Fishing Cat Capital

@MikeFritzell Did a rough calculation. Appears that they are just approaching cash breakeven on their marina (excl. residual value). Hopefully this gives them reason to negotiate for a materially better deal on lease renewal

@FishingCatCap Yeah so those are the key questions. Especially the former. Will the lease renewal premium be based on forward IRR? That’s what I fear. But the stock is still cheap

SUTL's enterprise value is now US$10 million (ranked as the best marina in the world). It's trickier than that, but you get my point.

@fivepointscap @RaleighPartners Its incredible how $META is just a “tax” on global economy - bought a full position last week

@RaleighPartners Useful info! I think $META is bordering on dirt cheap

$META is at a 20% discount to the S&P. Last time it troughed this low was November 2022 at a 26% discount.

@macrosat Yes, a take private at NAV is ideal for shareholders

@FishingCatCap I think they are going to keep running it

Took a small position in $CMSG as a “leveraged” play on crypto recovery. $CMSG is a crypto mining company with market cap fully covered by net cash (excl. crypto assets) so downside is protected. A move to 1x book value alone would be a ~40% return.

@macrosat That makes more sense; although from an IRR standpoint I’d prefer a take-private / liquidation

@FishingCatCap No I'm saying they will buy another small miner at a depressed price

@macrosat Although I don’t think $CMSG stock will react well if they buy assets outside of crypto - kinda defeats the thesis if investors invest based on cash position + BTC price exposure

@FishingCatCap I actually think they like CMSG as a pure play. I think its more likely that they may buy something else. FRMO is great but has legacy assets like TPL and MIAX. I think that CMSG will buy a smaller asset at depressed prices and then uplist to realize shareholder value.

SpaceX starts trading this Friday. Here's what history says happens next. This is the post-IPO performance of every major tech listing of the last decade. Every name you know. Every name you use. Look at the last column: maximum drawdown in year one. – Facebook: -54% – Snap: -56% – Uber: -68% – Pinterest: -70% – Lyft: -79% – Rivian: -88% – Robinhood: -90% Median first-year drawdown across the entire list: -54%. Average: -55%. Not the speculative junk. The whole class. Including the eventual winners. Zoom eventually rose 142% in year one. It still drew down 40% along the way. Palantir gained 153%. It still fell 53% at one point. CrowdStrike, Datadog, MongoDB. All ended year one higher. All put their holders through a 40 to 67% drawdown first. There has not been a single major tech IPO in a decade that didn't hand you a brutal drawdown in the first twelve months. Not one. Now SpaceX joins the list, at the richest valuation in IPO history. You don't have to buy it today. The IPO is the seller's moment, not the buyer's. Wait for the base.

Interesting compilation from @BradMunchen - $SPCX’s 4x oversubscription means ~$300B of total demand vs ICBC’s ~$1.6T, $META $550B or $BABA’s $465B. Clearly indicates underwhelming demand even adjusted for capital raised.

@ArcanineXBT I’d monitor for improvements in roofing segment results and US existing home sales before committing to a highly levered serial acquirer. Note that macro environment has changed substantially post Beacon acquisition and would put pressure on results and investors’ expectations.

@FishingCatCap at what level would you be a buyer @FishingCatCap ?

$QXO While Brad Jacobs has a great track record, the QXO platform will likely remain weak in the near term given higher for longer interest rate impacting housing turnover and high oil prices impacting building materials cost (oil is the key input to asphalt shingles roofs).

Despite the track record of Brad Jacobs, tough macro environment for $QXO with higher oil prices + higher for longer interest rate + persistently low existing home sales due to high new vs old mortgage rate differential.

$QXO Institution will get a shock on their underwritten case of ~$50B in revenue in the next decade.

Amazon and Walmart (current highest revenue companies) only has ~$700B revenue or <1% of global GDP. $3.4T revenue in 2040 would likely be >2% of 2040 global GDP. Most audacious analysts’ forecasts I’ve seen; not even hiding it at this point.

@MikeFritzell Seems increasingly the case for markets recently

Carson Block: “For our momentum strategy, valuations are irrelevant” youtu.be/kK9A3uq6_UM?si…

@fivepointscap Yes, service quality is multitudes higher compare to few years ago. Shopee is the first ecommerce mentioned compared to TikTok shop or Lazada here.

@FishingCatCap I’ve heard this a lot from Singaporeans!

$SE What is the market worried about with Sea Limited? I know it had a good day today but the stock is absurdly cheap. It’s trading at 22x forward earnings when margins are still expected to be compressed by the high level of investment. Margins will increase substantially when the investment cycle ends. This isn’t like 22x forward earnings for a mature company with high single digit EPS growth. EPS is going to 2-3x in a couple of years. They just grew revenue 47%(!) and EBIT 30%. And the revenue number has accelerated QoQ for the last five quarters in a row. Then you have the pristine balance sheet which contains $7B of net cash or 12% of their entire market cap. So on an enterprise value basis, their earnings multiple is even cheaper. It’s founder led, insiders own ~35% of the company, net dilution is only 0.24%, they have a very conservative balance sheet, growing very quickly, AI resilient business model(s), executing flawlessly, and yet it’s ridiculously cheap. Even if Shopee’s margins are permanently lower because of competition, it’s still dirt cheap! I didn’t even get into all the optionality, the potential margin upside from AI and robotics, ShopeeVIP, Monee expanding deeper into financial services, new games at Garena, etc. What am I missing?

@EquityBrian Cash fears are overblown in my opinion. While cash is not readily deployed outside of China, firms like $BABA has shown a willingness to borrow overseas against this cash for share buybacks.

At some point you have to seriously question $PDD management. This is a $120B company with roughly $80B of cash/short-term investments, trading at ~7x NTM P/E. I get wanting to keep investing in the business, but come on. Growth has slowed, profits are still massive, and they clearly have enough cash to do both. Instead, they just keep hoarding it. At what point do you just start asking if the cash is even real lol. Because the market sure as hell isn’t giving them credit for it.

@fivepointscap Personally a subscriber and long-time user. First thing I do is always checking the price on Shopee before I make a retail purchase.

@FishingCatCap I completely agree. Plus ShopeeVIP is another way they deepen their moat against “agentic commerce”.

It's happening

$AMRZ was spun out of $HOL.NE as a pure-play NA building materials player. The signal I find most interesting: the CEO chose to lead $AMRZ rather than remain at $HOL.NE, despite Holcim being ~2x larger. Insiders including CEO has been a consistent buyer of shares at this price.

$AMRZ a compelling compounder at this price. Business has leading positions in attractive markets like aggregates and roofing with ~44% repair & replacement mix

Could we see a Wework moment for AI? 😜