Special-Situation With Active Catalysts
Includes a live takeover offer at roughly 2x the current share price.
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I view every stock through the lens of actually buying the business in the real world.
On the one hand, the assets of today’s business are highly attractive.
They own property worth the current market cap value alone, and the brand is recognised and well known.
In fact, the TTM revenue generated by that brand is almost $200m.
They hold net-cash and virtually zero debt.
The problem is the management team.
If I was buying this business, it would be on the understanding that I’m going in, firing basically all of them and starting again.
This would be a hassle, to say the least.
The good news, is that most of them have already been fired, so the clean up is underway.
The downside is also fully protected and other active catalysts are playing out too.
It’s more of a special-situation / arbitrage play more than a traditional business acquisition.
But there is at least 100% upside if the catalysts successfully take hold.
Let’s take a look…