Independent Research, Food Delivery Space, Newmoon Capital

Newmoon Capital

Independent Research, Food Delivery Space

We look for owner-operators in what we believe are either highly defensible assets or soon to be highly defensible assets, trading at a fraction of their future potential.

Equity Bottom-Up

GE Vernova Inc is an electric power company. The Company designs, manufactures, and delivers electric power systems and services that generate, transfer, orchestrate, convert, and store electricity. GE Vernova serves customers globally.

<ul><li>ENR should do 15.4% EBITDA margin in FY26 versus GEV at 13.6%, or 180bps higher.</li><li>Also remember that ENR has a 100bps penalty from the Siemens AG royalty payments that will sunset in a few years and so the real margin delta is actually 280bps.</li><li>Far higher margin.</li></ul>

ENR should do 15.4% EBITDA margin in FY26 versus GEV at 13.6%, or 180bps higher.Also remember that ENR has a 100bps penalty from the Siemens AG royalty payments that will sunset in a few years and so the real margin delta is actually 280bps.Far higher margin.

Siemens Energy AG operates as a renewable energy company. The Company offers power generation and transmission, technical consultancy, and operation and maintenance services. Siemens Energy serves customers worldwide.

<ul><li>My view is that Siemens Energy’s gas earnings are not peaking in 2030.</li><li>The 2031-2034 delivery slots will largely be booked over the next two years, and order pricing is still rising.</li><li>That locks in equipment economics well into the mid 2030s. Services revenue and EBITA should take over as the main driver of growth and margin expansion starting 2030. </li></ul>

My view is that Siemens Energy’s gas earnings are not peaking in 2030.The 2031-2034 delivery slots will largely be booked over the next two years, and order pricing is still rising.That locks in equipment economics well into the mid 2030s. Services revenue and EBITA should take over as the main driver of growth and margin expansion starting 2030. 

<ul><li>While I no longer do L/S professionally, I continue to trade actively in my PA.</li><li>I rarely discuss specific positions unless I see an opportunity that is exceptionally attractive and widely misunderstood – such as my previous notes on ROO LN in 2021, SE and OMI in 2022, and going long on SE in 2024.</li><li>I believe a similarly compelling and yet highly misunderstood opportunity is currently emerging with both Siemens Energy and to some degree GE Vernova. </li></ul>

While I no longer do L/S professionally, I continue to trade actively in my PA.I rarely discuss specific positions unless I see an opportunity that is exceptionally attractive and widely misunderstood – such as my previous notes on ROO LN in 2021, SE and OMI in 2022, and going long on SE in 2024.I believe a similarly compelling and yet highly misunderstood opportunity is currently emerging with both Siemens Energy and to some degree GE Vernova. 

Siemens Energy (And GE Vernova): Debunking the Peak Gigawatt Bear Case

Owens & Minor, Inc. distributes medical/surgical supplies throughout the United States.  The Company's customers include hospitals, integrated healthcare systems, and group purchasing organizations.  Owens & Minor also provides services in supply chain management, logistics, and technology.

<ul><li>It looks to me that the company is now run-rating to $500M of EBITDA, but it is possible that it is much lower depending on how Q3 turn out.</li><li>It was very possible that things were fine for the first 2 months of Q3 and then got really bad thereafter and so the run-rate EBITDA is actually much lower…but let’s just use $500M as our base case</li><li>Capex in this business is really closer to Opex. Apria is really a leasing/distribution business and so Capex is needed to keep the business running.</li></ul>

It looks to me that the company is now run-rating to $500M of EBITDA, but it is possible that it is much lower depending on how Q3 turn out.It was very possible that things were fine for the first 2 months of Q3 and then got really bad thereafter and so the run-rate EBITDA is actually much lower…but let’s just use $500M as our base caseCapex in this business is really closer to Opex. Apria is really a leasing/distribution business and so Capex is needed to keep the business running.

Eastside Distilling, Inc. produces hand-crafted spirits in Southeast Portland. The Company also offers tours and tasting.

<ul><li>I believe EAST might be a 0, or basically 0, before the end of this year and equity holders (as well as preferred equity holders) are going to be wiped out.</li><li>Here is my analysis of the latest results. Please note that this is after my 3rd (but not last) whiskey shot so there is a chance this will just be a stream of disorganized consciousness</li><li>EAST has $2.6 million of cash as of March 31st, but that is after raising $2 million of working capital financing during the quarter offset by paying off $900K of the Live Oak debt facility.</li></ul>

I believe EAST might be a 0, or basically 0, before the end of this year and equity holders (as well as preferred equity holders) are going to be wiped out.Here is my analysis of the latest results. Please note that this is after my 3rd (but not last) whiskey shot so there is a chance this will just be a stream of disorganized consciousnessEAST has $2.6 million of cash as of March 31st, but that is after raising $2 million of working capital financing during the quarter offset by paying off $900K of the Live Oak debt facility.

Eastside distilling part 2: review Q1 results