YB new stock pitches (Mon, Jan 27)

CBL & Associates Properties, a mall operator that emerged from bankruptcy in 2021, owns 87 properties and manages 4 others. Valued at $40-45 per share against a current price of $28, CBL offers an attractive discount with low downside risk. The company has $9 per share in excess cash and unencumbered properties worth $15 per share, providing a $24 per share floor value. Despite challenges in the mall business, CBL has reduced leverage, invested in its best properties, and returned capital to shareholders. The portfolio ranges from high-quality malls with $500+ annual sales per square foot to challenged properties in tertiary markets. CBL's net operating income remained steady from 2023 to 2024, with occupancy increasing in Q3. The company is working to consolidate some joint ventures and recently purchased its partners' interests in three malls. While facing industry challenges, CBL's manageable debt burden, strong cash flow, strategic reinvestment, and capital return strategies are expected to drive share value higher in the near future.

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NVIDIA faces multiple threats to its dominance in the AI chip market, challenging its 20x forward sales valuation and 75% gross margins. Innovative architectures from companies like Cerebras and Groq bypass NVIDIA's interconnect advantage, while major customers are developing custom silicon. Software frameworks such as MLX, Triton, and JAX are reducing CUDA lock-in, and efforts to improve AMD drivers could unlock cheaper alternatives. DeepSeek's recent breakthrough achieving comparable model performance at 1/45th the compute cost suggests potential industry over-provisioning. TSMC's willingness to manufacture competitive chips for well-funded customers limits NVIDIA's architectural advantages. The convergence of these threats—architectural innovation, customer vertical integration, software abstraction, efficiency breakthroughs, and manufacturing democratization—increases the likelihood of impacting NVIDIA's margins or growth rate. Despite these risks, the market currently doesn't appear to be pricing them in at NVIDIA's current valuation.

Read the full article here. Read time: 40 min

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Thyssenkrupp AG (TKA.DE) is a conglomerate with a net cash position twice its market cap, presenting a potential multibagger opportunity. Key catalysts include the TK Elevator stake sale/spinoff, the Marine division with an €18bn backlog (15x EBIT covers market cap), Rothe Erde (global leader in bearings), Nucera (hydrogen play), and Steel division restructuring. The Marine division, valued at 15x EBIT, could cover the entire market cap alone. Rothe Erde delivered €120m EBIT last year, while Nucera, despite 0 EBITDA, holds potential in the hydrogen sector. The underperforming Steel division faces challenges but is implementing cost-cutting measures and may be partially sold. Other valuable assets include the Materials business (€200-400m historical EBIT), Automotive segment (70% engine-agnostic parts), and significant undervalued real estate holdings. Multiple spin-off and sale opportunities exist across the company's diverse portfolio, with upcoming triggers like the potential Steel division sale expected to improve investor sentiment.

Read the full article here. Read time: 3 min