Against the Grain's Posts

Against the Grain

@atgrain06/16/2023

A small Swedish serial enquirer, punching above its weight!

Teqnion Rundown $TEQ 📊

Efficiency

Gross Margin: 43.1%

Operating Margin: 10%

ROC: 17.8%

FCF/Net Income: 91.16%

Growth 5Y

Rev: 46.35%

Net Income: 52.25%

FCF: 34.24%

Valuation

FCF Yield: 3.64%

EV/EBIT: 22.48

P/S: 2.08

Let's dive in 👇

The Company

Teqnion, a Swedish serial acquirer founded in 2006, is the epitome of trust & support in business! With 24 businesses (22 in Sweden, 1 in the UK, & 1 in Ireland) under their umbrella, their approach is to let companies flourish independently. To date, they recently acquired two more businesses.

Strategies

Are to acquire healthy companies with good future prospects.

To support and further develop acquired companies.

Competitive Advantages

Diversified portfolio providing stability in stormy markets.

Solid B2B & B2G strategy for reliable partnerships.

High barriers to entry due to government compliance rules.

Their competitive advantages appear intact by their high gross margin and ROC.

Price Action

$TEQ has returned 625% in the last 3 years compounding at 93% on average every year. Compared to its serial acquirer peers (ADDT B, INDT and LIFCO), TEQ has performed better.

$TEQ is a fascinating company, go see my full analysis in my newsletter about: (link below)

Management

Performance

Comp advantages

Growth Opportunities

Financial Health

Valuation

My blog - "Against the Grain", https://againsthegrain.substack.com/

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StockOpine

@stockopine06/16/2023

Not that it's of our business but this post has a great resemblance on this tweet....

https://twitter.com/InvestInAssets/status/1667841610867175428?s=20

+ 3 comments

Against the Grain

@atgrain06/14/2023

A value play in the semiconductor industry $TSM

$TSM Rundown 📊

Efficiency

Gross Margin: 59.7%
Operating Margin: 49.5%
ROC: 28.3%
FCF/Net Income: 49%

Growth 5Y

Rev: 18.28%
Net Income: 23.79%
FCF: 24.25%

Valuation

FCF Yield: 3.4%
EV/EBIT: 13
P/S: 6.74

The Company

$TSM, founded in 1987 in Taiwan, is the global leader in semiconductor foundries, pioneering the pure-play foundry model. Specializing in advanced integrated circuits, it's a key player in smartphones and high-performance computing. Clients include Apple, Nvidia, AMD. #TSM #Tech 🌍🔧🔬

Strategies

$TSM’s success is driven by:

Embracing the Pure Play Foundry model, focusing solely on manufacturing without competing with clients.
Investing heavily in R&D to continuously refine manufacturing processes.
Building long-lasting partnerships based on trust.

Competitive Advantages

$TSM's competitive advantages include:

Technological Leadership with cutting-edge chip innovation.
Economies of Scale, producing high-quality chips cost-effectively.
Strong Customer Base including giants like Apple, ensuring steady revenue streams.

High gross margin and ROC = moat

Price Action

TSM has returned 1,530% to shareholders compounding 11.47% over 25 years compared to the S&P500’s 9.8%. Slow, steady and stable wins the race.

$TSM is an intriguing company, go see my full analysis on: (link below)

Management
Performance
Comp advantages
Growth Opportunities
Financial Health
Valuation

My blog - "Against the Grain", https://againsthegrain.substack.com/

Please share this post if you found it insightful

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Eric Pelnik

@eric06/14/2023

Thanks for the breakdown! In your eyes, how does $TSM compare to $ASML?

+ 3 comments

Against the Grain

@atgrain06/13/2023

Mini serial acquirer in the construction industry

Atlas Engineered Products Rundown $AEP.V 📊

Efficiency

Gross Margin: 32.1%
Operating Margin: 20.2%
ROC: 27%
FCF/Net Income: 106%

Growth 5Y

Rev: 46.7%
Net Income: 77.69%
FCF: 130%

Valuation

FCF Yield: 13.4%
EV/EBIT: 5.53
P/S: 2.13

Let's dive in 👇

The Company

$AEP.V is a micro-cap from Canada that makes and sell floor and roof trusses, wall panels and engineered wood products.

Strategies

Increasing Sales: AEP is dedicated to expanding its sales by nurturing sales teams and diversifying its products and services.
Cutting Costs: By purchasing in bulk and optimizing resources, AEP is efficiently managing its expenditures.
Diverse Portfolio Growth: Actively acquiring businesses in trusses & engineered wood, AEP is not just extending its reach but also fostering the growth of the Canadian construction sector.

Competitive Advantages

Economies of Scale: AEP's bulk purchasing powers pricing advantages, retaining loyal customers & attracting new ones.
Diversified Portfolio: With an array of products from roof trusses to engineered wood, AEP caters to diverse construction needs.

Price Action

In the past 3 years $AEP.V has returned 284% compounding at 56.8%. Compared to the S&P/TSX Composite Index, this returned 29% compounding at 9%.

$AEP.V is an intriguing company, go see my full analysis on: (link below)

Management
Performance
Comp advantages
Growth Opportunities
Financial Health
Valuation

My blog - "Against the Grain", https://againsthegrain.substack.com/

Please share this post if you found it insightful

Follow me here and on Twitter for more insightful ideas