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MONTHLY NEWSLETTER

February 2024

Arbor Realty Trust Inc.

Arbor Realty Trust (ABR). ABR is a 40-billion-dollar originator, owner and manager in the multifamily loan market. We initiated coverage due to the changing environment and the various opportunities in the capital structure. This report contemplates the effects of rising defaults on ABR and provides insight into commercial loan portfolios. 

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January 2024

Blackstone Secured Lending Fund

Blackstone Secured Lending Fund (BXSL) is a 9 billion leveraged loan portfolio that focuses on private market (middle market) senior secured loans. The portfolio  is comprised of $9.5 billion in investments of which over 98% are floating rate, first lien senior secured debt.We expect the fund to continue to pay an 8.5-11% dividend based on 80% of projected NII, providing high income to investors.

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December 2023

DocuSign Inc. 

DocuSign has dealt with a general decline in growth since Covid but has reduced costs and has turned to several initiatives to propel the company. Initiatives have yet to be proven and growth continues to slide. So, at this time we would consider DOCU to be fully priced without a foreseeable catalyst. The company has no debt and a cash position of $1.6 billion but the current cash flow yield is around 6%, leading to our Hold recommendation and price target of $55.

Read Report>>

December 2023

Macy's Inc. 

As of December 10, Macy’s is reported to have received a takeover offer from real estate investment firms Arkhouse Management and Brigade Capital (whom already own shares) for around $21 per share. We evaluate the real-estate values and possible outcome for bond and shareholders in this report. 

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November 2023

Harmony Gold Mining Co. LTD.

Recently, Harmony demonstrated several substantial financial improvements for the 3rd quarter of 2023. Operating costs dropped 7% combined with a 17% increase in production. The company also reduced long-term debt to zero and reported a strong increase in cash flow. Our price target of $10 is based on 10 X 2024 projected earnings and 5.4 X our 2024 projected EBITDA

Read Report>>

November 2023

Fisker Inc.

After reporting 3rd quarter results the company seems to be in disarray. Since the company is not generating confidence with the operation this could cause an additional problem with raising the necessary capital needed to reach profitability. This may easily improve in the next few quarters, but we estimate that Fisker will also need to be producing 22,000 cars per quarter in order break even on EBITDA.

Read Report>>

October 2023

Community Health Systems, Inc.

CYH is a heavily indebted company that used the increased optimism surrounding Covid to beneficially rearrange the maturities of its debt. We report on the senior secured notes, which we consider well covered and are yielding 11-12%. The company has over $1 billion in liquidity and no bond maturities until 2026 giving management time to improve the financials. 

Read Report>>

September 2023

Medical Properties Trust

Medical Properties trust (MPW) is the 7th largest healthcare real estate investment trusts or REIT in the U.S. After a rocky 2022 and 2023 We are forecasting improvements in EBITDA, earnings, and funds available for distribution (adjusted FFO) in 2024 and 2025.

Read Report>>

September 2023

Albertsons Companies, Inc.

Albertsons (ACI) is the fourth largest food retailer in the United States. Our price target of $27.00 is based on the probable closing of the Kroger merger and the strong valuation . Investors in ACI will receive a return of over 14% if the deal is consummated and an annualized return of over 30% if the merger is completed in early 2024. 

Read Report>>

August 2023

The Kraft Heinz Company

Kraft Heinz (KHC) is a well-known company that has been undergoing somewhat of a transformation over the last 4 years. Total debt has been reduced from $29 billion to $20 billion through cash flow and divestitures and the company is also realigning its product portfolio. The accomplishment of financial goals, such as deleveraging, is providing management with resources to grow the business.

 Read Report>>

July 2023

Under Armour, Inc.

Under Armour: (UAA) is a well-known clothing company that produces sports apparel. There is strong potential for the brand and the operational challenges are dissipating. Our buy and price target of $9 are based on 12.4 X projected 2025 fiscal year EPS and the healthy balance sheet. We feel that UAA has possibilities beyond our targets if new CEO Linnartz can navigate the company and reignite the brand.

 Read Report>>

June 2023

Albertsons Companies, Inc.

Albertsons (ACI) is the fourth largest food retailer in the United States operating 2,271 stores in 34 states under 24 different banners, including Safeway and Vons. The company was sold to Kroger for $34.10 in October of 2022. But there are questions about the approval process.  

 Read Report>>

May 2023

Wix.com Ltd.

Wix.com Ltd. (WIX) is an Israeli software company that offers a user friendly website building tool through Wix Editor and an advanced tool through Editor X in 22 languages and over 190 countries. Several recent developments have led to financial improvements at WIX.    

 Read Report>>

June 2023

The Children's Place.

PLCE reported down guidance in May for the current year, including downward projections for total revenue in the high-single digit percentage range as compared to the prior fiscal year. Although the company continues to make progress on the digital transformation, we do not see a recovery until 2024......... Read Report>>

April 2023

Danaos Corp.

Danaos (DAC) is an international owner and lessor of containerships. The company owns 68 Container Vessels ranging from 2,200 TEU to 13,100 TEU. Danaos trades at a massive discount although our analysis shows that strength is projected to continue...... Read Report>>

March 2023

Petco, Inc.

Petco, Inc. (WOOF) operates over 1,500 pet retail locations in the U.S., Mexico, and Puerto Rico. The company has over 24 million members in its’ rewards program now known as Vital Care (formerly Petco Pals). Our initiation of coverage is based on the potential, unique asset and the close to 10% EBITDA margin. .... Read Report>>

February 2023

Amarin Corporation PLC

Amarin (AMRN) is a biopharmaceutical company and owner of the successful drug VASCEPA. Several positive events are evolving, the company reported positive cash flow in the U.S. for the 3rd quarter, due to cost reductions by new management, and the European launch of VASCEPA began in 4th quarter. .... Read Report>>

January 2023

Vodafone Group PLC

Vodafone Group plc (VOD) is a well-known multinational telecom that is usually considered the 2nd or 3rd largest telecom in the world by subscriber count. We consider Vodafone’s current financial position to be good with over 10 billion Euro in cash and cash flow and possibly over 15 billion considering planned deleveraging actions. The buy and $13 price target are based on the dividend yield, low enterprise value to EBITDA and near and longer term deleveraging prospects... Read Report>>

December 2022

Owl Rock Capital Corp.

Owl Rock Capital Corporation (NYSE: ORCC) is a $13 billion leveraged bond fund comprised of “middle market” loans that is trading at a 21% discount to its’ NAV. The company is one of the “funds” managed by the $132 billion asset manager Blue Owl. Our buy recommendation and price target of $13.50 is based on a more reasonable 10% discount to NAV, the stability of middle market loans and the good operating history of the fund... Read Report>>

November 2022

Fisker Inc.

We are highlighting the Fisker 2.5% convertible notes. The notes are the only debt currently at Fisker and at a recent price of 56 offer a 19.33% Yield to maturity. Fisker’s business model is described as a technology-enabled, capital-light automotive business that involves a focus on vehicle development and customer experience. The company began production of the Fisker Ocean recently.. Read Report>>

November 2022

Unisys Corporation.

We are highlighting the common shares & 6.875% senior secured notes at Unisys (UIS). Unisys is a global information technology company that provides IT services, software, and technology. Unisys clients are large well-known corporations and governments. Government customers and financial companies accounted for 39% and 25% of 2020 revenues respectively. Investors have been challenged by a bumpy transition to higher margin revenues which may not gain traction until 2024..... Read Report>>

October 2022

Abercrombie & Fitch Co.

We are highlighting the 8.75% senior secured notes at Abercrombie (ANF). The Company is a global retailer under the Hollister and Abercrombie brands operating in North America, Europe and Asia. 2022 has been a difficult year for most clothing retailers and we may not have seen the operational lows yet. Abercrombie ended 2nd quarter with $369 million in cash and just $308 million in debt, which currently is comprised only of the notes. The bonds are rated BB by S&P and mature within 36 months..... Read Report>>

September 2022

Genworth Financial, Inc.

We are highlighting the Junior LIBOR + notes at Genworth holding company (GNW) against the improved balance sheet and subsequent ratings upgrades. GNW owns two large independent insurance companies: Genworth Life Insurance and Enact. This year, Enact is expected to earn over $600 million. Currently, Genworth owns 81.6% or around $3 billion worth of Enact shares... Read Report>>

August 2022

Roku, Inc.

Roku, Inc. (ROKU) is a hardware and software digital media service that offers access to streaming media content through Roku brand connectible television devices (CTV) or as an embedded component in televisions. The company is the clear dominant CTV device leader in North America with around a 50% market share........... Read Report>>

July 2022

Dell Technologies

Dell Technologies (DELL) is a worldwide technology and services provider with sales in over 180 countries and 133,000 employees. Our buy recommendation and $65 price target are based on 6 X our projected fiscal 2024 EBITDA and 9 X non-GAAP earnings. Dell significantly deleveraged in 2021 and is demonstrating improved synergies with technology solutions and services along with its’ hardware.......... Read Report>>

June 2022

Stellantis N.V.

Stellantis N.V. (STLA) is a multinational automotive manufacturer formed in the 2021 merger between Fiat Chrysler and Peugeot S.A. 2021 should be considered a success with €3.2 billion of cost reductions achieved and earnings of over 4 euro per share. The company is trading at around 3 X 2021 earning, an enterprise value of 3 X EBITDA and the shares boast a current yield of 8.4%. ........ Read Report>>

May 2022

Macy's Inc

A large portion of Macy's current success results from strategic planning previous to the Covid lockdowns. As a result, digital sales have increased by 39%, the store base continues to be rationalized and cost saving measures have been implemented. Macy's achieved its' best earnings in 5 years for 2021 and has demonstrated that the company is a long-term survivor. ........ Read Report>>

April 2022

D.R. Horton, Inc.

D.R. Horton, Inc (DHI) is the largest homebuilder in the U.S. The company constructs and sell homes under the of D.R. Horton, Emerald Homes, Express Homes, and Freedom Homes brands. DHI reported earnings for the quarter ending in March and showed a 60% increase in net income to $4.03 per share versus a $3.37 consensus...... Read Report>>

March 2022

ZIM Integrated Shipping Services Ltd.

ZIM is an international container shipping company operating 118 vessels with a total capacity of close to 430,000 TEU. The company produced a robust $39 per share in earnings in 2021 and management is forecasting a more robust 2022..... Read Report>>

February 2022

The Children's Place

The Children’s Place (PLCE) is a children's clothing retailer that designs, licenses, wholesales, and retails its' value priced apparel. Over the last few years PLCE has successfully executed a digital transformation resulting in sharply higher margins and earnings.... Read Report>>

February 2022

Paramount Global (ViacomCBS)

On February 15th ViacomCBS announced 4th quarter 2021 earnings and an aggressive change in near term business strategy. The company will now go "all in" on new content for its Paramount Plus streaming service. and over time terminate most its content licensing in order to stoke additional subscriber growth.. Read Report>>

January 2022

U.S. Steel

Recently several factors have improved in favor of U.S. Steel (X) (Steel). The medium and near-term outlook for steel pricing has stabilized and the company has vastly improved its balance sheet. Our price target of $43 is based on 9 X our 2023 estimated earnings and an enterprise value of 5 X our 2023 EBITDA estimate. Read Report>>

December 2021

The Macerich Company

We opened up coverage on MAC due to the fact that a number of metrics are starting to flow their way. Average tenant sales have rebounded strongly in 2021, advancing over 13% from 3rd quarter 2019 and the company has reduced debt from $6 billion to 4.5 billion this year. Read Report>>

November 2021

Global Ship Lease, Inc.

Global Ship Lease is a containership owner with a fleet of 65 ships. Rates for vessel chartering have risen and remained strong. The company is well positioned to generate additional cash flow with improving credit metrics. Read Report>>

November 2021

ViacomCBS

In the third quarter total advertising and subscription streaming subscribers surpassed 100 million with 6.4 million additions exceeding the rate of Disney +, Netflix and Roku. Read Report>>

November 2021

Broxton 4th Quarter Presentation.

If every position in the Broxton Alpha Portfolio was trading at 15 x earnings, Our portfolio positions would be up 100% simultaneously if the same wer true for the S&P 500, it would be down 28%. Read Presentation>>

November 2021

Unisys Corporation Update 

Unisys reports third quarter results slightly behind estimates and reaffirms full year guidance. Read Report>>

October 2021

Bloomin' Brands, Inc. 

Bloomin' Brands, Inc. one of the world's largest casual dining companies with approximately 77,000 Team Members and more than 1,450 restaurants worldwide. Read Report>>

September 2021

Qurate Retail Inc.

Qurate is a unique hybrid retailer utilizing television networks and digital platforms.

Read Report>>

August 2021

Teekay LNG Partners

Teekay LNG Partners L.P. is an international provider of marine transportation services focusing on LNG and LPG. Read Report>>

July 2021

Unisys Corporation

Unisys is a global information technology company whose clients clients include large well-known corporations and governments Read Report>>

June 2021

Thor Industries

Thor Industries is the largest manufacturer of RV's in North America. Read Report>>

April 2021

Viacom CBS

ViacomCBS is on its way to pass 100 million steaming subscribers this Summer. Read Report>>

March 2021

Deutsche Bank

Strategic Transformation has reduced Core Bank expenses by roughly 4 billion Euro annually or 19%. Read Report>>

Feb  2021

Cardinal Health

CAH has a strong investment profile and dividend coverageRead Report>>

Feb  2021

Enlink Midstream

ENLC shares are currently yielding 14.3% offering an opportunity for income and price appreciation. The senior notes are rated BB+ by S&P and the company is forecasting $270 million in "excess" cash generation after dividends and capital expenditure for 2020. 

Read Report>>

December  2020

United Foods

UNFI currently trades at close to 5X 2021 consensus EPS and our price target of $30 reflects a more reasonable 9 X EPS with an enterprise value of $4.4billion.  Read Report>>

November 2020

Community Health Systems

CYH is a leading operator in acute care.  Read Report>>

May  2019

Viacom CBS Merger

VIAC is growing their top line and operating income  Read Report>>

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