- 🟨 The Yellowbrick Road
- Posts
- Top stock pitches (Thu, Jun 27)
Top stock pitches (Thu, Jun 27)
Connor Van Ooyen
June 27, 2024
In partnership with
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:
DeFi Technologies ($DEFTF)
Author: @EricJackson | Price: $1.25 | Price Target: $20.87 (+1570%) | Market Cap: $854M | Timeframe: end of 2024 | Industry: Crypto Exchange Traded Products
The Walt Disney Company ($DIS)
Author: Bireme Capital | Price: $101.80 | Price Target: N/A | Market Cap: $186B | Timeframe: FY26 | Industry: Media/Entertainment
Farmer Bros ($FARM)
Author: Craig-Hallum | Price: $2.78 | Price Target: $6 (+116%) | Market Cap: $59.54M | Timeframe: N/A | Industry: Coffee Wholesaler
-
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
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.
WINNING PITCH
+75% Returns in 5 Months for $ARIS
This stock pitch for $ARIS (link) was shared in the free, daily email on January 25th and has gone up 75% in the 5 months since then.
Shoutout to Rewey Asset Management for the stock pitch.
STOCK PITCHES
Author Returns
The below stock pitch is from @EricJackson.
Their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
TWITTER - @EricJackson
DeFi Technologies ($DEFTF)
DeFi Technologies Inc., a technology company, develops and lists exchange traded products in Canada, Bermuda, and the Cayman Islands. The company provides asset management services, such as investment vehicles, indirect exposure to underlying cryptocurrencies, digital asset indexes, and other decentralized finance instruments.
Ticker: DEFTF | Price: $1.25 | Price Target: $20.87 (+1570%)
Market Cap: $854M | Timeframe: end of 2024
🪙 Crypto Exchange Traded Products | 📈 Bullish Idea
* I recommend using Interactive Brokers (link) to trade international and OTC stocks if you can’t trade them in your current brokerage
DeFi Technologies ($DEFTF), a small-cap Canadian company operating crypto-related ETPs in Europe, presents a compelling investment opportunity with significant upside potential. With $620M in AUM, the company expects to generate $142M in annual revenue ($62M yield + $80M trading) and $132M in earnings, implying a fair value of $20.87 per share at a 39x '24 P/E multiple and $70M net cash, compared to the current price of $1.60. Potential catalysts include a rise in Bitcoin price to $150K, which could drive the stock to $32.88, and joint ventures in MENA and Asia, which could push the price to $48.48 in a bull case scenario. Key risks to consider are cryptocurrency price fluctuations and execution challenges. Overall, DeFi Technologies offers investors the prospect of a 30x return by the end of 2024, making it a compelling long position for those willing to accept the associated risks.
Read the full article here. Read time: 4 min
Author Returns
The below stock pitch is from Bireme Capital.
Their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
FUND LETTER - Bireme Capital
Bireme Capital Portfolio Holding: The Walt Disney Company
The Walt Disney Company operates as an entertainment company worldwide. It operates through three segments: Entertainment, Sports, and Experiences.
Ticker: DIS | Price: $101.80 | Price Target: N/A
Market Cap: $186B | Timeframe: FY26
🎥 Media/Entertainment | 🎢 Theme Park | 📈 Bullish Idea
The Walt Disney Company (DIS) is undervalued as investors focus on negative headlines and challenges in prominent business lines, ignoring the totality of the enterprise relative to its valuation. The Experiences segment, predominantly parks, resorts, and cruises, can justify the entire market cap with $18 billion in projected EBIT by 2030 (10% CAGR), while the rest of the business, including valuable IP, growing streaming services nearing profitability, and profitable linear networks, is available at a steep discount. Disney's streaming efforts, including Disney+, Hulu, and ESPN+, are expected to become profitable in Q3 and generate substantial earnings growth with a focus on margins, bundling, and a compelling content mix. Despite near-term challenges, Disney's unique assets and growth potential make it an attractive investment opportunity.
Read the full article here. Read time: 4 min
*SPONSORED BY World Copper
Copper is up 70%
Discover the Zonia Advantage
World Copper’s (OTC: WCUFF | TSX.V: WCU) Zonia project is leading the industry in next-generation copper production, and is poised to meet surging global copper demand. By leveraging simple metallurgy and proven SX-EW processing in a prime location, Zonia stands to achieve cash flow up to 4x faster than typical projects.
World Copper is one of the very few projects that can start producing before the end of this decade, just in time to capture the upcoming copper price surge.
Author Returns
The below stock pitch is from Craig-Hallum.
Their historic returns are:
Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.
ANALYST REPORT - Craig-Hallum
Craig-Hallum initiates coverage on Farmer Bros
Farmer Bros. Co. engages in the roasting, wholesale, equipment servicing, and distribution of coffee, tea, and other allied products in the United States.
Ticker: FARM | Price: $2.78 | Price Target: $6 (+116%)
Market Cap: $59.54M | Timeframe: N/A
☕️ Coffee Wholesaler | 📈 Bullish Idea
Farmer Bros, a 112-year-old nationwide coffee roaster, wholesaler, and service provider, is poised for significant growth after divesting its unprofitable B2C business and refocusing on its core Direct Store Delivery (DSD) business under new management. The company has strengthened its balance sheet, implemented AI-informed pricing, upgraded its tech stack, rationalized its facility footprint and brand portfolio, and is expected to generate positive free cash flow in 1H FY25 (2H CY24) and significant EBITDA growth thereafter. With these improvements, Farmer Bros is approaching an inflection point, and the stock is initiated with a Buy rating and a $6.00 price target based on 12.4x EV/EBITDA on the FY26 (June 2026) EBITDA estimate of $12.5MM, compared to peers trading at ~17.1x CY25 EBITDA and ~16.4x CY26 EBITDA.
Read the full article here. Read time: 2 min
Which stock idea was the most compelling to you? |
Yesterday’s Poll Results:
🟩🟩🟩⬜️⬜️ Barfresh ($BFRH) [63%]
🟨🟨⬜️⬜️⬜️ Gravity Co ($GRVY) [22%]
🟥⬜️⬜️⬜️⬜️ Equity Commonwealth ($EQC) [15%]
MARKET OVERVIEW / NEWS
Market Overview
Are you short-term bullish or bearish on the market? |
Yesterday’s Poll Results: 60% bullish
We had a slightly more bullish day yesterday with all of the indexes closing green (except for the Russell), the Fear v Greed index gaining a couple points (but still in “fear”), and Yellowbrick Road readers remaining bullish.
A handful of companies had huge news yesterday, causing the stocks to pop (led by Rivian due to an investment from Volkswagon), and Apple and Amazon are also starting to show a little strength. It’ll be interesting to see if we get a little bit of rotation out of the big mega-cap winners this year (like Nvidia) into Amazon and Apple.
Stock Market News
Amazon reaches $2 trillion market cap for the first time - CNBC
Southwest Airlines cuts revenue forecast - CNBC
General Mills posts bigger-than-expected drop in quarterly sales - Reuters
LVMH boss Bernard Arnault reportedly buys stake in Cartier owner, sparking takeover rumors - New York Post
Amazon to launch discount section with direct shipping from China, the Information reports - Reuters
Rivian soars as Volkswagen plows $5B into struggling EV maker: ‘Game changer' - New York Post
FedEx cost-cutting efforts pay off in Q4 earnings - Yahoo Finance
LINKS YOU’LL LOVE
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! |
Reply