Kits Eyecare 🇨🇦
TSE: KITS • EV: $363M • Last Close: $11.29
KITS is a vertically integrated manufacturer and e-commerce retailer of glasses and contacts. By owning their own optical labs and selling direct to consumer, KITS can sell eyeglasses for less than a 1/5th the price of competitors while remaining considerably more profitable. Customers also have the benefit of receiving their KITS glasses in days rather than weeks.
Founder and CEO Roger Hardy scaled his previous company, Coastal Contacts, from $30M in sales in 2004 to $200M+ before selling to Essilor for $430M in 2014.
KITS CAC/LTV is exceptional. Revenue has grown at 30%+ over the last 5 years which has been funded entirely by cash flow. Management is aiming for $500M in sales by 2030 which would see EBITDA margins in the 10-15% range.
A Writeup from Pound the Rock Investing (Greystone Capital) (Link).
A VIC Writeup (Link).
Playboy Inc 🇺🇸
NASDAQ: PLBY • EV: $261M • Last Close: $1.20
After a rough couple of years, Playboy has just one non-core asset left to sell (Honey Birdette) to complete their transition to an asset light royalty company. They’re collecting $33M of guaranteed licensing revenue from deals with Byborg and UTG plus ~$15M from other non-guaranteed licensing deals which are growing at a healthy clip.
Honey Birdette should fetch $50M at the very minimum. Proforma, Playboy will be left with a ~90% gross margin royalty business abd $24M of overhead which has a lot of room to come down.
Check Out: 18% IRR for 57 Years
Disclosure: This newsletter does not provide investment advice. Information presented is for informational purposes only and should not be considered a recommendation to buy or sell securities. The author may or may not own the securities discussed.