YB new stock pitches (Thu, Sep 17)

Dingdong is an event-driven long at $2.14, with an estimated 46% gap to the weighted deal value. Meituan agreed to pay $717M for Dingdong’s China operations, compared with the company’s $506M market capitalization; Dingdong also previously received a $157M transfer financed by a short-term subsidiary bank loan. The company may extract up to another $280M from Dingdong BVI and its subsidiaries, provided at least $150M of net cash remains. Dingdong intends to use at least 90% of its post-closing cash, after costs and payables, for dividends and/or repurchases. Shareholders have approved the transaction, with founder Liang Changlin controlling 81% of voting rights but 25% of economic rights. SAMR approval is the remaining central condition; the case is that consolidation supports the regulator’s stated effort to curb destructive competition. If Meituan walks, it owes $150M; if regulators block the deal, it owes $75M, while Dingdong owes $75M if it terminates. The main risk is timing: approval could come quickly or take a year, reducing the prospective IRR.

Read the full article here. Read time: 4 min

Zentek’s investment case is principally Albany, a PEA-stage Ontario deposit designed to supply ultra-high-purity graphite for nuclear, defence and semiconductor applications rather than commodity markets. Bench-scale acid-free purification achieved 5N+ carbon purity and 2.60 ppm equivalent boron, within the cited nuclear-grade threshold. The August 2026 PEA estimates a US$3.85B after-tax NPV5%, US$2.29B NPV8%, 27.4% IRR and 4.4-year payback, based on a US$23,485/t realized price and US$817M initial capex. More than US$140M of disclosed graphite contracts for X-energy’s first four-reactor plant illustrates spending on qualified specialty graphite, though those contracts cover synthetic material and are not direct pricing evidence for Albany. At C$0.72, enterprise value is roughly US$55M, or 0.03x NPV8%; applying 0.1x P/NAV to Albany and US$10M to revenue-generating ZenGUARD yields a C$2.70 target and 275% upside. The central risks are that Albany remains preliminary, has no qualified customer or offtake, depends heavily on contract pricing, and will require substantial external financing.

Read the full article here. Read time: 39 min

Sportsman’s Warehouse offers asymmetric turnaround value at $1.16, with an estimated $1 orderly-liquidation value limiting downside to 17% and a $4.92 target implying roughly 300% upside. Bankruptcy appears avoidable: the asset-backed facilities have no major covenants beyond maintaining 10% availability on the borrowing base, current availability is $73M before breaching that threshold, supplier terms remain steady, and debt maturities extend to 2031. Inventory has been rightsized, camping and apparel sell-downs are complete, in-stock levels have improved from 50% to 80%, and same-store sales have turned positive, driven by hunting and shooting. The first path back to normalized earnings is recovery in gun and ammunition demand from historic lows; the second is better bundling and loyalty programs, supplemented by improved inventory. At 140 stores, estimated normalized EBITDA is $75M and unlevered FCF is $50M. The biggest risk is that customers increasingly buy only low-margin firearms and ammunition in stores while purchasing higher-margin accessories elsewhere, weakening the historical traffic-and-bundling model.

Read the full article here. Read time: 6 min