PUMP AND DUMP – QAV America #52

QAV America 52 CLUB VIDEO

[00:00:00]

Cameron: Welcome to QAV America, Tony. Episode 52, the 12th of May 2026. The title of this episode, Tony, Pump and Dump.

Tony Kynaston: You keep titling these episodes before you’ve even spoken yet. So

Cameron: It’s ’cause I’ve

Tony Kynaston: title

Cameron: my– Uh, we could swap it out, but

Tony Kynaston: okay.

Cameron: the working title of this episode, let’s say that.

Tony Kynaston: You put a thumbtack in

Cameron: Mm, mm. The Pump and Dump,

Tony Kynaston: Pumping

Cameron: which will become clear later on. Um, big week in, uh, news, Tony. Um, surprising to everyone.

Tony Kynaston: we can use in the US?

Cameron: You heard of the Nacho trade?

Tony Kynaston: I have, but I’m just struggling to remember what it stands for.

Cameron: I just read about it in the Fin just a minute ago. No, it’s not a chance of Hormuz opening, is the Nacho trade. There was an article in the Financial Review this [00:01:00] morning, uh, Michael, Michael Burry from The Big Short, basically talking about how the US market is headed for a massive disaster, but they also had somebody mentioning the Nacho trade.

Not a chance of Hormuz opening. Trump, Trump says Iran’s offer is totally unacceptable. That was yesterday, and today he said, “The Iran ceasefire is on life support.” For weeks, all I’ve heard from him is, “Oh, they, they can’t wait to do a deal. They’re begging to do a deal. They wanna, they’d love to do a deal.

They’re desperate to do a deal.” Apparently, they’re not so desperate to do a deal.

Tony Kynaston: H- you name one war the US has gotten into in the last 100 years that hasn’t lasted for, like, at least five or six

Cameron: Yes. Yes, uh, Gulf War one.

Tony Kynaston: Ooh, that lasted a while though, didn’t it?

Cameron: Nah, it was over in, like, two weeks, but

[00:02:00] just went in, surprise attack, massive overwhelming force, signed a, signed a deal with Saddam, and got out. Um, but yeah, it was, it was a rare one. But, you know, as I’ve talked about on my other shows many times, you and I have talked about off air, you know, the US is driven by military Keynesianism.

The US economy survives on military Keynesianism.

Tony Kynaston: Mm-hmm.

Cameron: it is now, $1 trillion Pentagon budget he’s got it at, uh, people don’t realize how much the US economy relies on that and how campaign financing for senators and congressmen and women rely on that, how it’s, uh, uh, the centerpiece of the US– uh, how the US economy works.

Doesn’t get talked about much, but when you drill down into it. And you can’t justify that kind of a budget endlessly unless you’ve got a [00:03:00] big war at least every five to 10 years.

Tony Kynaston: No, that’s all true. But my point is that every time US, uh, exceptionalism thinks they’ll get in and out of a war within a week, it generally lasts

Cameron: But they don’t think that. That’s what they say publicly. They don’t really think that. I mean, the planners I don’t think, think that because there’s no profit in a quick war. I mean, okay, you do 24,000 missile strikes and you need to go and rebuy all those missiles, but there is some profit in it. But there’s a way more profit in a long drawn out war for everybody involved militarily.

Not for the people who die, but for the people who make the money on the back end of the military industrial complex, that’s where the profit is, right?

Tony Kynaston: Uh, yes, but I don’t think Trump saw things that way. I think he saw a way of stamping his authority and,

Cameron: Oh,

yeah, “

Tony Kynaston: I’m a

Cameron: Yeah.

Tony Kynaston: than anybody else, and I’m a better deal-doer than anybody else,” and he’s just proving that he’s not.

Cameron: Well, I [00:04:00] don’t think Trump knows what he’s getting into most of the time. He just… Yeah. Uh, so anyway.

Tony Kynaston: in the shoes and goes, “Ooh, what have I gotten into now?

Cameron: Yeah.

Tony Kynaston: Look at

Cameron: Yeah.

Tony Kynaston: Best shoes

Cameron: mean, and a lot of it I do believe, like there’s also the element of distraction of the day, so deals are getting done on the back end and

building hotels in Gaza and, uh, probably in Venezuela and the Epstein file distraction and all that kind of stuff.

Tony Kynaston: Yep, definitely.

Cameron: Uh, uh, I’ll just cut, I’ll just cut and paste all the news in later.

Tony Kynaston: Okay.

Cameron: Tony, there’s been a lot of news in my US news report that I run a couple of times a week. Uh, too much really to go through. These are stocks that we’ve, that we own in our portfolios or we talk about. I’ll get into those in a minute.

Before we do that, let me just talk about our portfolio performance in the US. Our, uh, dummy portfolio, which as you know, has been running since [00:05:00] September 2023, is currently tracking at 125% time-weighted return versus the S&P 500, 66% over that period. So doing double market on that one. The QAV America Light portfolio, which has been running since the end of last year, s- December 22nd, is currently at 7% versus 7% for the S&P.

So we’re neck and neck. We have come back quite a bit. Uh, we were doing way better than it a week ago. What’s fallen in the last week? Hmm, couple of things. Hmm, PAGSEGURO Digital has dropped. But a lot of s- a lot of, uh, stocks have had a rough week with oil prices and all this kind of nonsense going on.

The Nacho trade or the Nacho [00:06:00] market, whatever we wanna call it. But that said, um, a lot of our stocks are doing very well. Uh, let me, let’s run through some highlights from the dummy portfolio. Uh, uh, let me, listed by that. Number one performing stock in our dummy portfolio is still Willis Lease Finance, and I’ve got some news from them in the news section.

They’re up 350% since we bought them. Enova International is up 183%. Euro Seas is up 156%. SASCO Energy Navigation, TEN, is up 148%. Banco Latinoamericano BLX, Blaze, uh, Blade, Blade, BladeX, I think. It’s up 115%. StealthGas is up 98.8. But you know when I always say invest in mass, not gas? They’re the exception, um, StealthGas.

They’re up 100%, 98.8% since we bought them. The others are all doing well, too. The one that’s not doing [00:07:00] well o- out of our portfolio is Korea Electric Power, KP. They’re down 11.8%. In the light portfolio, Cord Energy, they’re also in my news today, is up 46.6%. Pitney Bowes is up 46.4. Commercial Vehicle is up 46.3.

Tony Kynaston: That’s amazing. How does, how does Pitney Bowes go up forty-six percent?

Cameron: I’ll tell you ’cause they’re in my news, uh, today. Kodak was up 80%. It’s now only up 35.

Tony Kynaston: Oh, that’s volatile, isn’t it?

Cameron: That is volatile. I mean, I’m s- I’m not complaining about being up 35% in a month, but still. Nabors Industry is up 28. Uh, all the rest are up, too, except for a few. Shi- Shinhan Financial is down four and a half. Opportune Financial, OPRT, is down seven, and PAGSEGURO is down 8.7.

Not coincidentally, they’re all not American-based companies. They’re all f- you know, foreign, [00:08:00] um, entities. But so is, uh, I think GeoPark, uh, so is Danaos. They’re all doing well. Ecopetrol is up now 4%. Deutsche Bank that we did last week is up 2%. But, uh, everything’s doing quite well. Um, the other stocks that we’ve talked about on the show, Pulled Pork’s, that aren’t in our portfolios but stack ranking them in terms of how well they’ve done since, uh, we talked about them.

At the top of the list is Zepp Health Corporation, the, uh, digital watch manufacturer. They’re up 278% since July 25. Sasol is up 166%. Chemex is up 134. Precision Drilling is up 92. POSCO’s up 82. ORIX Corporation is up 75. Long, long list of stocks doing very well. [00:09:00] On the not so good side of things, uh, Cal-Maine Foods is down 20.

Controladora Vuela Compania de Avion is down 20. Bausch Health are also in the news. No, not Bausch, it’s Dausch that’s up. They’re down 15. AMC is down 14. They still haven’t worked out how to sell Mad Men. Um, couple of others. But yeah, generally speaking, yeah, most of them are doing really well. So I’m gonna, uh, too much news to go through in detail.

I wanna get to my Pulled Pork, but, uh, just some quick highlights. Kodak shares fell. They came out with their quarterlies. Uh, US commercial print and chemicals maker rose 7%. Revenue rose 7% year on year. Operational EBITDA jumped to 15 million from two million, driven by improved pricing. But net loss widened to 16 million from seven million a year earlier.

So the share price dropped, but as I said, we’re still up 35% from [00:10:00] when we bought them a little over a month ago, so I’m not complaining. Jackson Financial, a stock that we’ve, hold. They’re an annuity provider. Q1 retail annuity sales rose 31% year over year. Adjusted operating EPS from Q1 rose slightly, $5.15 from $5.10 a year ago.

But the company posted wider net loss due to less favorable hedging and higher volatility. So their shares took a little bit of a hit as well. Um, Willis Lease Finance, I mentioned, Q1 revenue rises 23% on higher lease and maintenance income. UBS, who we hold, climbs after a stellar Q1. Uh, ro- went up 4.5% after profits beat market expectations.

Net profit attributable to shareholders rose 80, rose 80% to $3 billion, [00:11:00] beating an average analyst estimate of 37%. Uh, RenaissanceRe, based in Bermuda, good Q1 operating income. Gray Media, the, uh, television company that we’ve, uh, held for a while, their performance was good, driven by core advertising exceeding guidance and political revenue reaching the high end of expectations.

Good old midterm spending.

Tony Kynaston: Yeah.

Cameron: Dowsch reports first quarter results, they were good. Callaway Golf Company announced their results. First quarter, I know you like this one. First quarter net sales up 9%, net income from continuing operations up 18%, adjusted EBITDA up 31%. Q1 non-GAAP net income from continuing operations increased 96%. Sounds good.

[00:12:00] Pitney Bowes released their results. Uh, management attributed strong Q1 results to a broad-based recovery, specifically noting that SendTech is nearing a sales inflection point while Presort builds momentum towards a return to growth. S- these are the guys that do all of the

Tony Kynaston: Franking.

Cameron: mail franking, yeah.

And Cord Energy, that we also hold, came out with their results. Delivered oil volumes above the high end of guidance despite adverse weather and midstream constraints, supported by solid cost control and the Strait of Hormuz being closed. So thank you very much for that. So, um, good results all around, but as I said, market’s sort of up and down like a bride’s nightie over there at the moment, so you never know what’s going on.

But generally speaking, the market is still going bonkers. As I said earlier, Michael Burry is saying it’s massively [00:13:00] overpriced and, uh, he’s expecting a disaster, uh, to come. But, you know, we don’t try and predict the future, we just play it day by day.

Tony Kynaston: Well, I hope it doesn’t come to pass ’cause that will impact us, but we’ll deal with it when it does, if it does. Uh, interesting though that Willis Lease Finance is doing well. I wondered whether they would come off because aviation worldwide is, is coming off. It’s slowing down. I think Qantas recently said they were down twenty percent internationally in capacity maybe. So, uh, you know, sometimes the first thing they do is to and save costs and extend their current fleet rather than lease new engines or whatever they do with Willis. But, uh, seems not to be the case.

Cameron: Well, Willis lease commercial aircraft and aircraft engines, but I imagine they have long-term contracts. I can’t remember from when we did the deep [00:14:00] dive on them, but I think they have long-term contracts in place, so they’re probably a little bit hedged against short-term fluctuations in demand. Don’t know.

But anyway, they’re doing okay, apparently.

Tony Kynaston: Mm.

Cameron: So let me get into my deep dive today, Tony. TRS, not the Reject Shop as it would be in Australia. I don’t even think they’re listed anymore, are they?

Tony Kynaston: No, they were taken over.

Cameron: we did well out of them for a while during COVID.

Tony Kynaston: Mm-hmm.

Cameron: This is TriMas. TriMas, T-R-I-M-A-S. Never heard of them, and for good reason.

Oh, well, yeah. They’re, they’re like… This is an interesting one, as I said to you earlier. Like, they’re in some ways a classic QAV stock. Uh, a company that makes bits and bobs that you’ve never heard of because they’re behind the scenes.

Tony Kynaston: Mm-hmm.

Cameron: a, uh, slimming down exercise, [00:15:00] refocusing activist investors that are forcing them, well, not forcing them, but pushing them to sell off bits of the business that don’t really fit with their main goal.

But their numbers are a little bit screwy. So, um, I didn’t buy them because I wanted to run it past you first. Uh, like you put the kibosh on Milrose, MRP a couple of weeks ago. We’ll see what you think of this one. But it did come up pretty high on my buy list this week. QAV score of 0.4, quality score was 9 out of 13, stock rank of 99, quality rank of 93, F score of 8.

So on paper, pretty good, about as good as you get. Manual, the, the PropCaf came in at 1.88. But as you’ll find out, the operating cash as it appears in Stockopedia is, is, um, [00:16:00] maybe not to be believed, not to be taken at face value.

Tony Kynaston: okay.

Cameron: Um, but we’ll get to that. So market cap’s about 1.53 billion. Shares are trading around about 43 bucks.

So what do they do? Tony, got a question for you. Do you like to be clean, Tony? Do you like to wash your hands? Yeah. Do you like to smell nice?

Tony Kynaston: Hmm. guess so. Better than smelling bad, but go out of my way.

Cameron: Do you like your wife to smell nice?

Tony Kynaston: Y– Uh, same thing. Yeah, as long as she smells clean.

Cameron: Post-COVID, do you like to keep your hands clean? Do you like to squirt stuff? Okay. Well then, you, you are the end customer for TriMas.

Tony Kynaston: Oh, all right.

Cameron: time you pump hand soap or spritz some perfume, if you lived in America, which you don’t, but if you did, you’d probably be a customer of TriMas. Um, all the little squirty bits in [00:17:00] bottles, somebody has to make those.

The little, the pumps,

Tony Kynaston: Dispensers,

Cameron: dispensers, these guys make that. Um, been doing it since 19… Oh, nice. Yes. Good job. Boom, boom. Is that what you’re doing so much? Is that your, is that your, is that your suggestion for a title? Indispensable

Tony Kynaston: Mm-hmm.

Cameron: Been doing this since 1986. They’re based out of Michigan. Uh, not a household name, don’t need to be.

Their website says, “TriMas designs, manufactures, and supplies a broad range of innovative and high quality products for the consumer packaging, life sciences, and industrial markets through its TriMas Packaging and Specialty Products Group. With approximately 2,500 employees in 12 countries, TriMas is committed to blah, blah, blah, blah, blah.”

Get into the divisions a little bit more in a minute. They were spun out of a company called Masco, [00:18:00] M-A-S-C-O. They’re a big building products giant in the Detroit area. They make plumbing and decorative architectural products, things like kitchen faucets. They’ve been around since 1929 and they spun TriMas out in 1986.

Mas from Masco. Tri because there were three business segments that they’ve rolled out into this thing. So Barry and Stan, who came up with the name for this, easy day. Easy day at the, easy day at the office.

Tony Kynaston: I guess you don’t need a marketing executive in the company if you manage– if you’re marketing dispensers.

Cameron: Yeah, not really. No. They got taken in private in 2002, then re-IPO’d in 2007, originally on the New York Stock Exchange, later moved to the Nasdaq.

Tony Kynaston: ‘Cause it’s a high-tech company.

Cameron: high tech. You wouldn’t believe how high tech. Actually, yeah, as we’ll see, they actually do have some high tech factories now in China. At least one, you know. [00:19:00] Um,

Tony Kynaston: So

Cameron: so yes. Well, yes. Yes. Well, some, you know, I drilled down into that a bit. Some of the tariffs were hit on the head by SCOTUS, other ones not.

So there are tariffs that are still maybe legit, although they are being challenged. It’s complicated. No one knows. This is, uh, you know, Trump 101. Keep them guessing.

Tony Kynaston: yeah.

Cameron: So, uh, as I mentioned earlier, a bit of activist investor activity that’s caused them to slim down the business a bit. So, uh, I like that.

So a couple of things already that I like. They, they manufacture things you’ve never heard of them, but they’ve been around a long time. They make money and they’re tightening their belt, streamlining, all that kind of stuff. Classic, classic value investing,

Tony Kynaston: Yeah.

Cameron: in January of 2025, a guy, [00:20:00] well, a firm called Barrington Capital, run by a guy called James Mitarotonda, took a relatively small stake, 1.5%, but sent a very public letter to the chairman Guy called Herbert Parker saying, “Hey, you’ve got a CEO transition coming up.

The timing is perfect. Let’s think about strategic allocations…” Sorry, “… strategic directions for the business.” And it was well received because Herbert Parker himself was originally put in on the board by another activist investor, a guy, a company by the f- name of En- Engaged Capital, nearly said Enraged Capital, which is a pretty good name for an activist investor.

Engaged Capital back in 2015. So you’ve got activist on activist action, Tony, and there’s nothing much sexier for a value investor than activist on activist action. Sexy activists.

Tony Kynaston: of value [00:21:00] investing camp.

Cameron: Yeah. It’s like a shake and bake in, uh, Talladega Nights. Activists building on activists. So Parker’s now the chairman. So this was in January of 2025, um, and around about this time they, uh, were already onto this a little bit with the previous C-suite.

They sold a division called Arrow Engine. It was a natural gas engine maker for the oil and gas pumping industry, so didn’t really fit with pumps. So they dumped it. This is where I got the pumps and dumps from, right?

Tony Kynaston: It, was, a really big dispenser of gas. Like you had to find a really big… Had to get Hulk Hogan in to push the dispenser there.

Cameron: They were like, “The gas pumping industry, we make pumps. Perfect fit.”

Tony Kynaston: Yeah.

Cameron: Yeah. So they offloaded that. Um, then in February last year, they announced they were gonna review all of their portfolio and then at the end of the year, November 25, after they had swapped [00:22:00] CFO and CEO, they made a deal to sell an aerospace segment for $1.45 billion.

It was made up of things like fasteners, blind bolts, and machined parts for Boeing, Airbus, Lockheed, and the defense supply chain. Had been part of TriMas for decades and was actually its highest margin segment, but was capital intensive, not many customers and, you know, had to deal with commercial aerospace cycles.

Didn’t really fit with, you know, uh, uh, hand pumps. So… And they decided they could get a good price for it, and they did. New management decided to dump it. Previous CEO had apparently done a good job- Making it a good business is, you know, making it very profitable. They flipped it, uh, to a company I think called PenAero.

Um, [00:23:00] sold it at 20 to 22 times earnings. So good deal. Yeah, did really well out of it. So new CEO or the old CEO was a guy called Thomas Amato, he’d been there since 2016. He was replaced by a guy called Thomas Schneider June of last year. He came from a company called Silgan Holdings. They’re a major US metal and plastic container manufacturer.

He was the president of Silgan Containers.

Tony Kynaston: It seem– Is it just me or does US corporate, the US

Cameron: S-

Tony Kynaston: dose of Barry and Stan?

Cameron: Ah, wouldn’t Barry and Stan love this? What do you make? Uh, containers. What do you generate them out of? Silicon. Well, Silgan Containers, that’s your name. Oh, that’s brilliant.

Tony Kynaston: Uh.

Cameron: who Barry and Stan are, it’s a, it’s an old joke. I- inside joke. So, um, he was the president of Silgan, so [00:24:00] they basically hired a packag- packaging industry veteran to run what is now a packaging pure play, huh?

They also got a new CFO. Old CFO left last year as well, replaced by a new guy, Paul Swart, in December 2025. So 2025 was a big year. They sold off a couple of divisions, new C-suite, um, new focus. They’re Six Sigma-ing the business, which I only know of because of “30 Rock.” Did you ever watch “30 Rock”?

Tony Kynaston: No, not really.

Cameron: Oh.

Tony Kynaston: be around a lot of people who put a lot of s- emphasis on Six Sigma. Um, especially when I did some deals with GE, they were right into it.

Cameron: Well, “30 Rock” is about GE, um, ’cause it’s… Right, it’s about… You’ve never seen “30 Rock”? So Tina Fey…

Tony Kynaston: here and

Cameron: Oh, right.

Tony Kynaston: Didn’t really get that

Cameron: Really? Oh, it’s brilliantly written. Really great. Yeah, yeah, it’s really great. But Tina Fey runs, like, a “Saturday Night Live”-type [00:25:00] show, 30 Rockefeller. It’s owned by GE. And, and Alec Baldwin is, like, the head of the television part of the business.

He’s, and he’s all about Six Sigma. He’s always, like, tr- trying to Six Sigma up, you know? Turn the entertainment business into Six Si- He’s always talking about Six Sigma this and Six Sigma that. It’s a really good show, and he was really good. Surprisingly very funny in it. Um, never thought of him doing comedy, but he was good.

And then he went and killed someone. But, you know, what are you gonna do? No, not allegedly. He fired the gun that killed

Tony Kynaston: Okay.

Cameron: or not he was culpable for it, you know, you know Whoo. So, um, big year. Um, so what can I tell you about these guys? So they got these, uh, three divisions. Packaging is pretty much 84% of revenue, growing at about 9% year over year.[00:26:00]

Like, um, apparently packaging is a good business. Making

hand pumps and sunscreen bottles or perfume samples or caps on buckets of paint, all of that kind of stuff they do. And apparently it’s a pretty sticky business as well. So when … no pun intended. When you get a customer and you build a mold for their

Tony Kynaston: Mm-hmm. Yeah.

Cameron: it’s quite expensive to build a machine and a mold and all of that kind of stuff.

So once you get ’em, you apparently get ’em for a long time. They’ve also got a life sciences division, which is interesting. They design and manufacture precision, pr- pr- why can’t I say that? Precision injection molded components and assemblies for applications in the life sciences market. Includes prototype production models, molds, production…

I can’t talk, and custom [00:27:00] medical related components such as consumable vascular delivery, patient monitoring, and diagnostic test components, which reminds me, I have to go get a 24-hour blood pressure monitor installed. I should be… Hey, Siri, remind me tomorrow to get a blood monitor installed, blood pressure monitor installed.

Keep putting that off. Surgical devices and pharmaceutical closures, that’s sort of the growth end of the business, but it’s not a big part of the business right now. Operating margins are 10% to 13%. Not bad. Not terrible. And then they’ve got… Oh, they built a, a tw- 225,000 square foot beauty packaging facility in China, which is all clean room, robotics, all that kind of stuff.

So it is high tech, despite you making fun of them.

Tony Kynaston: I

Cameron: Then,

Tony Kynaston: fun of them.

Cameron: edge technology, you’re saying. It’s all AI. They’re gonna change their name to TRSA, or TriMas AI, Tony. That’s where, that’s the big [00:28:00] bucks are. May I, may AI. Yeah, yeah. And then, uh, they’ve got this thing called Norris Cylinder. High pressure steel and aluminum cylinders for industrial gases, oxygen, nitrogen, CO2, propane and propa- propane and propane accessories.

Do you ever watch King of the Hill?

Tony Kynaston: No.

Cameron: Uh, Chris is a huge King of the Hill fan. Propane and propane accessories, that’s what he deals in. And refrigerants, that’s, uh, the third part of their business. Steady, low growth, mature market, not gonna move the needle much. Okay, but here’s the thing Cash hoard distortion.

So they sold the aerospace business for $1.45 billion.

Tony Kynaston: Right.

Cameron: And if you look at Stockopedia year-on-year operating cash, in 2025 it was 2.88. Their TTM is [00:29:00] 22.7,

which is a big jump.

Tony Kynaston: I can see it now. Yep. So that’s interesting. So you’re saying the sale of the aerospace division went through operating cash flow?

Cameron: In Stockopedia. Now,

Tony Kynaston: Right.

Cameron: not how the company’s reporting it.

Tony Kynaston: No.

Cameron: business disposal proceeds go in investing activities, not operating, which they did correctly in their cash flow statement. I pulled up their report. Their actual Q1 2026 operating cash flow from continuing operations is negative 19 million.

Tony Kynaston: Okay.

Cameron: Their TTM operating cash flow is roughly 125 to 130 million, but it’s not 890 million like Stockopedia’s reporting. By the way, Claude, I got it to read the annual report and it said, “Look, the negative 19 million is just sort of messy accounting.” It said, “They’ve got [00:30:00] discontinued operations from these two divisions they sold.

It’s just gonna be messy GAAP accounting numbers for at least a few quarters while stuff flows through from the divestitures, special items, charges, et cetera, et cetera.” But Stockopedia’s operating cash flow numbers are wonky. For some reason, they’re showing this up as operating cash flow when it’s not really, and that’s not how the company’s reporting it either.

Anyway, total debt’s about 396, uh, million, but they’re sitting on a billion dollars in cash, so they could pay that off if they wanted to. They’re not going to.

Tony Kynaston: Mm-hmm.

Cameron: gonna use the cash for strategic acquisitions in consumable, consumer packaging stuff.

Tony Kynaston: I think they’re also– Aren’t they also doing some buybacks and other

Cameron: But,

Tony Kynaston: initiatives? Yeah.

Cameron: hmm, they have done that.

Tony Kynaston: [00:31:00] Yep.

Cameron: they’ve done… Well, they’ve approved a big buyback. They’re about a third of the way through it. Share price is at an all-time high at the moment, up around 42, 43 bucks, so some of that is flowing through to it. Also, the market has liked the fact that they’ve offloaded this stuff.

Tony Kynaston: Yep.

Cameron: But- The 2025 annual report cites about $117 million of cash flow from operating activities, but that includes aerospace, which they’ve just sold off. So if you strip that out, it’s about 40 million.

Tony Kynaston: Mm-hmm.

Cameron: with something like 70 to 80 million. So the OpCaf per share would be around about two bucks.

Tony Kynaston: Yep.

Cameron: Share price is 42 bucks.

Tony Kynaston: Yep.

Cameron: So the Pr/OpCaf, if you were basing on that, would be like 20 times.

Tony Kynaston: Yep.

Cameron: We have a cutoff of seven, so this would be an immediate fail,

Tony Kynaston: Mm-hmm.

Cameron: uh, on our checklist if we were using those numbers. But as I said to you, um, I think in the last [00:32:00] show, we normally don’t drill down into this level of financials.

So it showed up on the buy list. I would’ve bought it if I hadn’t have done the Pulled Pork on it, just looking at the, the scoring. But in terms of the business, like I like the business. I like what they do. I like the management. They, they, you know, they seem to be slimming it down. They’re focused. They brought in this guy who knows, seems to know what he’s doing, comes from packaging.

They’re sitting on a massive amount of cash that they can use for acquisitions. Um, mm, you know, it’s a good story, but if I backed all of that stuff out, it wouldn’t be on our buy list,

Tony Kynaston: No.

Cameron: on merit.

Tony Kynaston: I wonder why Stockopedia is reporting the operating cash flow to include investments. That’s just very strange.

Cameron: Claude said, look, they get their data feed from whoever they get it from these days. Um, who was that company that you [00:33:00] used to have a subscription with?

Tony Kynaston: Was it Reuters?

Cameron: No, it was some, it began with an R. Um, re- reinvest. Refinitiv,

Tony Kynaston: yep.

Cameron: who I think changed their name or got bought or something there, not that. But yeah, something to do with their data feeder.

Like we see this with stock, uh, Stock Doctor all the time in Australia, right? We have dodgy numbers that come through, so data feeds do things for various reasons and screw up sometimes for various reasons. Um, so,

Tony Kynaston: at the, the, company when you sent through the, the notes this morning, it was, me, my, my sort of top line summary was it’s great when good management gets a, um, a cash injection.

Cameron: right.

Tony Kynaston: a good lump, lump of cash often means good results.

Cameron: Right.

Tony Kynaston: at this stage, you’re right, you should back out that windfall and look at the underlying business, I think, until they invest it and see what they’ve bought.

Cameron: Yeah. That was my concern with it. Like, everything looks [00:34:00] good, but that number doesn’t really

Tony Kynaston: Yeah.

Cameron: You know, pass the sniff test if we’re gonna break it down. The rest of the numbers are good. As I said, they pass all of the Stockopedia stuff.

Tony Kynaston: Mm-hmm.

Cameron: than book plus 30. Book plus 30 is $52.61. Price is $42.72.

Doesn’t pass, uh, price, uh, less than book. Um, book value growth is positive, um, over the last three years. Good sentiment, uh, et cetera, et cetera. IV1 is actually negative because of a trailing 12-month EPS loss.

Tony Kynaston: Mm-hmm.

Cameron: is 17, well below the price. The yield is only 0.37%, so that’s, they’re not gonna score for that.

But, you know, everything else scores well,

Tony Kynaston: Yep.

Cameron: but, uh, doesn’t really, we can’t really honestly score them for

Tony Kynaston: No. That’s

Cameron: PropCaf.

Tony Kynaston: a coffee shop which is doing well because I sold the, [00:35:00] sold the land. like,

Cameron: No.

Tony Kynaston: It’s not… It’s…

Cameron: Although

Tony Kynaston: not–

Cameron: they

Tony Kynaston: the, you can’t add the land income to the, uh, operating cash flow of the business and then make an assumption about the worth of the business based on that.

Cameron: do have

Tony Kynaston: Yep.

Cameron: a lot of cash, but that’s, doesn’t necessarily mean it’s operating, tr- gonna translate into operating cash flow, right? Mm-hmm.

Tony Kynaston: Yeah.

Cameron: So another one, you put the ca- the, the TK kibosh on.

Tony Kynaston: Well, it’s interesting, we talked on the last Australian show about whether Pulled Pork’s a, for show or whether they’re actually worth the analysis, but I think this is another case of where they’re worth the analysis.

Cameron: Yes. Yeah, yeah. Um, and whether or not, you know, this is interesting ’cause as, as, as I said a couple of times, normally we don’t do this level of analysis and these things would sneak through. But, [00:36:00] you know, it’s my AI analysis that, um, pulls these things out. You know, I have a script that Claude runs, and the first thing that it said when it, I said, “Go do a deep dive on this for me,” was it raised this as a red flag immediately.

The, the first thing I have it do before it does the pulled pork is look for anything that looks, um, screwy. It’s called phase zero of the analysis. Phase zero is check for anything that doesn’t pass the sniff test, and it did that on Millrose, and it did it on this too. It went, “Whoa, whoa, whoa, whoa, whoa.

This operating, this price to operating cash flow is dodgy,” right?

Tony Kynaston: I thought

Cameron: Mm-hmm. actually

Ah, yeah, well, I’m smart enough to use Claude. Yeah.

Tony Kynaston: Yeah. So what are you doing? You like comparing Stockopedia to the balance sheet on the, on the annual report or something. You’re looking for discrepancies.

Cameron: Yeah, I have it, uh, I have it pull the recent, most recent financial report, read it and, you know, do some analysis on that and compare that [00:37:00] with my scoring.

Tony Kynaston: Okay.

Cameron: Yeah. It’s the bullshit filter mechanism on it.

Tony Kynaston: good. Yeah.

Cameron: it sneaks through sometimes, like with Millrose, right? You know.

Tony Kynaston: And I

Cameron: Okay.

Tony Kynaston: something, I don’t run Claude over it, but I do have a look at it and see if,

Cameron: Yes.

Tony Kynaston: if there’s something a bit wonky about it. Why is it throwing up such a high Pr/OpCaf, or anything else about it? High dividend yield or whatever.

Cameron: Right.

Tony Kynaston: the pub test. Yeah.

Cameron: Yeah. And I’m not sure I would’ve picked … Like, I’ll normally look at the revenue line and the operating profit line in Stockopedia, net profit, see if they all look above board. I normally wouldn’t drill down seven or eight layers to look at the operating cash flow per share history, but, you know, this one, it goes 2.92, 3.1, 1.71, 2.11, 1.58, 2.88, 22.7!

Tony Kynaston: Yeah.

Cameron: Hmm. Okay.

Tony Kynaston: done. Okay.

Cameron: there’s another one [00:38:00] that’s two in three weeks that you’ve said no to. Um, I, uh

Tony Kynaston: Well, I think you’re saying no to them as well, aren’t

Cameron: my gut feeling as soon as I was like, “Hmm, look, I like it, I like it, but, um, I don’t think that’s, uh, you know, apples with apples.”

Tony Kynaston: It’s interesting that your… You know, my first response would be there’s something different in the US accounting standards compared to Australian companies, putting those lump sum windfall numbers through operating cash flow. But if you’ve checked that out against the balance sheet, then that doesn’t seem to be the case. to be a problem with the data provision.

Cameron: Yeah. Yeah, no, the, um, the company reported it, um, appropriately. Hmm.

Tony Kynaston: Okay

Cameron: Okay. Well, I don’t know what I’m gonna buy this week then. I’ll have to go back to the drawing board and see something else. But I think in future when [00:39:00] I, uh, find something like this that has a dodgy flag, I won’t bother doing a pulled pork on it.

I might just,

Tony Kynaston: Yeah.

Cameron: um, run it, run it past you via an email and pick something else. Hmm.

Tony Kynaston: Yeah, cause there’s plenty of other stocks on the, on the buy list, so

Cameron: Yeah.

Tony Kynaston: Yeah.

Cameron: But it is interesting to sort of see these anomalies,

Tony Kynaston: Yeah,

Cameron: the buy list and, you know, we don’t see this happen in Australia, right? Where there’s … I can’t remember a single time we’ve had a stock on the… Well, yes, we have, News Corp. Yeah.

Tony Kynaston: number of shares

Cameron: Yes Yeah, we have had data quality issues, ’cause that’s really what these things are, they’re sort of data quality issues.

Tony Kynaston: Yeah.

Cameron: Hmm.

Tony Kynaston: and far between, but they do happen.

Cameron: Yeah.

Tony Kynaston: Mm.

Cameron: Okay. Well,

Tony Kynaston: All right.

Cameron: What have you got for after-hours, TK? Quick one.

Tony Kynaston: Yeah, not a whole lot [00:40:00] today. I probably, um, wanna focus on Red Dragon. Have you seen that? You probably have. It’s like 40 years old or something,

Cameron: That’s one of the sequels to “Silence of the Lambs.”

Tony Kynaston: that’s the interesting thing. So I, I hadn’t seen it before, and it came up on, um, one of the streams. Jenny and I watched it, Jenny said, “Oh, this is a sequel to Silence of the Lambs.”

No, it’s the original. The Silence of the Lambs is a sequel to Red Dragon.

Cameron: Right.

Tony Kynaston: interesting to see that the, um, Anthony Hopkins character was fully formed and his backstory, uh, that, um, the FBI agent this time was played by, um, his name? Ed, uh, Norton.

Cameron: Right.

Tony Kynaston: of role to the one that Jodie Foster played in Silence of the Lambs.

But, um, yeah, it was just– It was– I always thought Silence of the Lambs was so original and a breakthrough and interesting, but it was, it was a sequel to Red Dragon.

Cameron: But “Red Dragon” is a prequel.

Tony Kynaston: [00:41:00] No, I think Red Dragon came out first.

Cameron: No. No way.

Tony Kynaston: Yeah.

Cameron: No. So “Red Dragon” came out in 2002. “Silence of the Lambs” came out in 1991.

Tony Kynaston: Oh, really? I got that wrong, have I?

Cameron: Yeah.

Tony Kynaston: Okay. Sorry.

Cameron: Yeah, it was a prequel, um, that, um, Brett Ratner made. Yeah. Hmm.

Tony Kynaston: Oh, well that, that makes sense then. I thought it was the first one that came out. Now, is there an earlier version of Red Dragon? ‘Cause I seem to recall it was out first.

Cameron: So Michael Mann,

Heat, made a film called Manhunter in 1986, which is based on Hannibal Lecter

Tony Kynaston: Okay, maybe that’s what I was thinking of.

Cameron: and Will Graham. Brian Cox was in it. Um, who else? Uh, looking at the thing here. No one. Joan Allen.

Hmm.

Tony Kynaston: Yeah.

Cameron: Um, [00:42:00] but actually Hannibal Lecter’s– Does it say Hannibal Lecter’s in this? But it’s kind of loosely based on the– that story. never seen it. I’ve always tried to track it down to see it. Um, but yeah, Silence of the Lambs then was made. And you know, I, I’ve told you the story about meeting Anthony Hopkins, right? Remember that one

Tony Kynaston: one of the reasons for raising it today.

Cameron: Mm-hmm. Uh, great actor. Great actor. I, I remember see- I did see Red Dragon. I don’t remember it being great.

Did you? Yeah.

Tony Kynaston: just the acting. It fa- a lot of famous, uh, people are in the show. Um, Fiennes plays the bad guy. Hannibal Lecter was played by Anthony Hopkins. Ed Norton’s in it. Yeah.

Cameron: Harvey Keitel, Mary-Louise Parker.

Tony Kynaston: Parker. Yeah. So

Cameron: Philip Seymour Hoffman.

Tony Kynaston: Mm-hmm.

Cameron: Yeah. There was another one that they made too, [00:43:00] with, uh, what’s his face in it,

Tony Kynaston: Okay.

Cameron: there’s another sequel, I think. Try- scrolling through IMDb, trying to find out who that was, but it was, it was really bad. Anyway, hmm. Oh, Hannibal, it was called.

Yeah. 2001.

Gary Oldman. Ray Liotta, that’s who I was thinking of. Julianne Moore, Gary Oldman, Ray Liotta. Hmm.

Tony Kynaston: Oh, I do recall seeing that one. Yeah, that’s a sequel.

Cameron: Yeah. Um, Julianne Moore played Clarice Starling in that one.

Tony Kynaston: Yeah.

Cameron: What else?

Tony Kynaston: Uh, have you seen the movie called “The Hunt” from two th- two, uh, from 2020, I think it is? So the, uh, series that’s out, I think on Apple TV, called “The Hunt.” It’s not that. is on Netflix and [00:44:00] it’s a movie. And, uh, I watched it last night. Um, I really kind of enjoyed it. Uh, the only sort of actor in the cast is Hilary Swank, and she plays a small part in it. Um, and it’s a sort of… I, I was c- I was looking at The Hunt and trying to work out whether I wanted to watch it, the TV series on Apple, and then I saw the short for the movie and I thought, “That looks much more interesting.” Even though it’s a, it’s kind of a cliché trope of having a secret place to take humans to hunt for sport.

Cameron: Oh, yeah.

Tony Kynaston: this movie is like a black comedy and it turns the whole trope on its head, one of the, one of the people they’ve kidnapped is the wrong person, and she runs amok and kills all the billionaires. a spoiler alert, but, um, it’s actually really, really good.

Cameron: The, the new series that’s got, um, what’s her face in it from the thing. Mad Ma- the [00:45:00] Mad Max, uh, sequel.

Tony Kynaston: Charlie’s?

Cameron: Charlize Theron. Yeah, yeah. Is it the one with Charlize Theron in?

Tony Kynaston: No, no, that’s a different one again. I think it’s called Apex.

Cameron: Oh, she’s getting hunted in that one, isn’t she? That’s

Tony Kynaston: a

Cameron: a different

Tony Kynaston: but,

Cameron: thing.

Tony Kynaston: thought it was quite good.

Cameron: Right. Uh, no, I haven’t heard of it. Sounds good.

Tony Kynaston: I hadn’t heard of it either, so

Cameron: I like– I, I totally like the idea of hunting rich people. Oh, no, it’s the other way around. It’s rich people hunting poor people. Yeah,

Tony Kynaston: goes and

Cameron: yeah.

Tony Kynaston: so it’s,

Cameron: Hey, listen, maybe that’s the next season of QAV.

You and I will hunt each other in Cape Schanck. Just with paint- paintball guns. Nothing, nothing lethal. Just give us, uh, each a paintball gun and then, you know, it’s like capture the flag. We, we, we, uh, hunt each other across the golf course. Have you ever played paintball?

Tony Kynaston: I haven’t

Cameron: Ah.

Tony Kynaston: not

Cameron: Should get you into a paintball course

Tony Kynaston: [00:46:00] Uh,

Cameron: and the, me and the boys.

It’s, uh… We used to do that on their birthday every year. It was fun.

Tony Kynaston: Speaking of that, like last night there was a, someone lit off a flare down the street and I was like, sit like– ’cause at home here at Cape Schanck it’s just quiet and dark. see this blue flare, couple hundred meters away go, go across it was just, you know, really eerie. Couldn’t see anything, couldn’t hear anything, just this flare. So one of the local kids I suppose is having fun on the golf course. But

Cameron: Oh.

Tony Kynaston: really eerie.”

Cameron: Hmm. Well, I don’t have much to report this week. I did watch Waiting for Guffman on Mother’s Day with Chrissy. You ever seen that?

Tony Kynaston: Oh, I think I saw 10 minutes of it and turned it off.

Cameron: Not your…

Tony Kynaston: guys.

Cameron: No? Okay.

Yeah, that’s right. You said you weren’t a big fan of Catherine O’Hara, so that tracks.

Tony Kynaston: No, or any of those, um, mockumentary best in shows and all those.

Cameron: [00:47:00] Hmm, Christopher Guest films? Hmm.

Tony Kynaston: And didn’t they remake, uh, um, what’s the Australian show? Um, with Kath & Kim. I think they remade them as well, and they were terrible

Cameron: He did that?

Tony Kynaston: Well, I don’t know if it was him, but certainly some of the actors from all those mockumentaries are in

Cameron: Oh, okay. Yeah.

Tony Kynaston: style of,

Cameron: Right.

Tony Kynaston: just hammy overacting from, you know… don’t know if they’re trying to make fun of people who are American and don’t have much of a brain, but yeah, it’s just I don’t, I don’t find it funny.

Cameron: Uh, okay. Um, let me, uh, tell you about a book that I heard about s-

Tony Kynaston: You can recommend Welcome to Gomorrah if it, if it

Cameron: No, no, no. It’s, it’s fine. We’ll move right along. Um, you know, uh, well, maybe you don’t know, but Elon’s big data centers that he builds for his AI operations, he [00:48:00] calls, um, uh… What does he call them? Colossus.

Tony Kynaston: From the Forbin Project.

Cameron: Yes! Right. So you do know it.

Tony Kynaston: No, I know the movie. I don’t know about Elon’s data centers.

Cameron: Oh, okay. Well, um, I had never heard of, um, Forbin and or the, or the movie. I didn’t even know there was a movie until you just mentioned

Tony Kynaston: Hmm.

Cameron: based on books

Tony Kynaston: Oh, okay.

Cameron: which I started reading the first one, uh, this week, you know, uh, knowing that you’re a science fiction fan, I wondered if you had read it.

Tony Kynaston: Haven’t

Cameron: read it?

Tony Kynaston: the movie. The movie came out when I was a kid

Cameron: 1970, I just looked it up.

Tony Kynaston: that, uh, imprisons a man to study him. think he was the inventor of the AI from memory.

Cameron: Right. So the original book was written in 1966 by a guy called D.F. Jones, Dennis Feltham Jones. Wrote Colossus: The [00:49:00] Fall of Colossus, and Colossus and the Crab. Um, so yeah, I’m sort of… Uh, I, I, I’m enjoying the first one. It’s, it’s kind of hilarious to read, you know, AI books from that period. The AI when it gets turned on, um, you know, it’s communicating with the humans via, uh, ticker tape that’s coming out of the side of the machine.

We were visionary enough to imagine artificial intelligence, but not visionary enough to imagine a world without ticker tape machines.

was talking in natural English like our computers do. The AIs do talk to us like that today, so at least those guys got it somewhat right.

Had lots of flashing lights, which we don’t seem to need on our computers these days. I do love a, I do love a sci-fi [00:50:00] film with lots of flashing lights on the supercomputers. Kind of miss that, to be honest. Kind of wish my computers did have, like, flashing lights and spinning tape reels and everything. It was so much more aesthetically pleasing than just a- Nondescript black box.

Tony Kynaston: It’s better for movies, isn’t it? When you can see things actually

Cameron: Yeah, it’s

cooler.

Tony Kynaston: Yeah. Like in Star Wars or Star Trek where there are all these lights that just flash.

Cameron: Yes, give me lights that flash and beep.

Tony Kynaston: Yeah.

Cameron: what have I been listening to that I can share with you? Um, nothing comes to mind.

Tony Kynaston: issue of The Aints which was really good.

Cameron: The Aints.

Tony Kynaston: Ed Kuepper

Cameron: Saints without that S. I’ve never heard of that.

Tony Kynaston: style of music. It’s good.

Cameron: Well, good.

Uh, do you see The Stones have got a new album coming out?

Tony Kynaston: I, [00:51:00] I’ve been seeing it on my streams. Yeah. The

Cameron: I listened to the first track that they’ve released, uh, off of that. It’s not bad.

Tony Kynaston: Mm-hmm. Yeah, it’s all right.

Cameron: And, uh, I’ve been listening to a lot of Yes this week. Do you like Yes?

Tony Kynaston: Oh, not– I haven’t heard a whole lot of them. I did a lot when I was a kid, but I can’t remember much of it.

Cameron: Hmm. I like.

Tony Kynaston: from

Cameron: Wow.

Tony Kynaston: people who were still in Yes of about 10 years ago.

Cameron: Wow. Why?

Tony Kynaston: one of my Canadian friends got it for me for a birthday present.

Cameron: Because they thought you were a big Yes fan or just…

Tony Kynaston: I think he’d been to, like, some kind of corporate gig with

Cameron: Oh,

Tony Kynaston: where they were playing.

Cameron: right. Jon Anderson are those guys.

Tony Kynaston: No, I got no idea.

Cameron: Thanks TK. Have a good week.

Tony Kynaston: you next week. You too.