YB new stock pitches (Wed, Sep 9)

VersaBank funds point-of-sale finance partners through a structure in which overdue loans return to the partner and cash holdbacks provide additional protection; the Canadian program grew at a 27% CAGR over five years, provided more than C$9B of financing and recorded no credit losses. The main reason to own the shares is expansion into the much larger US market following the acquisition of a national bank charter. US funding costs are approximately one percentage point lower than in Canada, US credit assets rose from US$472.0M in January 2026 to US$604.9M in April, and management targets at least US$1B of funding this fiscal year. Adjusted net income grew 45% year over year after excluding C$6.7M of one-off April-quarter charges. At $17, the entry valuation was roughly 1.3x book and under 9x estimated next-year earnings based on the existing business, excluding the US ramp, wider margins and blockchain initiatives. Tokenized deposits remain uncommercialized optionality, while stablecoin-reserve custody has begun. Risks include substantial execution, term-deposit renewal rates and the required disposal or wind-down of the cybersecurity subsidiary by September 2026.

Read the full article here. Read time: 5 min

Applied has been owned since early 2023 and the position was recently increased to an above-average basket weight despite an approximately 100% gain. At ¥4,355, the company trades at 5.5x management’s net-income forecast and roughly 1.5x EV/EBIT after adjusting for its substantial cash and securities, while generating 17.6% ROE. Profit growth predates the Windows 10 replacement cycle, and Q1 operating profit rose 14% year over year even as management forecasts a 5.3% FY27 decline. The business has shifted toward B2B hardware with attached services and sells, installs and supports custom and third-party AI/HPC systems; it lists more than 700 deployment case studies and also supports systems sold by other vendors. Bain’s acquisition of MCJ at about 7x forward EBITDA implies roughly ¥12,000 per Applied share at the same multiple. Risks include extreme illiquidity, 52% founder-family ownership that largely precludes activism, a modest 2.3% dividend and the non-core How’s lifestyle business, which remains loss-making.

Read the full article here. Read time: 6 min

Net Digital combines a rapidly expanding carrier, reseller and payment business with an internally developed open-banking platform. Revenue increased from €11.0M in 2024 to €37.8M in 2025, while EBITDA rose from roughly break-even to €4.19M. Preliminary H1 2026 revenue of €31M and EBITDA of €3.1-3.3M already represent 58-65% and 60-70% of existing full-year guidance, making a forecast review after October’s final half-year report a near-term focus. If H2 merely matches H1 — a sensitivity, not company guidance — full-year EBITDA would reach €6.2-6.6M, implying 5.6-6.0x EV/EBITDA on a roughly €37M enterprise value. Net Money could add further upside by extending the company’s existing regulated payment infrastructure into direct bank payments and future data-based services, though merchant adoption, transaction volume and unit economics remain unproven. The valuation model uses an 18.7x fair P/E and targets €59.9 in three years, 222% above €18.6. Key risks are high transaction-related costs, customer concentration, competition, regulation, cybersecurity and limited share liquidity.

Read the full article here. Read time: 9 min