YB new stock pitches (Wed, Feb 4)

Journey Medical Corporation (DERM), a dermatology-focused pharmaceutical company with $55 million in 2024 revenue, launched its FDA-approved oral rosacea treatment Emrosi in April after showing superior Phase 3 efficacy versus Oracea, the prior standard of care that achieved peak sales over $300 million before going generic. Led by CEO Claude Marauoi and senior team members from Medicis (sold to Bausch Health for $2.6 billion in 2012), the company has already achieved strong early prescription demand with Emrosi sales annualizing over $35 million, supported by an existing cost structure including thirty-five sales reps that should enable efficient revenue scaling. With patent protection through 2039 and positioned to become the new standard of care among oral rosacea therapies, management forecasts Emrosi could reach $100 million in sales within a few years, driving the company to profitability and positive cash flow, with projected untaxed earnings per share of $1.50 by 2027 and a $20 price target, prompting the investor to add to their position initially begun in February of the prior year.

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Valeura Energy (VLE:TO) is a Canadian oil company operating producing oil fields in the Gulf of Thailand that trades at $8.18 CAD with a $630 million USD market cap and gained 13.3% in 2025 despite oil prices dropping from $75 to $60 per barrel. The company remains highly cash generative, producing $90-$100 million annually at current oil prices with breakeven in the mid-40s and no debt, ending 2025 with $47 million more cash despite spending $40 million on Wassana redevelopment, $39 million on non-recurring taxes, and $5 million on stock buybacks. Key catalysts include the $120 million Wassana platform FID approved in May, which adds 8 million barrels of 2P reserves, extends field life by eight years, reduces opex to $12-$16 per barrel, and delivers a 40% IRR even at $60 oil; an 8.7x acreage expansion through a PTTEP farm-in deal for $18.4 million providing 40% interest in 20,000 square kilometers of derisked, near-term prospective acreage adjacent to existing Jasmine and Nong Yao fields; and a Turkey gas joint venture with Transatlantic Petroleum requiring no cash outflow from Valeura while providing development upside optionality. The investor views Valeura as exceedingly undervalued and anticipates adding more shares, expecting strong medium-to-long term performance regardless of short-term oil price movements, with the company positioned to benefit substantially if oil prices recover while remaining financially strong even if they decline further.

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DCC plc (DCC.L), an Irish energy distributor listed on the London Stock Exchange, represents a new position as the former conglomerate transitions from a disparate collection of businesses to focus on its core propane energy distribution operations across the US, Ireland/UK, and continental Europe. The company's energy business, which generates consistent returns across energy cycles without direct commodity price exposure through cost-plus contracts, consists of three segments: energy products (68% of Energy EBITA, delivering propane and other fuels), energy services (9%, installing solar panels with 7-10% expected growth), and mobility (23%, operating gas stations with convenience stores and EV charging). DCC completed the divestiture of its healthcare business for £1,050 million (12x 2024 EV/EBITA) in April 2025 and sold its European consumer electronics business for nominal proceeds in July 2025, with disappointment over sale prices contributing to stock weakness. The company executed a £600 million share buyback in December 2025 at £51.70 per share and expects to repurchase approximately 25% of outstanding shares using divestiture proceeds. The final divestiture involves the technology business (audio-visual equipment, appliances, musical instruments) expected to generate ~£80 million EBITA, though new US tariffs pose risks and could impact the anticipated 8x EBITDA sale multiple or prevent a sale altogether. Following all divestitures and buybacks, the core energy business trades at approximately 6.6x FY 2026 EBITDA versus higher multiples for more leveraged peers, with management guiding for 9%+ medium-term growth that would imply a 4.6x 2030 EBITDA multiple. Key risks include uncertainty around the final technology unit sale due to tariffs, technical selling pressure from index exclusions, and the 'dirty energy' perception among European investors despite the company's lack of commodity exposure, while the attractive valuation and unleveraged balance sheet could make DCC vulnerable to private equity bids or activist intervention if shares continue underperforming.

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