TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Equity Bottom-Up

<div><p>Our investment philosophy attracts us to investing behind THE major secular trend in the world today…offline to online transition of massive TAMs. Even the largest TAMs in the world – groceries, entertainment, autos, commerce, finance, real estate, etc. are still incredibly early in the long term re-platforming of how the global economy functions, but <span>COVID has turbocharged these trends. Gambling has been online in Europe and Australia and parts of Asia for a few years now, but the US is jusssst scratching the surface. We think DraftKings is a great long term holding and had a good tactical entry point yesterday when we wrote this...it was up 9% today on news that Illinois (~4% of the US population) had reinstated remote registration for online gambling, just ahead of the start of NFL season. We think there's still 15%+ upside in our base case, and 56% in our bull case. </span></p></div><div></div><div class="content-highlight"><p>Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.</p></div>

Our investment philosophy attracts us to investing behind THE major secular trend in the world today…offline to online transition of massive TAMs. Even the largest TAMs in the world – groceries, entertainment, autos, commerce, finance, real estate, etc. are still incredibly early in the long term re-platforming of how the global economy functions, but COVID has turbocharged these trends. Gambling has been online in Europe and Australia and parts of Asia for a few years now, but the US is jusssst scratching the surface. We think DraftKings is a great long term holding and had a good tactical entry point yesterday when we wrote this...it was up 9% today on news that Illinois (~4% of the US population) had reinstated remote registration for online gambling, just ahead of the start of NFL season. We think there's still 15%+ upside in our base case, and 56% in our bull case. Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.

Equity Analyst, LightStream Research

Supun Walpola

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<p>Bloomberg reported last week that <a href="https://www.smartkarma.com/entities/wanda-sports-group-co-ltd" target="_blank" data-smartkarma-citation="entities:28119:1" rel="noopener">Wanda Sports Group (WSG US)</a> (Wanda) is planning to sell its Ironman brand (under which it operates IRONMAN and IRONMAN 70.3 triathlon events globally) for $1bn. Bloomberg’s report stated that Wanda Sports is working with an adviser to determine whether or not to proceed with the sale, adding that the company has already had discussions with interested private equity buyers.</p><p><iframe src="https://www.youtube.com/embed/qjxxYoL7nSU" width="560" height="315" frameborder="0" allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="allowfullscreen"></iframe></p><div style="text-align: left;" class="content-caption">Source: Youtube</div><div class="content-highlight"><p>At an EV/Revenue multiple of 10x (versus the peer average of 5x) the expected $1bn valuation for Ironman seems to be on the expensive side. Hence, there is a good chance that the transaction would eventually go through at a lower price. However, it is doubtful as to whether Wanda would be willing to sell Ironman at a lower price, given that proceeds are presumably expected to cover its loan commitments worth c.$1bn maturing over the next two years.</p></div>

Bloomberg reported last week that Wanda Sports Group (WSG US) (Wanda) is planning to sell its Ironman brand (under which it operates IRONMAN and IRONMAN 70.3 triathlon events globally) for $1bn. Bloomberg’s report stated that Wanda Sports is working with an adviser to determine whether or not to proceed with the sale, adding that the company has already had discussions with interested private equity buyers.Source: YoutubeAt an EV/Revenue multiple of 10x (versus the peer average of 5x) the expected $1bn valuation for Ironman seems to be on the expensive side. Hence, there is a good chance that the transaction would eventually go through at a lower price. However, it is doubtful as to whether Wanda would be willing to sell Ironman at a lower price, given that proceeds are presumably expected to cover its loan commitments worth c.$1bn maturing over the next two years.

Wanda Sports: Ironman Offer Seems Expensive But Would Do Well for Solvency If Goes Through

United States

Madison Square Garden Sports Corp. is a professional sports company that owns and operates sports franchises.

Madison Square Garden Sports Corp. (MSGS US)

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Madison Square Garden Sports Corp. (MSGS US)

DraftKings: First Round Pick

Our investment philosophy attracts us to investing behind THE major secular trend in the world today…offline to online transition of massive TAMs....

Aaron Gabin

Wanda Sports: Ironman Offer Seems Expensive But Would Do Well for Solvency If Goes Through

Bloomberg reported last week that Wanda Sports Group (WSG US) (Wanda) is planning to sell its Ironman brand (under which it operates IRONMAN and...

Supun Walpola

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