Investment Pitches

Pitch Summary:
TSH Corporation is a growing hospitality business in Singapore, trading at a low P/E ratio and below net current asset value. The company has expanded its operations with new management contracts in China and has shown strong revenue and net income growth post-COVID.

BSD Analysis:
TSH Corporation's strategic expansion into China with new management contracts could significantly enhance its revenue streams. The company's focus on luxury hotel integrations and its flagship whiskey convention positions it well in the niche market of high-end hospitality. Despite its small size, TSH's financial metrics, including a strong balance sheet and low valuation multiples, make it an attractive investment. The company's ability to grow revenue and net income post-pandemic indicates operational resilience. However, investors should consider the risks associated with its small market cap and potential volatility in the hospitality sector.

Pitch Summary:
Pardee Resources is a diversified natural resources company with a strong balance sheet and a history of returning capital to shareholders through dividends and buybacks. Despite recent challenges in coal prices, the company's diversified revenue streams and ongoing investments in alternative energy projects position it well for future growth.

BSD Analysis:
Pardee Resources' diversified portfolio mitigates the risks associated with any single commodity price fluctuation. The company's strategic investments in solar projects and its substantial land holdings provide long-term growth opportunities. While coal revenue has declined, Pardee's focus on alternative energy and its robust financial position, with $48 million in current assets, offer resilience. The company's commitment to shareholder returns through dividends and buybacks enhances its investment appeal. As coal prices potentially recover, Pardee's earnings could see significant upside, making it a compelling investment in the natural resources sector.

Pitch Summary:
Beaver Coal Company offers a high dividend yield of 10.5% and has a stable business model with multiple revenue streams. However, its performance is heavily tied to met coal prices, which have been declining. The company maintains a strong balance sheet, making it an interesting investment if coal prices recover.

BSD Analysis:
BVER.S's reliance on coal royalties, which constitute the majority of its revenue, makes it vulnerable to fluctuations in coal prices. The company's robust balance sheet, with minimal liabilities, provides a cushion against market volatility. Despite a challenging 2024, BVER.S continues to pay substantial dividends, appealing to income-focused investors. The Minimum Rental Charge mechanism in its contracts offers some revenue stability. However, the company's future performance is contingent on a rebound in met coal prices. Investors should weigh the potential for coal price recovery against the company's current valuation and dividend yield.

Pitch Summary:
First Acceptance Corporation is undervalued, trading below book value and at a low P/E ratio of 4.9. The company has streamlined operations by selling its retail locations, initiated stock buybacks, and is positioned to receive additional funds from the sale. Despite a revenue decline due to a risk-sharing agreement, the underlying business has grown.

BSD Analysis:
FACO's strategic sale of its retail locations has reduced overhead costs, and the company is capitalizing on its strong financial position by repurchasing shares. The risk-sharing agreement, while impacting revenue, has effectively transferred significant risk to an external reinsurer, allowing FACO to focus on core operations. The recent earnings report, showing a 92.9% increase in EPS and a 9% revenue growth, underscores the company's operational strength and market potential. The stock's recent 20% increase reflects growing investor confidence. With a potential $30 million still to be received from the retail sale, FACO is well-positioned for future growth.

Pitch Summary:
@Pelicanwayre presents a highly bearish thesis on HOVR, arguing that the company lacks the facilities, capital, and technological progress required to develop a viable eVTOL aircraft. The thread emphasizes site visits and third-party checks that suggest HOVR remains in an early experimental stage with no full-scale aircraft. Extreme shareholder dilution and insider selling are highlighted as central risks, with management portrayed as prioritizing personal liquidity over long-term value creation. Comparisons to better-capitalized peers underscore HOVR’s minimal R&D investment and limited competitive positioning. Accounting restatements and auditor changes further undermine credibility. The conclusion is that HOVR’s equity value is at risk of sustained decline due to dilution, weak execution, and governance failures.

BSD Analysis:
This short thesis fits a familiar SPAC-era pattern where early-stage aviation concepts access public markets far ahead of technical or commercial readiness. eVTOL development requires massive capital, sustained R&D, certification expertise, and credible manufacturing infrastructure, none of which HOVR appears to possess at scale. Heavy dilution combined with insider selling creates a misalignment between management incentives and shareholder outcomes. Accounting restatements and auditor turnover raise additional red flags around financial controls and disclosure quality. Relative to peers with deep balance sheets and multi-year funding runways, HOVR’s competitive position appears untenable. Without a clear path to certification, funding discipline, or differentiated technology, equity value is highly exposed to continued dilution and sentiment reversal.

Actual Post Content:
$HOVR operates out of a minuscule building at an airport in Canada so small we wonder whether it can realistically fit a full-size eVTOL. $HOVR’s other listed address on its website is just a small house in Ohio, which, according to public sources, the CEO’s wife occupies (and presumably the CEO does as well); In an interview the CEO appeared taken off guard by a question about it and said they are thinking about expanding to Ohio, then closed with no one should look into it." We spoke to waitresses at the airport restaurant, who apparently had never seen $HOVR flying or leaving the hangar because they didn’t actually know what $HOVR did; one even thought they did repairs and decals. On the other hand, the airport manager knew what was happening and told us that $HOVR was still in the design phase with only a small-scale model to work with; he called it “only an experimental thing they’re doing right now”. $HOVR is reliant on extreme dilution that allows management to continue playing with their toy eVTOls. They managed to dilute the 2024 shareholders by ~236%, with insiders dumping millions of dollars in stock. Even worse, management appears to be dumping their own stock before turning on the dilution, banking millions before gutting shareholders. We believe that $HOVR will be a bottomless pit of dilution and shareholder money, and will continue to pump out misleading press releases to issue more shares. They filed a prospectus on 10/31 to do just that. When $HOVR’s facilities are compared to peers like $JOBY and $ACHR, they look laughable, with their main facility likely to be able to fit inside one of ACHR’s many times over. Even if we exclude the facilities, $HOVR’s R&D spend is so minimal, at its current rate, it would take $HOVR ~80 years to spend as much as $JOBY spent just in FY24. $HOVR managed to botch its accounting so badly that it had to restate immediately after going public, eliminating nearly all of its supposed “development assets” because the tech wasn’t far enough along to qualify. After this embarrassing development, management decided to swap in a new auditor. We think they are scraping the bottom of the barrel by hiring MNP; they were just sued for gross negligence tied to a fraud/ponzi scheme case. We believe $HOVR never should have gone public in the first place: by the company’s own filings, insiders would have lost their investment if the SPAC failed to close. We think this management team is out for itself and will gladly take money from anyone dumb enough to invest so they can cash in and pay for their toys. We are short and believe shares are headed materially lower."

URL: https://x.com/Pelicanwayre/status/1988981236803518687

Pitch Summary:
We last wrote up the position in the March 2024 newsletter, explaining that the investment case was predicated on the deep misunderstanding and undervaluation of News Corp’s unlisted stub assets, most notably Dow Jones, and the potential for management and the family to take steps to unlock value. Upon little news, News Corp shares declined sharply during the period, compounding a widening of the discount to NAV and providing an opportune moment to revisit the thesis. Since our initial investment, there have been incremental steps toward value realisation, including the exit from Foxtel at a higher than anticipated valuation and the announcement of an enlarged buyback programme. However, the stake in REA Group, which accounts for the majority of News Corp’s market value, remains central to any meaningful discount narrowing. We believe that resolution of family trust disputes improves the probability of structural reform, even if timing remains uncertain.

BSD Analysis:
News Corp is a bundle of quality media assets with structural headwinds attached. The moat is brand and content—Dow Jones and The Wall Street Journal are real franchises with pricing power. The concentration risk is legacy media economics and cyclicality in advertising. Real estate classifieds exposure can be valuable but is also macro-sensitive. The company’s complexity creates a chronic “sum-of-the-parts” debate that rarely resolves cleanly. Capital allocation is the story: what gets invested, what gets sold, and what gets returned. The bull case is that premium news subscriptions and B2B data offset legacy declines. The bear case is that structural headwinds keep the discount permanent. News Corp can be valuable while the stock stays unloved.

Pitch Summary:
As discussed in the June 2025 newsletter we have been building our exposure to Korea in light of the on-going corporate governance reform agenda and the rich array of deeply undervalued companies. At the time of writing Korea accounts for 9.5% of AGT’s NAV and returns to date have been pleasing, driven by strong performances at HD Hyundai, Hyosung Corporation and Samsung C&T. Notably, the performance has predominantly come from NAV growth through a combination of earnings growth and multiple expansion at our underlying companies. The majority of discounts are as wide now as when we first initiated our positions, indicating that share price upside has not yet reflected underlying value creation. We believe Samsung C&T remains materially undervalued given its ownership of high-quality listed assets and the potential for governance reform to unlock value over time.

BSD Analysis:
Samsung C&T is a hybrid: part trading, part construction/engineering, part strategic holding vehicle inside the Samsung ecosystem. The “moat” is access—relationships, brand, and project capability—plus the implicit value of its stake-linked exposure within the group. The concentration risk is governance: minority shareholders live under chaebol rules, not Western-style capital allocation accountability. Construction and EPC exposure adds cyclical volatility and project-execution downside. Trading is also cycle-driven and margin-thin, more about volume and relationships than pricing power. The bull case is value realization through re-rating of holdings and disciplined capital returns. The bear case is perpetual conglomerate discount and episodic project risk. You don’t buy Samsung C&T for clean optics—you buy it for embedded asset value and optionality. It compounds only if governance behaves.

Pitch Summary:
CalPrivate Bank is positioned as a high-performing regional bank with strong growth metrics, including a 20.4% CAGR in tangible book value over the past five years. The bank's strategic expansion, including the opening of a new branch and hiring key personnel, supports continued growth in loans and deposits. With a focus on commercial real estate and business lending, CalPrivate benefits from high yields on earning assets and robust returns on equity. The bank's valuation at 1.27x Price/TBV is reasonable, with potential for upside if asset quality and efficiency improve. The local banking environment in California presents additional opportunities due to shifts in deposit trends and regulatory support.

BSD Analysis:
CalPrivate's operational strategy is well-aligned with current market conditions, particularly in the Californian banking sector, which has seen a shift towards smaller institutions following the regional banking crisis. The bank's focus on high-yielding loans and low-cost deposits positions it advantageously in a high-interest-rate environment. Despite minor asset quality issues, the bank's proactive management of credit risks and strong recovery rates are positive indicators. The absence of a dividend is offset by share repurchase programs, reflecting management's confidence in the bank's valuation. Overall, CalPrivate's strong financial performance and strategic market positioning make it an attractive investment opportunity.

Pitch Summary:
During the quarter, we invested in Capital One Financial Corporation, a leading credit card issuer and diversified bank, as a new position. We think Capital One is well positioned to benefit from normalizing credit trends, resilient consumer spending, and the company’s ongoing technology transformation, which is improving its ability to underwrite risk and deepen customer relationships. The stock trades at a discounted valuation relative to peers and its own history despite strong capital levels, solid profitability, and a track record of returning capital to shareholders through dividends and buybacks. We believe management’s focus on data, analytics, and digital engagement provides a durable competitive advantage in card lending and supports attractive long-term growth and returns. In our view, the current share price underestimates Capital One’s earnings power and the potential for continued market share gains in cards and consumer banking.

BSD Analysis:
Capital One is a high-quality, data-driven lender that the market is pricing through a cyclical and credit-risk lens rather than a structural one. Despite a temporarily elevated headline P/E from near-term earnings volatility, the forward P/E sits around the low double digits, a discount to many large-cap financials given its strong capital ratios and historically robust returns on equity. The manager is right to highlight the power of Capital One’s analytics and digital capabilities, which should support better underwriting, lower losses and higher marketing efficiency over the cycle. Credit normalization and potential consumer strain are real risks, but current reserves and capital levels look conservative, and the company has meaningful flexibility to dial back growth if conditions deteriorate. If charge-offs stay contained and management continues its disciplined buyback program, we see meaningful upside to both earnings and book value per share over a multi-year horizon.

Pitch Summary:
Fair Isaac Corporation (FICO) is a leading provider of credit scoring and decision analytics solutions, best known for the FICO Score, which is widely used by lenders to assess consumer credit risk. We believe FICO operates a highly attractive business model characterized by recurring revenue, high margins, and significant pricing power because of the mission critical nature of their scores and software tools. Shares declined this quarter following management’s commentary around a potential revision to the FICO score used for mortgage underwriting, which initially concerned investors about the potential for reduced usage or pricing pressure. However, we think these concerns are overly pessimistic given FICO’s strong competitive positioning and the limited number of viable alternatives at scale. We expect FICO to retain its dominant market position and continue growing earnings per share at a rapid rate over the next several years.

BSD Analysis:
FICO remains a uniquely advantaged franchise in credit scoring and decision analytics, with substantial switching costs and regulatory embeddedness. The market has been willing to pay a premium—current P/E is around the high 60s with a forward multiple near 50—reflecting mid-teens revenue growth and outsized EPS growth from mix shift and buybacks. Recent worries about mortgage-score changes and alternative models like VantageScore are real but likely to erode, not destroy, FICO’s economics, especially as management pivots to more direct licensing and software-driven revenues. The business throws off significant free cash flow, which has historically funded aggressive share repurchases and selective product investment. We think downside is cushioned by the mission-critical nature of FICO’s products, while upside comes from deeper penetration of decision-management software across banking and adjacent verticals.

Pitch Summary:
Shopify Inc. is a cloud-based software provider that helps merchants sell online. Shares rose during the quarter as the company reported strong revenue growth, improving profitability, and continued success in moving upmarket to serve larger merchants. We believe Shopify is benefiting from secular tailwinds in e-commerce adoption as well as higher attach rates for merchant solutions like payments, shipping, and financing. Management continues to invest heavily in product innovation, logistics, and international expansion, which we think will extend the company’s competitive advantage and support durable long-term growth. While Shopify trades at a premium valuation, we see significant upside over time as the company scales its ecosystem, increases take rates, and further monetizes its large and growing merchant base.

BSD Analysis:
Shopify is a scaled, mission-critical commerce infrastructure provider with a business model that blends high-margin subscription revenue with powerful payments and merchant-services monetization. The stock trades on a rich multiple—its forward P/E is roughly 80–90x—but that premium is underpinned by 20–30% revenue growth, strong unit economics, and a long runway in both SMB and enterprise. The manager’s emphasis on attach rates and upmarket penetration is spot on: higher adoption of payments, capital and logistics significantly increases ARPU and deepens merchant stickiness. Near-term risks include cyclical pressure on discretionary retail spending and intense competition from large ecosystems, but Shopify’s platform breadth and developer ecosystem are difficult to replicate. If management can maintain growth while expanding margins, the current valuation can still yield attractive risk-adjusted returns.

Pitch Summary:
Interactive Brokers Group, Inc. contributed to performance, driven by strong earnings growth and continued customer account expansion. The company reported solid results with healthy commission and net interest income, reflecting robust client trading activity and higher interest rates on margin loans and cash balances. We think Interactive Brokers’ technology leadership, low-cost structure, and broad global market access provide a durable competitive advantage that continues to attract sophisticated investors and advisors. Management’s disciplined risk management and conservative balance sheet further reinforce the quality of the franchise, even amid periods of market volatility. We believe Interactive Brokers remains well-positioned to gain share in electronic trading globally while delivering attractive long-term earnings growth.

BSD Analysis:
IBKR is one of the best-positioned global brokers, combining scale, low-cost execution and a technologically advanced platform that is difficult for competitors to replicate. With a P/E ratio in the low 30s and a forward P/E around that level, investors are paying a premium to traditional brokers but getting structurally higher growth in accounts, balances and trading volumes. Rising interest rates have supercharged net interest income, but even if the rate tailwind moderates, fee-based and commission revenues should continue to grow as IBKR wins share from legacy full-service brokers and smaller regional players. The manager is right to highlight the importance of risk management—IBKR’s conservative margin policies and capital position are key in stress scenarios. Risks include potential fee compression and regulatory changes, but the company’s global diversification and technology moat mitigate much of this. Overall, we see IBKR as a compounder with a long runway in electronic brokerage and market structure electronification.

Pitch Summary:
Robinhood Markets, Inc., a provider of commission-free trading and investing tools, contributed to performance as shares rallied on accelerating account growth, higher assets under custody (AUC), and improving profitability. The company reported strong quarterly results highlighted by robust year-over-year revenue growth, expanding operating margins, and a meaningful increase in net new funded accounts. We think Robinhood is benefiting from a healthier retail trading environment, broader adoption of options and other higher-value products, and the ongoing expansion of its product suite, including retirement accounts, credit cards, and advisory services. While the stock has been volatile and remains sensitive to changes in retail engagement and macro conditions, we continue to own Robinhood because we believe it is gaining share with younger investors, has multiple avenues for monetization beyond trading commissions, and is well-positioned to compound earnings over the long term. We also appreciate the company’s strong balance sheet with significant excess capital, which provides flexibility for continued investment and shareholder returns.

BSD Analysis:
Robinhood is a high-beta way to play the secular shift toward self-directed, app-based investing, with fundamentals now catching up to the narrative. The business is scaling into profitability as higher interest rates boost net interest income on customer cash and margin balances, while options and other high-value products drive ARPU higher; the market is paying a premium multiple (Robinhood’s P/E is north of 50x on trailing earnings), but that is partly justified by rapid top-line growth. The manager correctly emphasizes the importance of expanding product breadth—retirement accounts, credit cards, and advice—which should lower churn and deepen monetization of a relatively young, sticky user base. Key risks are regulatory intervention, cyclicality in trading volumes, and over-reliance on market-sensitive revenues, but the balance sheet strength and excess capital provide some cushion. We see upside if management can sustain double-digit revenue growth while driving operating leverage and diversifying revenue away from purely transactional activity. Overall, the thesis is a conviction “own-the-platform” call on retail participation in capital markets rather than a short-term trading bet.

Pitch Summary:
During the quarter, we initiated a new position in one such company where we see big upside potential: Evolution AB, based in Stockholm. Evolution specializes in live online casino games, offering video streams of classic table games like blackjack and roulette hosted by real dealers. As a gaming supplier, the company sells directly to licensed digital gaming companies (like DraftKings and the parent company of FanDuel, for example), which offer its products to end users in regulated markets worldwide. In exchange, Evolution earns a commission on the casino’s winnings. The global online casino market has experienced rapid growth and is projected to remain one of the fastest-growing sectors in the gaming industry. But it’s also highly regulated. In response to a formal review by the UK Gambling Commission, Evolution is taking decisive measures to block its games from unlicensed operators and prevent its video feed from being pirated. This has slowed near-term growth and weighed on the shares, providing a compelling opportunity for us. Evolution has many of the characteristics we look for in an investment: it is highly profitable, debt-free and generates strong cash flow. It is the global leader in an attractive, growing industry and delivers capital returns to shareholders through stock buybacks and an annual dividend (currently 3.9%). The co-founders continue to own 11% of the company. The near-term regulatory challenges have driven the valuation down to levels that we view as highly attractive, and we are excited about the prospects of this new position.

BSD Analysis:
The manager views Evolution as a capital-light, high-ROIC gaming supplier whose temporary regulatory headwinds have obscured a structurally attractive business. Its dominant position in live casino, long-standing relationships with major operators, and revenue share model create recurring, high-margin cash flows with limited balance sheet risk. A debt-free capital structure, meaningful insider ownership, and a mix of dividends and buybacks underscore disciplined capital allocation. While regulatory tightening in key markets can pressure growth and sentiment in the short term, compliance investments should further entrench Evolution as the preferred partner for licensed operators. With secular growth in online casino and potential for geographic and product expansion, the stock appears mispriced relative to its quality and growth profile.