YB new stock pitches (Thu, Oct 23)

NextNav Inc. (NN) is a wireless spectrum and alternative GPS investment where the thesis centers on the FCC approving the repurposing of NextNav's existing spectrum for 5G wireless communications that would also provide a terrestrial backup GPS system, which the U.S. desperately needs. Positive developments include FCC Chairman Brendan Carr highlighting the need for GPS backup, NextNav management holding ex parte meetings with FCC members responsible for drafting the Notice of Proposed Rulemaking (the next approval step), and the company moving long-term CFO Chris Gates into a corporate development role signaling imminent FCC approval expectations. The AT&T/DISH spectrum deal suggests approximately $2.50 per MHz/pop value, which would imply a NextNav stock price approaching $60 per share compared to current levels. However, short-term negatives included government shutdown fears (erroneously assumed to delay the FCC process) and forced selling pressure from an estate that received shares as payment for spectrum licenses sold to NextNav, causing the stock to decline approximately 20% from intra-quarter highs to quarter end. The main risk is uncertainty around spectrum monetization, though the clear long-term positives outweigh the meaningless short-term negatives.

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Aclara Resources Inc. (ARA.TO/ARAAF) is a pre-production Chilean exploration company with an estimated $13-15 billion rock value from 254,000 tonnes TREO at its flagship Penco Module, targeting heavy rare earth elements (dysprosium and terbium) through environmentally-friendly ionic clay mining that requires less intensive chemical usage and produces no radioactive discharge, unlike conventional hard rock mining. The company's ionic clay deposits complement rather than compete directly with MP Materials' light rare earth production, as Aclara focuses on scarce heavy rare earths critical for high-grade magnets and green technologies while MP dominates in neodymium and praseodymium production from its $90-100+ billion rock value Mountain Pass operation that produces radioactive byproducts including thorium. Despite MP's deposit being roughly an order of magnitude larger by tonnage, MP's $14 billion market capitalization is 28 times higher than Aclara's $500 million valuation, creating a theoretical 4x valuation gap that could narrow through relative valuation increases or potential acquisition, making ARAAF an attractive speculative position on the rare earths theme for investors seeking exposure to complementary heavy rare earth supply outside of China.

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Kraken Robotics (PNG.V), a Canadian subsea drone company trading at $4.15 USD with a $1.26 billion USD market cap, has established a virtual monopoly on advanced SeaPower batteries that power Anduril's autonomous submarines, including the Dive-LD ($1-2M CAD content per unit) and Dive-XL ($8-10M CAD content per unit). The company benefits from vendor lock-in due to NAVSEA certification requirements and 18-24 month switching costs, while competitors lack necessary certifications or rely on Chinese materials unacceptable to defense contractors. Kraken has tripled revenue over the past two years and projects $130M CAD revenue for 2025, targeting $1B CAD by 2027/2028 as Anduril ramps production at its new Rhode Island factory with 200-unit annual capacity. Key catalysts include the US Navy's 'maximum readiness by 2027' goal driving procurement surges, Anduril's $1.12B Australian GhostShark order, expected major US Navy contracts, potential Taiwan orders, and another major customer announcement before year-end, plus planned uplistings to Toronto Stock Exchange and eventually NASDAQ/NYSE by H2 2026. The bull case centers on China's 200-300x shipbuilding capacity advantage over the US creating urgent demand for economically asymmetric subsea drones, with Kraken's 55% gross margins reflecting its dominant market position. Trading at 14x sales compared to the predicted 10x sales target valuation, the stock represents a potential 10x return over 3-5 years, though risks include dependence on Anduril's success, geopolitical tensions with Taiwan, and execution challenges in scaling production to meet projected revenue targets.

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