Sample Ideas

IACI - One Of The World’s Largest Internet Stocks

• Net cash: 60% of mkt cap, EV/EBITDA < 4x
• 25% of mkt cap repurchased last 2 yrs, 14% FCF yield
• Free optionality on numerous internet growth businesses
• Acquisition target, value creation through spin-offs/JVs

Orkla - Conglomerate To Branded Goods

• 15.6% dividend yield, 40% 3-year total dividend potential
• Consistent 14% to 17% ROCE, FCF/rev of 12.6%
• Over the past 25 years, +8% revenue and +12% EBITDA CAGR
• Brands rank No. 1 in Scandinavian countries

Toyota - Global Industry Leader

• 0.9x P/B, 13% FCF yield, 7.7x P/E, 3.8% dividend yield
• Stock down -70% due to temporary events; great entry point
• Huge likely rebound in earnings next year in FY03/2013
• Market share gain opportunity in US and Emerging Markets

Resilient Performer In A Cyclical Industry

• Net cash: 122% of mkt cap, 20%+ FCF yield, EV/EBITDA -ve
• 0.6x P/B, 12x P/E [ex-cash P/E < zero], 5.6% dividend yield
• JV with a leading Japanese company, no analyst coverage
• Consistent outperformer; beneficiary of stricter emission norms

Top Global Brand

• 1.1x P/B, 3.6x EV/EBITDA, 12x P/E, 11% FCF yield
• No. 1 market share in multiple businesses
• Corporate action, shareholder activism
• EBIT margin improvement, div increase, cost-cutting

Market Leader In Growth Industry

• 13% dividend yield, 300% CAGR 5-year dividend growth
• 50% net cash, 1.3 P/B, 7x P/E, 29% ROE
• Top Brand with only one down year in the past 15 years
• Improving fund performance and positive fund flows

European Industry Leader

• 0.80x P/B, 15% FCF yield, 5.5% dividend yield, 10x P/E
• Renewable diesel production should lead to rerating
• Debottlenecking/cost saving to improve EBITDA by 30%+
• Backward integrated: from forest to paper [incl. power]

World's No. 1 Specialty Glass Manufacturer

• 0.86x P/B, 7.0x P/E, 16% net cash
• 8% FCF yield, 3% dividend yield, 7% buyback
• Operating history of more than 160 years, innovation leader
• Subsidiaries include world’s largest polysilicon producer

Leading Business House In India: Excellent Pedigree

• 66% discount to NAV; 5% dividend yield
• 67% net cash [no debt]; 3.9x P/E; 1.1x P/B
• Undiscovered gem; limited coverage
• Insider increasing stake

Market Leader + Deep Value + Catalysts

• Real estate = 170% of mkt cap, 28% ROE
• 9% FCF yield, 3.5% div yield, 10.7x P/E
• 26% reduction in share count in last 3 years
• Strong brand franchise and market presence

Largest Tax Return Preparer In The World

• Buybacks = 23% of mkt cap; 5% div yield
• 9% FCF yield, 9.0x ex-cash P/E; 11% net cash
• 27% ROE, double-digit EPS growth
• New CEO/CFO huge catalyst for higher returns

Brand + Growth + Deep Value + FCF/Div

• 35% ROE, 11.4x normalized P/E
• 6.6% dividend yield, 25%+ five year CAGR
• Huge discount to sector; highly oversold
• Secular growth in luxury goods market