Viola Capital

Going long $PBI was the most obvious trade going into 2025 (50% YTD return including dividends). Going long $PBI is still the most obvous trade going into 2026.

I’ve never worked out exactly how to say this in a way that perfectly maps on to the sense I have of it, but it’s something in the left wing brain that sees institutions as more like powerful natural phenomena, instead of as collections of individual human beings with individual desires and motivations. The local school, their Landlord, the comedy cellar, IBM — the way they think of it is that there are regular people like you and me and then there are these enormous constructs that have just kind of always existed and in some sense always will exist, as though they were imbued with power by our creator at the beginning of the universe. I think it’s a sign of a certain kind of stunted development. They see these institutions sort of in the same way that an eight year-old views their parents, not really as fully formed human beings with their own incentives, but rather as all powerful overseers from whom infinite resources can be extracted, because they’ve always been there and always will be there. Similarly, to an eight-year-old, their classroom at school needs no explanation or justification; it has always existed, always will exist. How did the chairs get there? How are teachers hired? What do we want to teach? These are questions that have to be answered by actual, living, breathing individuals who respond to incentives. But the eight-year-old doesn’t think about any of that. The classroom is just *there*. How could it be otherwise? The world has always just simply contained classrooms. This is how the progressive sees the world around them — as an eight-year-old sees their parents or their teachers or the chairs and desks in their classroom. This is how you get these situations where progressives are mad that the last remaining grocery store in the ghetto doesn’t have fresh enough produce and so they make the store stock fresh produce and then when this pushes so hard on the margins that the store is no longer profitable and closes, the progressive demands that the store remain open to serve the failing neighborhood. It’s as if the store is eternal. You have to be unable to imagine a time before or after the store. You have to see the world as an eight year-old sees the world. The neighborhood grocery store merely exists. It has always existed. It must always exist. The work of the entrepreneur is invisible. The incentives that keep the store open are not legible. Neighborhoods just simply have grocery stores. This is the store in my neighborhood. If you just kind of squint at communism, what it looks like to me like is an attempt to make this relationship to reality concrete. They think they can make this understanding of the world reality. They want to make it so that all of these hidden, invisible incentives and constraints are officially irrelevant. They’ve never understood what they were for, anyway. They usually don’t even notice them. It only frustrates them to hear them pointed out. The neighborhood grocery store should simply just exist, as it has always existed.

In this tread I will introduce you to EDM resources. $EDM.v offers a unique combination of existing infrastructure, base metals + gold/silver credits, good management, almost permitted and set for a restart with blue sky gold exploration potential. 1/x

@Merridew__ Let he who has not taken a 50% loss in a Swedish foot fungus stock cast the first stone

@aki_cheta There would be some interesting benefits for Cohen in acquiring $PBI, (e.g. the ILC), but his sights seem set on something bigger.

@violacapital Wouldn't this be a great acquisition by Ryan Cohen of $GME? Kurt was originally working with Dr. Burry on $GME's takeover in 2019 until Kurt handed off the reigns to Ryan. Similar corporate execution strategies by both CEOs in their respective companies, turning them profitable.

Kurt Wolf doesn't actually want to be the CEO of $PBI. He wants to run his fund, spend time with his family, and feed his chickens. The only reason he's doing this, and the only reason Paul Evans joined him in stepping down from the board into a tedious, high-demand operating role, is because they think they have a forced checkmate. They seem to believe this is a ~$20 stock; none of their behavior much sense otherwise. We're now approaching 5 years of Kurt's involvement in $PBI. If he wanted a quick double off his cost basis, he could have cashed out a year ago. Instead, he let his original 10b-5 expire; became CEO; asked for 85% of his compensation to be in the form of stock options with strike prices that, as of this morning, are still pretty far out of the money; bought back 20% of shares outstanding (issuing debt to do so); and started tearing up the floor in search of new value-add opportunities. This is the context as we enter phase 2 of the strategic review.

Wow! Corn tanked today and ethanol spiked. Ethanol margins going to insane levels for this time of year. April crush margin is now $0.44! Last April 1st it was $0.07. $ALTO sells about 20 million gallons of ethanol a month. What is that... an extra $7M ... a MONTH? 👀👀👀👀👀

$ALTO is now a 4-bagger after 6 months of holding. There could be 50-100% more runway left depending on how E15 legislation and their remaining projects pan out, but I've sold 40% of my position post-earnings to lock in some gains. @DOMOCAPITAL deserves a major shoutout for his analysis on this one, and just generally. He has a great work ethic and an unusual ability to anticipate second- and third-order effects of news developments and other data. The result is that he usually has the most comprehensive and informed upside picture of anyone covering his positions. I often see things differently than him, but his incisive analysis has been a huge influence on how I think about valuation and my ability to differentiate signal from noise.

$GPRE 2025 Adjusted EBITDA (including 45z): $94.0M $ALTO 2025 Adjusted EBITDA (including 45z): $44.6M If $GPRE is massively undervalued at $1B market cap.... then were should $ALTO trade? Definitely not around $4, $5, or $6.....

EDM Initiates Gold Exploration Program at the Scotia Mine $EDM.V tinyurl.com/2yaqc8rv

This tweet from John is a good primer on why $PBI's FCF is so much higher than net income, and why the FCF number is what really matters. $PBI has a market cap of $1.65b and a financing receivables book of $1.1b. The net cash runoff from this book clearly counts for something in the context of Kurt Wolf trying to buy back every share possible. The reason the company calls the bank "an incredibly undervalued asset" is simple: these receivables are generating mid single digit returns while the stock has a levered FCF yield of 22%. Back out the financing portion of FCF and you still have a serious gap. I don't see a world where they don't monetize the bank in some way. The remaining buyback auth of $360m is also coincidentally 22% of the current market cap. The company bought back 20% of shares outstanding last year, and that was almost entirely in the last nine months. The math is overwhelming.

$PBI has bought back 16% of their shares in the last 6 months. $350m FCF and about 150m shares left.

What in the world is going on at $PBI???? investorrelations.pitneybowes.com/news-releases/… Steve Fischer is the new PB Bank President and previously ran a bank 35x larger?? Benoit Robinot left $AMZN for $PBI? David Cossit-Levy left a parallel job at $IQV a company 25x larger than $PBI to work for Kurt? Something big is brewing... why are super talented people suddenly moving over to Pitney Bowes?

👀 $PBI Saber Capital Management filed a 13-F with Pitney Bowes as a new position with 1 million shares as of 12/31/2025. Given the trading range of $10-$11 recently, interesting entry point. Looking forward to the earnings release this week!

In today’s concall, when asked about Celsius Resources $cla.ax ,Manish Kiri, Chairman of Kiri Industries ,clarified that discussions are currently active, timelines for conclusion are around March , potential stake under discussion is in the 20 to 40% range, and nothing finalized

I will tell here in this post why I believe $CLA.AX is going to be taken out by Silvercorp. Firstly is difficult to hold this large stake in CLA while the management acts this way, but of course Im not selling at these prices. I am not going to speak a lot more about it. I am getting tired of speaking of it. Last long post on it. I am holder of it. And I hope it gets sold. Market cap is 37 mill usd The DFS gives 1.2 billion usd NPV at 6$ copper and 4500$ gold. A lot more resources that the ones being used in the DFS, while lower grades. They have coming 66 million loan from MIC very soon to start building the road to the site. 2 other projects with lot of inferred resources Botalio exploration permit Different points to speak about: 1. Philippines wants to open to mining, however they want really sustainable mining, they want underground mining, with the best techniques in terms of ESG. Even the CEO of the public fund of Philipines is putting MCB project as a example to follow for the rest firms. It is the first mining permit given in 15 years. Is the only project in all Philippines where they have invested money on. And not a small quantity, it is 76 mill usd in form of a loan. No shit. This mine is going to be real, before or later. Matter of time. 2. The stock is trading at 3.3% of the current NPV while they are approaching to FID. Too cheap for me. It is a good mine, and there is optionality to increase production after several years on MCB due to the near probable deposit in Botilao. Satellite deposit, take out the ore and process it in MCB. Furthermore, they have 2 other projects, that are not small. 3. 40-60 JV CONCERN: Lets speak about the 40-60 JV Structure in the country. In paper, they have only 40% while Sodor have the 60%. However for them, to have that 60% they must pay 43 mill usd. And talking with others investors, Sodor has acted as the 60% holder, only to advance the project. But it reality they might not exercise this buy option (of course we never know). The buy option expires the 16th of February. After that, $CLA.AX is going to be the 100% holder, even in real paper (if they not extend). Although the 40-60 JV structure is supposely required in Philippines, in reality they exchange ideas with the government and each company could arrive to a much better deal. For instance B2gold supposely has the 40% of the mine, but after that, they have the 100% economic benefits of the proccesing mining firm. 3. MANAGEMENT CONCERN: At the moment there is only 1 executive director. The board of directors is currently looking for different optionality directors that could helpt the team. They have done an incredible job with the mine, the local community and ESG matters. However, it seems that shareholders have not been its priority. But I believe this could change now fast. They have appointed Bardin Davis, the CEO of Peak Rare Earths as a financial advisor. He sold it for 400%. I hope that he is going to get appointed to board of directors and helps to put shareholders interest first. 3. Why I believe this is getting sold to Silvercorp: $SVM has too much cash to invest in projects. Mining this is not easy. There are very few companies that mine in this way. Silvercorp is one of those. In Ying District they follow the same approach. At the same time, China is near Philipphines, it makes some sinergies for them. Silvercorp needs lower risk countries. They have bought a project in Kirgistan. Interesting, what a "shit" diversification from China I would say. And they know that. Philippines is a decent jurisdiction when you have the permits. Silvercorp could take out this, get an incredible project such as MCB in near-term production, and get Sagai for free. A similar size deposit. They will start producing in MCB in a sustainable way, and they would starting to advance Sagai. And will be much easier for them to get the permits in Sagai with the government while producing in MCB. Is an optionality play for them imo. Silvercorp holds the 10% of the shares now. 4. Why they are selling and not keeping it? The project is really good in numbers. However the project has a shit payback period. Early high sustainable capex, and slow initial ramp up. They payback is more than 4 years including construction. Bad payback-> Not interesting for juniors If they advance this to a JV with some other investor, they wouldnt have no money to develop Sagai. Do you believe Sagai is going to be "stopped" for 4 years until they have some money? Why they are not trying to divest from it to raise some money to construct MCB? They need financing urgently, they are divesting from Namibia. Why not from Sagai, they need the funds, they need it NOW, and they are not going to have a project stopped for 4 years. This is a clear possible sign. 5. Real Steps: $CLA.AX management have been selling to shareholders financing was coming while nothing was coming in reality, and they know that. That is why everybody is that upset, and call this a shitco (and for other reasons, of course), I understand it totally. They were waiting to construction decision to take a decision. Now they have appointed in January Davis as financial advisor, they have appointed an investment bank: Grant Samuel, and they have moved from a mid-tier auditor to a tier 1, that is Grant Thornton. Now is the moment when they need the financing, they cannot "derisk" cheaply this project with few financing. There are only 2 options-> JV->It does not make sense for me Sell it all to a bigger mining firm Something is coming, 1 week, 1 month or whenever, but something is coming. And it seems in coming in February.

$EDM.V is one of the most unbelievable setups I've ever seen. Wish someone had told me about this in the $0.10's but I'll have to settle for the position I've built over the last week. Now an 8% position. @LoneyZachariah has done a great job outlining the opportunity on this one. EDM is a zinc mine nearing a restart as soon as Q3 this year, and at current zinc/lead prices it's a potential multi-bagger. But even more compelling is the fact that last September, the company discovered substantial amounts of gold in the concentrates left by the prior operators. In other words, the mine had been unwittingly processing gold until it shut down in 2009. Nobody bothered to check this because the deposit was supposedly MVT, which isn't supposed to contain gold. However, there's good evidence to suggest that the MVT label was a mistake to begin with. After all, EDM's mine is sandwiched between several other gold mines in Nova Scotia. EDM is currently verifying the size and distribution of the property's gold reserves, but Zachariah makes a solid argument that it is indeed likely to be significant and relatively ubiquitous. You can credibly estimate that EDM has 25-50k oz/year of gold production potential, which would again come online as soon as Q3 this year. More details here: t.co/kpLYfaSA1N If the gold reserves are verified, it would suggest a valuation pretty deep in the nine figure range, and potentially $1 billion USD depending on where the price of zincgold goes. The fully diluted market cap is $30m USD as of today (111m shares + warrants). DYODD, junior mines are hyper-risky investments, etc.

There's a circulating theory from @Milinkoeterno and others that $CLA.AX is on the verge of getting bought out of their MCB project, and I think it's credible. The assets are very undervalued, but there are also a bunch of weird breadcrumbs. Silvercorp tried to buy out MCB in 2023. In January, Celsius brought on Grant Samuel, who led the sale of a separate mining project. Then $CLA.AX was randomly halted for trading last week because the company (or a third party doing their due diligence?) suddenly decided to notice a filing issue from 2011. Then today, Grimes says he's looking forward to sharing positive news in coming weeks. I think it ~doubles. Now a 3.5% position.

Again, everyone needs to understand that $GOOG's search ads revenue is only increasing at this point because they've gone absolutely full tilt on monetizing their platform at the expense of user experience and organic traffic. Ask any large advertiser what's happened since 2024 and most will tell you they're getting squeezed--that they're paying Google more dollars to acquire roughly the same volume of business. Google has hyper-saturated the SERP with ads and is rapidly introducing new ads products and features because they know the writing is on the wall.

Paul agreed with @DOMOCAPITAL last year that $HOG's HDFS deal is a good template. They'd sell an equity stake in their lending platform and a portion of their receivables book for cash up front. This is an attractive option because they're sitting on $1B of receivables earning mid single digit returns while their stock has a 23% levered FCF yield.

@violacapital Thanks. Any thoughts on what a transaction might look like?

$PBI is releasing earnings on February 17, or 48 days after quarter end. This may be noteworthy, as it's their longest reporting delay by far in the last 10 years. Second place was a 39 day wait, on August 8, 2024. That was the day they announced the GEC exit. This quarter's earnings call is also scheduled for the day after the release, which has never happened before. A few things could be happening here. The call will mark 6.5 months since Paul Evans said to "stay tuned" for a bank deal announcement. It's possible they're already near the finish line on this, although it would be a few months faster than I expected. Or maybe they're taking extra time to provide guidance given their recent work on forecasting issues?