1/4/25 - $rpd - meh at $40, cap structure doesn't help1/4/25 :: VROCKSTAR :: NASDAQ:RPD
meh at $40, cap structure doesn't help
- MSD topline growth meh
- healthy GM but lacking EBITDA mgn (spending a lot for not great top line)
- decent FCF yield at 175ish FCF on 3000 EV = 5.8% or better than cash
- but given the cap structure include net debt of 500 mm - to get a yield of closer to 7% (which is starting pt for me given alternatives of either nxt close to 10% or stuff like tsm/ nvda)... you'd need to see 175 on top of 2.5 bn EV and that means 500 mm needs to come off the 2.5 bn current market cap... so that's -20% vs. today's px (=2/2.5-1)
- so while V's not "the market" i have hurdles based on opportunity costs of other owns (i don't like scattered portfolios or to milk OTM calls on stonks that aren't obvious winners to me)
- so yuh. sidelines here for now, focusing elsewhere until hits some of these levels in the picture e.g. low 30s and ideally mid 20s if/when/why. otherwise, pass, unless EPS/ catalysts change this picture
V
