YB new stock pitches (Thu, Jul 3)

EACO Corporation ($EACO) is an industrial distributor supplying critical small components to over 10,000 OEMs and manufacturers across the U.S. and Canada, acting as a logistics middleman by sourcing, kitting, packaging, and delivering specific parts. The company has grown revenues at 17% annually since 2015 through a simple but effective strategy of scaling its sales force, adding 31 new sales representatives in the first half of 2025 alone, which helped drive an 87.6% year-over-year increase in net income. A conservative DCF analysis using 13% revenue growth, 8.6% operating margins, and a 12% discount rate yields a fair value of $88.27 per share, representing 112% upside from the current $41.50 share price. While CEO Glen Ceiley owns 96% of the company's shares, he has proven to be an exceptional steward, guiding EACO to over 500% stock growth since 2010. The investment thesis rests on EACO's straightforward business model, strong operating leverage, and significant growth potential as it continues its proven strategy of hiring effective salespeople.

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Happy Belly Food Group Inc. (HBFG.CN) is a QSR franchise business with 50 locations currently (13 corporate-owned, 37 franchised) and 591 contractually committed franchises. Although currently unprofitable, the company is approaching breakeven with net income increasing nearly 100% QoQ. The royalty economics are compelling: $50,000 per franchise at 65% EBITDA margins, generating approximately $33,000 in EBITDA per franchisee to HBFG. Projecting 100 new franchises annually could yield 500 locations by 2029, potentially generating $17.5 million in EBITDA. At a conservative 25x EV/EBITDA multiple (significantly lower than peers like Sweet Greens at 92x, Cava at 80x, and Chipotle at 33x), the QSR segment alone could be worth approximately $450 million by 2029, about three times the current market capitalization. The company also has a Consumer Processed Goods (CPG) segment growing at 18% revenue CAGR over the last three years, adding further value. Confidence in execution comes from the CEO's track record of successfully scaling and exiting brands to MTY Foods and Fairfax.

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Grupa Pracuj (GPP.WA), trading at PLN 60 with a market cap of $1.1B, operates Poland's dominant job classifieds business (60% of revenue) and is expanding in Ukraine (20%), with additional HR SaaS offerings in Poland and Germany (27%). The company trades at just 9x 2026E EBITDA versus classifieds peers at 15-30x, offering an 8% FCF yield plus mid-teens growth potential for a 20%+ IRR. GPP is positioned to benefit from three major tailwinds: German fiscal stimulus, EU recovery funds flowing into Poland, and potential Ukraine war resolution. Recently, GPP increased its stake in Ukraine's #2 job portal (robota.ua) to 77% and acquired 53% of the #1 portal (work.ua), establishing dominance in a market with significant post-war growth potential. The company's online classifieds business enjoys strong network effects, high incremental margins (40-80% EBITDA), and pricing power. With a price target of PLN 130 (120% upside), GPP faces risks including low liquidity ($750k daily volume), macro uncertainties in core markets, founder control (CEO owns 52%), and currency exposure.

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