Rightsized CapStack Capital

Yes, there is execution risk to $NNBR, but also the operational turnaround has already begun to bear fruit. It has already improved. Margins have been expanding, WC unlocked, unprofitable facilities (the Group of Seven) have all either been now shutdown or restructured to be FCF self-sustaining. Meanwhile, the pivot to focusing on A&D & Medical seems to already be paying off + increased focus on electrical grid is a plus. A lot of the risk here is more so re: the Refi / take-out of the Preferred Equity. But I spent a lot of time U/W this based on a range of scenarios as it relates to a full debt refi, hyprid (Debt + Equity), and a full equitization. No matter what, and how high you juice the WACC & other assumptions + no matter the variant of the Refi, there's still upside (imo) as the market is essentially pricing in bankruptcy which is utterly BS. At the end of the day, I feel the R/R here is actually favorable. The Preferred Equity is owned by a MS Tactile Opps fund. Given the turnaround of the Company is already proving itself out and looks to be on the upswing, I expect the MS crew to be willing to play ball here bc there is significant upside. And the addition of the new director yesterday from its 2nd largest shareholder with cap markets expertise and received support from the largest shareholder is a positive sign imo. If you wanna chat more in the DMs hmu.

Dogs >>>>