1/3/25 - $kd - it's worth a lot less... than $371/3/25 :: VROCKSTAR :: NYSE:KD
it's worth a lot less... than $37
- i turn over a lot of rocks, as you guys probably guess. this one i'd never heard of until i looked thru the NASDAQ:SIXG etf's holdings and went "hem let's see"
- look. it's a consulting company with LSD growth and promise of really churning the FCF engine in coming years.
- i don't doubt the product is good, ppl good etc. etc. but again there's a difference between a "company" and a "stock". many ppl don't learn this, or they pay the tuition to learn it the hard way (sometimes more than once).
- so if we give this co the benefit of $500 mm in fcf in '26 (not even '25) and for MSD top line growth we say discount by 5% ("risk" free ish), you'd get $10 bn. and enterprise value is $11.5 bn and that's with heavy net debt - nearly $3 bn. so in other words, if m cap is about 8.5 bn today, to "remove" 1.5 bn (to get to the enterprise value of that hypothetical 10 bn), you'd need to haircut equity by (7/8.5 - 1) = 17%.
- and honestly, that's just being "nice". realistically a co growing this rate in this environment, esp where the stock looks to have gotten half painted into YE and half looped into the pltr-style meme move... means you're probably looking at a -20-25% move (minimally) in '25 base case. could it meme to $40... $50. brosef's... it could go to $1000. anything is possible. but most things, like that, and even $50 are unlikely. so if $50 is "amazing" and $25-30 is base case...
- "good luck". so i'm just burning a post on this to tell myself if anything it's probably more of a short than a long (tho shorting sux balls and i'd set a target at $45 b/c if/when the risk reward would be that much more obvious as a hedge). otherwise, definitely a no thank you and pass.
V
