Kip Johann-Berkel @BerkelKip Twitter profile

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Kip Johann-Berkel

@BerkelKip

11 months

Cleaning out my office and ran across my Monster Beverage $MNST (then Hansen Natural Corp. $HANS) 1-page pitch I used while interviewing in BSchool (Oct, 2008). If only all my picks worked so well! 🤣

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Kip Johann-Berkel

@BerkelKip

1 year

$6049.T Itokuro is a Japanese microcap ($45M USD mkt cap) trading below cash minus all liabilities, is growing, profitable, and just raised guidance. Downside appears limited while upside is potentially very substantial.

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Kip Johann-Berkel

@BerkelKip

1 year

$CNS.MI Civitanavi is an Italian microcap ($125M USD mkt cap) technology provider to the A&D industry with strong growth (+63% 10 yr sales CAGR), mid-20s ROEs, high inside ownership, net-cash B/S and attractive valuation (10x EV/ttm EBIT, 13x ttm P/E ex-cash) - multibagger pot'l

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Kip Johann-Berkel

@BerkelKip

7 months

A few tidbits from Constellation's $CSU / $CSU.TO filings: 1) Altera improving: Altera actually grew +4% organically in 4Q and finished the year at -5% organic. Recall this was a quickly declining business when CSU acquired it in May 2022. Too early to call a turn but promising

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Kip Johann-Berkel

@BerkelKip

7 months

Just realized it's been >10 years since my first purchase of Constellation Software $CSU / $CSU.TO Doubt the next 10 will be as fruitful as the first but I've learned a ton along the way. Big thanks to ML, PB & DJ

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Kip Johann-Berkel

@BerkelKip

7 months

On Sygnity $SGN / $SGN.WA for their recent acquisition of Edrana Baltic, it looks like the acq'n was done at 0.95x P/Sales (sales +21% yoy) and probably had some cash included. Also 8.6x earnings. Pretty much what you would expect from a $CSU child

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Kip Johann-Berkel

@BerkelKip

8 months

Teqnion $TEQ / $TEQ.ST reported 4Q23 results this morning. See @alexeliasson post (below) for high level results. A few other details: 1) 2023 had some non-recurring costs while '22 was boosted by some non-recurring items - if you wish to "normalize" these:

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Kip Johann-Berkel

@BerkelKip

1 year

CEL Corp $5078.T the Japanese net-net / cash-net reported FY1Q24 results recently (July 14th) that look more like a growth company (sales +47% yoy, op profit +211% yoy) than a company trading below cash minus all liabilities. Additionally, their guide seems very conservative

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Kip Johann-Berkel

@BerkelKip

1 year

Japanese cash-net CEL Corp ($5078.T) reported FY2Q24 results last night and raised their FY2/24 guidance by +9% on sales & +24% on EPS. Cash continues to build and the stock remains very cheap with no catalyst: 5,303 cash/sh vs. 2,913 stock price, 0.5x P/TBV & <12x P/E

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Kip Johann-Berkel

@BerkelKip

11 months

Not to take anything away from $CSU.TO but I suspect a lot of the recent organic growth acceleration has to do with how they structure the majority of their contracts to have CPI pass throughs

Braden Dennis

@BradoCapital

11 months

$CSU.TO 6% organic (FX adjusted) Chugging along. $3K a share coming in hot.

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Kip Johann-Berkel

@BerkelKip

11 months

Teqnion ($TEQ.ST) 3Q23 results were even better than headline numbers suggest. 2 tidbits from their reports: 1) TEQ had 3M SEK of costs running through their I/S from a revaluation of the contingent purchase price for acquisitions (basically acq'ns doing better than planned):

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Kip Johann-Berkel

@BerkelKip

1 year

$5078.T Cel Corp Japanese net-net recently (April 14th) reported FY2/23 results so just wanted to update my valuation for results. Please see @gw_investing 's write-up for an in-depth biz analysis - still one of the statistically cheapest cash-nets out there:

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Kip Johann-Berkel

@BerkelKip

5 months

Tiny special situation for those that have access to the expert market: SeaChange $SEAC trading at $5.10 vs. $8.71/share of cash & limited liabilities after asset sale; also has $131M (~$51/sh) of federal NOLs. @InvestSpecial @DarkfireCapital @TreyHenninger @eriksen_tim

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Kip Johann-Berkel

@BerkelKip

5 months

Friendly reminder that the Constellation Software $CSU / $CSU.TO annual shareholder meeting is tomorrow (Monday, May 13th) morning, 9am ET. Looking forward to hearing a blank screen (ML) talk again 🤣

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Kip Johann-Berkel

@BerkelKip

6 months

$CNS.MI Civitanavi announced today that Honeywell $HON will acquire CNS for €6.30/sh in cash vs. the €3.72/sh price at the time of my post ~7 months ago. Equates to 15.4x EV/ttm EBIT which I personally think is still way too cheap.

Kip Johann-Berkel

@BerkelKip

1 year

$CNS.MI Civitanavi is an Italian microcap ($125M USD mkt cap) technology provider to the A&D industry with strong growth (+63% 10 yr sales CAGR), mid-20s ROEs, high inside ownership, net-cash B/S and attractive valuation (10x EV/ttm EBIT, 13x ttm P/E ex-cash) - multibagger pot'l

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Kip Johann-Berkel

@BerkelKip

5 months

Thank you @Sugrorsmannen and @CXODanielZ for changing Teqnion’s $TEQ / $TEQ.ST reporting language to English. Hopefully helps a few more international companies join the group! Just when I was starting to get a hang of Swedish too 😁 Tack!

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Kip Johann-Berkel

@BerkelKip

1 year

@InaTailHedged Excellent PM I used to work with: there are “slow moving” valuation metrics like P/B and “fast-moving” valuation metrics like P/E. For cyclical companies generally using slow-moving metrics is best while for more stable companies earnings/FCF-based metrics are best

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Kip Johann-Berkel

@BerkelKip

5 months

What are some small cap names whose main asset is a unique database? Examples: $3901.T MarkLines (auto) $RTH.AX RAS Technology (horseracing) $INOV Inovalon (health outcomes) - before it got acquired

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Kip Johann-Berkel

@BerkelKip

1 year

$CNS.MI Civitanavi 1H23 results today-mixed: + Sales strong & accelerated (1H: +66% yoy, 2Q: +81% yoy) + Bookings +72% yoy & backlog +66% yoy = 2023 guide maintained: sales +28% yoy, Adj. EBITDA% 29% - Adj. EBITDA% -900bps to 20% & adj. EBITDA +12% - Cash declined 11M on WC build

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Kip Johann-Berkel

@BerkelKip

6 months

I’ve only talked to one company mgmt. team that has said $CSU outbid them on an acquisition (it was on a tiny legacy Icelandic CRM software business). They really do play a different game.

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Kip Johann-Berkel

@BerkelKip

7 months

In terms of valuation, if I subtract out the value of the $TOI & $LMN holdings from CSU's EV (and only use CSU's sales & EBITA) I get valuation at 7.6x EV/S, 32.1x EV/EBITA and 37.9x adj. Market Cap to FCFA2S - actually the lowest multiples of the "CSU family"

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Kip Johann-Berkel

@BerkelKip

6 months

With respect to Lumine's $LMN purchase of $CASA's Cloud+RAN assets, a quick read of the 3Q press release suggests these were the "good" assets.

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Kip Johann-Berkel

@BerkelKip

4 months

Kind of ironic that $TPL is +24% today on being included in the S&P MidCap 400 since it’s a very large holding of Murray Stahl’s Horizon Kinetics. Murray has talked at length about many of the irrational things about indexes. Glad to see he’s benefiting from it this time!

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Kip Johann-Berkel

@BerkelKip

11 months

Interesting pitch for those that like cheap small cap Japanese stocks:

ヘム/ 配当&優待&DOE 雪だるま☃️投資

@pygmy_hem

11 months

I would like to introduce one of the Japanese small-cap companies that I purchased last month. At first, I have one simple question. Can non-Japanese people buy individual Japanese stocks in your home country? Does my introduction to Japanese small-cap stocks make sense? 🙄🙄

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Kip Johann-Berkel

@BerkelKip

8 months

Valuation: $TEQ trades at 27x EV/2023 EBITA or 26.3x if you use my "normalized" number above. Definitely not "cheap" so IMHO you have to have a view on how much capital they can deploy and at what returns going forward.

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Kip Johann-Berkel

@BerkelKip

1 year

$6049.T Itokuro reported 3Q23 results AMC on Friday & raised 2023 op. profit (again) - this time by +50% (better advertising costs). With the stock +33% since June it's no longer a cash-net but it still trades at a negative EV and just below TBV.

Kip Johann-Berkel

@BerkelKip

1 year

$6049.T Itokuro is a Japanese microcap ($45M USD mkt cap) trading below cash minus all liabilities, is growing, profitable, and just raised guidance. Downside appears limited while upside is potentially very substantial.

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Kip Johann-Berkel

@BerkelKip

7 months

One of the best investors I know would always ask mgmt. teams “Why do companies in your industry fail?”

MastersInvest.com

@mastersinvest

7 months

“I like to study failure… we want to see what has caused businesses to go bad." - Warren Buffett [A good case study ...]

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Kip Johann-Berkel

@BerkelKip

7 months

@adrivalue @CJ0pp3l If only the bear case in all my stocks was “they’re giving money back to shareholders” 🤣

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Kip Johann-Berkel

@BerkelKip

1 year

What are some companies buying back shares below book value? Ideally with a history of growing BV/sh at a healthy level. I'll go first: $FFH.TO / $FRFHF and $TOT.TO / $TOTZF

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Kip Johann-Berkel

@BerkelKip

7 months

Hurco $HURC now at ~62% of TBV with 28% of market cap in cash (no debt) and decent history of growing TBV (though not the last few years). 3% div yield. A few folks might be interested: @chasericker3 @benbakhshi @CapitalShipyard

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Kip Johann-Berkel

@BerkelKip

7 months

Tagging a few folks that might be interested: @CJ0pp3l @CompTortoise @NotMarkLeonard @chriswmayer @acquirers_club @JerryCap

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Kip Johann-Berkel

@BerkelKip

7 months

I remember a Portfolio Manager telling Peter Lynch that he (the PM) was a “Quality Growth” investor. Lynch replied: “why limit yourself?”

Unemployed Capital Allocator

@atelicinvest

7 months

Pretty much every successful investor that experiences a modicum of success ends up developing a strong filter for the type of idea that made them money. This is also one of the most common ways investors with good ~10+ yr of good track record end up being mediocre (or worse).

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Kip Johann-Berkel

@BerkelKip

4 months

Not my normal investing-related post, but happy with my San Diego Marathon time. The “Highway to Hill” at mile 23 almost got me!

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Kip Johann-Berkel

@BerkelKip

9 months

@Larryjamieson_ The “Swedish Constellation Software”. Unfortunately they’re paying up a lot more for acquisitions (lower returns) than they used to, don’t have much of an internal M&A team (use brokers) and accounting is less conservative (they capitalize whereas CSU expenses everything)

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Kip Johann-Berkel

@BerkelKip

10 months

$EBIX filed for Chapter 11 bankruptcy today. If only there were warning signs…

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Kip Johann-Berkel

@BerkelKip

6 months

Rule #1 : is management trustworthy and capable?

C.J.

@CJ0pp3l

6 months

Bad management is a no-go. Doesn't matter how cheap, or that "anybody could run this business". They will find ways to hurt you with unbounded creativity

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Kip Johann-Berkel

@BerkelKip

5 months

I wish more companies would publish Owners’ Manuals like this

Brett Kelly

@BrettKPG

5 months

$kpg.ax are pleased to share our latest (3rd edition) Quality Shareholders Owners Manual

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Kip Johann-Berkel

@BerkelKip

11 months

@LogicalThesis I’d push back a bit on this. When one buys stock they’re buying the claims on the equity, not the EV so P/E or P/FCF is ok most times. That said, debt is more senior on the capital stack so if the company is shrinking the debt holders needs to get paid first so EV metrics better

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Kip Johann-Berkel

@BerkelKip

1 year

@FundasyInvestor FYI: quant studies have shown self-relative valuation (i.e. current multiple vs. it’s own trading history) is almost information-less (not a good predictor of future returns) while market-relative valuation (i.e. current multiple relative to the market’s multiple) is much better

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Kip Johann-Berkel

@BerkelKip

5 months

Not a blank screen!

Kip Johann-Berkel

@BerkelKip

5 months

Friendly reminder that the Constellation Software $CSU / $CSU.TO annual shareholder meeting is tomorrow (Monday, May 13th) morning, 9am ET. Looking forward to hearing a blank screen (ML) talk again 🤣

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Kip Johann-Berkel

@BerkelKip

1 year

@chriswmayer What is your sell discipline? Maybe use TPL as an example (I believe your only sale last year). Thanks!

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Kip Johann-Berkel

@BerkelKip

10 months

Big money can be made going from horrible to just bad. Another really cheap (0.35x P/B) Japanese stock $1827 Nakano Corp gets a big boost (+17% today) after mgmt says they are "conscious of capital costs and stock prices".

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Kip Johann-Berkel

@BerkelKip

1 year

Any pushback/feedback appreciated. Tagging a few folks that might be interested: @alluvialcapital @equitybaron @Sutjeinvestor @Govro12 @hurdle_rate @FairwayResearch

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Kip Johann-Berkel

@BerkelKip

7 months

2) Continuing the Altera theme, cash flows & returns seem strong: Altera generated $94M of FCFA2S in 2023 vs. $700M purchase price. $276M of debt at Altera so $424M of equity = 22% "cash ROE" (or more like 35% if you back out the $158M in cash)

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Kip Johann-Berkel

@BerkelKip

7 months

Wasn’t expecting a $TOI / $TOI.V dividend. Guess they’re not trying to reinvest all cash flows into M&A like their parent $CSU / $CSU.TO

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Kip Johann-Berkel

@BerkelKip

7 months

@mavix_leon If interested I did a quick pitch on this one a little while ago:

Kip Johann-Berkel

@BerkelKip

1 year

$CNS.MI Civitanavi is an Italian microcap ($125M USD mkt cap) technology provider to the A&D industry with strong growth (+63% 10 yr sales CAGR), mid-20s ROEs, high inside ownership, net-cash B/S and attractive valuation (10x EV/ttm EBIT, 13x ttm P/E ex-cash) - multibagger pot'l

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Kip Johann-Berkel

@BerkelKip

5 months

@evfcfaddict I believe 6 projects account for ~83% of $DUR.AX's revenues. I'm not sure how the contracts are structured (e.g. fixed-cost vs. cost-plus) but if they're fixed-cost and one goes wrong that can be a disaster. No idea if that's the case, just an observation

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Kip Johann-Berkel

@BerkelKip

1 year

Whenever I’ve asked successful investors that have been investing for a long time what’s changed in their process over time all have said they place more importance on management… stuff like this makes me understand why!

Luke Winchester

@lukewinchester9

1 year

$ERD board knock back $1.30 takeover offer back in June which "materially undervalued" the business, then proceeds with a 50% dilutionary raise at 70c...🤨

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Kip Johann-Berkel

@BerkelKip

6 months

Anyone know how to pull a Japan-listed stock's price into excel? Excel's built-in Data -> Stocks doesn't appear to support Japanese stocks

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Kip Johann-Berkel

@BerkelKip

7 months

@CompTortoise @CJ0pp3l @ReturnsJourney My favorite Lifco slide is the one showing the revenue contributions of acquisitions by year, e.g. aggregate revenue of all the acquisitions in 2018 when they acquired them vs aggregate revenue now. Shows that they add value post-acquisition. Wish more would do that

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Kip Johann-Berkel

@BerkelKip

1 year

On Cake Box $CBOX.L the (cheap) UK-based cake retailer, they announced FY1H24 results today that were reasonably good (LFL +6% & profits up yoy) but I don't understand how total revenues are expected to be just +6% when LFL is +6% and they have +9% more stores - anyone?

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Kip Johann-Berkel

@BerkelKip

8 months

For those that follow the B&B set of serial acquirers, the Return on Working Capital (EBITA/WC) of these acquisitions also looks extremely healthy at >300%! (I'm not including the cash in WC) Good proxy for business quality.

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Kip Johann-Berkel

@BerkelKip

8 months

2) The main item that was concerning to me was declining return metrics (ROCE & ROE) with ROCE going from 23% in '22 to 18% in '23. For me, it's all about what return they can get on incremental capital deployed. Are they paying more for acquisitions? Or worse acq'ns? However...

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Kip Johann-Berkel

@BerkelKip

3 months

"Poor man's Constellation Software" $CSU / $CSU.TO otherwise known as Enghouse $ENGH / $ENGH.TO - I've seen worse ideas. Probably see HSD/sh profit CAGR (all via M&A) + 3.5% div yield trading at 10.5x EV/EBITA & <13x EV/FCF (10.5x ex-WC)

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Kip Johann-Berkel

@BerkelKip

1 year

If a company’s new CEO has an engineering degree - especially if in math or physics - this is a big plus for me. Correlates to a more rational thought process. Example: $CBTT-B.ST

Sidecar Investor

@sidecarcap

1 year

Half the Outsiders were under 40 Half had engineering degrees All were first-time CEOs While these traits don’t mean much in isolation, together they dramatically increase the odds the CEO isn’t shackled by the Institutional Imperative.

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Kip Johann-Berkel

@BerkelKip

6 months

Never ask a barber if you need a haircut… 🤣

BuccoCapital Bloke

@buccocapital

6 months

Interesting study from Bain on M&A “Companies that were frequent acquirers earned 130% higher shareholder returns vs. those that stayed out of the market. Sitting on the M&A sideline is generally a losing strategy.”

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Kip Johann-Berkel

@BerkelKip

6 months

@1MainCapital Community Adjusted EBITDA

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Kip Johann-Berkel

@BerkelKip

7 months

5) On the negative side of things impairments were $22M in 4Q and $26M in 2023 - much higher than in any other prior period. Somewhat to be expected with the ramp in M&A & decentralization of M&A but something to keep an eye on.

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Kip Johann-Berkel

@BerkelKip

3 months

On Kingsway Financial Services $KFS anyone understand valuation? Doesn't make sense to me: ttm heavily-adjusted EBITDA of ~$9M & $4.6M of interest expense (1Q annualized); even w/ minimal capex & taxes that's still only $4.5M of FCF vs. $225M mkt cap & $260M EV??

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Kip Johann-Berkel

@BerkelKip

4 months

@hcapinvesting I would imagine this isn’t really an organic growth “story”. I’d expect $LMN.V to probably have the lowest organic growth of the 3 (CSU, TOI & LMN) but the highest overall (percentage) growth over the next ~10 years

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Kip Johann-Berkel

@BerkelKip

8 months

The way I interpreted that (and others can definitely have different interpretations): the poor organic results in 4Q & 2023 were more associated with the lower-quality, more cyclical/economically sensitive subsidiaries that TEQ acquired pre-IPO (the ones they could afford then)

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Kip Johann-Berkel

@BerkelKip

1 year

@tk_financial Industry consolidation (fragmented ==> Eastern/Western duopolies) & mgmt change focusing on price over volume. If you have access Wolfe Research has great industry historical data & info

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Kip Johann-Berkel

@BerkelKip

11 months

@stonkmetal If you’ve ever covered a “net cash” struggling retailer you know op leases are like debt 🤣

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Kip Johann-Berkel

@BerkelKip

1 year

@FundasyInvestor Definitely not smarter. Had done the same analysis many times myself before the quant guys at my last employer debunked it

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Kip Johann-Berkel

@BerkelKip

11 months

Tagging a few folks that might be interested: @chriswmayer @NoNonsenseAlpha @abrowninvesting @NordicAssetMind @NicoperJES @InvestInAssets @aktieoptimist @DTmesswithtexas @pedroleongarci2

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Kip Johann-Berkel

@BerkelKip

7 months

It’s amazing the difference good operators can make, especially in software! $BVS.AX

Tristan

@hurdle_rate

7 months

these results are quite good. much better than anticipated - especially cash balance.

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Kip Johann-Berkel

@BerkelKip

7 months

On TeamSpirit $4397.T (HCM SaaS name at 1x EV/S) does anyone know why their gross margins are ~37%? Seems like it’s mostly software (90%+ recurring) so I would have expected closer to kaonavi’s $4445.T 77% GMs? @willschoebs @TeddyOkuyama

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Kip Johann-Berkel

@BerkelKip

1 year

Risks include: 1) limited recurring revenue - mostly new systems with limited parts/service, 2) customer concentration with top 1, 5 & 10 at 29%, 66%, & 79% of sales (2021 data - likely a bit less now)

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Kip Johann-Berkel

@BerkelKip

7 months

What names (ideally <$5B) have a history of gaining market share in large, fragmented market? I'll go first: 4imprint $FOUR.L

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Kip Johann-Berkel

@BerkelKip

8 months

we can see from their footnote 5 disclosure the price paid and EBITA of acquisitions in 2023: 206.3M SEK purchase price (78.8 of which is deferred) for 3 acquisitions that pro-forma generated 35M of EBITA in 2023 which works out to 5.9x Price/EBITA

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Kip Johann-Berkel

@BerkelKip

1 year

@PythiaR Sweden has a bunch: ADDT, LAGR, VOLO, MMGR, TEQ probably top tier in terms of quality and INDT, BEIJ, BRAV, ANOD, NCAB, INSTAL, BUFAB all worth mentioning The CSU family: CSU, TOI, LMN, SGN Others: SITE, , BEWI.OL, JDG.L, , TNOM.HE

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Kip Johann-Berkel

@BerkelKip

1 year

Did a study once looking at corporate name changes. TL;DR: corporate name changes = really bad for future stock performance (defined as 12 mo relative return for those companies that changed their name). See, e.g. Facebook -> Meta (Oct 29, 2021)

Nick Kephala

@cypriotstatsman

1 year

Foresta $FGH.AX annual report says one of its "most exciting developments" in the past year was that "the company name has changed officially". Value creation at its finest.

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Kip Johann-Berkel

@BerkelKip

10 months

@junkbondanalyst Very successful PM I worked with: “never trust a CFO under 40”

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Kip Johann-Berkel

@BerkelKip

11 months

Good summary of the Teqnion $TEQ.ST 3q 2023 call from @pedroleongarci2 Full call here:

Teqnion 2023 Q3 Q&A

Teqniåner Johan and Daniel answers investors' questions after 2023 Q3 release.

www.youtube.com

Pedro León García

@pedroleongarci2

11 months

$TEQ meeting: + Refinance is coming in better terms + Backlog is high and new acquired companies do not tend to have backlog so even higher + Pipeline full + House building companies only represent 5% of the revenues in the Q + Stanwell is extremely stable, Schill growing a lot

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Kip Johann-Berkel

@BerkelKip

1 year

For Civitanavi $CNS.MI - good write-up from @zippy_capital

Zippy

@zippy_capital

1 year

New write-up on Civitanavi Systems SpA $CNS.MI h/t @BerkelKip

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Kip Johann-Berkel

@BerkelKip

7 months

3) Optimal Blue (carve out from ICE/BKI) generated $187M in sales in 2023 ($8,541 pf - $8,407 actual + $53 '23 contribution). It was estimated to do ~$211M in 2022 but actually held up better than I thought it would (mortgage origination software; originations down -45% in '23)

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Kip Johann-Berkel

@BerkelKip

7 months

@turtlebay_io @breadcrumbsre Thanks for sharing. Your treasure trove of historical documents never ceases to amaze me!

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Kip Johann-Berkel

@BerkelKip

4 months

@ToffCap Wolfe Research primer on Rails

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Kip Johann-Berkel

@BerkelKip

7 months

My main takeaway after reading Buffett’s letter: be wary of investing in companies reliant on regulators and/or politicians!

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Kip Johann-Berkel

@BerkelKip

1 year

@TintinCapital @david_katunaric To clarify: $OTCM bought Edgar-online not the SEC’s EDGAR. vs

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Kip Johann-Berkel

@BerkelKip

3 months

Is (was?) freeze dried candy a fad? $SOWG

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Kip Johann-Berkel

@BerkelKip

1 year

Scenario analysis below as well which shows the positively skewed risk/reward at current levels - imho not unreasonable to see a doubling of EPS and a doubling of the multiple in 3 years!

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Kip Johann-Berkel

@BerkelKip

7 months

@DV_Situations Lots of money to be made going from horrible to just bad…

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Kip Johann-Berkel

@BerkelKip

7 months

@TrungTPhan Was my pitch in Oct 2008 after it had gone down 70% (crazy times!)

Kip Johann-Berkel

@BerkelKip

11 months

Cleaning out my office and ran across my Monster Beverage $MNST (then Hansen Natural Corp. $HANS) 1-page pitch I used while interviewing in BSchool (Oct, 2008). If only all my picks worked so well! 🤣

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Kip Johann-Berkel

@BerkelKip

1 year

@adrivalue $TEQ.ST has and stock did fine. $KPG.AX is contemplating it and stock didn’t really move on the announcement

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Kip Johann-Berkel

@BerkelKip

7 months

@_inpractise Last conference call I asked why they (TEQ) allocate so much to goodwill instead of intangibles for purchase price accounting - see 41:15 here:

Teqnion 2023 Q4 Q&A

Teqnion Q&A from Nubis Solutions´ meeting room...

www.youtube.com

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Kip Johann-Berkel

@BerkelKip

6 months

@retaox 1) Exchanges ($CME, $ICE, $NDAQ): volumes go up as volatility increases 2) 4imprint $FOUR.L, while cyclical, does a good job gaining market share in downturns w/ a big cash B/S & invests in downturns as others pull back e.g. no layoffs during Covid

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Kip Johann-Berkel

@BerkelKip

1 year

@TintinCapital Make sure to read the proxy / Founder Advisory Agreement - pretty egregious in my view:

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Kip Johann-Berkel

@BerkelKip

1 year

Tagging a few folks who may be interested / know: @CJ0pp3l @permastonks @ZachValueInvest @FundasyInvestor @Investmentideen @EvanFox22

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Kip Johann-Berkel

@BerkelKip

6 months

@hurdle_rate I generally do a "what needs to happen to get a good IRR" calculation. In this case, 5 years out what's a realistic revenue and mature margin profile and multiple. Does that get you your hurdle rate? Obviously also realize "30%+" growth for 5-10 yrs is very rare!

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Kip Johann-Berkel

@BerkelKip

6 months

For anyone interested in higher quality, small cap (and cheap) Japanese stocks, @InvestInJapan is a must follow!

Made in Japan 🇯🇵

@InvestInJapan

6 months

New one out, and trying out a new format! Wrote a condensed version of an investment idea rather than a deep-dive like for $7115.JP This time I'm discussing a micro-cap that looks abit like Appfolio $APPF, a sticky SaaS solution for the property management industry that is

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Kip Johann-Berkel

@BerkelKip

11 months

@pygmy_hem Thanks for the idea - sounds interesting! Yes, US retail investors can purchase individual Japanese stocks through brokers like IBKR and Fidelity

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Kip Johann-Berkel

@BerkelKip

9 months

@pedroleongarci2 Any takeaways from the $LMN & $IWG meetings you’re willing to share? Thanks!

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Kip Johann-Berkel

@BerkelKip

7 months

4) $49M bargain purchase gain on an acquisition in 3Q23 - will lose money the first yr & lower margins the next 2 but I expect the IRR at that purchase price has to be very healthy & CSU one of the few with operational chops to do something like this

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Kip Johann-Berkel

@BerkelKip

8 months

Bad debt write-down was all in 4Q23 - 2.5M from 2 housing developers that went bankrupt and another 1M from a "a large industrial customer in Europe [that] went bankrupt". Not saying these aren't real costs (and TEQ should be better at managing receivables) but also not "normal"

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Kip Johann-Berkel

@BerkelKip

11 months

@hurdle_rate I would bet that’s the case as well. Though I’d also say sticky software is likely one of the better places to be in an inflationary environment as many of their costs typically don’t increase as much as inflation

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Kip Johann-Berkel

@BerkelKip

8 months

However, that 206.3M purchase price also includes 42.7M of cash so 163.6M EV and 4.7x EV/EBITA! This suggests they aren't "paying up" for acquisitions (at least the 2023 batch)

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Kip Johann-Berkel

@BerkelKip

8 months

@chasericker3 What are mgmt’s incentives/ownership? I’ve seen a lot of companies that *could* have avoided bankruptcy but chose to go into it because they got more equity in a post-reorg

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Kip Johann-Berkel

@BerkelKip

4 months

@eyesigh557 @Investmentideen FWIW a big chunk of SGN's current FCF is from improving working capital and a tax-related item in the transition quarter - I wouldn't consider either sustainable. More like 3.5-4% "normalized"

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Kip Johann-Berkel

@BerkelKip

6 months

@CuriosityInves Imho I think the main takeaway with $SDI.L is just be careful not to extrapolate 1x items - either on the upside or downside

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