Latest news with #Lasse
Yahoo
2 days ago
- Business
- Yahoo
Braskem S.A. (BAK): A Bull Case Theory
We came across a bullish thesis on Braskem S.A. on Lasse's Substack by Lasse. In this article, we will summarize the bulls' thesis on BAK. Braskem S.A.'s share was trading at $3.2000 as of August 8th. BAK's trailing and forward P/E were 8.44 and 9.78, respectively according to Yahoo Finance. Pressmaster/ Braskem presents a compelling 'cycle + overhang' investment opportunity at fire-sale levels, offering significant upside if polyolefin spreads mean-revert or if there is binding environmental clarity or credible strategic interest. The company's mid-cycle EBITDA is estimated at $1.9–$2.0 billion, supported by normalized polyolefin spreads and utilization rates, implying an enterprise value of roughly $11.4–$12.0 billion at a 6x multiple. With adjusted net debt around $8.7 billion, this translates into an equity value of $2.7–$3.3 billion, or approximately $6.7–$8.2 per ADR, compared to current prices near $3. Braskem's earnings are highly sensitive to polyolefin spread changes, with every $50/ton increase potentially adding $450–$500 million in EBITDA, translating to a material EV and share price uplift. Two main catalysts could unlock value: binding environmental resolution that limits cash outflows related to the Alagoas disaster, and a strategic sale or stake transaction that could reset earnings expectations and valuation multiples. While Brazil's import tariff increases on chemicals provide some tailwind, the thesis does not rely on this. The downside scenario assumes prolonged weak spreads and higher-than-expected environmental liabilities, potentially pushing equity values toward $2.0–$2.5 per ADR, whereas a bull case with faster normalization and a binding cap could push values above $11 per ADR, though governance and country risk temper this upside. Key triggers include sustained spread and utilization improvements, environmental settlement clarity, and M&A developments. Risks include prolonged commodity weakness, environmental cost overruns, and liquidity stress. Overall, Braskem is a through-cycle cash generator priced as if recovery is impossible, presenting an attractive risk/reward for disciplined investors prepared to act on validated catalysts. Previously, we covered a bullish thesis on Rayonier Advanced Materials Inc. (RYAM) by Value Degen in June 2025, which highlighted its cyclical nature and insider buying as key drivers. The company's stock price has appreciated by approximately 17.5% since our coverage, reflecting growing investor confidence. Lasse shares a similar thesis on Braskem, focusing on environmental clarity and strategic catalysts in a different industry, presenting a distinct opportunity. Braskem S.A. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 11 hedge fund portfolios held BAK at the end of the first quarter which was 13 in the previous quarter. While we acknowledge the potential of BAK as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None.
Yahoo
3 days ago
- Business
- Yahoo
Braskem S.A. (BAK): A Bull Case Theory
We came across a bullish thesis on Braskem S.A. on Lasse's Substack by Lasse. In this article, we will summarize the bulls' thesis on BAK. Braskem S.A.'s share was trading at $3.2000 as of August 8th. BAK's trailing and forward P/E were 8.44 and 9.78, respectively according to Yahoo Finance. Pressmaster/ Braskem presents a compelling 'cycle + overhang' investment opportunity at fire-sale levels, offering significant upside if polyolefin spreads mean-revert or if there is binding environmental clarity or credible strategic interest. The company's mid-cycle EBITDA is estimated at $1.9–$2.0 billion, supported by normalized polyolefin spreads and utilization rates, implying an enterprise value of roughly $11.4–$12.0 billion at a 6x multiple. With adjusted net debt around $8.7 billion, this translates into an equity value of $2.7–$3.3 billion, or approximately $6.7–$8.2 per ADR, compared to current prices near $3. Braskem's earnings are highly sensitive to polyolefin spread changes, with every $50/ton increase potentially adding $450–$500 million in EBITDA, translating to a material EV and share price uplift. Two main catalysts could unlock value: binding environmental resolution that limits cash outflows related to the Alagoas disaster, and a strategic sale or stake transaction that could reset earnings expectations and valuation multiples. While Brazil's import tariff increases on chemicals provide some tailwind, the thesis does not rely on this. The downside scenario assumes prolonged weak spreads and higher-than-expected environmental liabilities, potentially pushing equity values toward $2.0–$2.5 per ADR, whereas a bull case with faster normalization and a binding cap could push values above $11 per ADR, though governance and country risk temper this upside. Key triggers include sustained spread and utilization improvements, environmental settlement clarity, and M&A developments. Risks include prolonged commodity weakness, environmental cost overruns, and liquidity stress. Overall, Braskem is a through-cycle cash generator priced as if recovery is impossible, presenting an attractive risk/reward for disciplined investors prepared to act on validated catalysts. Previously, we covered a bullish thesis on Rayonier Advanced Materials Inc. (RYAM) by Value Degen in June 2025, which highlighted its cyclical nature and insider buying as key drivers. The company's stock price has appreciated by approximately 17.5% since our coverage, reflecting growing investor confidence. Lasse shares a similar thesis on Braskem, focusing on environmental clarity and strategic catalysts in a different industry, presenting a distinct opportunity. Braskem S.A. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 11 hedge fund portfolios held BAK at the end of the first quarter which was 13 in the previous quarter. While we acknowledge the potential of BAK as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-08-2025
- Business
- Yahoo
Transocean Ltd. (RIG): A Bull Case Theory
We came across a bullish thesis on Transocean Ltd. on Lasse's Substack. In this article, we will summarize the bulls' thesis on RIG. Transocean Ltd.'s share was trading at $2.9100 as of August 5th. RIG's forward P/E was 18.15 according to Yahoo Finance. Transocean Ltd. (RIG) is a leading provider of ultra-deepwater and harsh-environment drilling services, operating 34 mobile offshore drilling units, including 26 ultra-deepwater and 8 harsh-environment floaters. The company reported $952 million in contract drilling revenues for Q4 2024 and generated an adjusted EBITDA of $323 million, reflecting a healthy margin of 33.9%. This performance highlights the strength of its operational model and its strategic positioning in high-specification offshore drilling markets. Transocean's fleet gives it substantial exposure to ultra-deepwater projects, which are typically long-cycle and high-margin opportunities, making the company well-placed to benefit from rising global demand for deepwater exploration and production as operators prioritize reserve replacement and energy security. However, its capital structure remains a key concern, with a net debt-to-EBITDA ratio of 7.58x, signaling significant leverage that amplifies risks in a cyclical and volatile industry. While this high debt load could limit financial flexibility and increase vulnerability during downturns, it also creates the potential for equity holders to capture meaningful upside if the company successfully deleverages as day rates improve. For investors with a higher risk tolerance, Transocean represents a leveraged play on the ongoing recovery in offshore drilling, supported by a robust backlog, tightening rig supply, and favorable pricing dynamics. If debt reduction initiatives and operational execution align with strengthening market fundamentals, the company could unlock material value for stakeholders, but risk management remains critical given its current balance sheet profile. Previously, we covered a on Transocean Ltd. (RIG) by Unemployed Value Degen in February 2025, highlighting leadership transition, strong revenue growth, and an $8.3 billion backlog. The stock has depreciated about 8.7% since, as contract awards slowed and acquisition uncertainty weighed. The thesis still stands given the tight offshore supply. Lasse shares a similar view but emphasizes deleveraging risks and upside potential. Transocean Ltd. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held RIG at the end of the first quarter which was 38 in the previous quarter. While we acknowledge the potential of RIG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. Sign in to access your portfolio
