YB new stock pitches (Mon, Jun 23)

Madison Square Garden Sports Corp. (MSGS) owns the New York Knicks (NBA) and New York Rangers (NHL), trading at a 55% discount to intrinsic value ($185 vs. $416 based on Sportico's $11.5B team valuation). The stock is down 17% partly due to a reset of regional sports network rights fees, with reductions of 28% for the Knicks and 18% for the Rangers, though these cuts were less severe than analyst estimates of up to 50%. Local media rights represent only about 15% of revenue, with national media rights being more critical for growth—the NBA recently signed an 11-year, $76B deal with Disney, NBC, and Amazon. Season ticket prices have increased 17% for 2025/2026, which should help mitigate the impact of the RSN reset. The recent Boston Celtics sale for a record $6.1B provides a positive valuation benchmark, especially significant as the Celtics lack the real estate and media advantages of MSGS. Despite the attractive valuation (4.6x 2026 estimated revenue versus 8-10x typical for team sales), the primary concern is the lack of a near-term catalyst, as James Dolan shows no indication of selling soon, though the company has made some shareholder-friendly moves including a 7% special dividend and $75M share repurchase in 2022.

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Bekaert (BEKB.BR) is a European industrial wire manufacturer trading at just 7.2x P/E with a 5.7% dividend yield and 5.5% buyback yield. Under new management since 2019 led by Chairman Jürgen Tinggren, the company has shifted focus to higher-growth, higher-margin segments and improved capital allocation, maintaining an 8.8% EBIT margin despite an 8.6% revenue decline to €4.0 billion in 2024. The company boasts a strong balance sheet with 0.54x leverage (€283M net debt), allowing flexibility for potential M&A while continuing shareholder returns. Upside catalysts include organic growth from end-market recovery, accretive acquisitions, and multiple expansion as the market recognizes structural improvements in margins and returns. Risks include ongoing restructuring costs, tariff uncertainty (though mitigated by 70% local US production), and lingering skepticism about sustaining margins through cyclical downturns. Management's 2026 targets include achieving 10% EBIT margins and improved growth, with the company strategically divesting low-margin assets while focusing on mobility, energy transition, and green construction markets.

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Forvia SE, the world's 7th largest auto parts supplier trading at historic lows (€8/share), is significantly undervalued as the market ignores that its 82% stake in Hella is worth more than Forvia's entire valuation. Despite concerns about struggling automotive clients, clean mobility division's decline, and debt (>2x EBITDA), Forvia has strong counterpoints: global leadership across segments, outpacing global vehicle production growth (2.8% vs -1% since 2017), 25% sales from Asia, and agreements with emerging Chinese OEMs like BYD. The company's portfolio is largely neutral or positive to electrification trends (85% of revenue), and its EU-FORWARD restructuring program is cutting 5,600 jobs (4% of workforce) for €500M annual savings by 2026. With no significant debt maturities until 2027 and projected growth to €30B revenue and €1.7B EBIT (6% margin) by 2029, a conservative 7.5x EV/EBIT multiple yields a target price of €17/share, offering a 20%+ IRR in the base case scenario.

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