🟨 The Yellowbrick Road

🟨 The Yellowbrick Road
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YB Premium Afternoon Email Example

This is an example of what the afternoon email would look like if you upgrade to YB Premium. In just 5 minutes per day, you will:

know if any of the Top 10 Investors made a new stock pitch (we copy those trades in the Yellowbrick Portfolio and alert you in this email),
know if any of the Elite Investors (the most profitable investors in our database) make a new stock pitch
get a rundown of all of the new stock pitches added to the database

It’s the most valuable stock market email out there.

Hello!

I’ve just added 32 new pitches to the website, including two pitches from top 10 investors, the second pitch in a row for $SOWG, and more. I also found a new top 10 investor that I highlight for Premium subscribers.

As always, you can visit the website at https://www.joinyellowbrick.com (if you are a premium member, make sure to login so you get the most recent pitches).

If you have upgraded to premium and currently receive the morning email that is sent to free subscribers and don’t want to receive it any more since you are getting this email, just reply to this and let me know and I’ll take you off it.

Thanks for reading!

Connor (founder of Yellowbrick and CEO Watcher)

YB PORTFOLIO

The YB Tracking Portfolio copies the trades of the top 10 investors (based on the average returns of their previous stock pitches) in our database of 1,000+ investors.

*All investments in the YBR Portfolio will be for ~3% of the portfolio value

**I use Interactive Brokers (link) for the portfolio because it makes it easy to have multiple accounts for different strategies and allows you to trade international and OTC stocks. If you decide to open an account with them, use this link so they know I sent you.

YB PREMIUM SUBSCRIBERS ONLY

The YB Portfolio is starting with $10,000. I hope to add (much) more in the future if returns are good.

New Purchase

No new purchase today.

Current Holdings

The 21 holdings are:

$REVG - purchased at $25.25
$CARD.L - purchased at GBX 104.80
$CVE - purchased at $20.88
$AMRK - purchased at $38.35
$TSSI - purchased at $1.44
$CRH - purchased at $81.71
$EHAB - purchased at $8.44
$JOE - purchased at $58.30
$TDW - purchased at $106.32
$INBX - purchased at $34.69
$VAL - purchased at $76.21
$SWI - purchased at $11.69
$RTO - purchased at $26.06
$RCM - purchased at $12.60
$DUR.AX - purchased at AUD 1.12
$PAR - purchased at $48.50
$KITW.L - purchased at GBX 364.55
$IMXI - purchased at $20.81
$ALTG - purchased at $8.91
$IBIO - purchased at $2.46
$GENI - purchased at $5.20

Portfolio Returns

Top Investors

You can see the list of the top 10 investors here (you may need to log in to see it).

A COUPLE OF THE MOST INTERESTING NEW PITCHES

Company: Gaming Innovation Group Inc. ($GIGSEK.ST)
Author: The Asymmetrical Edge (Blog)
Sentiment: bullish
Category: Special_situation
Market Cap: NOK 366.26M
Given Upside: N/A
GIGSEK: Undervalued iGaming affiliate marketing biz; 45% EBITDA margins, 37% rev CAGR since '20. Platform spin-off in Q3 '24 unlocks value. Forecasting 41% IRR over 4yrs (20% organic growth, 50% margins). 20%+ insider buys, strong SEO, paid ads and publishing. Risks: regulation, algorithms, debt. (link)

Company: Vanda Pharmaceuticals Inc. ($VNDA)
Author: Clark Street Value (Blog)
Sentiment: bullish
Category: Special_situation
Market Cap: USD 348.61M
Given Upside: N/A
VNDA: Biopharma w/ commercial & late-stage drugs. $5.40/sh cash after liabilities. Rejected Future Pak's $7.25-$7.75/sh + CVR bid as undervaluing co. Cycle offered $8/sh cash, no CVR. Entrenched mgmt may block sale. Potential higher bids or CEO-led buyout. Small position. (link)

Company: GreenFirst Forest Products Inc. ($GFP.TO)
Author: @BuyCheapNPray (Twitter)
Author Avg Returns: N/A
Sentiment: bullish
Category: Turnaround
Market Cap: CAD 68.37M
Given Upside: N/A
GFP.TO: Lumber play near cyclical lows at 40% of book. Dilution risk, but 71M working capital (102M inventory, 32M receivables) vs 1.49M cash provides cushion. Ignore mgmt, focus on cycle. Buy when earnings dry up, cash burns, and dilution spikes. Patience is key. (link)

PITCHES FROM TOP INVESTORS

This section contains the new stock pitches from investors who averages at least 20% returns on every stock pitch in my database

YB PREMIUM SUBSCRIBERS ONLY

Company: Vanda Pharmaceuticals Inc. ($VNDA)
Author: Clark Street Value (Blog)
Author Avg Returns: 53% (113 pitches)
Sentiment: bullish
Category: Special_situation
Market Cap: USD 348.61M
Given Upside: N/A
VNDA: Biopharma w/ commercial & late-stage drugs. $5.40/sh cash after liabilities. Rejected Future Pak's $7.25-$7.75/sh + CVR bid as undervaluing co. Cycle offered $8/sh cash, no CVR. Entrenched mgmt may block sale. Potential higher bids or CEO-led buyout. Small position. (link)

Company: ADF Group Inc. ($DRX.TO)
Author: ToffCap (Twitter)
Author Avg Returns: 29% (46 pitches)
Sentiment: bullish
Category: Growth
Market Cap: CAD 669.12M
Given Upside: 169%
DRX.TO: Q1 revenues $107M (+34% YoY), gross margins expanded to 29.2% (from 16.8%), $23.1M EBITDA (+130% YoY), $15.3M net income (+184% YoY). Order book at $517M. Plans to repurchase up to 9.2% of shares. Valuation remains low despite strong results, indicating 80-150% upside potential. (link)

ALL NEW PITCHES

YBR PREMIUM SUBSCRIBERS ONLY

Click here for a simplified Google Sheet of all of the stock pitches from these emails

Consumer

Company: Monro, Inc. ($MNRO)
Author: Pernas Research (Blog)
Author Avg Returns: 32% (39 pitches)
Sentiment: neutral
Category: Turnaround
Market Cap: USD 743.72M
Given Upside: N/A
MNRO: Auto service provider w/ 1300+ stores. Shares at 14yr low on recession fears & EV threat. New CEO closing/fixing 300 underperforming stores, focusing on profitability & capital allocation via debt paydown & shareholder returns. Believe EV impact overblown. 9x EV/EBITDA. (link)

Company: Lowe's Companies, Inc. ($LOW)
Author: Compounding Dividends (Blog)
Author Avg Returns: N/A
Sentiment: bullish
Category: Dividend
Market Cap: USD 124.42B
Given Upside: N/A
LOW: 2nd largest home improvement retailer w/ 29yr dividend growth streak. 2% yield, 35% payout ratio. Trades at 17x PE, in line w/ 5yr avg. Pros: economies of scale, 'Total Home Strategy'. Risks: only US exposure. Insiders own just 0.1%. (link)

Company: McCormick & Company, Incorporated ($MKC)
Author: Ave Maria Growth Fund (Fund letter)
Author Avg Returns: 8% (6 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 18.41B
Given Upside: N/A
MKC: Dominant spice maker benefiting from diverse cuisine demand & from-scratch cooking trend. Cholula hot sauce a hit with younger consumers. Simplifies complex inventory for customers, enabling extraordinary returns on capital. Well-positioned for long-term growth. (link)

Company: Campbell Soup Company ($CPB)
Author: Erin Lash (Analyst)
Author Avg Returns: N/A (4 pitches)
Sentiment: bullish
Category: Value
Market Cap: USD 12.87B
Given Upside: 42%
CPB $61 PT: Sovos buy boosts mix. Flat Q3 org sales but vol. improving. Adj GM +30bps as savings offset inflation. Investing in innovation vs promos. Bears say costs may crimp margins & PL rivalry risk vol/price. Wide moat: 60% soup share, strong brands (41% pretzel share), 5% of sales to R&D/mktg. Cost edge: 27% direct margin vs 25% peer med. Sees 1-2% meals & 2-3% snacks LT org growth, 17%+ op margin. M&A focus on insights. Div growth, buybacks seen. (link)

Company: XPEL, Inc. ($XPEL)
Author: Ave Maria Growth Fund (Fund letter)
Author Avg Returns: 8% (6 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 1.09B
Given Upside: N/A
XPEL: PPF maker grew rev 100x in 15yrs, huge runway ahead. Low single-digit penetration of new cars, most consumers unaware of PPF. Content/car to grow as more of car covered & new higher-priced products like matte PPF can change car look dramatically. (link)

Company: Gaming Innovation Group Inc. ($GIGSEK.ST)
Author: The Asymmetrical Edge (Blog)
Author Avg Returns: 17% (2 pitches)
Sentiment: bullish
Category: Special_situation
Market Cap: NOK 366.26M
Given Upside: N/A
GIGSEK: Undervalued iGaming affiliate marketing biz; 45% EBITDA margins, 37% rev CAGR since '20. Platform spin-off in Q3 '24 unlocks value. Forecasting 41% IRR over 4yrs (20% organic growth, 50% margins). 20%+ insider buys, strong SEO, paid ads and publishing. Risks: regulation, algorithms, debt. (link)

Company: Target Hospitality Corp. ($TH)
Author: Acid Investments (Blog)
Author Avg Returns: 9% (5 pitches)
Sentiment: bullish
Category: Special_situation
Market Cap: USD 721.49M
Given Upside: N/A
TH plunged 30%+ as Biden plans to close its largest ICE facility, putting 72% of revenue at risk. But cheap at 4.8x EBITDA ex-Dilley, 64% owner TDR may still take private at $10.80 (7x). Facility repurposing & new contracts offer upside. CXW/GEO comps 7-7.5x despite lower margins & more debt. Panic selling creates opportunity. (link)

Company: Landsea Homes Corporation ($LSEA)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Special_situation
Market Cap: USD 345.02M
Given Upside: N/A
LSEA: Undervalued homebuilder focusing on entry-level homes. Reduced Chinese ownership to <50%, enabling debt refinancing on better terms. Quality management, homes, demand in target markets. Recent strategic Texas acquisition. Significant growth potential. (link)

Energy / Utilties

N/A

Financials

Company: Mr. Cooper Group Inc. ($COOP)
Author: sirisaiah623 (VIC)
Author Avg Returns: N/A
Sentiment: bullish
Category: Growth
Market Cap: USD 5.24B
Given Upside: 105%
COOP: Largest non-bank mortgage servicer. Grows servicing portfolio (+14% CAGR to $1.1T) via subservicing, origination, bulk MSR buys & correspondent channel. Naturally hedged biz: servicing fees in high rates, gain on sale in low rates, 70-80% refi recapture. 26% TBV/sh CAGR since 2018. Scale tech advantages drive industry-low servicing costs (33-50% < banks). Bulk MSR spreads near '08 highs as banks sell. $138-172 PT for 23.5% base IRR. Key risks: rate volatility, liquidity for servicing advances. (link)

Company: GCM Grosvenor Inc. ($GCMG)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 430.29M
Given Upside: N/A
GCMG: Alt asset mgr focused on PE, infra & credit. Institutional demand for PE accelerating. Earnings up since IPO, but stock cheaper now vs our 2020 purchase. Bought back in Q1 as attractive re-entry point. (link)

Company: Affinity Bancshares, Inc. ($AFBI)
Author: Special Situation Investments (Twitter)
Author Avg Returns: 4% (3 pitches)
Sentiment: bullish
Category: Special_situation
Market Cap: USD 132.31M
Given Upside: N/A
AFBI acquired by credit union for $22.50/share, 9% spread. Closing Q4'24, no regulatory or shareholder approval risks expected due to small size and no regional overlap. Trades at 22x LTM P/E and 1x TBV. Prolonged timeline main reason for spread, could be cash placeholder alongside similar deals. (link)

Company: SoFi Technologies, Inc. ($SOFI)
Author: Data Driven Investing (Blog)
Author Avg Returns: -4% (3 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 7.40B
Given Upside: 182%
SOFI: Analysis shows potential to hit $0.55-$0.80 2026 EPS guidance (vs $0.44 consensus) if 1) Lending, tech, finserv margins stay on track 2) Revs reaccelerate to 30% in 2025-26 3) Other costs contained to +10%/yr. Bullish case $0.93 EPS possible w/ new products. Risks: Macro, execution. (link)

Health Care

Industrials

Company: Franklin Covey Co. ($FC)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Value
Market Cap: USD 464.97M
Given Upside: N/A
FC: Provides training & products to improve effectiveness. '7 Habits' line & 'All Access Pass' subscription model driving success. Stock cheap based on strong cash flows & predictable bookings. Recession-resistant due to efficient online delivery & businesses prioritizing people investment. Buybacks show management confidence. (link)

Company: Wabash National Corporation ($WNC)
Author: TBH Micro Cap Strategy (Fund letter)
Author Avg Returns: N/A
Sentiment: bullish
Category: Growth
Market Cap: USD 928.37M
Given Upside: N/A
WNC: Leading trailer maker benefiting from stricter fuel standards. Innovative materials like DuraPlate & Econex boost efficiency. Recurring rev via 'Trailers as a Service' subscription model for parts & services. Domestic reshoring trend driving demand for efficient, sustainable transportation. (link)

Company: The GEO Group, Inc. ($GEO)
Author: Chalkbaggery (VIC)
Author Avg Returns: -12% (2 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 1.82B
Given Upside: 126%
GEO: Pivoting from 'prison operator' to 'diversified gov't services biz.' BI Inc e-monitoring segment (35-37% of NOI) enables immigration crisis mgmt. Base case: 20% 3-4yr IRR from deleveraging + buybacks. Bull case: 10-50% FCF accretion from e-monitoring growth (184K users now vs 6.2M non-detained aliens) + 15K to 20K+ ICE detention beds. 98% renewal rate, <3.5x leverage. Founder bought 50K shrs in Mar. $30/sh NAV est. Catalyst: Buybacks, dividend, ICE funding. (link)

Company: Elopak ASA ($ELO.OL)
Author: Heritage in Actions (Blog)
Author Avg Returns: -2% (7 pitches)
Sentiment: bullish
Category: Growth
Market Cap: NOK 815.16M
Given Upside: -6%
ELO.OL: Elopak, packaging co. Bricks for food & non-food. Wood fiber main material. Q1 strong: rev growth, record margins. US growth +13% '23, new AR plant '25. MENA region booming. Debt ratio improving. ROE 22%, ROCE 17%. Ferd AS 52% owner. CEO ex-Tetra Pak. Peers: Tetra Pak, SIG, Greatview. Trades at P/E 12x, P/FCF 9x. Green bonds issued. PT: NOK 33 for 15x P/E. Uptrend since Nov '23. Risks: material prices, debt. (link)

Company: Aris Water Solutions, Inc. ($ARIS)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 455.16M
Given Upside: N/A
ARIS: Oilfield water mgmt firm. New pipelines boost recycling, slashing E&P costs. Q4 results hit by weather delays, but Q1 saw 52-wk high on strong earnings, lower capex & higher cash flow guidance, validating long-term outlook. Largest TX drilling cost is water. (link)

Materials

Company: Aspen Aerogels, Inc. ($ASPN)
Author: Pernas Research (Blog)
Author Avg Returns: 32% (39 pitches)
Sentiment: neutral
Category: Growth
Market Cap: USD 2.23B
Given Upside: N/A
ASPN: Aerogel insulation maker up 5x on potential EV battery use case. Trading at rich 6x sales despite competitive industry & nascent EV biz. Investors betting on sustained aerogel adoption in EVs & ASPN's ability to beat rivals. Mrkt cap $2.36B at $30.50/share. (link)

Real Estate

N/A

Technology / Media / Telecom

Company: Oracle Corporation ($ORCL)
Author: Long-term Investing (Blog)
Author Avg Returns: 16% (6 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 340.49B
Given Upside: N/A
ORCL Q4: Cloud rev +20.5% YoY, RPO +44% to $98B on huge AI/cloud demand. 30+ AI deals worth $12B+. OCI seen as faster, cheaper, more secure vs rivals. Cloud margins expanding. FY25 guidance: double-digit rev growth, cloud infra +50%+. Partnering MSFT, GOOG for hybrid cloud. Appealing for cost, flexibility, security. Debt high but cash flow to improve. Raising portfolio allocation from 2% to 3% on strong results. (link)

Company: Lantronix, Inc. ($LTRX)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Value
Market Cap: USD 139.80M
Given Upside: N/A
LTRX: Revenues & earnings up modestly but missed expectations, causing shares to plummet. Still held due to attractive valuation after decline. Provides integrated software, SaaS management, edge computing, sensors & trackers. (link)

Company: Silicon Motion Technology Corporation ($SIMO)
Author: Ave Maria Growth Fund (Fund letter)
Author Avg Returns: 8% (6 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 2.80B
Given Upside: N/A
SIMO: Fabless semi co specializing in low-end flash memory controllers. Rising chip dev costs driving memory makers to outsource commodity controller dev to SIMO. New enterprise controller to capitalize on outsourcing trend expanding from consumer to server markets. (link)

Company: Luna Innovations Incorporated ($LUNA)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: N/A
Market Cap: USD 129.42M
Given Upside: N/A
LUNA: Optoelectronics & fiber-optic test products for telecom, sensors for aero/auto. Down on accounting mistake re: US vs intl revenue recognition timing, isolated incident not affecting cash flows. Bought more on weakness with new CFO in place. (link)

Company: Gamma Communications plc ($GAMA.L)
Author: Robin’s Substack SME (Blog)
Author Avg Returns: N/A
Sentiment: bullish
Category: Growth
Market Cap: GBP 1.39B
Given Upside: N/A
GAMA.L: UK/EU cloud comms provider w/ strong FCF, 13% YoY growth (90% recurring rev). Expanding in UCaaS mkt (14.5% CAGR to '32) via M&A, organic growth. 30% ROCE, resilient in downturns. Risks: Regs, M&A, low mgmt ownership. Potential: Market tailwinds, margin expansion, buybacks. (link)

Company: Smartsheet Inc. ($SMAR)
Author: Emma Williams (Analyst)
Author Avg Returns: -1% (5 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 6.09B
Given Upside: 38%
SMAR: Smartsheet raised to $60 PT on strong Q1; enterprise momentum driving 20% rev growth, 26% increase in $100K+ ARR customers, net retention 114%+ (120% for enterprise). Expanding margins (16% vs 10% LY) on larger base. Freemium model & functionality fueling paid user growth. Competitive but switching costs high. Very high uncertainty rating but exemplary capital allocation. Trades at 43x FY25 P/E, 7x EV/S. (link)

Company: Hewlett Packard Enterprise Company ($HPE)
Author: James Kelleher (Analyst)
Author Avg Returns: N/A (9 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 26.72B
Given Upside: 24%
HPE: ARGUS upgrades to BUY on strong AI positioning across ISS/GPU servers, Cray supercomputers, Greenlake cloud, & NVDA partnership. Q2 beat, raised FY24 guidance on AI momentum despite overall earnings decline. $4.6B AI orders, expanding margins, and Juniper acquisition to fuel growth. $26 PT reflects cheap valuation vs rejuvenation potential from AI exposure. (link)

Company: GitLab Inc. ($GTLB)
Author: @BigBullCap (Analyst)
Author Avg Returns: 7% (43 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 6.93B
Given Upside: 72%
GTLB: GitLab deepens Google partnership, integrating workflows for better dev visibility on GCP without leaving platform. Validates disruptive DevSecOps platform, should drive adoption with GCP users. Increases conviction in share gains in attractive DevSecOps market. BofA Buy PT $80 (link)

Company: Rubrik, Inc. ($RBRK)
Author: @BigBullCap (Analyst)
Author Avg Returns: 7% (43 pitches)
Sentiment: bullish
Category: Growth
Market Cap: N/A
Given Upside: 46%
RBRK impresses in public debut: 38% YoY rev growth, 45%+ YoY sub ARR (Cloud +100% YoY), narrowing losses. Q2/FY guide ahead. Citi reaffirms Buy, ups PT to $47 on 9-10x target multiple. Room for continued beats given conservative guide (raise < beat). Cloud and large deals picking up. (link)

Company: Klaviyo, Inc. ($KVYO)
Author: @BigBullCap (Analyst)
Author Avg Returns: 7% (43 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 5.97B
Given Upside: 23%
KVYO: Fastest grower in Barclays software coverage at 25% CY25E YoY, trades in line with SaaS at 5x EV/CY25 sales despite growth. Klaviyo seen trading at steep discount to peers, with room to rerate to 8x sales. Barclays upgrades to Overweight with $29 PT on 7x EV/CY25 sales. (link)

Company: Thoughtworks Holding, Inc. ($TWKS)
Author: Pernas Research (Blog)
Author Avg Returns: 32% (39 pitches)
Sentiment: neutral
Category: Value
Market Cap: USD 933.22M
Given Upside: N/A
TWKS: High-end tech consulting firm down 90% since '21 IPO. Agile digital transformation & AI services in demand, but Q1 rev -19% YoY as quality erodes with scale & competition intensifies. Strong brand but premium pricing at risk in current environment. Mkt cap $912M, EV/EBITDA 56x. (link)

Company: BigCommerce Holdings, Inc. ($BIGC)
Author: Wasatch Global Investors Micro Cap Value Strategy (Fund letter)
Author Avg Returns: N/A (7 pitches)
Sentiment: bullish
Category: Growth
Market Cap: USD 623.61M
Given Upside: N/A
BIGC: Shift to large enterprise e-commerce accounts for long-term growth. Workforce cuts to accelerate profitability. Strong competitive position with best-of-breed solution. Q1 underperformed on conservative 2024 revenue guidance, but mgmt likely underpromising to overdeliver later. (link)