YB new stock pitches (Tue, May 6)

MHA.L, the UK's 13th largest accounting firm with 1,800+ employees (160 partners), recently listed on AIM at a £271m valuation, raising £92m while partners retained 55% ownership. The company has grown 10-fold since 2006, with improving partner leverage (fee earners per partner increased from 5 to 9) driving profitability. MHA targets £500m revenue in 3-5 years (20-36% CAGR), planning to grow through lateral hires and bolt-on acquisitions, with £35m net cash available. The firm is transitioning from a partnership model to a corporate structure with a new remuneration system including tiered salaries (£100k-£350k), bonuses (25-30% of adjusted EBIT), equity, and planned quarterly dividends (50% of NPAT). With a run-rate adjusted operating profit after tax estimated at 10-20% of its £236m enterprise value, MHA faces key risks including worsening audit deficiency rates and maintaining auditor independence, particularly as audit services represent a growing proportion of revenue and PIE audit engagements increase.

Read the full article here. Read time: 10 min

Raketech Group Holding PLC (RAKE.ST) is an iGaming affiliate marketing company with a €15M market cap that has already generated €15M in operational cash flow this year. Revenue has grown from €17M in 2017 to €61.1M in 2024, maintaining free cash flow margins between 25-50%. Despite this performance, the stock trades at a significant discount due to upcoming deferred acquisition payments: €8M due in H1 2025 (€3M already paid in January) and €20.8M due by September 2026. Management is confident they can meet these obligations through quarterly operational cash flow of approximately €2.75M, an available €3.2M credit facility, and the potential sale of their U.S. segment. The company has produced more cash from operations than its entire market cap in each of the last four years. The key risk is the large 2026 payment, which could necessitate dilution if profitability declines significantly, though even a 100% dilution would still leave the stock trading at approximately 2x free cash flow per share.

Read the full article here. Read time: 4 min

Almaden Minerals (AMM.TO) has filed a $1.06 billion ICSID claim against Mexico under the CPTPP for the expropriation of its Ixtaca project, which contains 85 million ounces of silver and 1.4 million ounces of gold. The claim, fully funded by a $9.5 million non-recourse litigation agreement and represented by Boies Schiller (which has won several similar arbitrations), alleges unlawful expropriation, failure to provide fair treatment, and discrimination after Mexico retroactively denied mineral title applications in 2023. Almaden's case is particularly strong compared to Odyssey Marine's similar claim (which received only $37.1 million, or 1.5% of its claim) because it involves direct government expropriation rather than regulatory denial of an unproven seabed mining concept. The company's current market cap of approximately $14 million versus the potential $1.06+ billion award represents a high risk-reward opportunity, especially as Almadex Minerals, a co-claimant with a 2.0% NSR royalty on the project, would receive only a small portion of any award.

Read the full article here. Read time: 7 min