Top stock pitches (Thu, Oct 3)

Connor Van Ooyen
October 03, 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:

Chart Industries (GTLS)

Fuchs SE (FPE.DE)

ImmuCell Corporation (ICCC)

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).

**I use Interactive Brokers (link) for the portfolio because it makes it easy to trade international and OTC stocks. If you decide to open an account with them, use this link so they know I sent you.

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.

YB Premium Portfolio returns - started mid-May

WINNING PITCH

12x in 5 months

This pitch for TSSI was included on the website and in the Elite Investor Feed (link) for Premium Subscribers in mid-April and is up almost 1100% in just 5 months.

STOCK PITCHES

Author Returns

The below stock pitch is from Joshua Aguilar.

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.

ANALYST REPORT - Joshua Aguilar

Chart Industries, Inc.: Chart Industries Has Numerous Growth Drivers

Chart Industries, Inc. engages in the designing, engineering, and manufacturing of process technologies and equipment for the gas and liquid molecules in the United States and internationally.

Ticker: GTLS | Price: $119.80 | Price Target: $200 (+67%)
Market Cap: $5.13B | Timeframe: N/A

🏭 LNG/Hydrogen Manufacturing | 📈 Bullish Idea

Chart Industries (GTLS) has pivoted towards high-growth areas like hydrogen and LNG, with a $200 price target. The Howden acquisition doubled the company's size, bringing $1B+ in sales synergies and improving aftermarket revenue. Management targets 17%+ annual revenue growth, 25%+ EPS growth, and 300-600bps margin expansion. Chart benefits from switching costs, creating a narrow economic moat. The company expects a 15% 5-year ROIC, supported by specialty products and aftermarket services. Risks include Howden integration challenges and material cost fluctuations. Chart's capital allocation is rated as exemplary, with successful acquisitions and joint ventures. The Howden deal, while large at $4.4 billion, has strengthened Chart's moat and exceeded synergy targets. Growth opportunities exist in aerospace, cannabis, water treatment, data centers, space, and hydrogen markets.

Share this stock pitch:

https://www.joinyellowbrick.com/sp/12319/?ref=PLACEHOLDER

Author Returns

The below stock pitch is from Value and Opportunity.

Their historic returns are:

Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.

BLOG POST - Value and Opportunity

Fuchs SE (FPE) - A Hidden Champion “Greased for Growth” after a 10 year consolidation phase?

Fuchs SE develops, produces, and sells lubricants and related specialties in Europe, the Middle East, Africa, the Asia Pacific, and North and South America.

Ticker: FPE.DE | Price: 32.90 | Price Target: N/A
Market Cap: 5.03B | Timeframe: N/A

🏭 Lubricant Manufacturer | 📈 Bullish Idea

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

Fuchs SE (FPE.DE) is a family-owned lubricant manufacturer with a market cap of 4.5 billion EUR, trading at 13.5x 2024 P/E and 12x 2025 P/E. The company boasts double-digit EBIT margins, >20% ROIC, and projects 9% organic EPS growth plus potential from buybacks and M&A. Fuchs offers a 3.5% dividend yield and has a solid balance sheet. After a 10-year consolidation phase, the company appears to be back on a growth and margin expansion path since early 2023. However, risks include 45% exposure to the auto/ICE industry and the upcoming retirement of the current CEO. Warren Buffett's praise of Lubrizol, a similar business, highlights the attractiveness of the lubricant industry. The author has allocated 4% of their portfolio to Fuchs at 30.80 EUR/share, citing the company's moderate valuation, strong management, and attractive expected returns as key reasons for investment.

Read the full article here. Read time: 3 min

Share this stock pitch:

https://www.joinyellowbrick.com/sp/12516/?ref=PLACEHOLDER

Author Returns

The below stock pitch is from SRK Capital.

Their historic returns are:

Upgrade to Yellowbrick Road Premium to unlock the historic returns for this author.

FUND LETTER - SRK Capital

ImmuCell Corporation - $ICCC

ImmuCell Corporation, an animal health company, develops, manufactures, and sells products that enhance the health and productivity of dairy and beef cattle in the United States and internationally.

Ticker: ICCC | Price: $3.61 | Price Target: $10 (+177%)
Market Cap: $28.28M | Timeframe: 6-12 months

💊 Animal Health | 📈 Bullish Idea

ImmuCell Corporation (ICCC) is an animal health company specializing in dairy and beef cattle products, with its main revenue driver being First Defense, a scours prevention product for newborn calves. The company is experiencing a significant turnaround, with Q2 revenue up 82% year-over-year as production normalizes following previous contamination issues. Margins are expected to improve due to 85% capacity utilization and an 8% price hike implemented in Q4 2023. A key catalyst is the FDA decision on Re-Tain, a mastitis treatment, expected in Q1 2025. The stock is considered undervalued with a $10 price target (100-200% upside) due to obscured financials from the mastitis segment losses and the return to growth in the scours business. Risks include potential contamination events and the possibility of continued pursuit of Re-Tain approval if not granted. The company has a strong backlog of $8.9M, indicating sustained customer demand despite production issues, and expects to reach its 40% gross margin target by the end of FY24.

Read the full article here. Read time: 8 min

Share this stock pitch:

https://www.joinyellowbrick.com/sp/12549/?ref=PLACEHOLDER

Which stock idea was the most compelling to you?

Yesterday’s Poll Results:

🟩🟩🟩⬜️⬜️ Sable Offshore ($SOC) [50%]

🟨🟨⬜️⬜️⬜️ Aquestive Therapeutics ($AQST) [29%]

🟥⬜️⬜️⬜️⬜️ Healthpeak Properties ($DOC) [21%]

Your comments:

🛢️ loril*** ($SOC): Great dividend and growth potential

MARKET OVERVIEW / NEWS

Market Overview

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

Yesterday’s Poll Results: 57% bullish

Stock Market News

Tesla stock slips after it reports 462,890 total deliveries during the third quarter - CNBC

Conagra Brands' first-quarter sales miss on weak demand - Reuters

OpenAI closes $6.6 billion funding haul at valuation of $157 billion with investment from Microsoft and Nvidia - Reuters

Toyota to invest $500 million in electric air taxi company Joby Aviation - Reuters

Private payrolls show better-than-expected growth of 143,000 in September, ADP says - CNBC

Nike shares dip as forecast withdrawal worries investors about turnaround timeline - Reuters

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 Biomea Fusion, Inc. ($BMEA)

The Director purchased 10,000 shares at $10.06/share ($101K total) which increased their vested holdings by 200.0%. The current price is $9.50 (-5.6%). Their median purchase size is $70,125.00 and this is their 1st largest purchase out of 2 all time. link

LINKS YOU’LL LOVE

What Killed Post-Break Up AT&T? What Lessons can be Learned from this Titanic Modern Failure?

Li Lu’s biggest mistake

What we learned pitching our startup to Charlie Munger – and how we almost went hunting elephants together

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THAT’S ALL FOLKS

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Connor

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