1 Disclaimer
Total Page:16
File Type:pdf, Size:1020Kb
http://sumzero.com 1 Disclaimer: SumZero is not a registered investment advisor or broker-dealer, and is not licensed nor quali- fied to provide investment advice. There is no requirement that any of our Information Providers be registered investment advisors or broker-dealers. Nothing published or made available by or through SumZero should be considered personalized investment advice, investment services or a solicitation to BUY, SELL, or HOLD any securities or other investments mentioned by SumZero or the Information Providers. Never invest based purely on our publication or information, which is provided on an “as is” basis without representations. Past performance is not indicative of future results. YOU SHOULD VERIFY ALL CLAIMS, DO YOUR OWN DUE DILIGENCE AND/OR SEEK YOUR OWN PROFESSIONAL ADVISOR AND CONSIDER THE INVESTMENT OBJECTIVES AND RISKS AND YOUR OWN NEEDS AND GOALS BEFORE INVESTING IN ANY SECURITIES MENTIONED. IN- VESTMENT DOES NOT GUARANTEE A POSITIVE RETURN AS STOCKS ARE SUBJECT TO MARKET RISKS, INCLUDING THE POTENTIAL LOSS OF PRINCIPAL. You further acknowledge that SumZero, the Information Providers or their respective affiliates, employers, employees, officers, members, managers and directors, may or may not hold positions in one or more of the securities in the Information and may trade at any time, without notification to you, based on the information they are providing and will not necessarily disclose this information to subscribers, nor the time the po- sitions in the securities were acquired. You confirm that you have read and understand, and agree to, our full disclaimer and terms of use, a copy of which can be accessed by clicking here and that neither SumZero nor any of its Information Providers is in any way responsible for any investment losses you may incur under any circumstances. All content and material within in this document is the exclusive intellectual property of SumZero, Inc., and may not be reproduced without the prior written permission of SumZero, Inc. http://sumzero.com 2 About the Top Stocks Challenge Ideas within this report were selected as the 15 Winners/Finalists of the 2nd Annual Top Stocks Challenge. The contest was run within the SumZero platform, an online community of 15,000+ buyside investment professionals. All SumZero members are current investment professionals at hedge funds, private equity funds, or mutual funds, or have substantial prior fund experience. The complete research history of individuals featured in this report, as well as bios, and work history can be found on SumZero. Contest submissions were independently assessed and voted on by a panel of over 40 senior fund professionals and asset allocators. The following, multi-factor criteria was utilized to determine the Winners/Runners-Up: • Validity of the Thesis; • Strength of the Supporting Argument; • Feasibility of the Trade; • Originality. The 15 ideas in this report were consensus favorites across 5 thematic categories. Event Sponsors http://sumzero.com 3 Table of Contents Special Situations.........................................................................................................6 Kyushu Railway Co Ord.....................................................................................................................................7 Liberty Media Corp Cl C Siriusxm.................................................................................................................20 Papa John’s Intl Inc..........................................................................................................................................26 Small Caps..................................................................................................................35 Andina Acquisition Corp Ii Com....................................................................................................................36 Techtarget.........................................................................................................................................................44 Summerset Group Holdings Ltd Ord............................................................................................................52 Mid/Large Caps..........................................................................................................60 Tripadvisor Inc...................................................................................................................................................61 Walt Disney Co/The.........................................................................................................................................78 Micron Technology Inc....................................................................................................................................86 Yield-Payers...............................................................................................................95 Ddr Corp Com...................................................................................................................................................96 Boc Aviation Ltd Ord......................................................................................................................................102 Eastman Kodak Company.............................................................................................................................108 Shorts.........................................................................................................................117 Tactile Systems Technology Inc Com...........................................................................................................118 Xxl Asa..............................................................................................................................................................126 Snap Inc Cl A.....................................................................................................................................................131 http://sumzero.com 4 http://sumzero.com 5 Special Situations 1 All ideas within this category are special situation theses with a tangible trigger event. Catalysts include bankruptcy, spin-offs, litigation, regulatory changes, etc. About 25% of research on SumZero is Special Situation focused. http://sumzero.com 6 Winner Best Special Situations Kyushu Railway Co Ord EXPECTED RETURN 40% Asset Class: Equity Symbol: 9142:JP Updated: 1/16/2018 Submitted: 12/29/2017 COMMUNITY RATING BY: BADGES: Adam Holzman FORMERLY AT: Paradigm Capital Management ATTACHMENTS: TIMEFRAME: SITUATION: MARKET CAP: LONG 1-2 Years Value 570.4B JPY Recently IPO’d rail business with attractive real estate holdings goes underappreciated due to mediocre rail segment. Business undervalued at current levels even if rail segment is a zero. AboutAbout Adam Morgan Holzman Housel Adam was most recently a PhD student in Financial Economics at the University of Chicago Booth School of Business. Prior to pursuing a PhD, he served as an equity analyst on the buy side, covering investment opportunities across geographies and sectors. He focuses on opportunities to purchase shares of companies at a discount to intrinsic value. Adam graduated with honors from Yale University with a BA in Economics and Ethics, Politics & Economics. He has also been recognized for his work in baseball analytics. http://sumzero.com 7 Kyushu Railway Co Ord Pricing & Return Details LONG Asset Class: Equity Symbol: 9142:JP Submitted: 12/30/2017 Updated: 1/16/2018 EXPECTED RETURN 40% INITIAL PRICE 3,515.00 JPY BY: BADGES: Adam Holzman TARGET PRICE 4,948.00 JPY FORMERLY AT: Paradigm Capital Management COMMUNITY RATING: PERCENTILE: 84% Recently IPO’d rail business with attractive real estate holdings goes underappreciated due to mediocre rail segment. Business undervalued at current levels even if rail segment is a zero. CATALYSTS: ASSET CLASS: SITUATION: TARGET ALLOCATION: Spin Off and TIMEFRAME: Equity Value 2% - 5% Dividend 1-2 Years Distribution Investment Thesis portfolios. As analysts become more familiar with KRC’s Overview structure, they should give the company more credit for its real estate, and they should grow more comfortable with Kyushu Railway Company (“KRC”) is a rail operator on the rail business once it demonstrates more consistent the southern Japanese island of Kyushu with significant operating margins. Post-IPO accounting complexities which real estate holdings in the vicinity of its local rail cloud the strength of KRC’s balance sheet will also dissipate stations and elsewhere. It was owned by the Japanese in the coming years, giving analysts better clarity into the government until its IPO in late 2016. Relatively positive value of KRC. Appropriate multiple revisions would result local demographic developments, growing tourism, and in shares trading ~40% above current prices. Even if we management initiatives should support measured growth assign KRC’s weaker rail business no value, the real estate in rail traffic, while cost-cutting efforts (further encouraged business alone may be more valuable than the market’s by privatization) will improve rail profitability in the valuation of KRC. coming years. More importantly, KRC’s real estate profile – accounting for over 40% of company EBITDA – is highly attractive and superior to those of the other privatized Business History Japanese Railways (“JRs”). However, KRC trades at a multiple similar to those of the other private JRs, and half KRC was created in 1987 with the restructuring of Japanese those of