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Top stock pitches (Tue, Jul 23)

Top stock pitches (Tue, Jul 23)

Connor Van Ooyen
July 23, 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:

Cool Company Ltd. (CLCO)

Amdocs Limited (DOX)

Amazon.com, Inc. (AMZN)

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.

STOCK PITCHES

Author Returns

The below stock pitch is from Unemployed Value Degen.

We have 5 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.

BLOG POST - Unemployed Value Degen

Taking a stab at floating steel: Cool Company $CLCO

Cool Company Ltd. engages in the acquisition, ownership, operation, and chartering of liquefied natural gas carriers (LNGCs).

Ticker: CLCO | Price: $12.43 | Price Target: N/A
Market Cap: $673M | Timeframe: 2027

🛢️ Oil/Gas | 💰 13% Dividend | 📈 Bullish Idea

Cool Company Ltd. (CLCO) is an LNG carrier trading at a significant discount to peers, with a price-to-tangible book value of 0.85 compared to peers at 1.6+. The company offers a 13.78% dividend yield, twice covered by operating cash flow, and trades at a price-to-operating cash flow ratio of 3.65. CLCO's fleet has an average contract backlog of 3.1 years (4.9 years including options), with a notable 14-year deal with GAIL. The company benefits from backing by Eastern Pacific Shipping, which owns 58% and provides advantages in contract negotiations. Risks include a potential LNG carrier glut, low day rates, and a possible small dividend cut. However, the contracted fleet and low valuation provide a margin of safety. CLCO serves as a potential hedge for natural gas plays and a contrarian bet on LNG demand. The main threats are management decisions and the possibility of Eastern Pacific buying out the company at a low price.

Read the full article here. Read time: 7 min

Share this stock pitch:

https://www.joinyellowbrick.com/stock-pitches/6816/?ref=PLACEHOLDER

Author Returns

The below stock pitch is from Palm Valley Capital Fund.

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 - Palm Valley Capital Fund

Palm Valley Capital Fund Portfolio Holding: Amdocs Limited

Amdocs Limited, through its subsidiaries, provides software and services worldwide. It designs, develops, operates, implements, supports, and markets open and modular cloud portfolio.

Ticker: DOX | Price: $83.42 | Price Target: N/A
Market Cap: $9.79B | Timeframe: N/A

📞 Telecom Software | 📈 Bullish Idea

Amdocs Limited (DOX), a leading provider of mission-critical software and services for top telecom companies, is currently undervalued despite forecasting 7-11% EPS growth for the fiscal year. The market overreacted to a minor 0.5% revenue guidance cut and 1% EPS trim, possibly due to misunderstanding the company's role. Often mislabeled as a call center, Amdocs is actually vital for customer portals, billing, and network efficiency for major clients like AT&T, Comcast, T-Mobile, and Vodafone. The company's current valuation doesn't reflect its quality and importance in the telecommunications industry, making it an attractive investment opportunity. Investors may also be misinterpreting Amdocs' exposure to artificial intelligence, further contributing to the stock's undervaluation.

Read the full article here. Read time: 1 min

Share this stock pitch:

https://www.joinyellowbrick.com/stock-pitches/7009/?ref=PLACEHOLDER

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Author Returns

The below stock pitch is from Capitalist Letters.

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.

BLOG POST - Capitalist Letters

Amazon: 3x In The Next 10 years?

Amazon.com, Inc. engages in the retail sale of consumer products, advertising, and subscriptions service through online and physical stores in North America and internationally. The company operates through three segments: North America, International, and Amazon Web Services (AWS).

Ticker: AMZN | Price: $182.73 | Price Target: $582
Market Cap: $1.91T | Timeframe: 10 years

📦 Ecommerce | ☁️ Cloud Computing | 📈 Bullish Idea

Amazon.com, Inc. (AMZN) is a diversified tech giant dominating e-commerce (40% US market share), cloud computing (31% share), and growing in digital advertising. Protected by strong moats including network effects, economies of scale, and ecosystem advantages, Amazon is well-positioned in fast-growing markets. By 2032, the company is projected to generate $1.3T in e-commerce revenue, $575B in cloud revenue, and $130B in advertising revenue. With expanding margins under CEO Andy Jassy, Amazon's financials are solid, featuring a 0.74 Debt/Equity ratio and improving profitability. Conservative estimates suggest Amazon could reach $400B in profit by 2032. Applying a 15x P/E multiple yields a potential $6T valuation, representing a 3x upside over 10 years. Key risks include market share erosion and slower-than-expected growth in core segments, but Amazon's diverse business model and strong competitive position mitigate these concerns.

Read the full article here. Read time: 11 min

Share this stock pitch:

https://www.joinyellowbrick.com/stock-pitches/6690/?ref=PLACEHOLDER

Which stock idea was the most compelling to you?

Yesterday’s Poll Results:

🟩🟩🟩⬜️⬜️ Alico (ALCO) [38%]

🟨🟨⬜️⬜️⬜️ Allient Inc. (ALNT) [31%]

🟥⬜️⬜️⬜️⬜️ CCC Intelligent Solutions (CCCS) [31%]

MARKET OVERVIEW / NEWS

Market Overview

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

Yesterday’s Poll Results: 52% bullish

Stock Market News

Verizon's customizable plan drives more subscriber additions than expected - Reuters

Alphabet to report double-digit Q2 growth; AI adoption, ballooning costs in focus - Reuters

Ryanair quarterly profit misses estimates, warns of weaker summer fares - Reuters

Theater chain AMC reaches new debt restructuring deal, shares surge - Reuters

Warner Bros. Discovery tells NBA it intends to match Amazon's media rights package - CNBC

Warren Buffett's Berkshire trims Bank of America stake for the first time since 2019 after strong rally - CNBC

McDonald's to extend $5 value meal in most U.S. markets as diners return to restaurants - CNBC

US House panel calls on CrowdStrike CEO to testify on outage, Washington Post reports - Reuters

LINKS YOU’LL LOVE

The Future of Common Stocks by Ben Graham

Chasing 10-Baggers: the Wisdom of Peter Lynch

So You Want To Be The Next Warren Buffett? Howís Your Writing?

🎁 REFERRAL PROGRAM 🎁

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Premium members have access to these awards here.

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.

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Connor

*Follow Yellowbrick on Twitter at @joinyellowbrick

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