YB new stock pitches (Thu, Jun 18)

Tripadvisor ($TRIP) presents a sum-of-the-parts (SOTP) anomaly combined with an explosive short squeeze setup following its June 15, 2026 announcement to sell European restaurant reservation platform TheFork to American Express for $700 million in cash (deal expected to close before year-end 2026), which sent shares up over 14% to above $14.20 in pre-market trading. Once a dominant but declining hotel review portal pressured by Google competition, the company has pivoted toward on-site experiences and tours via its Viator subsidiary, which now accounts for nearly 50% of group sales and generates almost $1 billion in annual revenue. At the pre-deal price of ~$12.41 (market cap ~$1.44 billion), pro-forma calculations show ~$775 million cash (after April debt repayment) plus $700 million TheFork proceeds equals ~$1.475 billion gross liquidity, less ~$838 million remaining Term Loan B debt, yielding ~$637 million net liquidity; subtracting this from market cap implies the market values the combined hotel and high-growth Viator businesses at only ~$800 million, suggesting extreme undervaluation given Viator's pure-play growth multiple potential. The short squeeze case is built on short interest of up to 36.99% of outstanding shares (~27-29% of free float) with a 12-15 day days-to-cover ratio; short sellers had bet on a liquidity crisis and dilution from the $345.4 million convertible bonds maturing in 2026, but management eliminated this risk by paying the bonds fully in cash on April 1, 2026, and the TheFork proceeds further fortify the balance sheet, trapping shorts now deep in losses. The key catalyst is the Q2 results expected August 6, 2026, where management—pressured by activist Starboard Value on the board—may formally announce an aggressive share buyback program using the $700 million, shrinking the free float and potentially igniting a panicked short squeeze.

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SK Kaken (4628.T), a Japanese paint maker, currently trades at 10x earnings with a 2% dividend that has been rising amid Japan's shareholder pressure campaign, assumed to normalize to around 3%; combined with roughly 3% cash growth (earnings-driven cash pile discounted ~70%), this yields a low-downside ~6%/year expected return ('heads'). The blocker is founder/family control: Shikoku Kousan (四国興産有限会社, based in Takarazuka, Hyogo, established September 1, 1998, ~27.75 years old) owns 31.88%, while Fujii Minoru, Fujii Kunihiro, and Fujii Mitsuhiro own ~9.3%, totaling ~41% of the Fujii block (excluding treasury); the company also holds 2.18 million treasury shares (~13.9% of issued shares, no votes). SK Kaken itself was founded in 1955 and incorporated in 1958. The 'tails' catalyst is the passing of 93-year-old patriarch and founder Fujii Minoru (turning 94 on September 1, 2026), which could unlock a 15%+/year expected return. Assigning even 30% odds to 'tails' makes this a fantastic risk-adjusted bet, though the thesis would look far more questionable if the patriarch were even 10 years younger.

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Element Solutions ($ESI), trading near $44 with a ~$75 target over 12-18 months, is an AI consumables play mispriced as a chemicals company. ESI does ~$2.5 billion in revenue at a low-20s EBITDA margin, grows mid-to-high single digits, carries significant debt, and includes a sleepy business plating chrome onto car parts—earning it a chemicals multiple of ~18x EBITDA, making it the cheapest electronic-materials stock. The thesis hinges on the order of operations of the AI re-rate: it worked outward from Nvidia (two years ago), to tool makers (Applied, Lam), then this year to subsystem shops Ultra Clean (+230%/up 270% in 2026) and Ichor (+268%), which tripled once investors connected them to rising wafer volume. Element sells the plating, copper deposition, and solder chemistry consumed making chips, circuit boards, and advanced packages—the same volume driver one rung lower in the stack that hasn't yet re-rated because the ticker sits in chemicals coverage. The stock is already up ~80% over the past year, but the author argues that move simply turned a cheap stock into a fairly priced one and is fully justified by fundamentals; the upside is growth in the highest-margin segment, a re-rate to semiconductor-materials multiples, and a product launching this fall that is largely unmodeled. The bear/skeptic view is that ESI is just a slow-growing, debt-heavy chemicals name. The author is buying it as a core/multi-year position targeting ~$75.

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