YB new stock pitches (Mon, Feb 3)

CuriosityStream Inc. (CURI), a documentary streaming platform, trades at 2.5x forward cash flow with a market cap of $121.5M and $40M net cash. The company has turned profitable after significant cost-cutting and restructuring, with management expecting 30-40% revenue growth versus 10% analyst estimates. Recent AI dataset licensing deals are projected to nearly double next twelve months' earnings, potentially increasing licensing revenue from $5M to $20M+ in 2025. The direct-to-consumer business, constituting >70% of sales, has shown double-digit growth year-over-year. Additional growth drivers include expansion into free ad-supported streaming television and continued cost-cutting measures. Catalysts include revenue stabilization, potential dividend hikes, and closing of AI deals. The price target is $4.89 (123% upside), based on 8x 2025 FCF. Risks include failure to close AI deals, unsuccessful acquisitions, and decline in the core business. Management, including the founder who owns >40% of the stock, has extensive media industry experience.

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Magnite (NASDAQ: MGNI), a $2.42 billion market cap company, stands to benefit significantly from the ongoing DOJ vs. Google adtech trial in the Eastern District of Virginia. A ruling against Google could provide a major boost to the open internet adtech sector, with Magnite being the largest beneficiary as the next biggest player after Google. However, the primary investment thesis revolves around Magnite's onboarding of Netflix, which is expected to drive rapid earnings growth due to the company's 75%+ incremental EBITDA margins. Currently trading at 10x EBITDA, Magnite has the potential to be valued at 10x sales, similar to its counterpart TheTradeDesk (TTD), which trades at 20x sales. The company has created a moat in what is typically considered a moatless business, and consistent growth could lead to a higher valuation. The antitrust trials against Google support the overall thesis, with Google having already lost the Play Store and search trials. Investors essentially get a free option on the Google ruling while benefiting from Magnite's core business growth potential.

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Clarus Corporation (CLAR) is trading at attractive valuations of 6x EBITDA and less than 0.5x sales, compared to competitors trading at 2-4x these metrics. The company has a strong balance sheet with over $1 per share in net cash on a sub-$5 stock. Despite large holders exiting the stock, the investor has added to their position, believing in the underlying value of Clarus's businesses. Profitability is expected to accelerate meaningfully this year, with sell-side estimates considered conservative. The stock is viewed as trading at a fraction of its private market value, with comparable companies having traded or transacted at double to quadruple Clarus's current metrics. Given the company's strong balance sheet, expected growth, and profitability, the investor believes patience will be rewarded in the next year or two.

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