Bullet Point Network

Bullet Point Network helps investors and portfolio companies be more strategic. Quantify Your Stories in Scenarios.

[Bullet Point Network @bulletpointnet]

Whether in merger arb, biotech, or gauging a company's level of differentiation in its industry, investors adjust their expectations for cash flow & valuation as the company's story changes. You can't do that in a spreadsheet. Contact @bulletpointnet to learn more.

[Dan Gahagan @dpgahagan]

@bulletpointnet bitemporal models forecast how changes in investor expectations for a company's success change their expectations for that company's cash flow & valuation. Many applications, incl biotech where positive data from FDA trials can drive step changes in valuation

[Bullet Point Network @bulletpointnet]

A company's CAC + unit economics today is guaranteed to be different in the future, and it's impossible to capture those outlooks scalably in a spreadsheet. See @dpgahagan $HIMS LTV/CAC analysis and how he used our software to produce scenarios for cash flow and valuation

[Dan Gahagan @dpgahagan]

1/ My math suggests $HIMS LTV/CAC is trending ~2.5-3x. Pretty good for a DTC biz scaling beyond its early adopters with rev growing >90% y/y, reaching >$525M in CY22. But CAC was >130% y/y. So can $HIMS scale into its growth + margin expectations implied by its price? 🧵

[Bullet Point Network @bulletpointnet]

Check out BPN analyst @dpgahagan 4Q22 update on $HIMS and how he leveraged @bulletpointnet platform to land on a HOLD for the stock!

[Dan Gahagan @dpgahagan]

1/ $HIMS reported🔥4Q22 results and guidance. But after the recent run-up and +15% move today, I’m a HOLD on the stock

It’s all about the market’s implied expectations and how they compare to my expectations for the company’s peak economics.

So why am I a HOLD?🧵

[Bullet Point Network @bulletpointnet]

Our users toggle between Percentiles for a summary and Cases to review each scenario in detail. They select a few cases to explore drivers of good and bad outcomes for valuation. And it's easy to navigate to other tabs to analyze financials, KPIs, and capital market conditions.

[Bullet Point Network @bulletpointnet]

Do you assign odds for upside/downside cases in your analysis? Our partners place odds on potential peak economic outcomes to explicitly weigh an investment's risk/reward skew. Learn how to leverage @bulletpointnet software to think probabilistically and make better decisions.

[Bullet Point Network @bulletpointnet]

How confident are you in an assumption for a key driver in your spreadsheet? With @bulletpointnet, users widen or narrow their range easily to produce scenarios with odds. Disagree with a judgment? Make a personal version, update scenarios, and compare odds for returns in seconds

[Bullet Point Network @bulletpointnet]

How do you sort the piles of research for an investment? How do you leverage the most critical excerpts? Can you recall which pieces support assumptions in your model? Our partners avoid biases in their scenarios for returns with @bulletpointnet research management solution.

[Bullet Point Network @bulletpointnet]

Our team has been hard at work developing a new interface for our partners Here is a glimpse of that new platform highlighting how easy it is to toggle between percentiles summarizing odds for returns to cases to review each scenario's valuation, financials, and metrics in detail

[Bullet Point Network @bulletpointnet]

Check out @dpgahagan update for D2C healthcare provider $HIMS. See how he leveraged @bulletpointnet software to price in expectations and assign odds, supported by research, to outlooks for potential peak outcomes based on a set of key drivers to land on a 2.3x mean MOIC in 5YR

[Dan Gahagan @dpgahagan]

1/ $HIMS Post 3Q22 earnings: I changed key assumptions + odds and updated what's priced in for growth profitability & scale The stock is up ~35% since 11/4, and as of today’s close, I see 37% odds of a >2x MOIC & 12% of a >5x against ~33% of losing money, for a mean MOIC of ~2.3x

[Dan Gahagan @dpgahagan]

/3 What do you think $HIMS margin structure will be at scale? Category dominance and >25% margins or a commodity forever spending high % of revenue on marketing as subs churn? Test my model yourself to view scenarios for YOUR odds for future returns.
https://t.co/z2ZdrRwiTe

[Dan Gahagan @dpgahagan]

2/ That risk lowers the odds $HIMS reaches their long-term EBITDA margin outlook of 25-35%, with Jailendra forecasting LDD%. My scenarios are slightly more favorable. Although my model shows no chance of >25% EBITDA margin, I see 75% odds of it being >12%

[Dan Gahagan @dpgahagan]

1/ @TruistNews Jailendra Singh out with a great IC report on $HIMS. He opens with the key risk: marketing costs and retention. It’s tough being a DTC business in an industry with low barriers to entry where it’s hard to be viewed by consumers as the superior offering

[Dan Gahagan @dpgahagan]

/4 How would you frame $HIMS opportunities, from highest odds of success to lowest? How big are those markets? What are the peak economics based on level of differentiation? Test my model yourself to view scenarios for YOUR odds for future returns.
https://t.co/z2ZdrRwQIM

[Dan Gahagan @dpgahagan]

3/ I'm using @bulletpointnet SaS to size these markets such as Core Male - US millennial men needing sex health & hair loss solutions. $HIMS has the most traction here and therefore highest odds today of becoming the dominant provider for this pop vs other areas eg mental health

[Dan Gahagan @dpgahagan]

2/ What's priced in is a combo of stacked S-curves of these segments and investors calling the odds $HIMS is dominant or a commodity in them. Each corresponds to expectations for different levels of penetration and peak economics based on $HIMS value prop relative to alternatives

[Dan Gahagan @dpgahagan]

1/ Has $HIMS @wearehims reported a revenue breakdown by product line or subscriber demographics since their investor presentation in 2020? Trying to gauge how dependent growth is on sex health, hair, men generally vs more nascent business lines and women subs.

[Dan Gahagan @dpgahagan]

3/3 What do you think $HIMS odds are of becoming category dominant or a commodity? Click this link & follow the tutorial. Change key driver assumptions + odds, attach research, and recalculate the model to see YOUR odds for future returns. (DMs open!)

https://t.co/z2ZdrRwQIM

[Dan Gahagan @dpgahagan]

2/3 This doesn’t change my odds of HIMS becoming a commodity but I can still attach research like this directly to my judgment to support my thinking. This way, I won’t fall victim to confirmation bias, and my research isn’t detached from my model driving valuation scenarios

[Dan Gahagan @dpgahagan]

1/3 Thoughts on NYT report on the growing # of derms prescribing oral minoxidil? Risk to $HIMS differentiation and growth in hair loss? I think nothing-burger. Won't gain widespread adoption and if ever FDA approved, @wearehims can add to generic portfolio https://t.co/RxJWRjKWRJ

[Bullet Point Network @bulletpointnet]

Venture capital is on track to have its largest fundraising year on record closing $137.5 billion so far. As VC fundraising soars, @bulletpointnet can help you make the best investment decisions possible. https://t.co/tDYKxSh9nl