YB new stock pitches (Thu, Mar 26)

GRDN: Long-Term Care pharmacy focused on Assisted Living Facilities w/ 14-15% mkt share, ~50 facilities. HSD% organic growth (aging demo, share from struggling mom+pops & bankrupt Omnicare) + MSD-HSD% M&A growth. Margin expansion to 10% from 8.6% as recent acquired/opened facilities (20% of base) ramp. Sticky, capital-light biz: >$120M EBITDA on $55M net PP&E. Decentralized model drives retention. Omnicare bankruptcy = major upside catalyst via cheap M&A or organic growth from closures. EPS growth 20-25%+ as leverage over D&A, buybacks. At 25x FY26 P/E (~$31), expect TSR ~20-25% over 5-10yr. IRA Part D concerns now resolved.

Read the full article here. Read time: 28 min

NOMD: Europe's largest frozen food co (Birds Eye, iglo, Findus) trading at decade-low valuation despite 8.8% FCF yield & 6.8% dividend yield. 2025 margins compressed 250bps on supply chain inflation; price negotiations underway to restore historical 7%+ margins. Management buying shares aggressively: retired 26.7% since 2019, another 10.7% potential by YE26. 18.3% insider ownership. €200M efficiency program to fund innovation & marketing to reclaim 190bps lost to private label. DCF fair value $18.23 (10% DR) vs ~$9.69 today.

Read the full article here. Read time: 12 min

KBR has transformed from low-margin EPC work into a higher-quality services and technology provider split between Mission Technology Solutions (MTS, ~55% EBITDA) focused on government services with an ~$13.5 billion backlog and 8-10 year contract durations, and Sustainable Technology Solutions (STS, ~45% EBITDA) featuring 80+ licensed process technologies in ammonia, fertilizer, petrochemicals, and LNG. Trading at approximately 8x consolidated EBITDA versus peers at 11-13x, the stock faces CY25 headwinds including the June 2025 termination of the $20 billion Homesafe contract (72% KBR stake), the prior administration's LNG ban causing project cancellations, reduced LOGCAP activity in Europe/Ukraine, NASA budget cuts, DOGE initiatives, and government shutdown impacts, which should begin lapping in mid-CY26. MTS targets 5-8% long-term organic growth supported by a neutral-to-slightly-positive CY26 budget environment and a proposed $1.5 trillion Trump budget (50%+ increase year-over-year), while STS has grown at approximately 26% CAGR since CY22 despite the Plaquemines LNG rolloff, with management previously securing Lake Charles LNG as replacement before Energy Transfer shelved it in December 2025. The September 2025 announced mid-2026 spin of MTS should unlock value through reduced conglomerate discount, with relevant comps (SAIC, CACI, VVX, AMTM) trading at 11x CY26 EBITDA for MTS and engineering/technical services peers (J, FLR, ACM, TTEK) at 13x for STS. A sum-of-the-parts analysis applying a combined 12x EBITDA multiple suggests material upside by CY28, assuming Plaquemines fully rolls off by end-CY27 without replacement (resulting in low-single-digit negative CY27 STS EBITDA growth and low-single-digit positive CY28 growth), while strong free cash flow generation and aggressive buybacks limit downside. Risks include persistent MTS budgetary issues delaying return to growth, Homesafe-related reputational damage, inability to replace Plaquemines EBITDA causing negative revisions, and tax-free spin execution challenges, with catalysts being earnings and the spin completion.

Read the full article here. Read time: 5 min