🧵1/
A good business is not the same as a good stock.
That’s the core premise behind Tanuki Research — where I will try to post some decent longs and shorts from the literal beach.
@ClarkSquareCap $shc PE overhang now gone, litigation mostly behind them. Medical device sterilization duopoly. Capex falling, pricing gains and outsourcing going to accelerate in response to more stringent requirements. Fcf inflection coming, guidance very conservative. 15x earnings vs STE 25x
@joinyellowbrick I think they won a massive defense helicopter deal (FLRAA) a few years ago that should just be starting to inflect soon iirc. Haven’t looked at it in a while.
$THR. Thermon is a niche duopoly in thermal solutions that’s moved beyond O&G into better end markets. Trades ~13x unlevered earnings, ~$1B EV, under-levered, and about to lap temporary headwinds. Rerate + M&A optionality.
@contralculator Ha thanks. Sadly I set out to start a short-selling blog, came across a fun long idea, didn’t really pump it for the clicks and just owned a bit in my tiny PA. Womp womp.
$THR. Thermon is a niche duopoly in thermal solutions that’s moved beyond O&G into better end markets. Trades ~13x unlevered earnings, ~$1B EV, under-levered, and about to lap temporary headwinds. Rerate + M&A optionality.
@RealJimChanos@PatrickMoorhead@ClayMagouyrk The slide seems to imply the data center and compute costs are in the 39bn of costs, but that feels….wrong? Given others talk about 50bn to stand up a GW? And then opex on top of it?
One dynamic w shorting that eventually humbles everyone is that a bad co (fraud/cyclical/fad/etc) going up in price w deteriorating fundamentals is often not a good short. This is sort of not intuitive and not the inverse of how longs work lol, just a different game entirely
"There's old short-sellers and there's bold short-sellers. There's no old bold shortsellers. "
-my old PM smugly explaining why all his friends were no longer in the business as he grinded me to death over my 15 80bp short positions at a time
I think most people think of "small" sizing for shorts as ~LSD%. In reality, 10-50 bps is reasonable sizing for fraudy/promote shorts.
More importantly though, it's an awful idea to get involved with these types if it's not your day job.