Research

Analyzing IPOs

The last two years we have seen the fewest back-to-back years for initial public offerings of greater than $1 billion since 2008 and 2009.  2021 was a record year driven largely by SPACs, and also correlated to the highest nominal GDP in the US in nearly a half century.  Tighter financial conditions, concerns about an

Read More »

Monthly Digest – October 2023

Detailed in our October 29th Level Set, our current highest conviction investment ideas are: Overweight Energy. Energy has low earnings expectations, compelling valuation, favorable demand / supply dynamics, and is not loved. This is our top investment idea for the next two to three years. We would own E&Ps, integrated oil companies, and oil services.

Read More »

Level Set – Our Highest Conviction Investment Ideas

While there is ample uncertainty about the overall market direction, with a laundry list of concerns, including geopolitical risk, dysfunction in Washington, higher bond yields, and mixed earnings results, we contend there are ample opportunities to generate alpha on both the long & short side. As we wrote in early October, in our ‘What Happened

Read More »

Level Set – Opportunities Where Stocks Are Near COVID Lows

In searching for stock ideas, we have noticed stocks in several industries have not generated substantial shareholder value when compared to stock market lows of March of 2020. Rate sensitivity, GLP-1s (Ozempic), shrink and other trends have certainly emerged over the last 3.5 years pressuring some stocks and industries disproportionately, but we thought we’d scour

Read More »

Consumer – A Level Set of Trivariate’s Views

The State of the US Consumer Recently generalist investors have been asking us about the state of the US consumer. A strong retail sales figure has some investors questioning whether “good news on the economy is bad for stocks” because it alters their expected Fed path. Others are more generally curious about revenue potential for

Read More »

Level Set – Small Caps Are Not That Cheap

The consensus view is that mega / large cap stocks are expensive relative to small caps, and many investors we speak to argue that small cap valuation is compelling. The cap-weighted price-to-forward earnings of the Top 500 US equities by market capitalization is near a 20-year high vs. the equally weighted price-to-forward earnings (see below),

Read More »

Spin-Offs: Probably Not A Panacea

While the historical results of spin-offs are mixed, and there are many different nuances and strategies related to these corporate actions, there is no doubt that management teams are increasingly being advised about the potential to unlock or create value through spins.  Conglomerates, businesses in multiple end-markets and sectors, and those valued on a sum-of-the-parts

Read More »