YB new stock pitches (Thu, Oct 8)

Old Market Capital owns 80% of Amplex, a northwest Ohio rural fiber and fixed-wireless operator with 18,000 fiber passings, 6,300 fiber subscribers and 11,700 unsubscribed “dark” passings. At $3.82 per share, parent cash and intercompany receivables account for $1.19, leaving the fiber network valued at roughly $1,419 per passing versus $2,800-$4,700 in precedent transactions. The resulting SOTP is $7.12-$9.41 today and $7.94-$11.31 by year three; an April 2026 insider transaction implies $5.71 per OMCC share, while a stress case with no penetration gains and fixed wireless written to zero yields $6.36. Growth is supported by low-cost subscriber conversion and a 2%, 20-year USDA loan for expansion. A $7 million repurchase authorization remains unused, and a sale is considered the likeliest route to full value based on the parent’s overhead burden, though management has not indicated one. Key risks are nano-cap OTC liquidity, reduced disclosure after deregistration, uncertain derived financial estimates, and execution in converting passings and completing new builds.

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HgCapital Trust offers exposure to profitable, workflow-heavy software at 379p, a 27.8% discount to its 524.8p August NAV. The evidence still points more to multiple compression than earnings deterioration: H1 underlying trading added roughly £363m, or 11%, to portfolio value, while lower multiples removed about £426m, or 13%, and increased net debt subtracted another 2%. Portfolio EBITDA is growing 19%, organic revenue 11% and organic EBITDA 17%, with 34% margins. After adjusting the portfolio’s 22.9x EV/EBITDA for 6.9x net debt and HGT’s discount, the implied valuation is approximately 18.6x EV/EBITDA, although about 15% of the portfolio is excluded from this rough calculation. NAV credibility is supported by H1 full exits averaging 31% above carrying values and Quantios agreeing at the same uplift. The base scenario assumes EBITDA growth moderates to 15%, leverage gradually falls, multiples remain stable and the discount narrows somewhat. The main risk is the combination of disappointing growth, further software derating and still-high leverage; the next checkpoint is the 30 September portfolio valuation.

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doValue is priced as distressed despite guiding to roughly €300m of EBITDA and €90m of 2026 free cash flow excluding coeo, implying nearly a 30% free-cash-flow yield at the €1.65 share price. The legacy NPL-servicing business is shrinking but remains cash-generative and could benefit from a weaker credit environment, while coeo diversifies the group into digital consumer receivables and grew revenue 25% in H1 2026; analysts now expect about €85m of 2026 coeo EBITDA versus €60m assumed at acquisition. The central issue is deleveraging after net debt nearly doubled to €855m and leverage reached 3.1x. A planned receivables-portfolio sale that management values at €120–140m, plus annual debt repayment from cash flow, could lower net debt to about €570m by end-2028 and leverage toward 2x. Applying 6x to estimated 2028 EBITDA of €275m yields roughly €5.00 per share, about 3x the current price before dividends. The October 8 Capital Markets Day is the near-term catalyst. Key risks are another portfolio-sale delay, Greece’s proposed servicing restrictions, continued Italian contraction and coeo’s roughly 50% revenue exposure to Klarna.

Read the full article here. Read time: 10 min