YB new stock pitches (Thu, Mar 12)

CLPT: MedTech enabling precise neuro drug delivery via MRI-guided surgery (patient asleep vs awake). 60+ pharma partners developing CNS therapies, 20+ indications. Recent IRRAS acquisition adds $500M cranial fluid mgmt market, expands sales team 40+. 2026 rev guide $54-60M (+54% YoY). Path to breakeven 2027. Mgmt targets $300M rev (20K procedures) mid-term, $500M long-term. Risks: UniQure AMT-130 approval uncertain post-FDA pushback, pre-commercial stage, dilution risk. Trading 8x 2026 rev.

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Lion Rock Group Limited (1127.HK), a founder-led vertically integrated global book printing and publishing platform specializing in illustrated, educational, and specialty titles, has demonstrated consistent financial performance with revenue growing at a 14.6% CAGR, EBITDA at 21.3% CAGR, and net income at 19.7% CAGR over 16 years, while maintaining EBITDA margins between 7-18% and an average net margin of 9%. The company, founded by Chairman Lau Chuk Kin who owns 48% through direct and indirect holdings, generates over €280 million in annual revenue with approximately 50% from the United States and 30% from Australia, operating printing facilities across Mainland China, Malaysia, Singapore, the UK, and Australia, along with a 49% stake in publisher The Quarto Group. Trading at an EV/EBITDA of 2.0x and P/E of 5.3x while offering an 8% dividend yield and over 12% free cash flow yield, the company maintains a strong net cash position of HK$180 million and net debt-to-EBITDA of -0.4x with HK$408 million in distributable reserves as of December 2024. The business benefits from focus on print formats resilient to digital substitution, vertical integration capturing value across the publishing supply chain, and strategic geographic diversification including Malaysian production capacity that mitigates U.S. tariff exposure on Chinese imports, which currently range from 7.5% for general books to over 30% for calendars and planners. Key risks include trade volatility from U.S.-China tariffs, currency fluctuations across multiple jurisdictions, ongoing digitalization pressures, input cost volatility particularly in paper prices which caused a 20% spike in 2017 leading to 10% revenue decline at 1010 Printing, logistics disruptions, and market consolidation among publishers. A DCF analysis assuming 7% EBIT margin, 0% terminal growth rate, and 14.3% WACC yields a price target of HK$4.12, while EV/EBITDA of 5.0x implies HK$3.66 and P/E of 10.0x implies HK$3.83, resulting in a blended fair value of HK$3.93 per share; applying a 10% margin of error produces a conservative price target of HK$3.54, representing 164% upside from current levels.

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ThredUp Inc. (TDUP) delivered an excellent third quarter with revenue up approximately 34% year over year, one of the fastest growth rates in its recent history, while adjusted EBITDA improved to $3.8 million (4.6% margin) from roughly breakeven last year and active buyers increased about 26% driven by strong new buyer acquisition. Management raised full year revenue guidance, signaling confidence in the outlook, and highlighted that new buyer growth accelerated to 81% year over year in October, up from 54% in Q3, following a rebrand and the launch of a new product recommendation feed in late September. Despite strengthening fundamentals, the stock has declined over the past five months, creating a dislocation between price and fundamentals that led the investor to add to the position, making ThredUp their largest holding.

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