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Top stock pitches (Thu, Jul 25)
Connor Van Ooyen
July 25, 2024
About // Sponsor YBR // Yellowbrick Website // Twitter
*This newsletter is for entertainment purposes only. Nothing in this newsletter is financial advice or recommendations.
👋 Good Morning!
Thanks for reading the Yellowbrick Road where I share the best stock pitches from fund letters, analyst reports, blogs, and more!
The three stock pitches you’ll read about in today’s email are:
Vale S.A. (VALE)
Author: Investing Lawyer | Price: $10.70 | Price Target: N/A | Market Cap: $48.50B | Timeframe: N/A | Industry: Mining / 16% Dividend
IHS Holding Limited ($IHS)
Author: Value Investing Blueprint | Price: $2.90 | Price Target: $63.90 (+2100%) | Market Cap: $965M | Timeframe: 2029 | Industry: Communications Towers
Lakeland Industries (LAKE)
Author: Merion Road Capital | Price: $23.42 | Price Target: N/A | Market Cap: $173M | Timeframe: N/A | Industry: Protective Gear
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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
📢 IN CASE YOU MISSED IT 📢
Last weekend, Clark Square Capital let me peek behind their paywall (they have great returns) and share some of their most profitable stock pitches and their two most recent stock pitches.
Check it out if you missed it and give it a like/repost!
Clark Square Cap (@ClarkSquareCap) is one of the best investors on here.
They let me take a look behind their paywall and see what I could find.
Here are some of their best pitches (and their two newest ones):
— Yellowbrick Investing (@joinyellowbrick)
6:03 PM • Jul 20, 2024
YBR PORTFOLIO
The YBR Portfolio copies the trades of the top 10 investors (based on the average returns of their previous stock pitches) in our database of 1,000+ investors. If you want to be alerted when the best investors buy/sell a stock, then this section is for you.
*All investments in the YBR Portfolio will be for ~3% of the portfolio value (which allows us to hold a maximum of 33 stocks at a time).
The YBR Portfolio is only available to Premium Subscribers. If you want to know which stocks the top investors are investing in, upgrade to Yellowbrick Premium.
Current YB Premium Portfolio returns (started in mid-May)
STOCK PITCHES
Author Returns
The below stock pitch is from Investing Lawyer.
Their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
BLOG POST - Investing Lawyer
Stock Investment: Vale S.A. - $VALE
Vale S.A., together with its subsidiaries, produces and sells iron ore, iron ore pellets, nickel, and copper in Brazil and internationally. The company operates through Iron Solutions and Energy Transition Materials segments
Ticker: VALE | Price: $10.70 | Price Target: N/A
Market Cap: $48.50 | Timeframe: N/A
⛏️ Mining | 💰 16% Dividend | 📈 Bullish Idea
Vale S.A. (NYSE: VALE), a Brazilian iron and nickel miner, is one of the top three global players alongside Rio Tinto and BHP. The company benefits from a strong moat due to high sector entry costs and has predictable cash flows with low-to-medium debt. Vale's experienced management, strong financial position, and NYSE listing mitigate forex risks. However, the company faces potential political instability in Brazil and is susceptible to commodity price fluctuations. Our portfolio acquired 200 shares at $11.2 each, with an expected 15% dividend yield (~$300/year). Vale operates in two segments: Iron Solutions and Energy Transition Materials, producing iron ore, pellets, nickel, copper, and other ferrous products. The company's diversified portfolio and global presence provide stability, but investors should be aware of the inherent risks in the mining sector and emerging markets.
Read the full article here. Read time: 2 min
Share this stock pitch:
https://www.joinyellowbrick.com/stock-pitches/6824/?ref=PLACEHOLDER
Author Returns
The below stock pitch is from Value Investing Blueprint.
Their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
BLOG POST - Value Investing Blueprint
IHS Holdings: The Giant Hiding in Plain Sight
IHS Holding Limited, together with its subsidiaries, develops, owns, and operates shared communications infrastructure in Nigeria, Sub-Saharan Africa, the Middle East and North Africa, and Latin America.
Ticker: IHS | Price: $2.90 | Price Target: $63.90 (+2100%)
Market Cap: $965M | Timeframe: 2029
🗼 Communications Towers | 📈 Bullish Idea
IHS Holding Limited (IHS) is the leading tower provider in seven countries, with over 93% market share in five. The company has shown strong growth with a 24% revenue CAGR and an 11.43% ROIC, outperforming competitors' average of 7.26%. Recent Naira devaluation impacted USD revenue, but 97% of contracts reset quarterly, mitigating long-term effects. MTN, a 25% owner, renewed over 30% of IHS's towers for 10 years, demonstrating confidence. With $693 million in liquidity and plans to explore a $1 billion asset sale, IHS is addressing debt concerns. The company achieved 35.5% organic growth pre-FX in Q1, highlighting its potential. A price target of $63.90 by 2029 at 17x P/FCF with $1.25 billion FCF is projected. Risks include Naira instability and debt management. The company's strong market position, long-term contracts, and growth potential in developing markets make it an attractive investment, despite currency challenges.
Read the full article here. Read time: 4 min
Share this stock pitch:
https://www.joinyellowbrick.com/stock-pitches/7184/?ref=PLACEHOLDER
Author Returns
The below stock pitch is from Merion Road Capital.
We have 7 stock pitches from them in our database and their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
FUND LETTER - Merion Road Capital
Merion Road Capital Portfolio Holding: Lakeland Industries, Inc.
Lakeland Industries, Inc. manufactures and sells industrial protective clothing and accessories for the industrial and public protective clothing market worldwide.
Ticker: LAKE | Price: $23.42 | Price Target: N/A
Market Cap: $173M | Timeframe: N/A
⛑️ Protective Gear | 📈 Bullish Idea
Lakeland Industries (LAKE), a protective gear manufacturer, is undergoing a strategic transformation led by new management from Transcat. The company is shifting its focus to the fire services sector, which now accounts for 40% of revenue, up from single digits. LAKE has made several acquisitions at estimated 5-6x EBITDA multiples, expanding its product range and regulatory certifications. The company is guiding for 12% EBITDA margins, with potential upside as they integrate acquisitions and improve profitability. LAKE is currently trading at 7x EBITDA and 10x FCF, significantly lower than market leader MSA Safety at 17x EBITDA and 25x FCF. As LAKE realizes its earnings potential and investors recognize the ongoing transformation, multiple expansion is likely. The firefighter turnout gear industry, valued at $1.8 billion globally, is expected to grow 5% annually, benefiting from its non-discretionary nature. With a net cash position, LAKE is well-positioned for further acquisitions in this fragmented market.
Read the full article here. Read time: 2 min
Share this stock pitch:
https://www.joinyellowbrick.com/stock-pitches/7063/?ref=PLACEHOLDER
Which stock idea was the most compelling to you? |
Yesterday’s Poll Results:
🟩🟩🟩⬜️⬜️ Shift4 Payments (FOUR) [42%]
🟨🟨⬜️⬜️⬜️ Microsoft Corporation (MSFT) [42%]
🟥⬜️⬜️⬜️⬜️ Hasbro (HAS) [16%]
MARKET OVERVIEW / NEWS
Market Overview
Are you short-term bullish or bearish on the market? |
Yesterday’s Poll Results: 52% bullish
A brutally bearish day in the market as all of the indexes got absolutely slammed. The Fear v Greed index dropped a massive 15 points and fell into “fear” territory, the news sentiment fell to “slightly bearish”, and Yellowbrick Road readers are barely above 50% bullish.
Stock Market News
IBM shares jump on earnings and revenue beat - CNBC
NBA says Amazon will be its new media partner, rebuffing Warner Bros. Discovery attempt to match deal - CNBC
Blackstone's battered mortgage fund slumps as empty offices intensify pressure - Reuters
Novo Nordisk's Wegovy weight loss drug wins UK approval for use as a heart treatment - CNBC
'Fear gauge' hits three-month high as US stocks sell off - Reuters
Elon Musk says he expects China to approve Full Self-Driving by the end of the year - CNBC
Elon Musk wants Tesla to invest $5 billion into his newest startup, xAI — if shareholders approve - CNBC
Tesla stock falls 8% as growing competition squeezes profits at Elon Musk's EV maker - New York Post
LINKS YOU’LL LOVE
🎁 REFERRAL PROGRAM 🎁
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THAT’S ALL FOLKS
Thank you so much for reading today’s email! Your support is the only way I can write this email for free every day.
Give me feedback in the poll below and share the newsletter with other investors if you find it useful!
Connor
*Follow Yellowbrick on Twitter at @joinyellowbrick
How would you rate today's newsletter?If you vote 1 or 3 stars, please leave a comment with what you didn't like so I can improve it! |
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