Riley Phillipson

Opinions are my own. Not investment advice. Information only.

[Riley Phillipson @R_Phillipson]

Signs were there when shares were $18! $FSK

https://t.co/AkW1LfDWQq

[zerohedge @zerohedge]

Private Credit Fund Run by FS and KKR Cut to Junk by Moody’s

[Riley Phillipson @R_Phillipson]

@TidefallCapital You forgot organic growth on base biz (i.e. removing impacts of Vidspine and Datafusion) being ~ +5-7%. Company typically lets unprofitable contracts roll off post acq, making organic growth in y1 artificially low. EBITDA margins expanding 400bps to 42% too. Impressive stuff.

[Riley Phillipson @R_Phillipson]

What's on our mind lately 👇

https://t.co/HTlvXI78Rz

[Riley Phillipson @R_Phillipson]

$BBU monetizing some underperforming assets by selling to retail investors at a much higher valuation from where BBU trades. Great outcome for BBU unitholders - not so sure about the retail investors. Y/y adj. EBITDA growth: CDK (-30%), DexCo (-23%) per Q1 filings. Probably nothing.

[The Globe and Mail @globeandmail]

Brookfield sells US$690-million in private equity stakes to set up fund targeting wealthy investors https://t.co/rkvnbOUCr7

[Riley Phillipson @R_Phillipson]

Reworked the headline a bit: “Retail investors now afforded the ‘opportunity’ to pay exorbitant fees to act as the liquidity provider for institutional investors as IPO window remains shut”

[The Globe and Mail @globeandmail]

Brookfield launches its first private equity fund tailored to individual investors in Canada https://t.co/XZBtmZVItZ

[Riley Phillipson @R_Phillipson]

Another strong showing from $WCN.TO. Core pricing +6.3%, revs and adj. EBITDA above expectations. Core margins up 80bps. Canceled 1% of shares outstanding YTD and raised dividend 11.1%. Voluntary employee turnover improves for the 12th consecutive quarter.

[Riley Phillipson @R_Phillipson]

No comment on the portfolio necessarily, but it’s undoubtedly been a difficult market for quality compounders. Eventually quality will matter again (as it always does), and the simple algo of above-inflation pricing + op leverage + cap allocation driving low teens FCF growth will be a winning formula. Until then, try to tune out the noise. Godspeed.

[Riley Phillipson @R_Phillipson]

Don't underestimate the power of extreme decentralization. When comp is tied directly to ROIC, dealmakers are incentivized to get creative - VMS or not. Will be interesting to see the next chapter for $CSU.TO.

[Riley Phillipson @R_Phillipson]

@ErnestWongBWM has been on top of this for some time now - and in my view, his work has been a genuine positive for the industry in Canada. Give credit where credit is due - competitor or not. Sadly, it's not how most advisors in Canada think today.

[Riley Phillipson @R_Phillipson]

Alternative funds have been halting redemptions left and right recently - Bn's in everyday investors' $ tied up with no clear timeline to get it back. Far too much (in fees and in sleep) has been lost chasing novelty when all anyone needs is a simple mix of stocks/bonds/cash..

[Riley Phillipson @R_Phillipson]

I get the “optimists make money” argument for just buying every 5bp dip in $QQQ and going to the beach. Yes, markets rise over time—no disputing that!

But I’d also wager many of these folks have never seen a client or family member in a brutal drawdown while simultaneously losing their job, forcing them to sell investments for income and wiping them out entirely. When it rains it pours! Unfortunate as it may be.

I've seen people forced into spending their retirement working a job they never wanted - AFTER they've sold a business and had a successful career - because of bad luck (unforeseen personal event) at precisely the wrong time (bad market).

For families who have already built a nest egg, whether the portfolio is flat or up 50% YTD means next to nothing. What matters is that its growing steadily over time above inflation + risk premium—at a pace that meets personal goals, funds the desired retirement lifestyle, and avoids the unforeseen bombs. What else really matters?

That's the difference between FinTwit and real people. (Though admittedly, I have a soft spot for watching FinTwit belligerence like the Zoomer guy from afar!)

[Riley Phillipson @R_Phillipson]

Tough market for many quality compounders lately. Quality will matter again eventually - as it always does

[Riley Phillipson @R_Phillipson]

@wlep Agree with you on the longer term margin expansion op - just disagree on the 'how' that some people are highlighting (i.e. aggressively cutting dev). Op leverage more likely to come from high incremental-margin organic product/feature rollouts imo

[Riley Phillipson @R_Phillipson]

Disagree with the idea that margins will explode higher at $CSU.TO with AI replacing dev staff. A few of its top private competitors outsource dev work overseas and have for years. Most sellers hate it. Part of the value prop of selling to CSU is the promise to keep the team intact

[Riley Phillipson @R_Phillipson]

Now tell us what % of loan interest is paid in cash vs PIK…

[Tom Smith @TomSmith839]

Anyone want to wager money 150 bps isn’t the floor?
$OWL $APO $KKR $ARES $BX

[Riley Phillipson @R_Phillipson]

Maybe not a specific example, but the whole ‘win by not losing’ approach of avoiding the bombs and controlling down-capture with *boring* names is pretty powerful in a LO acct (+ tax efficient) over time. Esp since we’re talking real humans that have real emotions & mouths to feed.

[Riley Phillipson @R_Phillipson]

$LULU is a great reminder that cheap is not a thesis, and social media has eroded the brand moat for almost every consumer-facing company.

[Riley Phillipson @R_Phillipson]

@partners_road All across the staples complex. Years of taking aggressive pricing on anemic volumes and shrinking packaging. Finally catching up. As it should. $PEP

[Riley Phillipson @R_Phillipson]

@BrownMarubozu I think being underweight gold has been the biggest relative drag, no?

[Riley Phillipson @R_Phillipson]

Time to sharpen the pencils.