YB new stock pitches (Thu, Feb 5)

Kopin Corporation (KOPN) is a U.S. defense contractor that has established a monopoly position in domestic microdisplay technology after Samsung's acquisition of rival eMagin left the DoD with only one independent American supplier. The company has transformed from a commodity chip manufacturer to a high-margin system integrator, moving from $500 components to $5,000 integrated modules while securing an $15.4 million DoD award for MicroLED production targeting the $22 billion Soldier-Borne Mission Command program. Kopin's breakthrough technology solves the critical sunlight readability problem with millions of nits brightness levels and reduces soldier fatigue through its NeuralDisplay AI-embedded solution, while maintaining zero debt and operating under a Fab-Lite model with ITAR-compliant facilities. The company has forged strategic partnerships including Theon International for European/international markets through ITAR-free Scottish manufacturing, Unusual Machines for onshoring drone supply chains, and HMDmd/Zeiss for medical validation with potential for 3,000 surgical units annually starting 2026. With a $1.1 billion pipeline where 40% is tied to soldier-borne programs, 80% of 2026 backlog already secured, and $23 million in restricted cash serving as a potential catalyst from the BlueRadios appeal, the company trades at approximately $480 million market cap despite its monopolistic position in a digitizing battlefield where NATO allies require over 2 million night vision goggle retrofits and the U.S. Army targets one million drone acquisitions.

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Natural Resource Partners L.P. (NRP), a natural resource royalty partnership, was added to by the investor after trading from mid-$90s in May to around $115 currently, with performance matching the S&P 500 over this period. The company is targeting debt-free status by February earnings, having $31M cash and $70M debt as of Q3 2025, with Q4 2025 free cash flow estimated at ~$50M driven by metallurgical coal prices rising 9% quarter-over-quarter to around $200/ton. Management's mandate prioritizes distributing FCF to unitholders, then buybacks, then growth, with special distributions typically occurring in March (estimated at $1.25/unit this year bringing TTM distributions to $3.50 annualized for just over 3% yield). For 2026, the company is projected to generate $200M in FCF assuming met coal prices hold at $200/ton, enabling $130-150M in annual distributions (8-9% yield) after paying down remaining ~$35M debt, creating a sustainable $150M/year distribution run rate for 5-10 years. As distribution yields compress to 5-6% MLP levels due to market confidence in distribution durability, unit prices could reach $150-180 from the current ~$115 level, representing the price target with 57% upside potential.

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TOYO Co., Ltd. is a solar company with an enterprise value under $300M that the investor is taking a new position in, representing an asymmetric multi-bagger opportunity trading at 2x 2027 projected EPS of $3.61 versus the current $7-8 share price. The company is 82% insider-owned with under 20% float and has achieved 300% growth in 2024, with 2025 guidance projecting $375-400M revenue (+112-126% YoY) and $39-45M net income at a ~$235M market cap (5-6x P/E). TOYO's innovative supply chain strategy involves purchasing US polysilicon, processing it in Ethiopia using cheap hydro-power and labor, then assembling modules in Houston, Texas to qualify for Section 45X tax credits worth $0.07/watt through 2030, targeting the $30-40B US solar module market. The company scaled from shipping equal amounts in H1 2025 as all of 2024, acquired a Texas solar facility ramping from 1.5GW by 2026 to 6.5GW by 2029, and claims FEOC compliance for tax credit eligibility. Bull case targets 3-10x upside ($18-50/share) driven by tariff arbitrage durability, potential $175M+ annual Section 45X benefits by 2029, patent litigation resolution, and AI-driven energy demand, while bear case risks include JinkoSolar patent injunction blocking US TOPCon sales, Ethiopia losing tariff exemptions, IRA modifications eliminating Section 45X benefits, and module price collapse, with downside targets of $1.50-3.00/share. Key risks include the convoluted Cayman Island structure and FEOC compliance uncertainty, though recent dismissal of IP infringement cases should unlock $60M US revenues not yet priced in.

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