Michigan Value Investor

Yup, it's really me, the one and only MVI

[Michigan Value Investor @Michigan_Value]

$HROW It's always amazing to me how price moves dictate sentiment when the businesses themselves have done nothing materially different than expected. Consider ETON and HROW recently, both the subjects of my recent SA public articles. In each case I bought lower originally, $5.70 for HROW and $3.50 for ETON, but never mind that, let's just think about YTD 2026.
Nothing has changed about the value of either stock YTD. Everything long term is exactly what it's always been. That's something like $100 for ETON and something like $500 for HROW by the end of the decade, call it 2030. Anyone can easily see this for themselves by looking even the most basic long term metrics over time - revenue growth, EBITDA margin growth - and then asking if the elements are in place for continued growth, as they clearly are. The details are uncertain, as is the timing. But the basic range of value centering around these targets, there has been practically no news at all.
And yet... ETON's price from the lows YTD has doubled and HROW's price from the highs this year has been cut almost in half. Zero change in value, no news that matters to value has been learned, long term targets not changed. Short term prices have moved the relative price of these two stocks by a factor of 4.
In each case, the stocks are simple to understand and easy to model over longer periods. HROW in particular is harder to model quarter by quarter because of the huge seasonality and the issues surrounding regulation and insurance, neither of which apply to ETON. So on a quarterly basis, ETON is easy. But both are very simple over a period of years.
If you are a value investor, something will click about what I just said. Buffett always said value investing is simple, but it isn't easy. And that it doesn't take a lot of IQ - anything over 120 is a waste is what he said, not sure I agree - but the real trick is the right mindset. Someone losing their mind over this short term price movement and letting fanciful stories impact their decisions when the long term trends are as plain as day, that person may have the required 120+ IQ, but clearly lacks the right mindset.
Buffett always said, too, that you can't teach that mindset. It either makes sense to you or it doesn't. I include this commentary here for those who have that mindset, but who are second guessing themselves right now. If that's you, ignore the fearful short termers who let the market tell them what to think, think for yourself instead, and act according to your views. For the rest, I wish you well, good luck!

[Michigan Value Investor @Michigan_Value]

@app_hyd the problem with $ETON is that it's not particularly underpriced any more. It is a little, but nothing like the 20x coming at $HROW. Eton already had its 20x

[Michigan Value Investor @Michigan_Value]

I posted my 18x $ETON to illustrate a point: people LOVE stocks AFTER they go up. Price drives narrative. The mirror image is $HROW: the narrative is negative BECAUSE the price is down. Psychology is the opposite of value investing. Value will win. It already did with ETON.

[Michigan Value Investor @Michigan_Value]

@gvanhp I'm fond of saying most investors are idiots. You are making my point for me nicely

[Michigan Value Investor @Michigan_Value]

$HROW will scale to well over $1B revenue. Maybe over $2B or even more. Eventual EBITDA margin at scale is 40%+. $ETON was profitless growth for a long time too... good old MVI saw that and bought at $3.50 two years ago. HROW's turn is coming.

[Michigan Value Investor @Michigan_Value]

Second aside: If you are old enough to remember $AMZN, you will know it was GAAP profitless growth for a long time. They invested in growth, but GAAP didn't capitalize those investments. $HROW is like that. Current EBITDA is irrelevant. The trick: first scale, then FCF.

[Michigan Value Investor @Michigan_Value]

@stockflowmethod 3e is going to be pretty good going forward. You know they get a huge price increase in '28 on that... and it's growing better than 100% CAGR now, and there's a trial readout that will put it on label if the results are good.

[Michigan Value Investor @Michigan_Value]

$HROW in case you guys are wondering

[Michigan Value Investor @Michigan_Value]

@stockflowmethod nah

[Michigan Value Investor @Michigan_Value]

$HROW today's call is what good IR looks like. Cautiously optimistic IR is a solved problem. Next: guide conservatively enough in '27 to enable a raise Q2 and/or Q3. If they do this, it rewrites the narrative forever, price up 5x fast, and then more to come.

[Michigan Value Investor @Michigan_Value]

@longboard96 @EyeFarma I don't brag. I think people are just super weird if they need to brag on frickin' twitter. I also think most investor are literally dumb. I mean it.

[Michigan Value Investor @Michigan_Value]

$ETON I seldom post on this one, but for the record I am up 18x on it. ETON was cheap like $HROW is cheap now. It's super predictable that the weighing machine will catch on eventually. @EyeFarma

[Michigan Value Investor @Michigan_Value]

@PrivacySetting1 @EyeFarma yup. $HROW is building a massive revenue base, and will eventually convert to EBITDA and FCF. It's pretty standard stuff. Lots of super confused dumb dumbs out there.

[Michigan Value Investor @Michigan_Value]

@JonahLupton yeah, it's just epic.

[Michigan Value Investor @Michigan_Value]

$HROW Excellent chance $50+ by January. Whatever doomer views people had on Vevye from Bloomberg, that's dead. Whatever short term negatives they were hoping for/worried about, that's dead. Q4 revenue up ~50% YOY. '27 up ~50% on '26. Biggest drug launches in '28. No end in sight.

[Michigan Value Investor @Michigan_Value]

@JonahLupton and there's something to be said for being able to raise. All the whining will end forever if they can do that. They will become beloved. Investors are fickle like that

[Michigan Value Investor @Michigan_Value]

@JonahLupton yes, my thoughts exactly.

[Michigan Value Investor @Michigan_Value]

@JonahLupton The market doesn't care about sell side on $HROW, imho, just look at sell side price targets as proof. I see no reason to guide more than up 40%, and $500M is a nice round number.

[Michigan Value Investor @Michigan_Value]

@PrivacySetting1 this guy gets it