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Top stock pitches (Mon, Apr 8)
Connor Van Ooyen
April 08, 2024
About // Sponsor YBR // Yellowbrick Website // Twitter
👋 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 135 stock pitches, 941 news articles, and 137 insider trades and found:
A video game company with 99% upside (stock pitch)
Market jumps after job growth totaled 303,000 in March, better than expected (news)
The biggest insider trades (insider trade)
and more…
Thanks for reading! Feel free to share this email with any other investors that may like it.
Connor (follow the Yellowbrick Twitter account - @joinyellowbrick)
* If you missed yesterday’s email, don’t forget to read it here
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STOCK PITCHES
VALUE INVESTORS CLUB
Take-Two Interactive Software, Inc. - $TTWO
Take-Two Interactive Software, Inc. develops, publishes, and markets interactive entertainment solutions for consumers worldwide. The company offers its products under the Rockstar Games, 2K, Private Division, and Zynga names
Ticker: TTWO | Price: $151.04 | Price Target: $300 (+99%)
Market Cap: $25.9B | Timeframe: N/A
🕹️ Gaming | 📈 Bullish Idea
Take-Two Interactive Software, Inc. (TTWO) is expected to release Grand Theft Auto 6 (GTA6) in the next 12-18 months. GTA5 has sold 195 million copies, making it the third best-selling game of all time. It is still the number one streamed game on Twitch, even 10 years after its release. Management often provides conservative guidance prior to major releases. Recurrent consumer spending, such as in-game purchases, is highly profitable for the company. The GTA6 trailer received a record 175 million views in 24 hours. The price target for the game is $70, with expectations of 50 million or more unit sales and over $1 billion in recurrent consumer spending in the first year. This could lead to upside for Take-Two's calendar year 2025 revenues, potentially reaching $7 billion. A sum-of-parts valuation for the GTA franchise alone could be $20-25 billion or more, compared to Take-Two's current enterprise value of $29 billion. The company is also a potential acquisition target following the Activision Blizzard and Microsoft deal.
Read the full article here. Read time: 9 min
BLOG POST
Raging Bull Investments' Favorite Position Heading into Q2: Roivant Sciences Ltd.
Roivant Sciences Ltd., a commercial-stage biopharmaceutical company, engages in the development and commercialization of medicines for inflammation and immunology areas
Ticker: ROIV | Price: $11.74 | Price Target: $20 (+70%)
Market Cap: $9.3B | Timeframe: N/A
🧪 Biotech | 📈 Bullish Idea
ROIV trades near the combined value of its cash and IMVT stake, essentially offering the rest of its pipeline for free. Catalysts include Vtama expansion, eight Phase 2 and 3 trials, and potential proceeds from the LNP litigation involving Arbutus Bio and Genevant. The recently announced $1.5 billion buyback at $9.10 per share helps clear the overhang from legacy shareholders. Additionally, brepocitinib demonstrated positive Phase 2 results in non-infectious uveitis, a large market opportunity. With a $20 price target based on buybacks and pipeline readouts, ROIV presents an asymmetric investment opportunity with significant upside potential and limited downside risk.
Read the full article here. Read time: 3 min
SPONSORED BY GLADIATOR METALS
Gladiator Metals Corporation ($GDTRF): Your Ticket to Capitalize on the Copper Crisis
Gladiator Metals Corp. engages in the acquisition, development, and operation of mineral property. The company explores for copper, molybdenum, silver, gold, zinc, nickel, and lead minerals
Ticker: $GDTRF | Price: 0.31 | Price Target: N/A
Market Cap: 18.41M | Timeframe: N/A
⛏️ Mining | 📈 Bullish Idea
* I recommend using Interactive Brokers (link) to trade international and OTC stocks if you can’t trade them in your current brokerage
Overview:
- Copper Crisis Ahead: Anticipated 10 million ton deficit by 2035, potentially driving significant price surges.
- Strategic Position: Located in Yukon's Whitehorse Copper Belt with high-grade copper deposits.
- Experienced Team: Leadership includes veterans from Snowline Gold, Dolly Varden, K92, and First Quantum.
- Strong Ownership: Notable insider and institutional investment, indicating confidence in the company's prospects.
- Active Development: Engaged in a 10,000m drilling program, with promising historical results and strong government support.
Opportunity: Gladiator Metals Corporation (GLAD/GDTRF) offers a unique investment opportunity, leveraging its high-grade assets and experienced team to capitalize on the escalating copper demand. As the market braces for a substantial deficit, Gladiator is well-positioned to thrive, making it an attractive option for investors looking to benefit from the upcoming copper squeeze.
BLOG POST
One Group Hospitality (STKS) - One Hour Analysis: Quick Thoughts on Benihana Acquisition. Building an attractive acquisition candidate by acquisition?
The ONE Group Hospitality, Inc., a restaurant company, develops, owns, operates, manages, and licenses restaurants and lounges worldwide. It operates through STK, Kona Grill, and ONE Hospitality segments. The company also provides turn-key food and beverage services for hospitality venues, including hotels, casinos, and other locations
Ticker: STKS | Price: $5.71 | Price Target: N/A
Market Cap: $179M | Timeframe: N/A
🧑🍳 Restaurants | 💼 Acquisitions | 📈 Bullish Idea
The ONE Group Hospitality, Inc. (STKS) is acquiring Safflower Holdings Corp., the owner of Benihana Inc., for $365 million. The acquisition is expected to add approximately $575 million in annualized system-wide revenue and approximately $70 million in annual run-rate EBITDA before synergies, which are estimated to be $20 million annually. The transaction is financed with $160 million of 13% PIK preferred stock from Hill Path Capital LP and $390 million of new debt. The all-in interest expense, including the 13% PIK, is about $35 million a year. Management sees the potential for 400 total US Benihana locations, which is 4 times the current number. The main risks are the high PIK rate and debt levels, while the potential upside includes growth, re-rating, and the possibility of a takeout.
Read the full article here. Read time: 7 min
Which stock idea was the most compelling to you? |
Yesterday’s Poll Results:
🟩🟩🟩⬜️⬜️ Superior Industries International ($SUP) [58%]
🟨🟨⬜️⬜️⬜️ PowerFleet ($PWFL) [24%]
🟥⬜️⬜️⬜️⬜️ Exor N.V. ($EXO.AS) [18%]
MARKET OVERVIEW / NEWS
Market Overview
Are you short-term bullish or bearish on the market? |
Yesterday’s Poll Results: 46% bullish
Well, we jumped from the most bearish day of the year on Thursday to one of the more bullish days on Friday. The indexes were all up significantly, the news index shot up to 0.729 which is the most bullish it has been in a long time, and the Fear v Greed index jumped 12 points and back to Greed levels. Yellowbrick Road readers fell to below 50% bullish for the first time this year, but the email goes out before market open, so I’m guessing readers are now much more bullish after seeing how the market performed on Friday.
Stock Market News
Job growth totaled 303,000 in March, better than expected, and unemployment was 3.8% - CNBC
PIMCO trims 2024 Fed rate cut expectations to 2 after jobs report - Reuters
Spire Global bets on AI to help improve weather forecasts, with boost from Nvidia - CNBC
Exclusive: Tesla scraps low-cost car plans amid fierce Chinese EV competition - Reuters
Johnson & Johnson to buy Shockwave Medical for $12.5 bln - Reuters
Elon Musk says Tesla will unveil its robotaxi on Aug. 8; shares pop - CNBC
Samsung flags 10-fold rise in first-quarter profit as chip prices recover - Reuters
Teladoc CEO departs the company, CFO to serve as interim head - CNBC
Foxconn Q1 revenue drops 9.6% y/y, sees growth in Q2 - Reuters
US drillers cut oil and gas rigs for third week in a row - Baker Hughes - Reuters
BIGGEST INSIDER PURCHASES
The insider trades are brought to you by CEO Watcher (another free, weekly email I write). It’s the only newsletter that tracks insider returns to find the best ones. Subscribe here
10% Owner at Boundless Bio, Inc. ($BOLD) purchased 200,000 shares at $16.00/share ($3.20M total) which increased their vested holdings by 32.4%. Their median purchase size is $1.54M and this is their 4th largest purchase out of 11 all time (link). 2 other insiders also purchased the stock
Director at Movano Inc. ($MOVE) purchased 4,690,000 shares at $0.51/share ($2.39M total) which increased their vested holdings by 79.3%. Their median purchase size is $250K and this is their 1st largest purchase out of 10 all time (link). 3 other insiders also purchased the stock. Was part of a private placement
10% Owner at Molecular Templates, Inc. ($MTEM) purchased 250,000 shares at $2.35/share ($588K total) which increased their vested holdings by 12.9%. Their median purchase size is $2.09M and this is their 61st largest purchase out of 65 all time (link)
SECRET QUESTION
(Or if you’d rather not answer, you can just reply and say hi!)
Secret Question: How was your weekend? Another weekend of beautiful weather here, but I spent a chunk of it doing taxes :(.
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THAT’S ALL FOLKS
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Connor
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