-off normalization and a re-rating to 9-10x EPS, with a $141 price target for a 3x multiple on invested capital.

Read the full article here. Read time: 5 min

*SPONSORED BY JURNY

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  • In 2023, they grew their customer base by over 5x — and processed $35M+ in bookings.

  • They’ve raised over $12M from leading VCs and from over 1,100 individual investors.

  • Featured in numerous reports and by the media, including Skift, McKinsey & Company, Forbes, Bloomberg, Entrepreneur, and many others as a leading AI company. 

If you are interested in investing this this disruptive AI company alongside top VCs go check out Jurny.

BLOG POST

Mineros S.A - An under the radar gold producer

Mineros S.A. engages in the exploration, development, and production of mineral properties. It explores for gold and silver deposits. The company holds a portfolio of properties in Colombia, Nicaragua, and Chile

Ticker: MSA.TO | Price: CAD 1.00 | Price Target: N/A
Market Cap: CAD 290M | Timeframe: N/A

⛏️ Gold Mining | 💰 10.5% Dividend | 🇨🇴 Colombia | 📈 Bullish Idea

* I recommend using Interactive Brokers (link) to trade international and OTC stocks if you can’t trade them in your current brokerage

Mineros S.A. (MSA.TO) is a Colombian gold miner that produces 250,000 ounces per year with an all-in sustaining cost (AISC) of $1,300. The company trades at a price-to-earnings ratio of 2.78 and a price-to-book ratio of 0.60. In the fourth quarter, Mineros raised its dividend by 11%, resulting in a 10% yield, and reported improved financials compared to the previous year. Strong institutions hold 40% of the company's shares. Despite having reserves lasting over 10 years, Mineros is significantly undervalued compared to its peers. The company stands to benefit from higher gold prices.

Read the full article here. Read time: 4 min

Which stock idea was the most compelling to you?

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Yesterday’s Poll Results:

🟩🟩🟩⬜️⬜️ Deutsche Bank ($DB) [47%]

🟨🟨⬜️⬜️⬜️ Kemper Corporation ($KMPR) [33%]

🟥⬜️⬜️⬜️⬜️ Xometry ($XOM) [20%]

Your comments:

  • 💸  anthon*** ($KMPR): Strong looking stock from the monthly time frame. $40 was your golden pocket, but should be good to buy dips anywhere under $50

MARKET OVERVIEW / NEWS

Market Overview

Are you short-term bullish or bearish on the market?

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Yesterday’s Poll Results: 55% bullish

Well just in case you were starting to get worried, have no fear! The markets have flipped heavily green after the Fed meeting. All of the indexes are up over 1% (except the S&P which was up 0.89%) and all of our sentiment trackers (Fear v Greed, Stock News Sentiment, and YBR readers) jumped quite a bit.

You can also see in our Winners/Losers table that the winning stocks had a killer day, led by Astera Labs IPO that capitalized on the AI hype.

Stock Market News

Fed holds rates steady but indicates three cuts coming sometime this year - CNBC 

Intel awarded up to $8.5 billion in CHIPS Act grants, with billions more in loans available - CNBC 

Reddit prices IPO at $34 per share, sources say - CNBC

Shares of Micron pop 12% on earnings beat driven by AI boom - CNBC 

China's Tencent posts weaker than expected revenue growth - Reuters

Nike set for rare sales drop with focus on US demand, direct-to-consumer pivot - Reuters 

Samsung soars more than 5% after report that Nvidia is looking to buy its next-gen chips - CNBC 

FEATURED INSIDER TRADE

The insider trade is brought to you by CEO Watcher (another free, weekly email I write). It’s the only newsletter that tracks insider returns to find the best ones. Subscribe here

Director at XCel Brands, Inc. ($XELB)

The Director purchased 146,250 shares at $0.65/share ($95,062.50 total) which increased their vested holdings by 12.5%. The current price is $0.82 (+25.5%). Their median purchase size is $7,994.22 and this is their 4th largest purchase out of 13 all time. (trade link)

Historic Returns
1m returns: 31% weighted | 24% median | 100% win rate (9/9)
3m returns: 43% weighted | 48% median | 78% win rate (7/9)
6m returns: 109% weighted | 74% median | 100% win rate (9/9)
1y returns: 185% weighted | 178% median | 100% win rate (9/9)

Note: 2 other insiders also purchased the stock

LINKS YOU’LL LOVE

RAD AI is the future of AI marketing. ~3X revenue growth proves it’s working and major clients like Hasbro, MGM, and Skechers — not to mention 6,500+ investors, VCs, Fidelity, and execs from Meta, Google and Amazon — already trust RAD. Invest today.*

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THAT’S ALL FOLKS

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Connor

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