YB new stock pitches (Tue, Dec 30)

Soleno Therapeutics (SLNO) is trading as the only FDA-approved treatment for hyperphagia in Prader-Willi Syndrome (PWS) with VYKAT XR, which demonstrated strong Q3 2025 launch results including $66 million revenue versus $46 million consensus estimates, 764 treated patients, and an 8% discontinuation rate within guidance. The drug targets 12,000-22,000 US PWS patients through ATP-sensitive potassium channel activation to quiet overactive hunger neurons, representing a significant improvement over legacy diazoxide suspension due to once-daily extended-release formulation with flatter pharmacokinetics that reduce peak-related side effects like edema (27% vs historical 40-50%) and hyperglycemia (17% vs placebo's 5%). Bull cases include weight-based dosing creating higher real-world revenues than consensus models assume (average 317mg daily dose), no meaningful competition until at least 2027 with Rhythm's setmelanotide facing mechanistic challenges and Aardvark's ARD-101 requiring Phase 3 proof, durable patent protection through 2035-2039 with method-of-use patents providing additional moat, and blockbuster potential with peak sales estimated at $3.2 billion by 2033. Bear cases and risks include safety concerns highlighted by Scorpion Capital's short report citing FAERS adverse events for edema and hyperglycemia (though these are disclosed in FDA labeling), potential competition from setmelanotide or other therapies, patent cliff risk in 2035, and the inherently small rare disease market limiting absolute scale. The company trades at a significant discount to the $130 DCF-based price target despite representing the standard of care for a severe, life-threatening condition with 3x higher mortality rates in PWS patients, suggesting the market has not fully valued the combination of monopolistic market position, weight-driven pricing power, and successful launch execution.

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NORMA Group SE (NOEJ.DE) is a German industrial company trading at a current market EV of €407m that presents a classic sum-of-the-parts opportunity where the market's focus on the cyclical automotive-exposed Mobility segment overlooks significant hidden value. The company recently sold its highly valuable Water Management division (NDS) for $1bn, which alone was worth €840m compared to the entire company's €407m valuation, while the remaining Mobility and Industry segments are valued at €216m and €246m respectively, creating an implied total EV of €1,302m versus the current €407m market valuation. The Water Management unit sale provides cash for debt reduction and significant share buybacks of approximately 17 million shares, with activist investor Teleios holding a 21% stake pushing for change. Despite recent declining performance with -6.7% LTM growth and declining margins, the company trades at €15.00 per share with a target price of €23.8, representing 59% upside potential. Key risks include execution risk in deploying proceeds from the asset sale, cyclical downturn impacting the remaining Mobility and Industry segments, and poor execution on potential future M&A, while catalysts include the realized Water segment disposal and potential margin recovery in the core industrial business.

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Mobilicom Limited (MOB) is a Nasdaq-listed Israeli drone datalink company producing datalinks for small drones and loitering munitions, serving Tier-1 defense customers like Teledyne, with current low single-digit million USD revenues and an $80 million market cap. The company is transitioning from prototypes to serial production and long-term Programs of Record (POR), with 2026 expected to be an inflection year when management targets break-even, and according to the CEO, a single POR could generate $20 million+ in revenue versus the current $80 million market cap. From 2027 onward, Mobilicom aims to generate high-margin recurring software revenues from cybersecurity for AI-based autonomous drone systems in what management describes as a billion-dollar market. The company trades at approximately 8x EV/Sales in 2026 and 18x PE with 3x EV/Sales in 2027, with a base case of at least $40 million revenue in 2029 with high-30% EBIT margins, while the bull case envisions triple-digit revenues that could make Mobilicom a tenbagger within 4-5 years.

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