MOI Global | The Membership Community of Intelligent Investors

Biodesix: Uniquely Differentiated AI Platform, With Catalysts Ahead

July 8, 2021 in Audio, Equities, Ideas, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Peter Mantas of Logos LP presented his investment thesis on Biodesix (US: BDSX) at Wide-Moat Investing Summit 2021.

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About the instructor:

Peter Mantas serves as a general partner of Toronto-based private firm Logos LP. Peter has an assortment of business experience at global institutions and has been involved in a variety of private and public equity transactions in addition to leading a proprietary trading team for a boutique desk. Prior to this, he held various economic research positions at the Export Development Bank of Canada, Statistics Canada and other various federal government departments. Peter has both an LL.B. and B.C.L. from McGill University’s Faculty of Law. Prior to studying law he obtained an Honours Baccalaureate in Commerce, Magna Cum Laude, from the University of Ottawa, Telfer School of Management, where he received several awards of excellence.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Chipotle: Nationally Scaled Fresh-Food Supply Chain, Mission-Infused Brand

July 8, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Todd Wenning of Ensemble Capital presented his investment thesis on Chipotle Mexican Grill (US: CMG) at Wide-Moat Investing Summit 2021.

Thesis summary:

Five years after an embarrassing national foodborne illness outbreak, Chipotle is running better than ever and has upsized ambitions, not just in the U.S. market, but around the world. It is benefiting from nascent national scale benefits, a loyal and growing fan base, a leading digital-first strategy, and an emphasis on creating stakeholder value.

Executing fresh food preparation at a national and global level is not easy to do – Chipotle learned this lesson the hard way – and no one is even close to catching Chipotle on this front. As global food preferences turn towards healthier options, Chipotle is becoming a dominant QSR brand.

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About the instructor:

Todd Wenning is a senior investment analyst at Ensemble Capital. Before joining Ensemble, Todd was an analyst at Johnson Investment Counsel, where he worked on the firm’s SMID cap strategy. Prior to that, Todd was a sell-side analyst at Morningstar, where he led Morningstar’s equity stewardship methodology and covered companies in the basic materials, industrials, and consumer sectors. Earlier in his career, Todd worked for The Motley Fool, SunTrust Asset Management, and Vanguard. He holds a BA in History from Saint Joseph’s University in Philadelphia and the Chartered Financial Analyst designation.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Peloton: Interactive Fitness Platform, Vertically Integrated Media Company

July 8, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Stefan Culibrk of Highway One Asset Management presented his investment thesis on Peloton Interactive (US: PTON) at Wide-Moat Investing Summit 2021.

Thesis summary:

Peloton is a vertically integrated media company operating in the at-home fitness industry. The company makes, markets, retails, and delivers high-end bikes and treadmills. The secret sauce is in the integration of hardware, software, and content: Peloton produces engaging boutique fitness content streamed on and off the devices.

In this session, Stefan compares Peloton to Planet Fitness (US: PLNT) and shows that Peloton’s offering has clear advantages in terms of results, cost, and the user experience versus a low-cost physical gym membership.

The founders started the company in New York City in 2012 and still run it. Stefan believes that the management team is focused on the right KPIs and that it passed an important test during the recent recall.

Over the next decade, Stefan sees potential for 30 million subscriptions and 60 million members (halfway to gym penetration), up from 4.5 million members recently. This would result in an estimated gross profit of $20 billion and operating profit of $10 billion, supporting an attractive long-term return.

Stefan started the session with an update of his investment thesis on Interactive Brokers (US: IBKR), which he had originally presented in July 2020.

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About the instructor:

Stefan Culibrk co-founded Highway One Asset Management in 2019, with a goal of achieving a superior long-term rate of return on capital. Previously, Stefan served as managing partner of Culibrk Partnership. Before that, he was employed by Bank of America Merrill Lynch, London, an investment bank, where he was trading emerging market equities from 2013 to 2014. Prior to joining the equities division, Stefan interned in the foreign exchange trading department in 2012. Stefan received a Master in Finance degree from the IE Business School, Madrid, in 2012. He has been a CAIA charterholder since 2010.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Disney: Going Digital — Where Imagination and Experience Converge

July 8, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Jonathan Isaac of Quilt Investment Management presented his investment thesis on The Walt Disney Company (US: DIS) at Wide-Moat Investing Summit 2021.

Thesis summary:

Disney is juggling numerous disparate and seemingly conflicting interests with their current approach to media. In addition to maintaining multiple streaming platforms, they split ESPN and film releases across old and new media.

Jonathan’s presentation models how Disney might consolidate its film operations and cable channels — including a streaming-only ESPN — into a closed-loop streaming platform in order to achieve attractive scale economics. This would enable Disney to shift its focus towards the monetization of new streaming consumers.

Disney has a long history of growing consumer monetization faster than its consumer base. Existing infrastructure — consumer products, theme parks and resorts, etc. — can be deployed towards growing the Lifetime Customer Value of this new consumer by appealing to their imagination. A successful transition could result in a stock price of ~$425 per share by 2028. A merger with Apple, financed in part by Berkshire Hathaway, is not entirely out of the question.

Disclaimer/Disclosure: Of the securities mentioned in this synopsis, Quilt Investment Management, LLC currently holds Disney in client accounts, and Apple in a client account, and may transact in either security, as well as any other security mentioned, without future updates. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of specific securities, investments, or investment strategies. Additionally, the information should not be construed as Quilt Investment Management, LLC’s solicitation to effect the rendering of personalized investment advice for compensation, over the internet or otherwise. This is not a research report and/or a recommendation. Investments involve risk and, unless stated otherwise, are not guaranteed. Always be sure to first consult with a qualified financial adviser and/or a tax professional before investing, and to verify any information deemed to be accurate. Past performance is not indicative of future performance.

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About the instructor:

Jonathan Isaac is President and Portfolio Manager of Quilt Investment Management, LLC, a registered investment adviser in Portland, Oregon.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Micron: Leader in Growing Industry With Supply-Side Discipline

July 7, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Nitin Sacheti of ARS Investment Partners presented his investment thesis on Micron Technology (US: MU) at Wide-Moat Investing Summit 2021.

Thesis summary:

Micron appears poised to benefit from a secular shift beginning with AI, machine-learning, 5G, and IOT. The “digitization of everything” should result in significant DRAM demand growth as more devices and more “content per box” drives usage.

Micron and its competitors benefit from new industry discipline around supply. As capex needs have increased with greater DRAM complexity, many fringe players have either gone bankrupt or been bought by the three remaining players, resulting in the benefits of an oligopoly market structure.

Micron exhibits quality capital allocation. Management recognizes the secular/structural shifts in the industry that are resulting in more predictable and growing free cash flows and the low multiple at which their stock trades, resulting in significant stock buybacks.

Meanwhile, Micron stock still trades like a cyclical, with a market quotation equal to an estimated 10x FY22 free cash flow. The DRAM industry has historically been a poor business marred by significant race to the bottom but that is changing post industry consolidation.

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About the instructor:

Nitin Sacheti is a Portfolio Manager at ARS Investment Partners. He is also the author of Downside Protection: Process and Tenets for Short Selling in All Market Environments and has appeared numerous times in Forbes and on the TD Ameritrade Network.

Prior to joining ARS, Nitin founded Papyrus Capital and beforehand, was a Senior Analyst/Principal with Equity Contribution at Charter Bridge Capital where he managed the firm’s investments in the technology, media and telecom sectors as well as select consumer investments.

Previously, Nitin was a Senior Analyst at Cobalt Capital, managing the firm’s technology, media and telecom investments and Tiger Europe Management. He began his investment career in 2006 at Ampere Capital Management, a consumer, media, telecom and technology focused investment firm, initially as a Junior Analyst, later becoming Assistant Portfolio Manager.

Nitin graduated from the University of Chicago with a BA in Economics, was a visiting undergraduate student in Economics at Harvard University and attended the Loomis Chaffee School in Windsor, CT.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Eastern Company: Engineered Solutions Provider With Strong FCF

July 7, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Jim and Abby Zimmerman of Lowell Capital Management presented their investment thesis on The Eastern Company (US: EML) at Wide-Moat Investing Summit 2021.

Thesis summary:

The Eastern Company is an undervalued manufacturer and marketer of engineered solutions to industrial markets in the U.S. and internationally.

The Engineered Solutions segment offers turnkey packaging solutions that are used in the assembly process of vehicles, aircraft, and durable goods. The Diversified Products segment designs and manufactures ductile and malleable iron castings. The company has a portfolio of scalable core businesses, including Big 3 Precision Products, Eberhard, and Velvac.

EML has a solid balance sheet with a strong focus on cash generation. EML recently had a market cap of $204 million and an enterprise value of $288 million. Absent a severe recession, Jim and Abby believe the strong cash flow generation can be sustained due to the company’s highly generative business model with limited capital expenditure needs.

EML is a fairly stable and sticky business with entrenched competitive positions in attractive markets. Management’s long term goal is to create a $100 million EBITDA company through organic growth in their three main business lines and through bolt-on acquisitions. Given the free cash flow generation of the company, Jim and Abby believe EML can achieve this with a healthy balance of leverage and ongoing cash from operations.

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About the instructor:

Jim Zimmerman is founder and portfolio manager of Lowell Capital Value Partners, LP, successor fund to Lowell Capital Fund, L.P. Jim managed Lowell Capital Fund L.P. from 2003 to 2015 employing a proprietary strategy laser-focused on smaller and/or misunderstood companies with large, sustainable free cash flow yields and “Ft. Knox” balance sheets. He generated a compound annual return significantly exceeding the HFRI Equity Hedge Index and the S&P 500 Total Return Index over this period, despite holding a significant net cash position (~30%) for most of this period.

Jim has over 25 years of investment banking and investment management experience in a variety of industries and has been involved with several billion dollars of investments.

Jim graduated with a BA with high honors in economics from Princeton University in 1980 and an MBA from Stanford Business School in 1984. He worked at Drexel Burnham Lambert, Inc., 1984 to 1990, serving in the Corporate Finance Department and multiple other investment banks from 1990 to 2003.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

JBG Smith: Attractively Valued REIT, With Multiple Growth Catalysts

July 7, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Robert Deaton of Fat Pitch Capital presented his investment thesis on JBG Smith Properties (US: JBGS) at Wide-Moat Investing Summit 2021.

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About the instructor:

Robert Deaton has enjoyed a long and successful investment management career as a money manager and private investor. Currently, Robert is managing member of Fat Pitch Capital, an investment partnership. Robert was a founding member of Bennett Lawrence a NY-based investment fund, which had peak assets of over $2 billion. Robert was chief investment officer of Cambium Capital and member, and is past managing member of Deaton Partnership. Robert holds an AB from Davidson College, an MBA from Vanderbilt University and is a CFA charter holder. Robert is an active member of numerous community organizations. He is a board member of the Presbyterian Healthcare Foundation (executive committee), the Physicians Impact Fund and the Vanderbilt University Owen School of Management Alumni Board. He is a member of the Board of Trustees at The Fletcher School (executive committee, treasurer-elect). He is a past two-term member of both the Board of Visitors at Davidson College and the Board of the Davidson Athletic Foundation. Robert is married with two children.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Sprouts: Differentiated Grocer With Attractive Unit Economics

July 7, 2021 in Audio, Equities, Ideas, Transcripts, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Gary Mishuris of Silver Ring Value Partners presented his investment thesis on Sprouts Farmers Market (US: SFM) at Wide-Moat Investing Summit 2021.

Thesis summary:

Sprouts is a differentiated grocery business with attractive unit economics and underappreciated potential for long-term unit growth. The company aims to deliver a farmers’ market shopping experience and differentiated products targeting consumers who either seek healthier options or look for the experience of finding new and exciting foods. Sprouts has competitive pricing, using regional scale and partnering with suppliers too small to support a much larger national grocer. The company has 362 stores across 23 U.S. states.

A new management team took over in 2019 and has been turning around the company. CEO Jack Sinclair previously served as CEO of 99 Cents Only Stores and EVP of US Grocery/Food at Walmart. Sinclair switched the focus from discounting to targeting more price-inelastic customers; he also reduced store size and capex to improve unit economics. Margins and EBIT were already showing meaningful improvement in Q4 2019, but then COVID affected further comparisons.

Sprouts shares recently traded below 60% of Gary’s “base case” value estimate, with moderate downside to his “worst case” estimate. Gary believes this opportunity exists in part because the market has focused on the short-term negative impact on earnings from post-COVID reopening.

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About the instructor:

Gary Mishuris, CFA is the Managing Partner and Chief Investment Officer of Silver Ring Value Partners, an investment firm with a concentrated long-term intrinsic value strategy. He also teaches the Value Investing Seminar at the F.W. Olin Graduate School of Business. Prior to founding the firm in 2016, Mr. Mishuris was a Managing Director at Manulife Asset Management since 2011, where he was the Lead Portfolio Manager of the US Focused Value strategy. From 2004 through 2010, Mr. Mishuris was a Vice President at Evergreen Investments (later part of Wells Capital Management) where he started as an Equity Analyst and assumed roles with increasing responsibilities, including serving as the co-PM of the Large Cap Value strategy between 2007 and 2010. He began his career in 2001 at Fidelity as an Equity Research Associate. Mr. Mishuris received a S.B. in Computer Science and a S.B. in Economics from the Massachusetts Institute of Technology (MIT).

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Multibagger Returns in International Equities — A Study by Pictet

July 7, 2021 in Audio, Equities, Ideas, Wide Moat, Wide-Moat Investing Summit 2021, Wide-Moat Investing Summit 2021 Featured

Benjamin Beneche of Pictet Asset Management discussed a proprietary study of globally listed multibaggers at Wide-Moat Investing Summit 2021.

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About the instructor:

Ben Beneche joined Pictet Asset Management in 2008 and is a Senior Investment Manager and Co-Lead of International Equity strategies which he began managing in 2012. He has a specific focus on Japanese and Pacific ex Japan Equities. The portfolios Ben manages employ a fundamental, absolute value-oriented approach looking for businesses which combine a long runway of predictable growth, high incremental returns on capital and an outstanding management team. Ben graduated from York University with a first-class honours degree in Economics and Economic History. He is also a Chartered Financial Analyst (CFA) charterholder.

The content of this website is not an offer to sell or the solicitation of an offer to buy any security. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this website. BeyondProxy’s officers, directors, employees, and/or contributing authors may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated herein.

Ep. 47: Scarcity vs. Abundance | Firestone’s Law of Forecasting

July 6, 2021 in Audio, Podcast, This Week in Intelligent Investing

It’s a pleasure to share with you Season 1 Episode 47 of This Week in Intelligent Investing, co-hosted by

  • Phil Ordway of Anabatic Investment Partners in Chicago, Illinois;
  • Elliot Turner of RGA Investment Advisors in Stamford, Connecticut; and
  • John Mihaljevic of MOI Global in Zurich, Switzerland.

Enjoy the conversation!

download audio recording

In this episode, Elliot Turner, Phil Ordway, and John Mihaljevic discuss

  • scarcity vs. abundance, and curation as the next big unlock; and
  • “Firestone’s Law of Forecasting” and the importance of avoiding zeros.

Follow Up

Would you like to get in touch?

Follow This Week in Intelligent Investing on Twitter.

Engage on Twitter with Elliot, Phil, or John.

Connect on LinkedIn with Elliot, Phil, or John.

This Week in Intelligent Investing is available on Amazon Podcasts, Apple Podcasts, Google Podcasts, Pandora, Podbean, Spotify, Stitcher, TuneIn, and YouTube.

If you missed any past episodes, you can listen to them here.

About the Podcast Co-Hosts

Philip Ordway is Managing Principal and Portfolio Manager of Anabatic Fund, L.P. Previously, Philip was a partner at Chicago Fundamental Investment Partners (CFIP). At CFIP, which he joined in 2007, Philip was responsible for investments across the capital structure in various industries. Prior to joining CFIP, Philip was an analyst in structured corporate finance with Citigroup Global Markets, Inc. from 2002 to 2005. Philip earned his B.S. in Education & Social Policy and Economics from Northwestern University in 2002 and his M.B.A. from the Kellogg School of Management at Northwestern University in 2007, where he now serves as an Adjunct Professor in the Finance Department.

Elliot Turner is a co-founder and Managing Partner, CIO at RGA Investment Advisors, LLC. RGA Investment Advisors runs a long-term, low turnover, growth at a reasonable price investment strategy seeking out global opportunities. Elliot focuses on discovering and analyzing long-term, high quality investment opportunities and strategic portfolio management. Prior to joining RGA, Elliot managed portfolios at at AustinWeston Asset Management LLC, Chimera Securities and T3 Capital. Elliot holds the Chartered Financial Analyst (CFA) designation as well as a Juris Doctor from Brooklyn Law School.. He also holds a Bachelor of Arts degree from Emory University where he double majored in Political Science and Philosophy.

John Mihaljevic leads MOI Global and serves as managing editor of The Manual of Ideas. He managed a private partnership, Mihaljevic Partners LP, from 2005-2016. John is a winner of the Value Investors Club’s prize for best investment idea. He is a trained capital allocator, having studied under Yale University Chief Investment Officer David Swensen and served as Research Assistant to Nobel Laureate James Tobin. John holds a BA in Economics, summa cum laude, from Yale and is a CFA charterholder.

The content of this podcast is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction. The content is distributed for informational purposes only and should not be construed as investment advice or a recommendation to sell or buy any security or other investment, or undertake any investment strategy. There are no warranties, expressed or implied, as to the accuracy, completeness, or results obtained from any information set forth on this podcast. The podcast participants and their affiliates may have positions in and may, from time to time, make purchases or sales of the securities or other investments discussed or evaluated on this podcast. [dkpdf-remove]

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