YB new stock pitches (Tue, Oct 29)

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

Bird Construction (BDT.TO) is a Canadian construction company with significant growth potential, trading at a valuation suggesting over 200% upside by 2027. The company is expanding through strategic acquisitions in stable sectors like energy and healthcare, focusing on self-perform capabilities, Public-Private Partnerships (P3s), and Integrated Project Delivery (IPD) to boost margins. Bird's 2025 targets include C$4 billion in revenue and a 6.25% EBITDA margin, with 2027 goals of C$5 billion revenue and 8% EBITDA margin. The company benefits from government infrastructure spending and has a strong backlog of C$3.4 billion with an additional C$3.7 billion pending. Risks include the cyclical nature of the construction industry and potential U.S. tariffs affecting raw material costs. Bird's focus on Canadian markets, operational excellence, and expansion into high-growth areas like renewables and telecommunications position it as a long-term play in infrastructure development.

Read the full article here. Read time: 6 min

Heartland Express (HTLD), a family-operated trucking company, is trading at 1x book value and 10x historical free cash flow. Recent acquisitions of Smith Transport and CFI doubled revenue but hurt the operating ratio (OR), breaking a 45-year streak of OR in the 80s or lower. Management aims to return to an 85% OR by 2026. The company is aggressively paying down debt from the acquisitions and owns undervalued terminal facilities, providing a safety margin. CEO Michael Gerdin and insiders control 39.8% of shares and have been buying stock. With a projected $23 price target based on 15x P/E and 2026 estimates, the stock could double in two years. Risks include a prolonged industry downturn and failure to turn around acquisitions. The company's strong service record, historical profitability, and management's track record of successful acquisitions support the investment thesis, while the current valuation offers potential upside.

Read the full article here. Read time: 4 min

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

Energiekontor AG (EKT.DE) is a German clean energy company focusing on wind and solar, with 65.2% of revenue from project development, 32.7% from power generation, and 2.1% from operational management services. The industry forecasts 8-12% growth, supported by Europe's push towards clean energy and global investment of $2 trillion annually. Despite being down 50% from 2022 highs, the company projects a 21% CAGR to €132/share by 2029, implying a 160% return. This projection assumes 12% annual revenue growth, a 17x FCF multiple, and a 25% FCF margin. Risks include subsidy removal, increased competition, and fading clean energy demand. The stock is considered a medium conviction opportunity due to uncertain long-term margins and industry variables, with historical margins fluctuating from negative to over 40%.

Read the full article here. Read time: 1 min