1/8/25 - $olpx - I'm back at mid 1.50s

1/8/25 :: VROCKSTAR ::
I'm back at mid 1.50s

- last q kept me waiting for mid 1's as i wrote about
- it ripped and i sold for a meager 10% gain. whatever, gainz r gainz.
- now we back in value territory. nearly 10% fcf yield.
- good product, improving business under legit ceo
- could still be some bumps along the road, but i'm a buyer lower - so i'm happy to own it here. 1.5% position to go. i'd like to take it higher. risk/reward favorable
- today's sell off seems to be a small cap quake (*cough* quantum leading that charge lower) than anything fundamental. rates don't help, but specifically today...

V

Trade active

if you really push me, i'll divulge the specifics here... but i've dug in here... and the say 3-6 mo context of this stock's trajectory are just not as clear as i'd like it to be. the tl;dr is i've taken it to a 50 bps position with a meager 2% loss on that small 150 bps position.

- nearly 10x ebitda for low to no ebitda is expensive - full stop
- consumer discretionary as a category - is still expensive - any outflows will disproportionately affect smaller caps (this name is barely 1 bn EV) regardless of the smaller cap fundamentals (more in the next bullet)
- and mgmt is telling us the "ST" remains higher promotions, i.e. higher capex, lower mgn, and given the revision to 2024 guidance (in the 3Q CC), i am struggling to understand how they'll offer optimistic 2025 guidance. in fact, a. if they did, it probably doesn't get believed/ or it's short lived pop and b. if they don't, it's biz as usual and c. if it's actually not provided (worst) or just MSD or LSD... mkt doesn't need to care and so the base case is - not ST ideal
- google trends reinforce this above picture
- does FCF yield near 10%? yes
- is that good enough? such that the product is good (it is!) ... "yes" - but it's a matter of horizon, price paid, opportunity cost. look friends- i'm not a consumer trader. i buy/ trade the filet mignon (or the giant white truffles if that's your pref.)... so it's not a "need to own". my north is "make money"

SOOOOOO

i think what i'll prob do here is sell June 20 2025 $2 calls for 25c... really offset my basis. and look to size up only 25-30c lower in the LOW 1's.. no longer the mid 1's, unless the trading environment changes.

hmu w/ q's. i don't like small positions, this name is a labor of love... but i wanted to double check my logic after hours, b/c 1.5% in my book is half preggers. it's either going to become 2-5% or it's going to get cut. so i needed to make sure i had a clear path. and now it's resolved so i'm spelling it out.

pz out home fries. have a good rest of week my friends!

V

VROCKSTAR

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