Revlon: Recession-Proof Business

Matthew Sweeney presented his in-depth investment thesis on Revlon (NYSE: REV) at Best Ideas 2017.

Revlon is a recession-proof business that is passed over by investors due to the presence of a controlling shareholder and limited float. Investors assume that this structure will prevent the company from realizing a comp group multiple, while failing to recognize that revenue has doubled over the last three years, and that EBITDA will likely double in the next few years as the company successfully integrates the acquisition of Elizabeth Arden. The company has an impressive new CEO and for the first time has started a shareholder outreach program, which should shed some light on this stock. The company is currently highly levered, which provides a path to drive value to the equity as debt is paid down in the coming years.

About the instructor:

Matthew Sweeney is the Founder and Managing Partner of Laughing Water Capital. The firm employs a concentrated equity strategy while focusing on companies that are dealing with some sort of structural or operational difficulty that is judged to be easily solved by an incentivized management team if given enough time. Matt began his career at Cantor Fitzgerald where he focused on equity idea generation for institutional clients. He received a Bachelor of Arts degree in History from the College of the Holy Cross, and a Masters degree in International Relations focused on the Middle East and Terrorism from Seton Hall University. Matt is a Chartered Financial Analyst (CFA), and former Vice Chair of the New York Society of Security Analysts (NYSSA) Value Investing Committee.

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