YB new stock pitches (Thu, Dec 5)

Stryker Corporation (SYK) presents a compelling investment opportunity with an expected 11-13% intrinsic value growth over five years. The company's durable economic moat in orthopedics, product innovation, margin expansion, and value-accretive acquisitions form the core of its strength. Stryker's Orthopedics/Spine segment (42% of revenue) is projected to grow 4-7% long-term, while the MedSurg/Neurotechnology segment (56% of revenue) is expected to grow 7-8%. The company's dominant market share, particularly in orthopedic instruments (50%), medical (30%), endoscopy (18%), and neurotechnology (40%), coupled with innovations like the Mako Robot, should drive growth and widen competitive advantages. Operating margins are expected to expand by 100 basis points by 2025, with a long-term annual expansion of 30 basis points. Stryker's capital allocation strategy, including mid-sized acquisitions, has created value, with returns on tangible invested capital approaching 50%. The company's well-articulated culture and stable leadership (only 3 CEOs since 1977) are considered key differentiators in long-term strategic planning.

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Taboola.com Ltd. (TBLA) is an AI-driven adtech platform with a $1bn+ market cap, trading at 6-7x 2025 FCF and 8x 2025 PE. The company has a 17.5% 5-year CAGR, 20% long-term growth guidance, and recent Q3 growth of 25% with doubled EBITDA. TBLA boasts 50-60% EBITDA to FCF conversion, a net cash balance sheet, and ongoing share buybacks. The base case scenario assumes 20% growth and 50% incremental drop-through, projecting $160m FCF in 2025 and $210m in 2026. A bull case with 25% growth and 75% drop-through estimates $195m FCF in 2025 and $288m in 2026. Despite its attractive metrics, TBLA lacks coverage from major financial institutions. The company draws comparisons to Applovin (APP), which has seen a significant multiple expansion. With potential for a 20-30x FCF multiple, TBLA could see a 4x return over two years, reaching a $5.2bn valuation based on 20x 2026 FCF in the base case scenario.

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Intellicheck, Inc. (IDN), a $50 million identity verification company, offers a superior fraud detection rate of 99.9% compared to competitors' 65-75%. With 90%+ margins and contracts with major corporations, IDN is expanding beyond retail into social media and other verticals. A recent deal with a major social media platform could be a catalyst similar to the 2020 American Express contract that quadrupled the stock by April 2021. The company is diversifying revenue streams, addressing retail transaction volume pressure, and anticipates significant operating leverage as revenues scale. IDN expects to achieve positive cash flow by late next year without needing additional capital. Despite near-historic low stock prices, IDN benefits from strong secular tailwinds in identity theft prevention. The company's growth strategy, expansion into new verticals, and path to profitability support a price target of $3.78.

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