Hugo Navarro

February 2026 portfolio update is now available: 7.79% YTD performance (2025 returns were 64.3%) Investing in small, cheap businesses with room to grow—mainly independent trend players that are relatively decorrelated from the market. Full deep dives every week, management calls, and some macro notes. If that sounds interesting, check out Undervalued and Undercovered (link in bio).

Pessimists tend to be right—but end up poor. Optimists get rich. Cautious optimists build lasting wealth. What do all successful value investors have in common? They’re cautious optimists.

Any thoughts on renewables in the EU, Canada, and the US? Are they doomed, or could they benefit from the recent energy crisis? Looking for all kinds of opinions.

$LFCR is near all-time lows despite having made substantial progress. Any bear views I’m not taking into account? It seems like a no-brainer at these levels—the main issue is the lack of catalysts. But it should deliver a good return over the next few years. Please destroy the thesis.

Being patient in the markets is key. In the current market environment, I am not comfortable with what I am being paid for in most growth stories. There are some exceptions, but with valuations high, there is no reason to take excessive macro risk. Understand how this backdrop affects your portfolio and stay cautious. All in all, in times like these, the most important thing is to avoid doing stupid things. If you own good companies and have not been riding beta like a degen, you should be fine.

@hector_sanchis @InverValueFund Es EBITDA IFRS, eso no incluye rent

@InverValueFund A ver si vamos en linea trimestre a trimestre. Que el reto es muy importante y el sector retail es muy complicado

NewPrinces $NWL Próxima presentación será también presencial en Milán, igual que hicieron para presentar Business Plan tras la compra de Princes. Más visibilidad para fondos Espero algo parecido, con una imagen clara de todo el grupo (Building a Leading European F&B Platform)

@Diego_La_Torre_ sure

@HugoNavarroPer2 Hey Hugo, can I dm you to talk about $CCLD?

$CCLD: great results, solid growth, and they’re projecting another year of high single-digit to low double-digit growth for 2026. Importantly, that doesn’t include any unannounced acquisitions—it’s based solely on the current business. They also noted they’ll remain active on the M&A front, and buying at ~1x revenue or lower, as they’ve done, should provide a meaningful lift. AI products are starting to become a key theme going into next year, and margins should continue to improve. There’s a lot of room to come in above current guidance—I think it’s very conservative. Cash generation is strong, valuation is around ~5x FCF, and it should be a big beneficiary of AI, not a loser like the market is pricing in. Great company, still underappreciated by the market.

Quick thoughts on $NFE restructuring: I sold some of the 26s $NFE bonds I bought personally at lower prices as a speculative trade—I think they’re overvalued here. Quick math, just so you know: I sold my ’26s and ’29s. At these levels, we’re essentially getting no credit for the Brazil assets; we’re left underwriting Nicaragua, FLNG 1, and Puerto Rico. The ’26s get ~5% (on an adjusted basis) of the total equity of the new entity. At ~20 cents on the dollar, we’re effectively paying for that implied equity slice at roughly a $100m valuation. My estimate for 2027 AEBITDA is ~160–410, with some “call options”—which I view as less likely given their history of overpromising. At 20 cents, the market is implying roughly $2b of equity value plus ~$500m of debt remaining in the company. That’s a mid-teens multiple on the mid-to-high end of adjusted EBITDA. The common equity might be a short here. Let me know what you think

@stockreveal Good catch

I think the stock is Enterprise Group Inc $E! Tag me for paywalled stocks smallcaptreasures.substack.com/p/8x-evebitda-…

@leevalueroach Like $MAPS? It seems interesting at this valuation but it seems a melting ice cube, regulation easing might actually be negative for them as big players enter and their discovery moat disapears

Co-founders offered to take their own company private at $1.70/share 15 months ago. The stock now trades at $0.73. Nothing material has changed in the business. They still own tens of millions of shares. Make of that what you will.

Precios bastante interesantes la verdad, pero entendamos bien la empresa, unlikely que veamos niveles agresivos de recompras. El capital va a ir a real estate y acquisiciones. Si se esta comodo con eso y con que se mantenga una estructura que prioriza el tamaño al valor por acción, es un buen play. Como dije, yo estoy long

Tercer día consecutivo comprando. Peso aprox 9,8%

Looking into $DBO.T. I already know the bull case—now I’m looking for the best bear arguments on why it’s overhyped and deserves a lower valuation. Looking forward to hearing some insightful comments.

@InverValueFund Real estate de Carrefour

@HugoNavarroPer2 ¿A qué compras de real estate te refieres?

Va calando el mensaje de que NewPrinces $NWL va a sufrir solamente porque cae el precio, en una acción ilíquida y volátil... Mientras #InverValue sigue comprando. Hace un mes, Angelo compartía su optimismo y la situación privilegiada, saneada y versátil de la empresa

@puppyeh1 Completely agree, have you talked with the new NED? if not happy to connect you with him. I think the board will do a good job here. Old management was a disaster.

I havent done a deep dive thread in a while, let alone a credit/distressed pitch, so let's give it a go. Alliance Aviation $AQZ.AX High level: this is an 'existential bet' type trade. You are simply betting it doesn't get restructured at these kinds of prices. Ie going from simply 'imminent B/K' to 'very bad' and the stock doubles. Obviously - this is a higher-risk security. There is risk in getting zeroed. This is a small-cap stock. This is a >2% position of my NAV. DYODD. All that said, dive in... 👇👇

$GMS used to be a favorite here on Twitter as a way to play the offshore thesis. It has significant Middle East exposure, and four vessels recently had to be evacuated (about a third of the fleet). Any takes on the company? Could this be an opportunity after the recent sell-off? Would it have tailwinds once the conflict eases?

Charlie Munger: “I won’t play in a game where the other people are wise and I’m stupid. I look for a place where I’m wise and they’re stupid. And, believe me, it works better.” “God bless our stupid competitors. They make us rich.” Maybe if Munger says it, you’ll believe me. Investing is all about playing a game where you have some kind of advantage over your competitors. Here are mine: First—and most important—I run a sub-$10m portfolio and don’t need to overly diversify. That lets me buy small caps with low coverage, and in many cases I can talk directly to management. Second, I’m patient. I can endure long holding periods and volatility—I don’t have to worry about clients pulling capital. Third, I’m flexible and fast to adapt my thinking compared to a big, slow organization. There are more advantages I have, and I try to build more each day. The whole game is to build a real edge—through structure, lifestyle choices, or any other creative approach.

Link: open.substack.com/pub/smallcaptr…

$EOS.AX — High-Growth Counter-Drone Play With 10x Potential (Multi-Billion Contract Optionality) A little-known Australian defense company is quietly building a real moat: it’s one of the only players outside the U.S. and Israel offering exportable, ITAR-free high-energy lasers—and the pipeline is starting to show it. On the latest earnings call, management disclosed that two countries have approached them about $3–6B in defense contracts, versus a current EV under $1B. The setup Revenue is inflecting, backlog is expanding quickly, and the company is finally positioned to scale without adding much cost. Cash sits north of $130M, there’s no debt, and the full tech stack (optics, lasers, targeting) is sovereign. EBITDA breakeven looks close, and if high-margin laser systems ramp as expected, 20%+ EBITDA margins are plausible on $300–400M of revenue within ~2 years. At that run-rate, the valuation looks cheap—and the market isn’t pricing meaningful laser upside yet. Why it could rerate This market has massive tailwinds—drone warfare, defense reshoring, and Europe diversifying away from U.S. dependence. EOS appears to be in the right place at the right time with tech that few can export. Quick note: I covered this a few months ago, but I didn’t personally take a position at the time—the setup was riskier than I was comfortable with. Since then, the stock is up 2x+, and I’ve now removed the paywall so the full deep dive is available to everyone for free. I’ve seen that many in X are getting interested in the company so this might be helpful. Link in the comments Not investment advice—just a seriously interesting setup.

@TKoljaj They do not benefit from GSR, its a whole different market

@HugoNavarroPer2 Look at TomTom; they're in a similar situation with the ISA coming into effect. But they're financially more secure (250M cash) than SEE and not at all "dilutive" like SEE.

Seeing Machines: 20% FCF yield, a duopolistic position, and 100%+ upside with multiple catalysts. I’m preparing a full updated deep dive on Seeing Machines. The price is back to levels below where I initially covered it, but the setup looks even better now. This will be fully updated after following the company for a long time and spending several hours speaking with the CFO and CEO. It could be one of the big hits of 2026/2027—regulation-driven, with contracts in place. Q3 KPIs could be the catalyst needed to show an inflection. Subscribe to Undervalued and Undercovered to receive this research straight to your inbox. (link in bio)

Seeing Machines: regulatory inflection at ~20% FCF yield A niche auto-safety leader in a duopoly, trading like another broken small-cap despite being right in front of a major volume and cash-flow inflection. Why now: from 7 July 2026, all new cars sold in Europe need Advanced Driver Distraction Warning. In practice, that means camera-based DMS. Investors got excited too early in 2021–2023, volumes did not show up, and the market gave up. Now the real deadline is here, but the stock is still priced like the ramp never comes. What we’re buying: the technology leader in real-world DMS performance, with meaningful exposure to major OEM programs already in place. The model is attractive: low-margin engineering upfront, then high-margin royalties as cars go into production. Guardian adds a second leg through fleet safety and recurring monitoring revenue. Why it works: this is not a blue-sky TAM story. It is mostly execution on programs already won. If GSR drives the volume ramp management expects, Seeing Machines should move from ugly reported numbers to real FCF very quickly. On my numbers, the stock is being valued at roughly a 20% FCF yield on a realistic year end run-rate. Risks: slower OEM ramps, weaker Guardian execution, Magna refinancing, or regulation taking longer than expected to show up in volumes. The market stopped believing right before the inflection. Full deep dive in Substack (link in bio)