Value investing is not formulaic; it is not a cheat code to easy wealth accumulation nor an escape from effort and hard work. Those who jump on board with that mindset will be sorely disappointed.

Value investing is an appraisal process based on refined investigative skills and real-time deep business analysis. The American and global economic order has morphed profoundly since the days of Ben Graham, young Warren Buffett, and even Walter Schloss. Looking for pure Net Nets and issues selling at extreme discounts to TBV whilst returning a higher rate of return above the 10-year T-Bills is a little naive. Today, investors ought to sharpen their judgment and show more psychological flexibility than ever. Ground research, broadening one's valuation scope, reading, and, more importantly, patiently holding are key.

Throughout 2026, I have been able to uncover a few undervalued securities that have proven to be great finds despite their inherent “ ugliness." Most investors wouldn’t touch these stocks with a ten-foot pole because, at first glance, they looked more like dead trees than flowering fruit.

But as I said, small investors in 2026 and beyond must be “entrepreneurial” to earn a higher rate of return than the market. It is a hard, lonely path built on refining one’s process and being willing to embrace errors once in a while.

Here are a few stocks that have worked out quite well for me so far.

1-Classic Net-Net value play with Groupe TVA (TSX:TVA.B)

TVA Group Inc. operates as a communications company in Canada.

It operates through Broadcasting, Film Production & Audiovisual Services, Magazines, and Production & Distribution segments.

The Broadcasting segment engages in the operation of the TVA Network’s television stations and specialty channels, specialty services, the marketing of digital products associated with televisual brands, and commercial production and custom publishing services.

Stock Analysis: I published this short insight 8 months ago on Reddit when the stock was trading around C$0.83 per share. Today, the stock trades around C$2.20 per share and remains significantly discounted below fair operational value.

“This is more of a deep value asset play selling below working capital, with profitable earnings and reliable access to financing. The company is the leading French-speaking broadcasting company in Canada, reaching up to 80% of French speaking households.

TVA Group is going through structural industry changes as their viewership is moving away from traditional TV for social media platforms and alternative media. Management has been cutting jobs and deleveraging for the past 3 years with more cuts expected.

Still, the assets are great, the consumer moat’s wide, and the expectations for traditional TVs continuity are certain.

The stock trades at $0.83, but my Net Net calculation gives me $1.73/share. WC is $94M, yet the whole business sells for $29M. The margin of safety is wide, making the assets enticing for an acquirer or prime for a value-contrarian bounce.

The stock is selling at -61% in 5 years.

Quebecor controls close to 60% of the shares. Good probability of a buyout in play.

The stock is being gradually accumulated, trading up 50% in the last 3 months. I am expecting the market to eventually rerate near or above its Net Asset Value in the future.”

2-Re/max Holdings (RMAX) an acquisition asymmetry opportunity!

Real Brokerage acquired Re/Max after the two companies officially closed their $880 million business combination on August 24, 2026. I wrote the thesis below on February 26, 2026, when the stock was trading near $6 per share. I was thinking of a more tech-aggregator-type acquisition, like Zillow or, in my estimation, even Google. The stock finally closed at $12 per share in August 26.

I still think a larger acquisition by a deep-pocketed tech firm is in play, and Real REMAX Group Inc. ($REAX) looks like a worthy acquisition target for a Zillow-, Amazon-, or Google-type firm.

“At UglyStocks, we look beyond headline metrics to focus on the overlooked and undervalued opportunities that may be hidden on the edges. Recently, I came across Re/Max Holdings, the world’s largest real estate agency. The market values the company at only $578M, which appears extremely cheap at a quick glance.

The stock has fallen 82% over five years, partly due to disruption in the real estate industry caused by an antitrust lawsuit over broker commissions. I won’t delve into the lawsuit details, but its likely impact will be to reshape the traditional real estate agency model, significantly reducing agent commissions in the coming years.

This traditional model is the core of RMAX’s business, supporting its 150,000 global agents. Ultimately, Re/Max’s revenue could decline slowly as agents leave the industry due to reduced income, forcing the company to rely more heavily on its international markets. Add to this the challenging macroeconomic environment, and prospects look bleak.

So, what if a cash-rich, well-known tech company acquired Re/Max to expand its global footprint, integrating the company’s traditional office model into its broader tech and AI growth strategy?”

3-Bumble Inc (BMBL) is ugly.

Bumble is going private, but I had already gauged the undervaluation when I wrote a short contrarian thesis on February 17th, 2026, highlighting the depressed value and general neglect. The stock was trading at $3.44 per share, with the deal price estimated at $6 per share today.

“ Buy when there is blood on the streets.” Nathan Meyer Rotschild.

Bumble is more than a discarded cigar butt; it represents a thrown-away value opportunity trading at an unreasonable discount.

The stock is down ~90% from its all-time high. This is peculiar given the company’s unique position as a women-first approach dating platform. The share drop reflects online dating “fatigue,” but the industry remains viable. The challenge is restructuring the revenue model to improve margins and reach profitability—likely requiring a takeover or acquisition by a deeper-pocketed competitor.

The market is essentially throwing the baby out with the bathwater.

I expect sentiment to shift gradually in the near future. I performed a deep discounted net asset valuation and derived a fair value of $2.87/sh—not far from the current trading price of $3.44/sh. Ben Graham might take a chance on such a bargain. The stock trades well below its estimated fair liquidation value, given the value of its goodwill alone.”

4-Bonus Mention:GoodRx Holdings, Inc.

The stock is still in play, and I am up 50% already since my initial entry. I wrote my initial thesis on January 25th, 2026. I have estimated a relative fair value at around $4.78 per share. I published my initial rambling thesis on X

GDRX HOLDINGS might constitute a contrarian investment opportunity. Further research warranted. Not investment advice.

EV/Ebitda 8.59
EV/FCF 6.43
ROIC 7.15
Op margins: 13.

”Some debt but manageable with bulk of debt not due until 2029.

Company is helping the “ little guy” deal with intermediaries capture of drug pricing discovery.
The platform aggregates discounted prices from Pharmaceutical benefits managers, allowing consumers to compare costs across local pharmacies.

The company monetizes primarily through 2 channels. First, it earns referral fees from PBMs when users fill prescriptions using GoodRx discounts, typically representing a percentage of the drug cost. Second, it operates subscription services, including GoodRx Gold and a telehealth offering.

GoodRx has significant market penetration, with over 20M monthly active consumers and acceptance at about 70,000 pharmacies nationwide. The platform processes billions in annualized prescription transactions, demonstrating substantial scale in a fragmented market.

Bull case:

Stock has declined significantly from its post-IPO highs above $50 to today’s low single digits. This drawdown primarily reflects concerns about regulatory pressure, competitive threats, lawsuits and exec scandals, and even questions about the long-term sustainability of the model.

However, these concerns may be overblown relative to the company’s actual competitive position.
GoodRx serves a genuine consumer need that would persist even under reformed healthcare pricing structures.
The platform has demonstrated resilience through various regulatory discussions, and management has consistently adapted its compliance framework.

Competitive anxiety around Amazon Pharmacy and other entrants has disproportionately weighed on sentiment. In practice, GoodRx has maintained market share despite these new entrants, suggesting its network effects and consumers’ habits create more defensibility than skeptics might acknowledge.
The company’s brand equity in prescription savings remains dominant, and its distribution partnerships with major retailers continue to expand.

Within digital health, GoodRx occupies a unique position as a profitable, cash-generating platform at a stage where many peers remain unprofitable. This profitability profile deserves a premium consideration relative to speculative health tech names burning cash to acquire users.

Shares are down 94.24% in 5 years! For such a well-entrenched, profitable, and stakeholder-engaging company, this pessimistic outlook is irrational, reflecting the unreliability of crowd perception versus the objective underlying business record.

I thus expect a gradual reconsideration by the market and a potential swift turnaround in

I wouldn’t be surprised to see the stock trade above $10/sh before the end of 2026.”

Conclusion: Value investing has never been more alive.

Buffett said in his 1999 Annual Berkshire Hathaway Meeting that investors working with small amounts can compound 50% a year with extreme dedication and effort. I concur! As a matter of fact, the scope of opportunities has never been broader with technology and globalization. I am looking everywhere around the world and I am amazed at the type of small gems that I uncover in far countries like the Philippines or Poland. Investors just need to get uncomfortable because the world is the MARKET, NOW!

So, Cigarbutts ugly stock value investing still works despite the derelict price economy and the dysfunctional macro environment driving the markets.

( Not investment advice. I still own ; exited , , and TVA Group. This write up should not constitute an offer to buy or trade in the aforementioned securities. Always consult a trustworthy investment advisor before buying or selling stocks. Wall Street is not your friend.)

1-The world is the market, now!

I believe the current pricing system does not reflect real assets value. Adjusted to gold as a monetary unit, equities are down to decades-low recession levels. That’s a unfortunate matter leading confidence drumming Neo-Keynesian analysts willingly ignore.

We are living through a lost decade. In real terms. Investors are threading through a financial matrix, they are navigating in an artificial market that hides a structural decay evident in most other aspects of our political economy.

Retail investors have also lost their influence in asset pricing due to the sway of large passive funds and the interference of monetary authorities. Valuation metrics and accounting estimations have equally lost their relevance in the aggregate; a situation that has worsened with every intervention.

So, what should a value investor do when the Game of investing is so distorted?

Asymmetrical international diversification.

Investing was always intended to be intellectually challenging and fun. The beauty of the free market capitalistic system is that CAPITAL IS NEVER systematically DESTROYED or CAPTURED. It is always transferred and recycled.

When Bad companies crash out, opportunistic entrepreneurs take on and refurbish them. When underperforming actors are outed, reasonable undertakers come in. Those who properly anticipate the temporary dislocation earn a profit as trust is restored.

That’s the essence of the profit-and-loss equation. Some people make money during the booms, and some also profit from the bust. Boom times are good, but bad times are equally necessary.

But today, the “confidence” undertakers have hijacked the price economy. Zombie stocks have metastasized, and equities are artificially suspended on cloud 9. Fraudsters and financial socialists love it, everyone be damned.

That’s why global diversification might be an alternative. It does come with its own risks and challenges as it basically entails embracing discomfort:

Learning a new language, gauging a new country’s culture and legal system, adjusting to different accounting metrics, reading foreign financial reports, navigating through distinct corporate cultures. Even traveling to an unknown place to gauge the facts from the fiction.

That’s a lot of work for the small investor. But the discomfort is also the edge for those willing to embrace an unforgiving world.

The world is the market for those who love the Game of value discovery.

Let’s set Warren Buffett aside for a moment. Reading Moody’s manuals and chugging Coca-Colas won’t do it in this day and age. Prompting valuation reports even less so.

Time to get reacquainted with Sir John Templeton. The dean of Global investing. One of the wisest contrarians ever.

He bought during the great depression. He personally invested in Japan in the 50s, loaded his Templeton growth fund with Japanese stocks in the 60s and 70s while the likes of Buffett were shutting their funds. He bought Korea in the aftermath of the 1997 Asian crisis. He shorted the internet bubble of the 2000s…etc

He was remarkable, amazing, wise, clairvoyant, ethical, humble….

Yet, he is not as famous as Warren Buffett or Munger. Even less have truly appreciated his global outlook.

I believe Sir John is more relevant today than ever, and I try to emulate him strategically.

I hunt everywhere: in Mexico, the Philippines, Africa, Europe, Korea and Japan, Brazil, and, of course, the USA and Canada. Some people say the age of globalization is over. They must be drinking their own homebrew! The world has never been more connected.

Investing is a global Game, now more than ever. Technology, AI, and the English language make it easy to buy shares literally anywhere in the world. Investors who don't mind traveling, exploring (intellectually and culturally), and getting uncomfortable may still unlock some serious gems.

“I have found an interesting stock in the Philippines 🇵🇭 selling for 0.13 USD per share!

The company dominates more than 47% of its industry, with return on equity (ROE) of 32.98% and return on invested capital (ROIC) of 25.16%. It has paid a double-digit dividend consistently since 2021. But most people in the West have never heard of this company.

I have never been to the Philippines! But for the sake of clarity, I might need to travel to check the facts on the ground. I think the stock can easily double within a year and even 10x within 5 years if the growth projections pan out.

As I write, a mining operation in Africa is returning 31% on Assets. The stock sells at 2x earnings and is priced at Net book value. The company also throws in a 4% dividend. The stock is listed in Canada by the way.

I can go on and on about Brazil, Mexico, France, Germany, South Korea.”

There are always opportunities for those who are looking.

The bottom line that investors can either cry that our markets have been zombified by the plunge protection teams. Which is probably true! Or, they can get out of our comfort zone and expand their reach beyond their cultural and geographical confines.

Charlie Munger told us to be learning machines. I agree wholeheartedly. It sucks to see what has happened to our markets with the likes of SPACEX, TESLA, NVIDIA, CARVANA, and god-knows-what bullshit AI scam burning $7 for every $1 of revenue yet valued at $45 billion.

But cosmic laws remain unyielding. If Western Nations are eagerly derailing their own economic and financial systems to sustain their neo-feudal financial elites, then real capitalists must seek opportunities elsewhere.

It is not personal, just business…

Time to get dirty.

Good luck!

2-RapidFireAnalysis: Stocks that I like:

RapidFireAnalysis is a process that I have developed to highlight investable issues that have caught my attention and may warrant a thorough investigation and valuation weight-off. The reports are not intended to be misconstrued as a complete and systematic valuation, but rather as a first brush-in into securities I have deemed interesting.

361 Degrees International Limited (HKG:1361)

The stock's EV/EBITDA ratio is 2.76, and its EV/FCF ratio is 9.82. Return on equity (ROE) is 13.12% and return on invested capital (ROIC) is 19.76%. In the last 12 months, operating cash flow was 906.51 million and capital expenditures -317.39 million, giving a free cash flow of 589.12 million.

361 Degrees International Limited trades like an “ ugly stock, " operating in the shadow of domestic Chinese giants such as Anta and Li-Ning, as well as Western behemoths Nike and Adidas. The market still views the brand as second-tier, suited for lower-tier cities in China, where it has grown and anchored as an affordable sportswear brand.

However, despite being perceived as a cheap, marginal producer, 361 Degrees has delivered outstanding returns against macro headwinds in mainland China.

The company posted 2025 revenue of 11.1 billion yuan (approximately $1.6 billion), up 10.6% year-on-year, with net profit rising 14% to 1.3 billion yuan (approximately $192.3 million). In the first quarter of 2026, offline retail sales for both the core brand and kids’ line grew approximately 10%, while e-commerce platform sales surged at a mid-teens pace.

The company has also expanded its international branding campaign by sponsoring elite marathon runners and even signing NBA stars such as Nikola Jokic and Aaron Gordon.

On June 1, 2026, 361 Degrees appointed Men Lijun, a former senior executive at Nike Greater China, as its new executive president, reporting to President Ding Wuhao. The appointment supports 361 Degrees’ international strategy upgrade and omnichannel business development.

The strategy is clear: 361 Degrees execs do not want to be relegated to perennial backwater cities as cheap shoe makers, and appointing Men Lijun clearly signals the company’s global ambitions.

361 Degrees does, however, trade like a discarded cigarbutts selling at close to its NCAV of HK$ 4.02 despite being a profitable, high-yielding, growth-oriented brand.

The stock trades below 5x earnings, yields a 7.7% dividend, and is backed by the Din family’s own skin in the Game and ambition to see their company grow on the international scene alongside Li-Ning and Anta.

The stock is down 30% y/y but has proven far more resilient than Li-Ning and Nike, which are down 70% (±) in five years and are showing clear signs of stagnation.

361 Degrees stock is up 5x since 2020, outperforming its larger and deeper-pocketed competitors.

3-Meet Mr Market

Or, more accurately, his triumphant overlord.

US M2 money supply jumped +$124.9 billion in August, to a record $23.34 trillion.
This marks the 28th consecutive monthly increase, totaling +$2.61 trillion.
YoY, M2 grew +5.7%, its largest YoY increase since June 2022.
This marks a sharp acceleration from +2.0% YoY growth seen in August 2024.

Meanwhile, since the 2020 pandemic, M2 money supply has surged +$7.85 trillion, equivalent to +$1.21 trillion on average per year, or +6.5% annualized growth.

US money creation is accelerating.

What stock market? There is no such thing. It’s all liquidity.

The Cantillon effect in full view.

Priced in Gold ( ), the DOW is trending near 15-year lows. This is the kind of eye-watering fact you won’t get from CNBC: a lost MOFO decade of stagnation that has benefited a small, extremely tiny class of financial undertakers.

4-Book Review: Bureaucracy ( LVM)

https://store.mises.org/Default.aspx

“The champions of socialism call themselves progressives, but they recommend a system which is characterized by rigid observance of routine and by a resistance to every kind of improvement. They call themselves liberals, but they are intent upon abolishing liberty. They call themselves democrats, but they yearn for dictatorship. They call themselves revolutionaries, but they want to make the government omnipotent. They promise the blessings of the Garden of Eden, but they plan to transform the world into a gigantic post office. Every man but one a subordinate clerk in a bureau. What an alluring utopia! What a noble cause to fight!”

Prologue:

“THE main issue in present-day social and political conflicts is whether or not man should give away freedom, private initiative, and individual responsibility and surrender to the guardianship of a gigantic apparatus of compulsion and coercion, the socialist state. Should authoritarian totalitarianism be substituted for individualism and democracy? Should the citizen be transformed into a subject, a subordinate in an all-embracing army of conscripted labor, bound to obey unconditionally the orders of his superiors? Should he be deprived of his most precious privilege to choose means and ends and to shape his own life?

Our age has witnessed a triumphal advance of the socialist cause. As much as half a century ago an eminent British statesman, Sir William Harcourt, asserted: “We are all socialists now.”1 At that time this statement was premature as far as Great Britain was concerned, but today it is almost literally true for that country, once the cradle of modern liberty. It is no less true with regard to continental Europe. America alone is still free to choose. And the decision of the American people will determine the outcome for the whole of mankind.

The problems involved in the antagonism between socialism and capitalism can be attacked from various viewpoints. At present it seems as if an investigation of the expansion of bureaucratic agencies is the most expedient avenue of approach. An analysis of bureaucratism offers an excellent opportunity to recognize the fundamental problems of the controversy.

Although the evolution of bureaucratism has been very rapid in these last years, America is still, compared with the rest of the world, only superficially afflicted. It shows only a few of the characteristic features of bureaucratic management. A scrutiny of bureaucratism in this country would be incomplete therefore if it did not deal with some aspects and results of the movement which became visible only in countries with an older bureaucratic tradition. Such a study must analyze “the experiences of the classical countries of bureaucratism—France, Germany, and Russia.

However it is not the object of such occasional references to European conditions to obscure the radical difference which exists, with regard to bureaucratism, between the political and social mentality of America and that of continental Europe. To the American mind the notion of an Obrigkeit, a government the authority of which is not derived from the people, was and is unknown. It is even extremely difficult to explain to a man for whom the writings of Milton and Paine, the Declaration of Independence, the Constitution and the Gettysburg Address are the fountain springs of political education, what this German term Obrigkeit implies and what an Obrigkeits-Staat is. Perhaps the two following quotations will help to elucidate the matter.

On January 15, 1838, the Prussian Minister of the Interior, G. A. R. von Rochow, declared in reply to a petition of citizens of a Prussian city: “It is not seemly for a subject to apply the yardstick of his wretched intellect to the acts of the Chief of the “State and to arrogate to himself, in haughty insolence, a public judgment about their fairness.” This was in the days in which German liberalism challenged absolutism, and public opinion vehemently resented this piece of overbearing bureaucratic pretension.

Half a century later German liberalism was stone dead. The Kaiser’s Sozialpolitik, the statist system of government interference with business and of aggressive nationalism, had supplanted it. Nobody minded when the Rector of the Imperial University of Strassburg quietly characterized the German system of government thus: “Our officials ... will never tolerate anybody’s wresting the power from their hands, certainly not parliamentary majorities whom we know how to deal with in a masterly way. No kind of rule is endured so easily or accepted so gratefully as that of high-minded and highly educated civil servants. The German State is a State of the supremacy of officialdom—let us hope that it will remain so.”

Such aphorisms could not be enunciated by any American. It could not happen here.”

Excerpt From

Bureaucracy

Ludwig von Mises

This material may be protected by copyright.

( Not investment advice. I write to feed my own curiosity and to expand my analytical process. Always consult a trusted investment advisor before trading securities. Wall Street is not your friend.)

1- Howie is the Right Choice For Berkshire.

“Warren Buffett pulled off a genius coup by appointing his son Howard as Chairman of Berkshire Hathaway. Although a simple farmer, “Howie”, who is 72 years old by the way, has already accumulated more wisdom and common sense in his dirt-stained farmer’s jeans than 99% of high-finance execs, which is more than sufficient as a prerequisite for him to chair his father’s trillion-dollar conglomerate.”

This is my personal reading of the whole Warren-to-Howard gambit.

Howard's elevation was likely set in motion decades ago, long before the public announcement in December 2011.

He was consciously molded and crafted to be the type of Berkshire Chairman who would operate at the opposite end of the typological constraints befitting Wall Street expectations.

With that in mind, Buffett’s legacy should be secured to thrive for a few more decades, and investors ought to rest assured and trust the old man’s judgment.

Nevertheless, my faith in Howard runs against the accusations of nepotism sweeping across many corners of the News media, not least from newsletter subscription grifters parlaying the “value investing” edge of the market to posit as know-it-all experts.

Even a book pusher and failed hedge fund manager is clamoring that Berkshire is past its heyday and should be restructured, broken into pieces, and repurposed to reward shareholders.

Clearly, the hyenas can’t even wait for the old man to cross over to jump in and propose their luminaries. Which should undoubtedly revamp an old, decaying, trillion-dollar, cash-flushed conglomerate! ( Sarcasm)

At face value, and in line with typical Wall Street elitism, Howard is unfit to carry his father’s legacy.

He did not complete college, did not even attend a respectable, made-for-Wall Street Ivy League University. He was a farmer, has briefly served as a sheriff in Illinois, and spent most of his career doing charity work in third-world countries.

This resume is as far removed from high Finance and from the sophisticated Wall Street milieu as conceivable.

So the verdict on the street is clear: Howie is unremarkable, unproven, undeserving. The only reason he got the job is because of Daddy!

As usual, the experts’ consensus is deaf in one ear and dumb in the brain.

It is as if decades of interviews and correspondence with Buffett and Munger never register within an industry that is, unsurprisingly, set in its ways and incapable of accepting that companies and markets are duty-bound to their customers and shareholders, not to the financial industry's expectations.

Buffett did not build Berkshire to please Wall Street, analysts, academics, financial journalists, economists, “bloggists”, pseudo-newsletter writers, or grifters.

He built his corporate castle to navigate uncertainty, crisis, wars, booms and busts; and to ultimately win.

Yes, despite his folksy middle-America demeanor, Warren Buffett is a winner, and he certainly expects his company’s winning legacy to endure on for centuries.

So, I have no doubt Berkshire will survive another century, because of its antifragile structure.

Warren designed his company around a decentralized operational model where independent managers run subsidiaries with little meddling from headquarters.

This approach makes the structure dynamic and flexible even when certain subsidiaries struggle.

In fact, Berkshire was constructed to profit from disorder in virtue of its unique insurance “float” access to cheap capital, its fortress balance sheet, and its long-term distressed-quality investment focus.

Quite simply: Berkshire does not need the next “ Warren Buffett” to take over.

Greg Abel was selected to run the company and allocate capital. He has earned the founders’ trust. That ought to be sufficient for now.

Warren stated it succinctly: “ Greg runs the company; Howard will guard its culture and values-both worth more than anything on our balance sheet.”

The accusations of nepotism are therefore misconstrued and unfair. Howard's mandate is narrow, yet fundamentally important. He is there to keep the culture from being captured by “ Wall-Street-ism.”

Berkshire's real asset was never its cash pile, its float, or even its wonderful stock acquisition record. Berkshire stood out for refusing to play along with the stereotypical Wall Street formula: empire building, leverage, short-termism…etc

Howard Buffett has been on the board since 1993; that's more than 30 years of apprenticeship. He is a farmer and has spent decades on food security and conflict work, far from trading tickets or investment-banking scoreboards.

He is grounded in reality, in facts. And he made it clear when he was interviewed by the WSJ in January 2025:

“ The culture is to keep things simple, to do what you need to do but don’t do a lot of things you don’t need to do, treat people fairly, respect your managers, respect your shareholders. Tell them the bad news upfront, be honest.”

A chairman whose worldview is soil, weather, and people who actually produce things is less likely to be seduced by a speculative class whose entire incentive is hyper-activity and trying to outdo their predecessor's legacy.

Howard Buffett has no career aspirations; he does not want to outdo his father.

He is wealthy, extremely wealthy. But more than anything, he is committed to maintaining, safeguarding, and protecting his father’s legacy, unlike any other outsider “star” capital allocator who might try to leave an indelible mark.

So Howard's selection is a genius coup, a real veto strike against cultural mutation. Warren Buffett and Munger built a self-driving conglomerate that could sit on cash for many years, ignore fashionable investment fads, and strike only when price and character line up. Howard will not try to improve it.

He will protect his family castle and eagerly kick out any CEO who dares to stray from the parameters set by Warren and Charlie.

2-Rapidfire Analysis: A stock that I like.

RapidFireAnalysis is a process that I have developed to highlight investable issues that have caught my attention and may warrant a deep-dive investigation and valuation weight-off. The reports are not intended to be misconstrued as a complete and systematic valuation, but rather as a first brush-in into securities I have deemed interesting.

DigiPlus Interactive Corp. (PSE:PLUS)

DigiPlus Interactive Corp., through its subsidiaries, operates as a digital entertainment company in the Philippines.

The company operates in four segments: Retail, Casino, Network and License, and Property and Other Investments.

The company offers a portfolio of gaming products, including bingo, e-casino, specialty games, sports betting, and poker through online and land-based platforms, as well as slot arcades.

It also operates BingoPlus, an interactive, live-streaming digital bingo platform that offers bingo, electronic games, and perya classics; ArenaPlus, an online sportsbook that livestreams local and international sporting events; SpinPlus, a specialized slot games platform; and GameZone, a digital gaming platform.

Market Cap: 620.84M ( In USA dollars.)

Revenue (TTM): 1.13B

Net Income: 227.11M

EPS: 0.05

PE Ratio: 2.73 Forward PE: 3.30

DigiPlus trades at $0.13 per share on the USA OTC! The current population of the Philippines is approximately 117 million. And DigiPlus's founder plans to transform it into a superapp à la Alipay.

From a purely quantitative and structural view, DigiPlus is probably one of the cheapest, most undervalued, and most profitable companies I have encountered in 2026.

With 40% of the online gambling market in the Philippines, the company is a local behemoth; it is extremely profitable, yet selling at almost -70% y/y despite recording healthy profits and swimming in cash.

The stock trades at 2.76x earnings, 0.56x sales, and below its net asset value with negligible debt-to-equity. DigiPlus's return on equity ( ROE) and Return on Invested Capital are simply outstanding, well above 25%, with almost 10% net return on assets.

The company is printing cash. But why has the stock crashed from its 2025 peak of 60 PHP to 8 PHP today? And is the stock a worthy contrarian “ uglystock” opportunity?

DigiPlus is also one of the riskiest and most politically exposed equities on the Philippine Stock Exchange, with its entire earnings power resting on the continued legal tolerance of gambling, an activity that a sitting Cardinal has publicly called a national “moral problem,” that a president has already banned one adjacent category of (POGO), and that multiple sitting senators have filed bills to prohibit outright.

This is not a regular cheap stock. It is an undervalued issue sitting in a room some political leaders may actively try to tear down. Which probably explains owner’s recent plans for international expansion in South Africa and in Brazil.

Nevertheless, several interesting factors may also warrant an optimistic thesis.

The company was founded and majority-owned by Eusebio Tanco, one of the Philippines' most powerful businessmen.

Rational valuation aside, big businesses operate in alignment with political power in countries such as the Philippines. This is an important valuation catalyst that has been de-emphasized throughout the stock's recent mini-crash.

Eusebio Tanco has been a net buyer of his company’s shares in recent months. He is a 76-year-old grey fox well tuned to his country’s politics. He wouldn’t be buying shares unless he was certain its operations were safe.

The probability of an outright ban on online gambling is also reduced given online casinos’ tax contributions and job-creation record. Instead, enforcement has so far been focused on illegal gambling facilities and dark alley gambling websites.

The country’s Cybercrime Investigation and Coordination Center took down over 10,000 gambling websites in September 2024 and also shut down offshore gambling platforms.

DigiPlus's moat and reputation keep it at arm’s length from government enforcement agencies, while competitors are simultaneously cleared out, which may warrant further market-share consolidation. DigiPlus holds multiple PAGCOR licenses, which creates real fixed costs and regulatory hurdles for new entrants.

The founder is also exploring ways of extending its digital platform to offer multiple products and services. Tanco has hired a team of software engineers from China to help remodel DigiPlus.

That's in addition to key senior hires in the past year to bolster DigiPlus' digital push: software engineer Hu "Tommy" Jiangguo as CEO, finance veteran Ping Chen as president, and former Ant Group executive Li "Rick" Jiaqi as chief digital officer.

The aim is to transform DigiPlus into a SuperApp that would also feature DigiPlus' entertainment offerings. In addition to live streaming of sports events, it will offer bingo and other mobile games. Over time, its entertainment portfolio could also span concerts and musical shows.

Our verdict is thus tentatively optimistic: DigiPlus will survive and even thrive if its SuperApp plans pan out. But enormous risks and uncertainty remain.

Which explains the stock's current undervaluation.

As an UglyStocks hunters, this is exactly the type of special situation that I like : ugly stocks that few, but “crazies,” are willing to touch.

I enjoy the intellectual and mental gyrations that come with extreme uncertainties. This might not be the case for everyone else.

Dollar-adjusted, the stock literally trades at 0.13 cents per share!

What is there to lose compared to buying or the ridiculous ?

( This is a preliminary analytical brush-off. I may write a thorough valuation report on the company in the future. Do not misconstrue this short post as investment advocacy. DigiPlus also trades in the USA OTC market under the ticker DigiPlus Interactive Corp. (DGIPF) )

3-Book Review: The Wall Street Jungle: Richard Ney.

Preface:

“Most of us enter the investment business for the same sanity-destroying reasons a woman becomes a prostitute; it avoids the menace of hard work, is a group activity that requires little in the way of intellect, and is a practical means of making money for those with no special talent for anything else.

With money one can achieve status and power of a kind no other means can reach, which in itself would not be unworthy if the methods used to obtain it merited our respect. They don’t. It should not surprise us, therefore, that these methods are less than explicit; or that the interests of the Stock Exchanges are solely in their billion-dollar speculations, without regard to their social obligations or the needs of a legitimate auction market.

There is a difference between what is legal and what is legitimate. Once understood, this distinction illuminates an environment in which larceny hides its nakedness in the toggery of law and order, custom and routine. We find it in the no man’s land of rules and regulations that sanction Stock Exchange member’s manhandling of credit and of stock prices on behalf of their own speculations.

Short selling, big block fees, special brokerage incentives, and the specialists’ investment and trading accounts. are only a few methods used to keep the members of the financial establishment established, at the expense of the individual investor.

Much that is painful in our society is due to the public’s belief in the can’t of the Exchange’s chief organs of opinion. Indeed, hidden behind a facade of pompous jargon and noble affectations, there is more sheer larceny per square foot on the floor of the New York Exchange than any place else in the world. It is the legacy of the communal effort that has become a property right, handed down from father to son to grandson. It is sustained by the exclusive allegiance of its high priests to a tradition that wars against reason and that has become so powerful that anyone setting himself against it on behalf of a higher loyalty soon finds he has set himself against a power that is identical to that of government itself.

Clearly the lunatics economics of this larceny appeal to the criminal. The story is told that after he had been deported to Italy, Lucky Luciano granted an interview in which he described a visit to the floor of the New York Stock Exchange. When the operations of the floor specialists had been explained to him, he said, “ A terrible thing happened. I realized I’d joined the wrong mob.”

4-Quote of the week:

Real compassion and responsibility start right at home with the people closest to us before trying to fix the world.

P.J O’ Rourke, All the Trouble in the World.

( This report must not be misconstrued as investment advice. I write for intellectual stimulation only. Always consult a trusted investment advisor before purchasing financial securities. Wall Street is not your friend. Never has been, never will be.)

1-You can’t hustle Warren Buffett!

Even Warren Buffett's older sibling had to learn the hard way about dealing with the Financial industry’s shenanigans.

Warren Buffett’s older sister Doris once went broke in the stock market, and her billionaire brother refused to write the check.

In the 1980s, she lived in Virginia. A small brokerage ( First Potomac Securities) talked her into a clever income trick: sell insurance on stocks. In finance speak, that is selling naked put options. In plain English, she collected small fees for promising to buy stocks if they crashed.

As long as the market kept rising, it felt like free money. She never mentioned it to Warren. She knew he would discourage her. This felt exciting. ( hubris)

Then came Black Monday, October 19, 1987. The market dropped more than 22% in a single day.

Those insurance promises suddenly came due. Doris got a margin call she could not pay, about $2.6 million. The little brokerage collapsed. She ended up roughly $2 million in debt and nearly lost her house.

Warren could have bailed her out overnight. He did not. His logic was blunt. The money would not really save her. It would just pay the people on the other side of a gamble she should not have taken.

She later inherited Berkshire stock from their mother, rebuilt her life, became very rich and spent years giving tens of millions of dollars to charities.

The family still repeats the story for one simple reason. Even Warren Buffett will not pay for a gamble you took without knowing the risk.

By the Way, Warren Buffett's refusal to bail out his sister's high-time preference venture proved ultimately correct.

Carole L. Haynes, the owner of the bankrupted First Potomac Securities Corp., went on to start a new investment company: First Potomac Investment Services, Inc.

In the mid-1990s, the SEC brought an administrative proceeding against Haynes. The division alleged that from May 1989 to April 1990, she willfully aided and abetted John G. Broomas in manipulating JML Class A stock through accounts at her new firm. An ALJ initial decision dated November 24, 1995, found against her and ordered her suspended from association with any broker-dealer.

It is for possible that the First Potomac undertakers had assumed that Buffett would intervene and bail out his sister ( what normal person wouldn’t? ) if or when she got into trouble with her little “ options gamble.” They thought they could rip a few million dollars out of Warren Buffett via his sister. He was a multi-billionaire after all, a few millions was pocket change!

Well, they miscalculated badly and were left to sink under a sea of their own misery!

Warren Buffett is just…Whoa!!!!!!

2-RapidFireAnalysis: Stocks that I like:

RapidFireAnalysis is a process that I have developed to highlight investable issues that have caught my attention and may warrant a thorough investigation and valuation weight-off. The reports are not intended to be misconstrued as a complete and systematic valuation, but rather as a first brush-in into securities I have deemed interesting.

RPA: Kino Polska TV Spolka Akcyjna, Alpargatas S.A.

A-Alpargatas S.A. (BVMF:ALPA4)

Gradually recovering

Alpargatas S.A. is a Brazilian manufacturing company headquartered in São Paulo. Established in 1907, it is one of Brazil's largest companies in the footwear and canvas business.

Alpargatas’ main product is Havaianas, one of Brazil's largest rubber flip-flop brands, introduced in 1962 and inspired by the Japanese Zori sandals.

The company is recovering from its failed post-pandemic international plans and bad bets on direct-to-consumer.

The operational turnaround has gradually worked out, as a return to core wholesale channels and improved inventory management have restored profitability and free cash flow after a challenging period of inventory write-downs and supply chain friction.

Returns on Invested Capital have expanded to 18%, up 1,100bps YOY; capital efficiency has also improved as working capital, especially excess finished goods inventory, was liquidated and normalized.

Higher gross margins, sitting comfortably above 55%, with operating and profit margins of 15.74% and 14.52%, and 18% ROIC and almost 8% ROA confirm the strength of the company’s moat.

The company is controlled by 3 prominent Brazilian Banking and mining Families: the Setúbal, Villela, and Moreira Salles families.

B-Kino Polska TV Spolka Akcyjna (WSE:KPL)

Kino Polska TV S.A. (KPL PW), based in Warsaw, is a leading producer and broadcaster of thematic TV channels, with operations in 68 countries worldwide and a 36% share of international sales in total revenues.

The company owns one of the largest catalogs of Polish content (movies, series, documentaries, etc.) and, through its owner, SPI International, which has been part of the leading European media company Canal+ Group since March 2022, has exclusive access to high-quality international movie content in Poland.

Of TV-channel sales, which last year accounted for 88.1% of the total, 56.9% come from recurring transmission/subscription fees, making KPL less dependent on highly profitable but cyclical advertising sales.

It exhibits a classic deep-value cash-generator undervalued profile. The stock trades at 4.5x P/E, a P/B ratio of 0.96x, and a dividend yield of around 6.4%; the stock trades at a significant discount given its strong operational performance.

The market is valuing the company as a declining linear TV asset, overlooking its high returns on capital, net cash balance sheet, and competitive advantage derived from its strategic parent company and unique local moat.

With an ROE/ROIC exceeding 23% and de minimis debt (D/E of 2.84%), KPL operates as a capital-light, royalty-like distribution model. It generates consistent free cash flows without taking on high-risk, expensive original production debt.

With a Return on Assets (ROA) of 12.75%, KPL's asset-light business model converts net income into free cash flow without requiring heavy capital reinvestment.

The company benefits from strong brand equity in Polish cult cinema, nostalgic content, and thematic entertainment, which protects it against direct disruption from foreign SVOD platforms (Netflix, Max) that lack localized archival library depth.

3- The Appeal of Anarcho-capitalism:

Let them fail

I have been a studious observer of the financial market for a little while now, and I have come to the conclusion that it is, by and large, a “huge pretentious” wealth-extraction scheme, benefiting from subsidized credit liquefaction and capital flows into financial assets.

In real terms, the markets create little to no net benefits for the common folk.

I am not opposed to it. I participate by analyzing and researching investable securities.

But in its current form, I think the “ financial market” is doing more harm than good to society and needs to be reformed…structurally.

In fact, a sustained deflationary pressure on general assets, which truly improves society’s living standards, would be disastrous to the financial economy as a whole, for it is an industry built on and designed for surviving on Inflationary credit injections and little else.

I have been pained to realize that most market skeptics are unable, naively or willingly, to distinguish the workings of real free enterprise from the workings of debt-liquefied “financialism.”

Financialism is a regime that supports and sustains the financial industry, first and its adjacent partners. Financialism is not free enterprise “ capitalism.”

Thusfore, the appeal of Anarcho-Capitalism is really about the cynical pleasure that I get when the market actually punishes the so-called Financial Elites, billionaire entrepreneurs, and other smartest guys in the room types.

It is actually beautiful to watch one of these individuals eat their humble pie through bankruptcy and a swift fall from grace.

That to me is the most beautiful and uniquely appealing aspect of the profit and loss equation.

Furthermore, “socialism” does not, contrary to popular belief, affect or challenge the financial elites. Socialism is a captive system designed to protect the upper class.

The market is the true enemy of the “ Fiat Aristocrats” since consumers’ preferences are quite volatile, with the added effects of competitive dynamics that force entrepreneurial undertakers to behave as servants rather than feudal lords.

In conclusion, the market punishes hubris, it humbles egomaniacs, and impoverishes liars and crooks.

And we all know that Wall Street is filled to the brim with the worst common denominators!

( Not investment Advice. I write for intellectual curiosity only and to feed my passion and interest for the markets. Always consult a professional and trusted advisor before buying or trading financial securities. Wall Street is not your Friend.”)

“ The analyst must take upon the impurities of the market to protect the Public from unworthy securitized promises. That’s his fundamental vocation.”

Avoid WhiteFiber, Inc.

Introduction: An easily dismissible pretense.

Given WhiteFiber's incestuous entanglement with the much-distrusted $BTBT, a company with a scandalous history of pivots and frauds, the market verdict should have easily dismissed its pronouncements and press releases as irrelevant pretenses, and deemed the cabal a mere continuity-capital-extraction dilutive operation.

is currently trading at around $1.24 per share, a far cry from its pompous exaltation as a leading bitcoin company five years ago. After multiple sector pivots, its share count has risen 500 percent, its net debt is up nearly 700 percent, while the stock is down 86% since listing on the US capital market.

Our thesis is simple: $WYFI is a continuation of Bit Digital Inc.'s capital-extraction scheme in the AI/ data center narrative, and we shall demonstrate this with clear, concise evidence in this report.

1-WhiteFiber Inc. : A Financial zombie.

WhiteFiber posits itself as a vertically integrated AI infrastructure pure-play, but a close reading of its SEC filings, quarterly results, and capital markets activity reveals a company that is involved in accounting gimmickry, is burning cash at an accelerating rate, all layered on expensive and dilutive financing tricks, with its listing valuation anchored to a single unproven counterparty with a shady crypto-mining background.

1-1. Revenue: Growth Masking Structural Deterioration

In the twelve months ended June 30, 2026, the company reported a net loss of -$44.3 million on revenue of $94.5 million, yielding a negative profit margin of -46.9% and a return on equity of -10.7%.

WhiteFiber's top-line numbers may look impressive on the surface, but the underlying economics are deteriorating rapidly.

Revenue grew 54% year over year in Q2 2026, yet the net loss widened by 70% (from -$8.8M to -$15.0M). For the first six months of 2026, the company recorded -$27.0 million in net losses versus just -$7.4 million in the comparable prior-year period.

I have highlighted comprehensive losses but look through Net returns.

• The “Adjusted EBITDA” Mirage

Management touted Adjusted EBITDA of $5.5M in Q2 2026, up 69% YoY. But this metric ignored:

• $6.6M in depreciation and amortization.

• $6.0M in interest expense.

• $5.0M impairment of capitalized software assets

• $3.7M in share-based compensation

On a GAAP basis, EBITDA was negative $3.1 million in Q2 2026.

The company is essentially a cash-burning engine that uses non-GAAP adjustments to paint a rosier picture.

Of the $23.8 million in Cloud Services revenue recognized in Q2 2026, management disclosed that approximately $12.3 million was associated with a previously disclosed customer termination, marking it as a settlement payment, rather than a recurring service revenue.

The same termination generated roughly $4.0 million of incremental cost of revenue payable to the company’s GPU lease provider, and $2.2 million of bad-debt expense.

Management has further acknowledged that underlying cloud results reflected a period of reduced utilization between the terminated contract and the ramp of its replacement.

Strip the one-time termination payment out, and organic cloud services revenue growth for the quarter is far more modest than the 54% headline suggests, and gross profit is correspondingly overstated by the associated non-recurring item.

• The company already lost its largest customer once.

WhiteFiber’s own disclosures show that its “Initial cloud Customer” represented approximately 70.7% of total 2025 revenue, and that this customer paused services pending renegotiation, which is the termination event referenced above. A company whose entire early commercial base was concentrated in a single counterparty, and whose relationship with that counterparty broke down badly enough to require a settlement, contract renegotiation, and bad-debt write-off, is now asking the market to extend the same trust to a new, even larger single-tenant dependency: Nscale.

• WhiteFiber’s growing operating cash flow is deceiving

Contract liabilities (customer prepayments and deferred revenue) rose from $79.6 million at December 31, 2025 to $143.1 million at June 30, 2026, a $63.6 million increase that was, per the cash flow statement, one of the largest single drivers of the $89.1 million of operating cash generated in the first half of 2026.

While this is a legitimate and common structure in capital-intensive colocation/GPU-hosting models, it means a meaningful share of the company’s positive operating cash flow reflects customer deposits for capacity not yet built or billed, rather than cash earned for services delivered.

The company separately capitalized $24.2 million of contract-acquisition costs (commissions) as of June 30, 2026, versus $25.2 million in deferred sales costs at year-end 2025, sitting on the balance sheet rather than expensed against the revenue that generated them.

Despite accounting adjustments and revenue- and cash-flow-boosting gimmicks, WhiteFiber’s operations have shown little improvement on a net-earnings basis, highlighting the company’s challenging transition from a cloud service to a colocation engine.

1-2. The shaky Capital structure: A dilutive-leverage time bomb.

WhiteFiber, Inc. is a Bit Digital subsidiary operating in the capital-intensive AI and HPC infrastructure business. The parent company controls it by owning 69% of its shares. WhiteFiber seems to have followed Bit Digital's financing model by raising cash through a pattern of aggressive, dilutive, complex debt-financed proceeds.

The company has undergone one of the most aggressive capital structure transformations among recent IPOs. In just one year as a public company, it has gone from zero debt to approximately $540 million in total obligations.

To scale its AI platform, the company has executed several major financing rounds in quick succession:

• August 2025 (IPO): WhiteFiber debuted on the Nasdaq, raising $183 million in gross proceeds with no funded debt on its balance sheet.

• January 2026: The company began accumulating debt with a $230 million private placement of 4.5% convertible senior notes due 2031.

• June 2026: It secured a $100 million delayed-draw term loan facility backed by Bit Digital and B. Riley Securities to support its HPC data center buildout.

On August 19-20, 2026, when WhiteFiber priced an upsized private placement of $270 million in 5.00% Convertible Senior Notes due 2032 (up from an originally announced $250 million, with initial purchasers holding an option for an additional $40 million).

The stock fell as much as 25.8% intraday to roughly $20.09 on the news, before further volatility left shares trading in the high-$20s to $27 range depending on the source and timestamp.

The magnitude of the market reaction was informative: convertible debt at a 5% coupon, converted into equity at a fixed price, is a dilutive and expensive way to fund a company with zero earnings, and the market reacted accordingly by souring on the stock.

Also, WhiteFiber’s January 2026 convertible offering included a $120 million zero-strike call option with Barclays, representing 52% of the gross proceeds, to synthetically raise the effective conversion price from $25.91 to $37.01.

Basically, the company raised $230M, then immediately spent $120M on a derivative to mask dilution, and kept only about $100M for operations.

Then, eight months later, it issued another $270M in convertibles because the first round wasn’t enough. This nearly doubled from the pre-IPO base in just over a year.

How many more dilutive offerings should investors expect over the next 5 years, until the debt matures?

Management is clearly engaging in a complex capital-raising financial engineering designed to mask the company's real dilutive risk and feed Bit Digital with service fees and administrative payments while burdening public holders with liabilities and debt obligations that could eventually come home to roost if the company’s projects do not proceed successfully.

The company has recorded a negative working capital of -$28M and negative net debt of -$265M against the backdrop of a yet-to-be-fully operated NC-1 facility partially financed through a bridge loan from Bit Digital.

What we are witnessing here is a textbook related-party leverage structure in a controlled carve-out: the parent extracts near-term liquidity and interest income and retains the majority stake in any upside, while minority holders in the public vehicle bear a disproportionate share of execution risk. This is a classic Bit Digital, Inc. business model in action.

2- Nscale and WhiteFiber: A murky relationship.

Josh Payne, from coal miner to AI Billionaire

WhiteFiber Inc is Bit Digital’s fifth pivot since going public; the parent controls close to 70% of the equity and shares executives while skimming off service fees from its spun-off entity. WhiteFiber has simply been securitized into a Nasdaq ticker and plugged directly into one of the world's largest circular-financing ecosystems ever conceived: Nvidia’s vendor-financing web

A-The Nscale agreement risk profile

WhiteFiber’s$865 million, 10-year colocation agreement with Nscale is the principal anchor of WhiteFiber's listing thesis. However, several structural red flags highlight legitimate execution risk:

In its Q2 2026 report, the company said its flagship NC1 site was active with customer deployment and targeted full run-rate billing of its contracted load by 2026. But the company also highlighted key risks including ongoing negotiations for permanent financing, past supply chain delays, and GPU availability constraints.

• The proposed permanent financing for NC1 has taken longer than initially anticipated. The parties are conducting diligence and negotiating definitive documents, but management cautioned that financing may not close on favorable terms or at all.

• The NC1 deployment ramp took longer than originally expected because of switchgear delivery and commissioning issues and the need to coordinate customer equipment installation. Management said the equipment issues have been resolved.

• The additional 200 megawatts under evaluation at NC1 remain subject to Duke Energy’s utility process, and no deployment schedule has been established.

• Cloud services results were affected by a terminated customer contract, including about $4 million in expenses payable to the GPU lease provider and $2.2 million in bad debt expense.

• GPU and deployable power availability remain constraints. White Fiber said it is avoiding commitments unless it has sufficient confidence in equipment delivery timelines.

• New sites and cloud deployments remain dependent on technical diligence, customer commitments, equipment financing and project-level capital.

B- Nscale controversial origin

Like WhiteFiber, Nscale was also spun out of an insolvent Bitcoin miner in May 2024 and was founded by Josh Payne, an obscure former coal miner now at the center of a controversy over the origin of his fortune.

“Josh Payne, the company’s 32-year-old CEO, tells TIME he wants to turn Nscale into a “$1 trillion hyperscaler”—a new cloud company that can compete with the likes of Amazon, Microsoft, and Google.”

From press release … to scrap metal site: the Essex ‘supercomputer’ that’s still a scaffolding yard

Nscale was spun out of Arkon Energy in May 2024. Arkon was a cryptocurrency mining startup founded by Josh Payne that had accumulated significant debt. According to TIME magazine, Arkon lost $102 million on just $19 million of revenue in 2024 and struggled to repay loans at interest rates of up to 17.5%.

Its financial statements that year flagged “significant doubt” about the company’s ability to continue as a going concern. Payne wound down Arkon and spun out Nscale as a new U.K.-based company devoted to AI data centers.

Investigative reports from the Guardian and the Financial Times have highlighted a recurring pattern at Nscale of promotional announcements outpacing real progress on the ground.

The flagship UK ‘sovereign AI’ supercomputer project in Loughton, Essex was announced with substantial claimed investment figures, but the site reportedly remained an active scaffolding and scrap yard months later, with planning applications appearing to accelerate only after media scrutiny intensified.

Delays in grid connection later prompted the investigation of on-site power-generation alternatives. UK government statements about Nscale’s contribution to national AI capacity relied in part on company-provided figures, which reporting suggests outpaced actual committed capital and operational progress.

Additional documented issues include reports of internal leadership friction, a copyright/trade-secret dispute, and a publicly discussed acquisition (Kontena) that the target company’s CEO later denied had been completed. Early loan facilities reportedly involved technical defaults that were rolled over during subsequent fundraising rounds.

This origin story raises structural questions. Nscale’s current $14.6 billion valuation and $2 billion Series C funding represent a remarkable turnaround from an entity whose predecessor turned out to be a dud.

The rapidity of this ascent has drawn journalistic scrutiny. The company is planning a US IPO that could take place as soon as September.

Bloomberg reported on Friday 4th September that the company was looking to sell $1.5 billion in convertible notes to a group of investors, while also seeking an additional $2 billion in financing from Nvidia.

Following a $45 billion contract with Anthropic, reports have emerged that Nscale had told potential investors it would have approximately $103 billion in revenue following the deal. The figure does not represent current sales, but a projection based on signed customer leases, according to The Information website.

The Sunday Times published both an article and a podcast titled “Josh Payne was a builder. How did he become a billionaire in two years?” explicitly examining “the questions surrounding his business.”

C- B. Riley toxic history

Most of WYFI’s financing flows through the controversial B. Riley, which serve as WYFI’s underwriter, creditor, and research analyst.

If there is a single name that should make a sophisticated investor slow down on WYFI, it’s B. Riley Securities.

B. Riley Securities served as lead-left bookrunner on WhiteFiber’s IPO, joint lead bookrunner on its $230 million convertible note offering, and, per SEC filings, a purchaser of pieces of the intercompany loans between Bit Digital and WhiteFiber. B. Riley’s equity research desk also covers the stock with a Buy rating and one of the higher price targets on the Street. That’s underwriter, creditor, and “independent” analyst, on the same name, at the same time.

This is a conflictual relationship worth flagging.

B. Riley Financial, the publicly traded parent of B. Riley Securities, has spent the past two years fighting off a widening SEC investigation into its dealings with Brian Kahn, the former CEO of Franchise Group, one of B. Riley’s largest investment holdings. B. Riley financed and helped orchestrate a $2.8 billion take-private buyout of Franchise Group in 2023, lent Kahn’s investment vehicle roughly $200 million secured largely against Franchise Group stock, and took a direct equity stake alongside him.

Franchise Group collapsed into Chapter 11 bankruptcy in November 2024. Federal prosecutors later tied Kahn to a $294 million hedge fund fraud scheme at Prophecy Asset Management; a co-conspirator in that fraud pleaded guilty, and Kahn has since pleaded guilty to defrauding hedge fund investors of roughly $300 million.

The SEC has issued multiple rounds of subpoenas to B. Riley and to founder Bryant Riley personally, covering both the Franchise Group dealings and a personal loan in which Riley pledged B. Riley shares as collateral, and a federal judge in December 2025 allowed a shareholder securities-fraud suit against B. Riley and Bryant Riley to proceed, finding investors had adequately alleged the firm acted with deliberate recklessness given Riley’s closeness to Kahn.

A separate shareholder derivative suit accuses the firm’s co-CEOs, CFO, and board of breaching fiduciary duty by failing to disclose the risk of the Kahn relationship. B. Riley’s stock lost more than half its value in a single trading session in August 2024 on news of the widening probe and has traded as low as roughly $4 a share, down from the $30s.

This is the firm WhiteFiber has repeatedly chosen as its primary capital-markets counterparty, whose balance sheet is now a direct, disclosed creditor in WYFI’s capital structure. A firm currently defending securities fraud claims over its own alleged failure to disclose conflicted related-party dealings is simultaneously underwriting, lending into, and publishing bullish research on a company whose entire capital structure is built on related-party dealings between a controlling parent and its Nasdaq-listed subsidiary.

D- WhiteFiber and The Nvidia Neocloud circular financing bubble.

Every dollar of the broader AI infrastructure boom that $WYFI is part of runs through Nvidia, which has become the vendor, the lender, the equity investor, and the GPU off-taker for the same small universe of neoclouds forming a circular loop that the Bank for International Settlements named as a top-three global financial stability risk in its 2026 Annual Report.

While WhiteFiber itself is a negligible node in the broader Nvidia Neocloud web, it aligns with other entities that pivoted from cryptocurrency mining or adjacent infrastructure, such as Nscale, into AI compute and colocation during the current buildout cycle.

This sector follows a recognizable pattern: contracted or letter-of-intent-backed capacity narratives are used to raise capital and re-rate equity, often before the underlying facility generates revenue.

In reality, WhiteFiber’s operational results are the least important factors in the company’s real operational model, given its parent/ controlling shareholder ( Bit Digital) history of pivot hustle into popular speculative themes and all leveraged for insiders’ enrichment through dual executive employment and salary benefits ( long time CEO Sam Tabar and CFO Erke Huang have held executive positions in both companies), Professional services Agreements (PSA), dilutive share raises, and complex financing schemes that usually end up with retail investors holding the bag.

Bit Digital execs extract fees from with PSA services

Michael Burry, the famous “Big Short” investor, has repeatedly highlighted the fragile construct supporting the Nvidia thesis by pointing to the disconnect between the AI growth narrative and Nvidia’s performance.

One of Burry’s long-standing arguments against AI stocks like Nvidia is that their demand is more about circular financing than genuine sales to customers. As The Street reported, Burry characterized these deals as “byzantine financing arrangements” that create a distorted view of the data center boom.

Basically, the Neocloud-Nvidia circular financing pump is an opportunity for Bit Digital and its affiliate, WhiteFiber, to extract capital and cash in on the AI speculative euphoria.

3- the history of a zombified pivot hustling concern.

White Fiber is the latest evolution of a company originally listed on the Nasdaq as a Cayman Islands VIE entity named Golden Bull Limited.

Golden Bull Limited was founded in 2015 and registered in the Cayman Islands. The business collapsed after the Shanghai Public Security Bureau investigated one of its variable-interest entities Shanghai Dainnu (VIEs) for suspected embezzlement of public deposits and defrauding investors of up to $42M.

By 2020, the Chinese government had launched an all-out war against its domestic peer-to-peer lending industry following accusations of systematic asset embezzlement by the country’s leading platform operators and claims of pyramid schemes that had wiped out the life savings of millions of retail investors.

The case of Zeng Erxin, Golden Bull’s founder, was a classic illustration of this crisis: his company used the brief, unregulated P2P boom to lure retail investors with promises of high-yield returns, then stole their savings and fled the country.

While some board members, including majority owner Liu Xiaohui and CFO Leng Jing, were detained by the tentacles of the Chinese police state, Zeng Erxin successfully escaped, with many allegations pointing to the USA as his likely destination.

By 2021, the Chinese government had completely eradicated its peer-to-peer lending industry, successfully shrinking the sector from a peak of more than 6,000 platforms to zero. As authorities moved in, Golden Bull execs sold off their P2P business for a nominal $10, pivoted to car rental via Shanghai Youwang Vehicle Rental Limited, and finally launched a new company rebranded Bit Digital to tap into the booming crypto sector.

From there on, scandal after scandal followed: In its January 2021 Report, J Capital Research called ( $BTBT) a “fake cryptocurrency business” meant to defraud US investors.

Bit Digital claimed to operate tens of thousands of ASIC miners across various Chinese provinces. J Capital Research checked with local government and utility entities in those regions and found zero record or physical trace of the alleged massive power draws or mining operations.

When investigators contacted major hardware manufacturers like Bitmain and MicroBT, those suppliers reported no record of the massive equipment purchases Bit Digital claimed to have executed during the period.

Overall, J Capital Research demonstrated that millions of dollars raised from capital markets for machine acquisitions went unaccounted for, functioning more like a stock-promotion vehicle designed to siphon cash than a productive enterprise.

Following the J Capital report, stock collapsed 25% in a day and continued to slide as the Chinese government enforced a ban on cryptocurrency mining. From its peak of $29 per share in January 2021, the stock reached an all-time low of 0.68 cents in December 2022 as it scrambled to pivot into yet another business line: Ethereum treasury.

On June 25, 2025, BIT Digital announced it had begun a strategic transition to a pure-play Ethereum (ETH) staking and treasury company, with 24,434 ETH and 417 BTC valued at approximately $44M and $34M, respectively.

Another pivot into a popular theme, followed by another bust, as treasury-stock mimicry of Michael Saylor’s MicroStrategy crashed out in late 2025 and took an entire industry with it. Bit Digital had failed yet again to carve out a slice of the pie.

When the Ethereum stacking theme matured, Bit Digital pivoted again, spinning out its GPU/data-center unit as WhiteFiber to ride the AI infrastructure wave.

WhiteFiber was thus carved out of Bit Digital’s HPC and AI division, built around Bit Digital’s 2024 acquisition of Enovum, a Montreal data-center operator with roots dating to 1999. It priced its IPO at $17 in August 2025, upsized to raise about $159 million, giving the company a fully diluted market cap of about $619 million on listing day.

is condemned to follow its parent’s collapse

WhiteFiber's stock has already crashed from its peak of $46.87 to roughly $17.29, down about -65%, as investors have begun to price in the reality that its financing strategy looks less like a disciplined infrastructure build-out and more like a Bit Digital-style dilution scheme wrapped in AI infrastructure cover-up. I expect WhiteFiber's value to incrementally collapse as the market continues to sour on its business proposition and insiders take advantage of cheap financing to raise capital through dilutive operations.

Conclusion: A vampire stock; no more no less.

Situational Awareness’ dirty dozen.

In bygone times, when gentlemen dominated the streets and the dollar was worth its weight in , evidence of WYFI -6.22%↓ incestuous association with $BTBT -6.36%↓ would have been sufficient to dismiss it as an unworthy investment proposition to the public, and its shares would have been quickly depressed. I am sad to reckon with the unfortunate reality of analysts recommending such a charade to investors.

Extreme due diligence is therefore warranted because the industry is unfortunately biased to the buy side, with many analysts simply failing to abide by their vocational obligations to protect investors before their own self-interest.

Indeed, we live in a less honorable age, where incessant stealth interventions have neutered price discovery and allowed the metastasis of zombified pretenses.

The entire AI demand narrative is also artificially sustained by Nvidia and its hyperscaler partners’ circular financial gamification; so it is fair to ascertain that small “hustlers” such as WhiteFiber, Inc. are just trying to suck on the juicy bones before they dry out.

Bit Digital/WhiteFiber’s executives are playing the liquidity game and extracting as much cash as possible from the irrationality sustained by AI just as they did with P2P lending in China, Bitcoin mining, crypto treasury, and other popular themes manufactured by cheap capital and promoted on Wall Street.

In all, WhiteFiber is an untrustworthy vampire stock playing a game it (Bit Digital) has mastered over a decade; but so are many other entities siphoning cash from the AI narrative, particularly companies linked to Leopold Aschenbrenner’s failed fund.

Indeed, the humiliating end to Leopold Aschenbrenner’s saga should have opened a Pandora’s box and compelled a broader investigation into his entire stock portfolio. While headlines have largely attributed Aschenbrenner’s failure to leverage, a closer look at his stock picks reveals a host of mediocre companies that further highlight the naivety and fragility of the 24-year-old's “ Next Warren Buffett” core thesis.

Among the fund’s holdings, WhiteFiber, Inc. (WYFI -6.22%↓) is the one case that caught my interest due to its ties to the much maligned Bit Digital. I sincerely believe that analysts could use Leopold Aschenbrenner's broken ramp as an opportunity to investigate and expose the fund’s other holdings. The whole fund was a farcical joke, and the most bemusing thing of all is that the young man is still trying to mount a comeback!

We live in a crazy world!

Resources:

-All source materials for this article are highlighted throughout. Click on the links provided.

-I have used AI for editing and research purposes only.

(NB: This article must not be misconstrued as investment advice. Nor is it a call for retail investors to short stock. I don’t trust the current pricing system; shorting in such a dynamic is almost always irresponsible and reckless. I write to satisfy my intellectual curiosity and feed my passion for financial markets. Always consult a trustworthy advisor before investing in securities. Wall Street is not your Friend!)

Africa remains an intriguing frontier for growth, and as a contrarian analyst, I've identified it as a promising opportunity for risk-aware investors. Africa’s public markets still represent a rounding error in the world’s equity capitalization, yet on-the-ground facts point to some of the highest returns in recent years, far outperforming Western and Asian equities.

The buzz around Aliko Dangote’s (Africa’s richest man) refinery listing is palpable across social media, with many voices painting the continent as the obvious growth engine for yield-hungry capitalists. But it’s crucial to acknowledge overlooked aspects of securitization that many analysts ignore, either through naivety or because of speculative promotional bias.

First off, companies go public primarily to raise funds for their projects and to offer an exit for early investors. Dangote is tapping public funds to expand his refinery capacity and give early investors an off-ramp. Some will keep their equities; others will cash out. That’s the Game of the Market. Let’s not pretend otherwise.

More broadly, investing stimulates savings by drawing money out of conventional bank deposits or informal networks. As Mises pointed out, the stock market is an important facilitator of the financial division of “savings.” Investing thus spurs savings-based capital formation and signals growing institutional trust in society. This is good for societal harmony.

However, this process can backfire when it is misinterpreted as a casino-like get-rich-quick opportunity. Often, the (FIAT) market acts as a wealth-extraction tool for schemers and insiders, at the expense of the enthusiastic but uninformed public.

In fact, speculation for speculation’s sake rarely ends well for most. A lot of “ pro-Africa” talks are simply conveyed for speculative purposes, and I am wary of the effects on the largely unsophisticated masses.

Another critical but ignored factor involves property rights and the broader unstable monetary environment in Africa. Cash is an easily exchangeable fungible asset, and investing in securities should reflect intrinsic value. In a low-trust society like in African countries, institutional trust is virtually nonexistent, and the monetary system is a glaring appanage of this state of affairs.

Nigeria’s currency for example, despite the country’s vast human and natural wealth, is among the most unstable historically, plagued with rampant inflation that renders official statements meaningless.

The Nigerian Naira has depreciated steeply over the past decade, moving roughly from 168 Naira per US dollar in 2016 to over 1,300 Naira per US dollar by 2026.

This is a terrible near-hyperinflationary reality for the common folks to deal with, and an important albeit neglected driver of social and ethno-religious unrest in the country.

Frankly, Nigeria’s elites have failed their people, particularly in monetary policy.

Simple solutions like dollarization or monetary denationalization could drastically reduce the chaos created by decades of political elites’ greed. The naira, with its 15% annual inflation rate, is a disgrace for such a resource-rich nation. The system seems designed for a small elite to drain as much value as possible, with little regard for the populace. Economic calculations and accounting processes are therefore unreliable, akin to fishing with a bayonet. The Nigerian economy cannot grow out its current predicament through securitization and euphoric speculation in stocks alone.

Clearly stated, a thriving stock market can’t compensate for decades of institutional corruption and monetary misconduct. The qualitative factor of the monetary medium is fundamental before concerns in tradable securities. If Africa truly wants to attract institutional capital, it must clean up its inflationary imbalances and institutionalize a framework that respects property rights, and design a legal foundation that serves everyone and not just its connected elites and its foreign undertakers.

African stocks to watch:

I’ve found several interesting companies generating strong returns in Nigeria and across Africa. Some are listed in Africa and in Western countries like Canada, the US, and the UK. For now, I prefer to hold African equities listed in more stable markets. Some companies have already been highlighted in the past, notably in the mining and telecom industries such as AngloGold Ashanti, AirtelAfrica, MTN, and the fairly mature SA equity market. The following stocks are unknown to the broader public and reflect my own biases.

Here are 3 stocks I consider undervalued.

( PS: The analysis below is neither exhaustive nor systematic. Investors should review this carefully and do their own due diligence. I'm highlighting interesting companies that fit my catalyst, and I may write a much more thorough report on any stock listed below at some point in the future. Caution warranted, and remember, hard work is the greatest equalizer. )

1-Thor Explorations. ( TSV/AIM: THX)

The company is a low-cost, high-margin gold producer operating the Segilola open-pit gold mine in Osun State, Nigeria, alongside the Douta development project in Senegal.

The Segilola mine is a real cash engine, producing steady cash flow well within the 2026 guidance with additional targets of more than 300,000 ounces in the future.

The stock trades at 3x PE, 1.7x EV/EBITDA, and 3.8x FCF, with 61.7% operating margins. Return on equity (ROE) is 55.53%, and return on invested capital (ROIC) is 34.18%.

Analysts’ consensus ( I hate that word) targets the stock's intrinsic value at CA$2.39 per share, 74% upside to the current price.

2- Zenith Bank Plc (NGX: ZENITHBANK / LSE: ZENB.L)

is one of Nigeria’s premier financial institutions, operating as a Tier-1 bank with expanding operations across West Africa, the UK, and key financial centers.

Founded by Jim Ovia (CON), Zenith Bank Plc was established in May 1990 and commenced operations in July of the same year as a commercial bank. The bank became a public limited company on June 17, 2004, and was listed on the Nigerian Stock Exchange (NSE) on October 21, 2004.

With a market capitalization of $3.1 billion, the stock trades at 4.3 earnings and 0.92 book. In full-year 2025, the company recorded $785M net profits, with interest income growing 52%. The bank's total assets are estimated at nearly $23 billion!

Zenith already meets the Central Bank of Nigeria’s ₦500 billion ($377M) international banking capital requirement through strong internal capital retention (retained earnings of ₦2.81 trillion), minimizing equity dilution risk compared to peers.

Beyond domestic market dominance, expanding trade-finance and corporate hubs (such as its Manchester hub) drive cross-border fees between European and West African trade routes.

Zenith has outlined a formal initiative targeting a full equity dual listing on the London Stock Exchange by 2027!

3-Guaranty Trust Holding Company Plc (LSE: GTCO, NGX:GTCO)

Guaranty Trust Holding Company Plc the parent entity of GTBank, is Nigeria’s premier Tier-1 banking franchise by profitability, operational efficiency, and capital strength. Trading at a market capitalization of $2.6B–$3.2B at ₦129–₦130 per share ($0.10c)

GTCO commands premium market multiples relative to local peers, trading at a P/E of 4.0x–5.0x and a P/B near 1.1x–1.3x. This valuation premium is an unique discount due to its industry-leading Return on Equity (ROE >45%), best-in-class cost-to-income ratio (sub-35%), and an attractive dividend yield of ~9.0%–9.8%.

The holding company structure provides structural advantages by allowing non-banking subsidiaries (HabariPay, Asset Management, and Pension Funds) to generate high-margin fee revenue independent of Central Bank of Nigeria (CBN) cash reserve restrictions. GTCO’s massive retained earnings base easily positions it to meet the CBN’s ₦500 billion international bank recapitalization mandate without destructive equity dilution.

Primary valuation discounts stem from systemic Nigerian macroeconomic risks, namely FX depreciation, sticky domestic inflation, and regulatory interventions, yet its pristine balance sheet, strong liquidity buffer, and prudent risk management make GTCO the premier quality proxy for West African financial sector exposure.

I have come to appreciate that many African and 2nd-tier world stocks trade much like pink sheets-OTC equities. This is an exciting opportunity for a dedicated analyst looking for real challenges given the current frenzy and irrationality, and even the dystopian state, of so-called mature Western markets.

In many ways, African equities still reflect pure capitalism because of the roadblocks and opportunities on the ground, mitigated in part by the lack of structural command from speculatively biased economic policies observed in the West and in Asia.

Africa is the Wild West frontier of capitalism. Capital is still “expensive”, and that’s a good thing. There is a dog-eat-dog world- no-bullshit capitalism in Africa. And I personally love this because only hardy men and women should access capital and drive industrial production!

Good hunting!

( Not investment advice. I write for intellectual stimulation only. I am still trying to refine my Newsletter and my valuation methodology. Always contact a trusting financial professional before investing in stocks.)

I’m interested in “uglystocks” for a simple reason: I’ve lost faith in the current pricing system. I believe its discovery function has been compromised, making it extremely challenging to perform reliable economic calculations and value projections. I believe buying undervalued stock issues, Ben Graham Net-nets, Walter Schloss cheap TBV, and contrarian international /oversold stocks (selling at their 5- to 10-year lows) is an intriguing proposition because these assets have already shed their “inflationary” excesses, making them leaner, healthier investments with potential for a turnaround. More importantly, the wider investment public and the US centric pros are rarely privy to such opportunities.

-Mitsubishi Motors Corporation (TYO:7211)

A Mitsubishi Outlander in my “ hood.”

I have recently noticed a significant uptick in Mitsubishi cars on the roads in my area.

This is an interesting visual cue that confirms a structural shift in the automotive industry, as price-conscious consumers are pressured to shop for the best deal available.

First off, Mitsubishi Motors is associated with the old Mitsubishi “Keiretsu” Group, one of Japan’s oldest and most influential holding companies, with tentacles across Japan and the global economy.

Mitsubishi Motors is an absolute “ugly stock”, and rightfully so. Years of declining sales, corporate scandals, and Chinese brands’ encroachment on its ASEAN market have put the company in a precarious position, with many seeing it as a near-death legacy automaker. The stock literally trades 4x below its GFC lows.

Depressed Valuation:

• Forward P/E: 11.5x (analyst EPS growth forecasts exceed 200% in some models).

• P/S = 0.15x (vs. Asian auto peers 0.3x and industry 0.9x).

• P/B = 0.57x on BV per share of ¥666.

• EV/EBITDA 3.5x with solid liquidity (cash ¥307B, short-term debt at ¥99B, current ratio 1.34).

  The stock has clearly stagnated, as its valuation metrics show, while major Japanese, Chinese, and Korean companies have gained market share and increased in value over the years. Calling the stock a “value trap” wouldn’t be too far-fetched given the company's recent history.

On the flip side, the market has over-discounted the company’s true value, ignoring the potential positive catalyst embedded in its recent turnaround strategy.

The affordability premium

The Value Proposition Moat, Not a Gimmick.

Mitsubishi has quietly built a genuinely defensible niche in the U.S. market as the value-AWD specialist. The Outlander Sport at $24,995 for the base S trim is the only model currently available with standard AWD below $25,000 in the U.S. market; rivals like the Jeep Wrangler start at $34,895, and the Ford Bronco Sport at $31,845. The Outlander is America’s most affordable new vehicle with 3-row seating, with Kelley Blue Book starting at $31,740 after its 2026 mild hybrid upgrade.

This positioning aligns directly with the consumer affordability stress reshaping the U.S. auto market in 2026. As higher borrowing costs persist and new vehicle prices remain elevated across the industry, Mitsubishi is sitting at exactly the right price point with the right product profile. The 10-year/100,000-mile powertrain warranty, an industry-leading outlier, gives buyers the confidence to stretch toward an unfamiliar brand.

Mitsubishi Motors Corporation (TSE: 7211) also recently reported a strong recovery in its first-quarter fiscal year 2026 earnings, featuring a 91.2% surge in net profit to ¥1.4 billion ($8.9 million) and a 79% jump in operating profit to ¥10.1 billion, driven by easing tariff pressures and a weaker yen. This marks a major pivot from a challenging fiscal year 2025, during which high U.S. tariffs and geopolitical disruptions caused full-year net profit to plunge 76% to ¥10 billion, even as full-year net sales grew 4% to ¥2,896.5 billion.

Let me be clear: this is a high-risk, potentially low-reward investment opportunity, especially for high-growth, high-time-preference trend chasers. Mitsubishi is a legacy brand working to rebrand as an EV/hybrid company and faces strong competition from Chinese brands. But in an environment dominated by overvalued, hyper-speculative issues, a stable, cheap, profitable legacy brand can easily benefit from a shift in sentiment as investors move toward conservative, stable yields and legacy brands. Mitsubishi is slowly rebuilding its trust thanks to its affordability premium and special powertrain warranty offerings. The company rising profits could build a positive speculative momentum and possibly re-rates its stock’s valuation at levels near those of its legacy auto-maker peers.

-CJ ENM CO., Ltd. (KOSDAQ:035760)

CJ ENM is South Korea’s largest entertainment conglomerate. It is could be compared with Disney or Warner Bros in the US with its combination of TV networks, film studios, and music labels, though it operates on a smaller scale than major U.S. media giants. The company is tied to the Samsung founder’s family and is still owned in large part by the CJ Group, one of SK most influential Chaebol.

On a purely quantitative basis, CJ ENM trades at an extreme discount to its local and global peers across all the metrics quantifiable. The South Korean entertainment giant owns valuable assets such as Studio Dragonand the streaming platform TVING yet it trades at heavily distressed multiples due to historical margin erosion, debt from international acquisitions, and the broader "Korea Discount." It is a quentissential “ugly stock” selling at its inflation adjusted near all time low.

The company is hampered by structural issues that are likely due to its ecclectic operations with low margins home shopping and e-commerce division acting as an heavy anchor against the high margin pure play intellectual property entertainment division. The company also carries a substantial debt burden ( -1.74 trillion KRW in total debt against its 667 Billion KRW market cap.) These factors have played an important factor in the stock soured equity valuation.

But the market must be ignoring the company recent positive outlooks marked by operating profitability of its streaming platform, TVING. The company is also growing internationally with joint ventures in Japan with the establishment of StudioMonowa aimed at bypassing domestic restrictions and scale content monetization globally.

The stock is currently trading at near its 2008 price.

At a market capitalization of roughly KRW 700 billion, CJ ENM’s holdings in Studio Dragon (54.4%) and Netmarble (~17%) alone are worth an estimated KRW 850–900 billion at current market prices. That is before assigning any value to the Commerce division (KRW 95.8bn of operating profit in 2025 alone), the Media Platform/Tving streaming business, the Music/IP business, or Fifth Season, CJ ENM’s U.S. scripted-content studio. On a look-through basis, the market is currently assigning a value at or below zero to the entire remainder of the company.

The stock basically trades at roughly 75% below its BV with a huge understated sum of the part value that could potentially be unlocked as investors shift their perspective towards the company significant free cash flow yield of 15 to 20%. Overall, the company can easily service its obligations and expand its turnaround strategy with little concern to covenants breach unlike many Western premium trading media company that have recently been rerated despite significant uncertainty about their ability to continue as going concerns.

Owning CJ ENM at current discount is a golden opportunity to own a piece of the influential Korean entertainment industry at steep bargains. The stock trades at 1/4 Net Assets, but the FCF, intangible and brand equity and its exponential IP holdings make the stock even more attractive.

2- What the Warren Buffett’s regurgitation industrial complex misses.

There are a lot of Buffett grifters on social media these days. They have literally built an industry dedicated to shilling securities and investment advice based on the life and achievements of the “ oracle of Omaha.”

Admittedly, I might just be a “hater” catching up late to the newsletter subscription hustle, which I find eerily akin to the “ slap a stock with AI sticker” game going on in the markets these days.

All it takes is Placating Buffett and Munger on a “blog site,” and a “value investing” subscription is born; $45/month times 100 loyal subscribers can lead to a pretty decent income stream with the right marketing.

Ok! I claim to be a radical anarcho-capitalist, so why the hate?

-First off, I am “ human” after all, and envy is a “Mofo!”

“Don’t hate the player, hate the Game;”

There are indeed a few dollars to be made copying and pasting old Buffett articles and old Munger aphorisms. Let me therefore swallow my own pride and pass my salute to the enterprising undertakers that have managed to cheat hard work by copying and pasting old investments and shareholders’ articles in their “ Financial Newsletters!”

Game is Game!

On a more serious note: if we are going to take Buffett seriously as a model for financial professionals rather than a mere source of content for marketers, we need to dig deeper to extract the Truth about the Man. The investment community has spent decades reverse-engineering his method while ignoring the foundational and ethical architecture that made his approach successful in the first place. In fact, Buffett's success hinges on a rather simple premise:

Buffett got wealthy with his investors, not through them!

That, to me, is the most impressive lesson to take from the man and the cornerstone of his legacy in the financial industry.

Buffett was the ultimate trustee, the greatest steward of capital that has ever existed.

His investors came first, always.

Before his own interests, before his own family at times. He was committed 💯 % to safeguarding his community trust and protecting their capital against the vagaries of the market and against his own fragile human frailties.

That had nothing to do with IQ, hard work, vision, genius, etc. All it took was integrity and honesty.

The first Berkshire shareholder meeting was held in 1973 in the employee cafeteria of National Indemnity Company, one of Berkshire Hathaway’s subsidiaries. In 1981 the meeting was moved to the Red Lion Hotel in Omaha. As Berkshire got bigger, and its shareholder base grew with it, the meeting moved to larger and larger arenas. In 1973, Berkshire class A stock traded around $71 per share. The stock would drop to $40 during the 74 bear market.

As of January 2022, there were 619,940 Class A shares and 1.3 billion Class B shares outstanding of Berkshire Hathaway. Class A shares have never undergone a stock split, resulting in the most expensive share price of any company. Today, Class A shares are worth over $750,000 each. According to various reports, at least seven individuals besides Buffett and Munger have become billionaires through their ownership of the stock. Thousands have become millionaires. Today, there are around three million shareholders of Berkshire, according to the latest count.

-Buffett has never bought a sports 🏀 franchise.

-He has never splurged on fancy cars and mansions.

-He has never owned a personal fleet of private jets.

-He has lived and still resides in his hometown, in the same home that he purchased in his 30s.

-His kids went to public school.

-He drove himself to work and ate McDonald's for breakfast. ( Probably still does.)

Buffett is the polar opposite of the modern “ Fiat Financier”, many of whom have been recurrently and consistently involved in scandals and accusations of fraud.

Too many get into the financial industry just to make money, by any means necessary, and they flaunt it. Maybe they have something to prove because they got bullied in high school for being the nerdy kids.

By the way, everybody got bullied back in the days!

But Buffett ( and Munger) is unique; he never sought personal glory, public validation, or adulation. Buffett’s stock picking record, extraordinary as it is, is not what made him the “ GOAT”. It was his willingness to subjugate his own “basic instincts” and align his fate and fortune with the people who entrusted him with their savings.

He has embodied true stewardship of capital for 60 years, and the results have been spectacular and the lesson infinite.

But this message on integrity, honesty, decency, and fiduciary Nobility has been ignored by the “value investing” money managers and stock-shilling newsletters that merely seek to replicate his method and system while ignoring the true underlying principles and philosophical message:

Get rich slowly and dare to carry everyone along with you.

3-Socialism: A Doctrine of the Aristocrats.

( I wholly concur with Ludwig Von Mises thesis on the origin and intellectual support and even financial backing behind all socialists and absolulitsts forms of government. I have copied this article from its original sources on the LVM institute web site.)

01/15/2019•Mises Daily•Ludwig von Mises

[Omnipotent Government (1944)]

Who is responsible for the deplorable events of the last decades? Did perhaps the lower classes, the proletarians, evolve the new doctrines? Not at all. No proletarian contributed anything to the construction of antiliberal teachings. At the root of the genealogical tree of modern socialism we meet the name of the depraved scion of one of the most eminent aristocratic families of royal France.

Almost all the fathers of socialism were members of the upper middle class or of the professions. The Belgian Henri de Man, once a radical left-wing socialist, today a no less radical pro-Nazi socialist, was quite right in asserting, “If one accepted the misleading Marxist expression which attaches every social ideology to a definite class, one would have to say that socialism as a doctrine, even Marxism, is of bourgeois origin.”2 Neither did interventionism and nationalism come from the “scum.” They also are products of the well-to-do.

The overwhelming success of these doctrines that have proved so detrimental to peaceful social cooperation and now shake the foundations of our civilization is not an outcome of lower-class activities. The proletarians, the workers, and the farmers are certainly not guilty. Members of the upper classes were the authors of these destructive ideas. The intellectuals converted the masses to this ideology; they did not get it from them. If the supremacy of these modern doctrines is a proof of intellectual decay, it does not demonstrate that the lower strata have conquered the upper ones. It demonstrates rather the decay of the intellectuals and of the bourgeoisie. The masses, precisely because they are dull and mentally inert, have never created new ideologies. This has always been the prerogative of the elite.

The truth is that we face a degeneration of a whole society and not an evil limited to some parts of it.

When liberals recommend democratic government as the only means of safeguarding permanent peace both at home and in international relations, they do not advocate the rule of the mean, of the lowbred, of the stupid, and of the domestic barbarians, as some critics of democracy believe. They are liberals and democrats precisely because they desire government by the men best fitted for the task. They maintain that those best qualified to rule must prove their abilities by convincing their fellow citizens, so that they will voluntarily entrust them with office. They do not cling to the militarist doctrine, common to all revolutionaries, that the proof of qualification is the seizure of office by acts of violence or fraud. No ruler who lacks the gift of persuasion can stay in office long; it is the indispensable condition of government. It would be an idle illusion to assume that any government, no matter how good, could lastingly do without public consent. If our community does not beget men who have the power to make sound social principles generally acceptable, civilization is lost, whatever the system of government may be.

It is not true that the dangers to the maintenance of peace, democracy, freedom, and capitalism are a result of a “revolt of the masses.” They are an achievement of scholars and intellectuals, of sons of the well-to-do, of writers and artists pampered by the best society. In every country of the world dynasties and aristocrats have worked with the socialists and interventionists against freedom. Virtually all the Christian churches and sects have espoused the principles of socialism and interventionism. In almost every country the clergy favor nationalism. In spite of the fact that Catholicism is world embracing, even the Roman Church offers no exception. The nationalism of the Irish, the Poles, and the Slovaks is to a great extent an achievement of the clergy. French nationalism found most effective support in the Church.

It would be vain to attempt to cure this evil by a return to the rule of autocrats and noblemen. The autocracy of the czars in Russia or that of the Bourbons in France, Spain, and Naples was not an assurance of sound administration. The Hohenzollerns and the Prussian Junkers in Germany and the British ruling groups have clearly proved their unfitness to run a country.

If worthless and ignoble men control the governments of many countries, it is because eminent intellectuals have recommended their rule; the principles according to which they exercise their powers have been framed by upper-class doctrinaires and meet with the approval of intellectuals. What the world needs is not constitutional reform but sound ideologies. It is obvious that every constitutional system can be made to work satisfactorily when the rulers are equal to their task. The problem is to find the men fit for office.

Neither a priori reasoning nor historical experience has disproved the basic idea of liberalism and democracy that the consent of those ruled is the main requisite of government. Neither benevolent kings nor enlightened aristocracies nor unselfish priests or philosophers can succeed when lacking this consent. Whoever wants lastingly to establish good government must start by trying to persuade his fellow citizens and offering them sound ideologies. He is only demonstrating his own incapacity when he resorts to violence, coercion, and compulsion instead of persuasion. In the long run force and threat cannot be successfully applied against majorities. There is no hope left for a civilization when the masses favor harmful policies. The elite should be supreme by virtue of persuasion, not by the assistance of firing squads.

This article is excerpted from Omnipotent Government, part 2, chapter five, section 3, “Aristocratic Doctrine” (1944).

( Not investment advice, I write to feed my thirst for knowledge and curiosity.)

I’m interested in “uglystocks” for a simple reason: I’ve lost faith in the current pricing system. I believe its discovery function has been compromised, making it extremely challenging to perform reliable economic calculations and value projections. I believe buying undervalued stock issues, Ben Graham Net-nets, Walter Schloss cheap TBV, and contrarian international /oversold stocks (selling at their 5- to 10-year lows) is an intriguing proposition because these assets have already shed their “inflationary” excesses, making them leaner, healthier investments with potential for a turnaround. More importantly, the wider investment public and the US centric pros are rarely privy to such opportunities.

PayPal Holdings. ( )

I like PayPal ( ). The company controls 45% of online payments processing. The stock sells at 8x FCF and is widely disregarded by the AI-infatuated public. Great opportunity to own a “ commodity” staple selling at an extreme discount.

PYPL shareholders and management rejection of a $53 billion buyout as “insufficient” signals internal confidence that the market is severely undervaluing the core business.

Without M&A distortion, the fintech giant can channel its robust double-digit unlevered free cash flow (FCF) yield into buying back its own stock at depressed valuations rather than letting a private consortium acquire that cash flow on the cheap.

What’s also worth mentioning is that PYPL’s second-quarter metrics were stable, with total payment volume up 10% year-over-year ($486 billion) and adjusted per-share earnings (EPS) of a better-than-expected $1.38.

A 1.04% dividend yield makes PayPal Holdings even more attractive to own for the long term.

NIKE, Inc ( )

I like Nike ( $NKE). Nike is still the most valuable sports brand in the world, and the crowd is overreacting to natural zigzagging patterns that often characterize great companies.

Granted, previous management miscalculations and brand-equity-destructive woke ideologies have severely hurt the company's cash yields. Nonetheless, Nike won’t go away without a fight and may even turn around as a safe haven when the AI narrative winds down and investors seek out alternatives to park their capital.

The stock is selling at its 13-year low, just our type of “Uglystonks”. The 4% dividend yield isn’t a bad return to hold onto as management scrambles to regain customers' and partners’ trust.

Pernod Ricard SA ( EPA: RI)

I like Pernod Ricard S.A. The company was founded in 1805, and isn’t going anywhere. Millennials and TikTok-infatuated Gen Zs drink less than their predecessors. They also have less sex and marry less.

But alcohol consumption is a civilizational reality, and holding onto valuable producers is as sound as an investment as they come along. In fact, alcohol ( whisky and vodka) has served as a medium of exchange during major currency crises.

Pernod Ricard owns a global portfolio of over 200 premium spirits, wines, and champagnes and pays a generous 7% dividend yield. The stock trades at a P/E of 12, nearly 1/2 below its industry’s peers of 22x. Pernod Ricard is currently selling at a 16-year low.

What’s not to like when everyone else is chasing Neocloud’s pump-and-dump schemes?

All these 3 stocks are leading brands, proven market leaders in their markets, and selling at extreme discounts to the popular AI narrative. The intelligent investor would be better off holding onto sound companies with proven records and established historical legacies.

(Not investment advice. I write to feed my own curiosity and for intellectual stimulation only. Always consult a trusted investment advisor before buying or selling financial securities. Wall Street is not your friend.)

Wall Street loves a bubble, even in the gold standard.

I am here asserting that the most important indicator of economic prosperity is the quality of the money medium. That is because a currency that maintains and even increases its purchasing power signals a prosperous, competitive, dynamic, free, and high-trust society, as opposed to an inflationary purchasing power-degraded monetary regime that often denotes interventionism, cronyism, and the hyper-financialization of the economy.

Interestingly, the financial industry tends to thrive under inflationary regimes while shrinking in a deflationary hard-money currency system. Wall Street, I must say, has rarely been the friend of Sound money.

Under sound money, workers need only to work hard and be thrifty to be relatively prosperous. Under inflationism, they must absolutely invest and own financial assets to mitigate the negative effects of declining purchasing power. Securities issuers and sellers therefore thrive as the production and demand for financial securities rise incrementally with inflation, transferring wealth and prestige towards the financial industry and adjacent sectors.

Under hard money, securities issuance is marginal, serving as proxy for actual industrial and business ownership. Savings-based capital investments and value creation are rewarded with profits, while entrepreneurial errors are quickly cleared out of the pricing network. Capital is dear, and interest rates stay relatively high to reward savers. Cheap credit-induced business cycles are shortened, and speculative euphoria restrained as fractional-reserve credit growth is severely hampered by monetary inelasticity. Investors can keep their savings safely in cash for decades, unperturbed.

In the meantime, the financial industry remains small; bankers, brokers, insurers, hedge funds, quants, lawyers, Newsletter writers, accountants, financial advisory services, and many other fancy white-collar “high finance” jobs are relegated to mid-level salaries. The social prestige and compensation attached to those jobs do not exist.

Gone are the days of large mansions and prestige attached to high finance, and welcome to middle-class three-bedroom, two-bath suburban life. The Cantillon wealth effect from central banks into the financial industry dries up, and capital formation shifts from artificial fractional-reserve credit growth to actual savings-based natural interest-rate demand.

Historical Evidence:

The American experience: 1873-1913.

The US operated under a de facto Gold standard after 1879, and the period was characteristically deflationary. Wholesale prices fell roughly 30-40% between the end of the Civil War and the mid-1890s.

During that period, a savings account was a prestigious wealth-building instrument. A farmer, mechanic, or store owner who deposited his gold-backed currency into a savings account or bought government bonds saw real returns with little equity market risk.

Wall Street was geographically and socially marginal. Powerful investment banks existed, with JP Morgan and Rockefeller’s banks competing over government financing and corporate reorganizations. But hyper-securitization of consumer debt or financial engineering was almost non-existent.

Also, the financial sector's share of GDP and employment was relatively small. Banks held mortgages on their balance sheets until maturity. There were no mortgage-backed securities, no collateralized debt obligations, no structured products…etc

The British Gold Standard, 1815-1914.

In Britain, the gentleman capitalist could maintain his social standing by holding consols ( government perpetuities) and keep a current account at his bank. The city of London social cachet was real, but limited to prestigious banking houses like the Barings or the Rothschild.

London under the classical Gold standard was the world's largest, most sophisticated financial center. Merchant banking, sovereign debt underwriting, and global capital flows boomed despite hard money. Capital raising and underwriting for genuine enterprise was dynamic, but the retail and speculative complexity of the financial service industry was almost nonexistent. Finance did not dominate popular culture, nor was finance a career aspiration the way investment banking and private equity are today.

The social contrast and the social contract:

Since the closure of the gold exchange window in 1971, the financial sector has exploded concurrently with rising inflation. Holding cash throughout that period guarantees poverty, as inflation gradually eats away at savers’ purchasing power. Every teacher, nurse, and engineer is thus forced to become an amateur portfolio manager, or hire one. This has created a massive captive clientele for the financial industry.

This led to a systemic shift in cultural values, as the brightest young minds aim for jobs in investment banking rather than becoming engineers, inventors, merchants, industrialists, or even clergymen. In the 19th century, the financier was a respected useful clerk; in the 21st century, he is the master of the universe.

In a fiat system, financial institutions generate massive revenues via financial engineering: taking illiquid debt (mortgages, auto loans, consumer credit, corporate debt), bundling it into tranches through structured products (MBS, CLOs), and selling it to yield-hungry investors. Wall Street and private equity firms occupy a central role in the culture and in the economy. They serve as the indispensable conduits through which central bank liquidity flows into real estate, buyouts, venture firms.

Initially a marginal, specialized finance niche, private equity exploded in the 80s; from 1982 through 1993, it grew amid a dramatic surge in leveraged buyout activity financed by junk bonds heralded by Drexel-Burnham Lambert and led by Michael Milken. The leveraged buyout industry then nearly collapsed in the late 1980s and early 1990s.

The second boom-and-bust cycle (from 1992 through 2002) emerged from the ashes of the savings and loan thrifts crisis, real estate market collapse, and the early-1990s recession. This period saw the emergence of more institutionalized private equity firms, ultimately culminating in the massive dot-com bubble in 1999 and 2000.

The third boom-and-bust cycle (from 2003 through 2007) came after the dot-com bubble's collapse; leveraged buyouts reached unprecedented size, and the institutionalization of private equity firms was exemplified by the Blackstone Group's 2007 initial public offering.

Today, thousands of private equity firms operate globally, with estimates generally placing the number between 10,000 and 24,000 active firms worldwide. In the US alone, industry data tracks over 11,000 investment vehicles and firms. The largest market leaders include Blackstone, KKR, Apollo Global Management, and the Carlyle Group.

The historical trajectory of hyperfinancialization is equally evident in the growth of the hedge fund industry. Alfred W. Jones created the hedge fund industry in 1949, a middle-aged journalist with a master’s in sociology and little to no investing experience. He borrowed $60,000 and added $40,000 of his own money to create the world's first “hedged fund”. Despite its management-incentive fee, over 10 years, Mr. Jones's hedge fund beat the top-performing mutual funds, the Dreyfus Fund, by 87 percent. This led to a flurry of interest in hedge funds in the 60s and 70s with at least 130 hedge funds started, including George Soros's Quantum Fund and Michael Steinhardt's Steinhardt Partners.

The hedge fund industry has grown by leaps and bounds since the 40s, with total capital reaching a record $5.6 trillion in the second quarter of 2026. Meanwhile, the US currency has lost nearly 90% of its purchasing power, and the US industrial base has shrunk dramatically. The number of global billionaires has equally surged from 140 when Forbes first tracked the world's richest in 1987 to over 3,400 today, many of whom are mere fee-earning capital trustees.

Conclusion: Wall Street, a Fiat benefactor.

Adjusted to Gold, the vast majority of asset prices have trended down for decades. Thanks to the exponential growth of international trade, technological and scientific innovation, living standards have factually increased across all spectrums. In real terms, prices have generally gone down: food, healthcare costs, education, leisure, travel, entertainment, and even stock securities. The veil of inflation only hides the real treasure of entrepreneurial dynamism and the success of the financial and capital division of labor, which continues to alleviate poverty worldwide regardless.

The trajectory of the financial industry, by contrast, is telling: Once a marginal and specialized sector, the financial industry has largely benefited from the past 50 years of unrelenting inflationary and rescue policies, driving growth and wealth aggregation within a small circle of sophisticated financial and corporate dealers. As an example: Total global hedge fund industry capital exploded in 2Q 2026 to a historic $5.6 trillion, jumping for the 15th consecutive quarter, as reported in the latest HFR Global Hedge Fund Industry Report, released by HFR®, the established global leader in indexation, analysis, and research of the hedge fund industry. Institutional Investors website notes that the 25 managers who earned the most last year made a total of $36.65 billion, the highest amount in the quarter-century Institutional Investor has been publishing its definitive ranking.

Meanwhile, Bankrate.com reports that only 46% of U.S. adults have enough emergency savings to cover three months of expenses according to its Emergency Savings Report. This is particularly troubling given the currency's gradual decline and the fall in savings rates. In fact, 40 years ago, CDs were considered great investments. The average annual percentage yield (APY) on a one-year CD was over 11%, a far cry from the meager 1 or 2 percent offered today. At 11%, most people will naturally try to work harder, produce more, and save more. In fact, a natural psychological link exists between market-based interest rates and savings rates. Today, unfortunately, the average investor has been forced to either “play the market,” with potentially disastrous consequences, or trust a fee-hungry financial professional. Either way, the working man has lost tremendously, while most of the wealth has been transferred to a small circle of connected Wall Street rent-seekers. The gap between the rich and the not-so-rich only continues to widen as the currency depreciates over time.

( I write to satisfy my own intellectual curiosity. Not investment advice.)

“ If you invest in a stock, you must be mentally ready to watch it drop 50% or even more and stay calm through it.”

Warren Buffett.

Introduction: The Nike Fatigue!

I was rather awestruck by this YouTube video comment, as it rightfully summed up the main reason behind Nike, Inc ( ) current crisis. I had to borrow it for this analysis: ( I left the comment as is for authenticity purposes!)

“as former Nike dealer who was with them for 36 years, I just want to say that before they got rid of somewhat big national chains that was not their "40 dealers". Nike got rid of all the independent dealer who were with them as long as 50 years or more. Our family were with them since 1980. And I was let go in 2016. So in big picture, they got rid of Independent then smaller nationals then big nationals like DSW and Zappo.
And Some of the 40s are not there anymore. LOL

You should have seen hubris, arrogance, misguided confidence of Nike executives and staff going back 10 years. It was something else, biblical.”

@YongKim-lp7hl

3 months ago (edited)

This comment hits the nerve. It effectively touches on the common factors that often precede great brands’ decay: hubris, arrogance, self-entitlement, detachment, and greed. Consumers’ growls have grown louder over the years, fueled by a series of blunders born from a gradual disconnect between consumers’ expectations and corporate priorities.

Nike executives just grew overconfident and lost their “ foot on the street” over the years. Decades of unchallenged success may have caused them to forget that customer satisfaction was their real bread and butter.

So a question must be asked:

Can Nike ( ) regain its mojo?

Watching Nike, hoping for $30 per share entry point.

The Facts: Nike is still expensive, to me!

I will get even more excited if the stock collapses -50%

I am an ugly stock hunter, and Nike screens like a contrarian bargain with its stock hovering near a 13-year low. The stock is down 73% in five years, and news headlines emphatically highlight the company’s struggles and its well-earned consumers’ distrust, which should hopefully put more downside pressure on the stock even when operations and results may warrant a fair rerating.

With a trailing PE ratio at 20.05, a PB ratio over 4, and an EV/FCF at 28, I believe Nike hasn’t quite hit the bar of real distress yet.

I am a scavenger by nature (allegorically speaking), and while everyone is panicking and crying “fool,” I hope the macro forces pressure the stock even lower.

I prefer to invest in stocks with a (P/E) ratio below 10 and a price-to-free cash flow (EV/FCF) ratio below 15. At its current valuation, Nike would need a share price below $30 to make me salivate.

The Ugly:

It is evident that the “ Swoosh” brand’s equity has deteriorated. The premium value associated with Nike has been compromised by the widespread commoditization of its products, which has eroded decades of cultivated exclusivity refinement. Purchasing a $250 pair of shoes no longer makes sense when everyone can wear the same logo on a $15 shirt or short.

The common blame is inputed on the company’s strategic miscalculation under past leadership, namely former CEO John Danahoe, that overemphazed digital direct-to- consumer sales while abandoning key wholesale partners to favor its own apps and stores. Other factors also include a shift away from sports toward generic lifestyle.

Macro factors such as tariffs, the entry of competitive new brands such as Hoka and Onon, rising inflation, and polarizing “ woke” issues have equally exerted real pressure on the company’s margins.

Cash often tells the big story, and while the brand remains relatively solid, its cash flow margins shine a brighter light than marketing stunts could ever do.

Nike Inc. (NYSE: NKE) reported an annual free cash flow of $2.184 billion for its fiscal year ending May 31, 2026. This represents a 33.17% decline compared to the previous fiscal year, continuing a downward trend from prior peak levels. Nike's free cash flow peaked in 2024 and has fallen by nearly 2/3 in 2 years!

• NIKE annual free cash flow for 2026 was $2.184B, a 33.17% decline from 2025.

• NIKE annual free cash flow for 2025 was $3.268B, a 50.61% decline from 2024.

• NIKE annual free cash flow for 2024 was $6.617B, a 35.82% increase from 2023.

Internationally, Chinese brands like Anta and Li Ning in particular, have demonstrated remarkable resilience and dynamism, enabling them to challenge Western brands in the most sought-after Asian markets. Nike has been among the hardest hit.

ASICS, the company that inspired Phil Knight to found his company, presents an intriguing case study, having successfully navigated hypercompetitive pricing through a well-defined strategy focused on quality and exclusivity. The stock is trading at all-time highs, while Nike is languishing near 13-year lows.

ASICS has successfully navigated Chinese entry and market stratification

Nike also faces challenges stemming from a deteriorating corporate culture, exacerbated by an aging executive team and a lack of clear leadership continuity.

Let’s be candid; Nike has lost its “cool factor,” and few people are willing to pay $300 for a pair of Jordans amid a challenging job market and an inflationary environment.

The beauty: Exceptionally recognized brand.

Nevertheless, Nike remains an exceptionally profitable company deeply ingrained in the global collective consciousness. A turnaround is still possible, provided it returns to fundamentals and structurally focuses on revitalizing the brand while dissociating its equity from partisan ideologies and pseudo-social justice themes.

Nike revenue for the twelve months ending May 31, 2026 was $46.398B, a 0.19% increase year-over-year. Net income for the twelve months ending May 31, 2026 was $3.108B, a 3.45% decline year-over-year. While the income statements have remained relatively in line with the company’s historical trajectory, cash-flow issues have been the clear red flags driving the stock's collapse.

Nike generated about $2.7 billion of cash from operations in 2026, slightly more than the $2.24 billion generated in 2020. This suggests the company's recent post-COVID boost was largely driven by consumer overspending and strategic over-commoditization, which temporarily boosted cash flow while diluting brand equity.

The “direct-to-consumer online strategy” seems to have failed. And the near -50% decline in cash flow proceeds in 2025 tells the story.

Bringing back Eliot Hill, a Nike 33-year in-house veteran, from retirement should be met with cautious optimism, as it signals the board is refocusing on mending broken relationships and rebuilding the company’s historical equity focus on quality and trust.

Positive momentum also seems to be building up, with more than $1 billion in tariff reimbursements and the Fed dropping a DEA subpoena alleging the company discriminated against workers. It is fair to say that the clouds are clearing quite a bit.

With $9 billion in cash reserves and a solid 4% dividend yield for patient investors, Nike can undertake numerous initiatives to recenter its equity on the trajectory that built its reputation as the most profitable and valuable sports brand in the world.

Conclusion: The only problem with Nike is that the stock isn’t cheap enough.

The herd tends to overreact to extremes, overstimulating a stock on positive momentum and equally over-panicking on negative headlines. Nike has been around for 60 years; it went public in the 80s and has dominated Athletic wear and sports fashion for decades. Its recent challenges are a normal occurrence in a successful company’s lifecycle. Trust and integrity are key, especially for a company whose operating model is built around its “BRAND EQUITY.” Nike seems to have gotten the wake-up call with its current CEO.

I have bought a few shares, but I really want the stock to crash! Nike stock is still overvalued even at current discounts. I love ugly stocks, and the panic button hasn’t really rung on Nike yet to get me (really) drooling. I am keeping an eye out and waiting for the opportune entry point to truly “go HAM”.

The stock currently trades at an EV/FCF of 28; I’d swoop in if a black swan event could crash the stock toward 15x, or preferably even under 10x.

Nike at $25 per share, not totally impossible but far from a sign of distress in my opinion. Nike is still the “go-to” leader in athletic wear and sports fashion. Any significant down pressure on the stock ought to be embraced as buying opportunity.

Nike is an iconic American brand with global appeal; its turnaround will not materialize in 2 years. This is a 5 years turnaround bet at minimum. Phil Knight was inspired by ASICS in the 60s; ASICS is once again quietly showing the roadmap by focusing on credibility over “politics” and ignoring diluted hyper-marketing that feels more like propaganda.

Nike execs should follow along, and everything will be alright.

( Not investment advice. I own a few shares. Always consult a reputable investment advisor before purchasing shares. Wall street is not your friend.)

Hindsight is indeed 20/20; thus the ominous collapse of “boy wunder” Leopold Aschenbrenner seems rather obvious now. Just a few months ago, he was hailed as the next Warren Buffett, the genius “valedictorian,” the 24-year-old who seemingly transformed a small $224M fund into a multi-billion-dollar investment juggernaut in just two years. Jim Cramer even quipped, “Everything he touches turns to gold.”

Move aside, old Warren, with your “value investing” bullshit, and make way for a new talent more attuned to the needs of AI. The twit-sphere and the casino Street heaped praise on this otherworldly genius while skeptics like me were ignored.

-I told you so!

No one really gives a damn now. Especially the investors who trusted the inexperienced first-time fund manager with their wealth and lost millions, maybe even hundreds of millions. Ken Griffin’s Citadel just bought the fund on the “down low,” yet everyone found out, and the market is rallying on this news as I scribe this paragraph.

Buying opportunity maybe? We shall soon find out in due time.

Meanwhile, the lessons are more important than the individuals who recurrently epitomize markets’ follies throughout financial history. That’s because outside of horror movies and ritualistic sacrifices, the world of finance is among the most terrifying and ghastly realms known to humanity.

Leopold Aschenbrenner is not the first nor the last boy wonder or boy plunger (Jesse Livermore RIP) ever recorded. He is, in fact, the most recent fallen domino in an industry built on hubris, pretense, and greed.

Let’s analyze three generations of heralded geniuses that were sold to the masses as the next great ones: Garrett Van Wagoner, the rock star of 1999. Cathie Wood, the prophet of 2020s. And Leopold Aschenbrenner, the current symbol of the AI infrastructure mania.

1-Garrett Van Govener: The dot-com wunder man ( 1996-2008)

In a 2008 Kiplinger article announcing the shutdown of his fund, Garret Van Wagoner tepidly acknowledged: “My track record is not good at all. I wish I had done better.” Warren Buffett had presciently warned in 1996: “You can’t tell who is swimming naked until the tide goes out.” Mr. Van Wagoner was unfortunately caught with his pants down when the bear market hit tech stocks three years later.

Garrett Van Wagoner emerged from relative obscurity in the mid-1990s as a specialist in small-cap technology companies. After relocating to San Francisco in 1993 to develop a small-cap business for the UK-based Govett, he struck out on his own in 1996, launching the Van Wagoner Funds.

His edge came from two disciplines: direct product research and “pre-IPO” investments in late-stage private companies before they went public.

Van Wagoner Emerging Growth Fund gained 291% in 1999. AUM ballooned to almost $1.5 billion, up from $189 million a year earlier. A $10,000 investment in Emerging Growth at the beginning of 1997 would have been worth more than $45,000 by March 2000.

Those riches didn’t come without risk. Garrett Van Wagoner was known for trading aggressively and successfully, and his hard-charging style suited the times. By the time PBS featured the rising star on an episode of “Frontline” in January 1997, Mr. Van Wagoner was being compared to legendary investor Peter Lynch of Fidelity Magellan Fund.

The Fall.

Emerging Growth lost 21% in 2000 as the Nasdaq began its slow grinding collapse. Then it dropped almost 60% in 2001, and fell 65% in 2002, when assets slipped below $100 million. That $45,000 amassed by early 2000 would have dwindled to $3,300 by the end of September 2002.

For every dollar invested at the height of the euphoria, investors were left with eight cents. The mathematics of catastrophic drawdowns are unforgiving — a 92% loss requires a 1,150% gain just to break even.

Van Wagoner stepped down in 2008, by which point the fund had delivered an annualized return of negative 7.8% since inception.

A New York Post article reported later that:

Well-known mutual fund manager Garrett Van Wagoner was barred from serving as a fund director or officer for seven years after the Securities and Exchange Commission alleged that he and his company duped investors about the value of his funds.

Van Wagoner and his firm, San-Francisco based Van Wagoner Capital Management, would later pay $800,000 in fines to settle allegations of improperly pricing securities.

He tried a comeback in 2018 with a Van Wagoner Venture Fund II focused on helping to build the smart grid of the future by leading the financing of the Fourth Generation Industrial Revolution by investing in vanguard companies that are building a cleaner, more sustainable, connected, and intelligent transportation ecosystem. His thesis was based on what he deemed an investment in the Fourth Industrial Revolution around transportation and connectivity.

The PitchBook website states that the fund had been liquidated.

Van Wogener is now retired in Palm Beach, Florida; his latest attempt at a comeback seems to have failed as the website for a Van Wogener private equity fund was shut down.

This is a hard fall from a man who ruled the market in the late 90s and was compared to Warren Buffett at some point.

Cathie Wood: “ It's all God’s work anyway -and the Fed.

Cathie Wood was mentored by “ fame” supply-side economist Art Laffer. It all makes sense in aggregate: She is a trained economist! Red flag numero uno.

Supply-side was extremely popular in the 80s and is still dominating conservative old-school Wall Street today. Supply-siders love a good government spending, especially when the credit and the policies support the financial markets.

Trillions of dollars of capital have been invested on the back of that theory, and Wall Streeters have cheered it ever since. Supply-side economics made mainstream waves in theaters with the popular Oliver Stone 1987 movie “Wall Street” starring Charlie Sheen and Michael Douglas. The famous “Greed is Good” speech delivered by Gordon Gekko has left a sour taste in many people’s understanding of Free-Market Capitalism ever since. Supply-side is flawed. Woundedly so!

Cathie Wood is also connected to Bill Hwang of Archegos Capital with whom she shares a strong faith in Christ. In an interview with CNBC, she said that BH provided seed capital for Ark’s first four exchange-traded funds. Red flag numero dos!

Cathie Wood spent 12 years at AllianceBernstein managing $12 billion of capital focused on growth stocks until she decided at age 57 to form her own fund.

She started ARK after reportedly clashing with her former employer: Her old boss at AllianceBernstein told the Financial Times that “her biggest blind spot is managing risk and volatility” — a serious charge against someone responsible for other people’s money. Wood credited the inspiration for starting ARK — which offers nine exchange-traded funds that anyone can buy like a stock, making them accessible to rank-and-file investors in a way that hedge funds are not — to a divine “calling” from the Holy Spirit. The fund is named after the Ark of the Covenant, a religious storage chest and relic held to be the most sacred object by the Israelites.

Cathie Wood was one of the earliest promoters of Tesla around 2014, when the company’s survival was uncertain. She bought initial shares at approximately $15 per share, adjusted for stock splits.

Her rise to fame coincided with post-COVID government spending policies and a stock market boom, as a combination of government stimulus, near-zero interest rates, and a surge in retail trading skyrocketed the markets, particularly tech stocks. Her flagship ARK Innovation ETF ( ARKK) gained 153% in 2020 and she became one of the most talked about investment stars. She quickly rose to icon status, praised for her bold, long-term forecasts on artificial intelligence, DNA sequencing, and blockchain.

AUM exploded from roughly $1.8 billion at the start of 2020 to $17 billion by December 2020, then peaked at $27.9 billion in February 2021. Wood even began to promise investors 40% compounding annual returns over the next five years.

The Fall.

A Morningstar analysis written in 2023 found that Cathie Wood's ARK Invest destroyed approximately $14.3 billion in shareholder wealth from 2014 to 2023, the highest for a fund family during that period. High-growth tech bets and rising interest rates drove these losses, with the ARK Innovation ETF (ARKK) accounting for roughly $7.1 billion of the total.

Wood, despite her background as an economist, did not anticipate the Federal Reserve would begin raising interest rates in 2022; her portfolio—full of unprofitable, long-duration growth companies that only work in a zero-rate world—collapsed. Her inability to manage volatility had come home to roost.

ARKK fell more than 70% from its all-time high. Investors who had rushed in at the peak, once again drawn by recent performance, absorbed the bulk of the losses.

Wood has never fully recovered her earlier status. She continues to manage money, make projections, and attract the kind of media attention that a 150% year buys you in perpetuity. But the investors who loaded up at the top are still waiting.

“ When he touches something, it turns to gold...” Jim Cramer.

Leopold Aschenbrenner: Situational Unawareness and more…A lot more.

The official story, so far, about Leopold Aschenbrenner is that he got caught with his pants down because of his overleveraged positions.

As of July 30, 2026, Situational Awareness LP — the AI infrastructure hedge fund run by former OpenAI researcher Leopold Aschenbrenner — has sold its entire public equity book to Ken Griffin’s Citadel following forced margin calls from Goldman Sachs, JPMorgan Chase, and Bank of America. The fund had reached $45 billion in AUM and boasted a 439% net return through June 30. It took less than three weeks for 4x leverage to turn that triumph into a forced liquidation.

That story is only partially accurate. In reality, his whole thesis was flawed from the get-go, and his selection of securities would have doomed him sooner or later, leverage or not. Just as his predecessors, Wagoner and Wood, Aschenbrenner's stock selection has been less than remarkable, built on momentum and hype with a complete disregard for the “art” of securities analysis and fundamental research.

In an alert 🚨 that I posted on my X account on May 25th, 2026, I clearly highlighted the red flags 🚩 of his selected investments.

My research — see the accompanying Loss Portfolio analysis — covers the 16 loss-making companies inside Situational Awareness LP’s disclosed holdings.

1. Bloom Energy (BE) — Largest non-semi long (~$879M). Fuel cell power play. Trades at P/S ~33x, forward P/E 126-160x+, P/B ~85x. GuruFocus GF Value shows ~900-990% overvalued (e.g., ~$26 fair vs. ~$280-290 price). Negative or razor-thin historical margins; speculative AI power demand. No margin of safety.

2. Core Scientific (CORZ) (~$389M). Bitcoin miner/AI hosting pivot. P/S ~22-25x, forward P/E 167x, negative P/B. Highly volatile crypto-adjacent; earnings erratic. Graham would reject due to lack of consistent profitability and asset backing.

3. IREN (Iris Energy) (~$401M). Similar miner-to-AI pivot. P/E 220x+, P/S ~25x, P/B ~8-9x. Extreme multiples on growth hopes; history of dilution and crypto cyclicality. Far from Graham’s “bargain” threshold.

4. CleanSpark (CLSK). Crypto miner/HPC. Elevated P/S (often 5-15x+ in rallies), volatile earnings. Benefits from the AI narrative but lacks a defensive balance sheet or a low valuation.

5. Riot Platforms (RIOT). Analogous to above—high P/S, speculative pivot risks, no stable earnings track record for Graham-style analysis.

6. Applied Digital (APLD). Data center/AI infrastructure. Similar high-multiples growth story with execution and funding risks typical of the sector.

7. CoreWeave (CRWV) (~$556M). GPU cloud provider. Post-IPO growth stock with premium valuation (P/S often 8-10x+ on projections). Heavy on future AI contracts; debt and capex intensive. Speculative, not asset-based value.

8. SanDisk (SNDK) (~$724M). Memory/storage. Benefits from AI data needs but trades on cyclical hype; valuation stretched vs. normalized earnings.

9-10. Other miners/infra proxies (e.g., Bitfarms/BITF, smaller positions) and selective longs like certain power/storage plays follow the pattern: narrative-driven premiums, weak current profitability, and vulnerability to delayed AI capex or competition.

Several of these companies are not merely unprofitable; they are deeply, structurally, persistently overvalued. Applied Digital traded at approximately 50 times sales while losing more money than it earns in revenue.

SanDisk posted a $1.64 billion net loss in FY2025, 144% worse than the year before.

CoreWeave, the fund’s second-largest position, is facing an active securities fraud class action, reported a $452 million net loss in Q4 2025 alone, and issued guidance that missed Wall Street estimates by more than 15%.

These are not small imperfections in an otherwise solid portfolio. These are structural red flags that would disqualify most of these companies from serious institutional analysis — were it not for the gravitational pull of the AGI narrative draping everything in inevitability.

While the leverage effect has precipitated the Fund collapse, the fundamental value of the heralded companies is still in limbo while the AI infrastructure thesis remains a major concern for investors with the entry of competitive Chinese companies and the growing fragility of hyper-scaling giants in the US and in South Korea.

How long will the party last?

Conclusion: The heroes of bubblenomics always end in tatters.

The history of speculative bubbles is always personified by the meteoric rise and inevitable fall of central figureheads. While they are exalted as heroes at the beginning, their swift fall is soon regarded as a cautionary tale. In reality, they were mere symbols of the blissful and blinding exuberance that periodically sweeps over the markets under the pretense of world-changing technological themes, only to end up in tatters when reality sets in.

The 90s were marked by the dot-com internet bubble. While that era gave birth to revolutionary companies such as Google and Amazon, the plethora of zombie pretenses that populated that bubble led to the bankruptcy of Garret Van Wagoner. For a brief moment, Van Wagoner rose from an obscure analyst into a celebrity financial expert hailed as the next Peter Lynch. As quickly as his rise occurred so was his fall.

Cathie Wood preached Tesla in the early 2010s, before everyone else would recognize the company's worth. And she benefited greatly. Covid stimulus further heralded her vision, and her Ark fund became a staple for the average investor seeking exposure to world-changing technologies. She is now worth up to $200M. But her fund returns have been abysmal. And she has become a subject of mockery across social media and internet platforms. She was right on Tesla…But missed the boat on literally everything else despite close to 4 decades as an investment professional!

Last but not least: Boy Wunder “New Warren Buffett” Aschenbrenner. The most recent archetype of market folly! It's rather perplexing how an inexperienced 24-year-old was even elevated to a hedge fund principal to begin with. His proximity to Sam Bankman-Fried, and to the very controversial Sam Altman as well as his intimate relationships with Anthropic's Chief of Staff should have raised eyebrows.

Eyebrows,I did raise! Not so much because of Leopold Aschenbrenner’s ties to Silicon Valley’s elites, but because of serious qualitative and quantitative valuation concerns. The vast majority of Aschenbrenner’s stocks are (his fund has been co-opted by Ken Griffin’s at Citadel) mediocre perennial hype-cycle riders (Bloom Energy), zombified crypto-to-AI infrastructure pivots (WhiteFiber), and unprofitable insiders’ stock-dumping schemes (Coreweave).

Although young “King” Leopold's story ended abruptly on his wedding day, his stock portfolio selection has not been wiped off the map. In fact, in some corners of the market, investors view the recent mini-crash as buying opportunity. This is utterly reckless!

Good old Warren must be laughing at the utter foolishness once again. These “actors” were prompted by certain media to replace his buy-and-hold and don’t-borrow “boring” strategy over three decades. All of them have eaten dust; one has vanished from the scene, retired. The lady is now a laughingstock to her former followers, and a young man has just learned a brutal lesson on the pitfalls of uber-leverage.

Finally, I believe the wider public must carefully reassess the fundamental value of these AI-related securities in light of global trends and risks. The 'AI infrastructure theme has hit a critical juncture, and the failure of 'SITUATIONAL UNAWARENESS' could be a major market top signal that may potentially trigger a significant downturn in the near future... KABOOM!!!!

You have been ALERTED.

( This article was written for intellectual stimulation only. None of the authors opinion should be conflated for investment advice. Always consult a trusted advisor before buying or selling financial securities. Wall Street is not your friend.)

I am drawn to “uglystocks” because struggling companies force their execs fat cats into taking action or they are fired and replaced by competent operators.

Most corporate leaders are Ivy League-educated climbers formatted to Wall Street’s metrics. The asymmetry lies in delineating technocrats and careerists climbers from real leaders-entrepreneurs trying to work out solutions to salvage and revive their companies.

The failure rate of turn around tends to be high but occasionally, a strong exec and a team of visionary officers successfully revive their struggling companies and sets them on a path to profitability, which benefits shareholders.

Struggling companies are thus a unique investment niche because they operate as closely as possible to pure capitalist active management, unlike “growth” investing, which is often driven by momentum and popular trends, therefore rewards unimaginative corporate opportunists.

Introduction

FMC Corporation is the quintessential “uglystock.” 20% of its tradable float is held by shorts. And that trade has been right on the money. Shorts have eaten “good.”

The stock is down 70% Y/Y after reporting a net loss of $2.5 billion on $3.4 billion in revenue in 2025. The company was booted from the S&P 500, slashed its dividend by 86%, and carries roughly $4.5 billion of debt in its balance sheet. FMC Company is stumbling around like an emaciated half-dead corpse waiting to wither away after a decade of miscalculated short-term Wall Street-friendly missteps.

The stock is currently trading below its Global Financial Crisis lows. Adjusted to inflation, it is likely selling at an all-time low.

At first glance, it is nearly impossible to identify a clear catalyst that justifies a contrarian buy outside of pure technical-analysis gymnastics. Even for an “Uglystock” lover like me, the situation looks a lot like a gamble into the void.

Nevertheless, everything isn’t completely gloomy. In fact, there is an interesting valuation catalyst that can transform this seemingly “ sick” stock into an interesting M&A trade opportunity: it is the human factor; more specifically, the leadership asymmetry. . .

The Man, the Mission

When Pierre Brondeau first joined FMC Corporation in 2010, the company was a sprawling hodgepodge spanning agricultural chemicals, lithium, soda ash, peroxygens, phosphorus chemicals, and health and nutrition ingredients.

Brondeau is a classically French-trained engineer turned Wall Street portfolio builder. Unlike lifetime managers who defend legacy operations, he views chemical assets as trading chips to be optimized, combined, and even liquidated.

During his first tenure, he executed a multi-billion-dollar portfolio overhaul. He orchestrated the divestiture of FMC’s soda ash and health segments, acquired Danish chemical maker Cheminova, and completed a major asset swap with Dow/DuPont to inherit their massive crop protection portfolio. He delivered a historic 325% total return to shareholders across his first tenured stretch.

FMC became the world’s fifth largest crop protection company with a balanced global footprint and a portfolio of patented, high-margin technology. Wall Street cheered, and Brondeau retired in 2020, giving way to his protegee Marc Douglas to take over the reins of the company.

The challenges

FMC Corporation stock has dropped from its 2022 highs above $140 per share to recent new lows at $11 per share. This collapse was driven by the lingering effects of post COVID crop protection destocking, debt accumulation, and most importantly, generic competition on its key diamide patents.

The global pesticide industry has shifted from being dominated by patented products and legacy multinationals to being led by generic producers in India and China. This “generics revolution” has led to increased pesticide use, particularly in lower-income countries, and has blurred the lines between R&D and generics firms.

Agrochemical patent expirations are driving a multi-billion-dollar shift toward generics, with Asian manufacturers in China and India leading global production. FMC’s core cash cows, Rynaxypyr and Cyazypyr, have faced increasing patent expirations and aggressive post-patent generic competition in key markets such as India and Latin America, eroding the company’s margins.

Global leaders in generic agrochemicals and off-patent crop protection include UPL Limited, ADAMA Ltd., and Nufarm Limited. All these companies are known for providing cost-effective, large-scale agricultural solutions. These firms have cornered the markets once dominated by Western pesticide companies like FMC -1.60%↓, which is among the most fragile and weakest market leaders.

Criticisism:

Christian Pereira, of Campo de Visao Internacional, wrote an in-depth analysis describing the driving factors behind the FMC Corporation difficulties:

the patent cliff, specifically the expiration of Rynaxypyr patents, and the acceleration of Chinese generics have eroded the company’s hold over its market.

Pereira paints an interesting picture of a company that failed to anticipate the lingering effects of its patent expiration, contending with short-term, Wall Street-friendly financial reporting rather than investing in structural acquisitions for the future. His article sheds new light on an industry-wide “neglect” that has come home to roost, negatively affecting heavily indebted and poorly capitalized companies such as .

At the November 2023 investor Day, FMC projected revenue of $5.5-6 billion for 2026 and $11 billion for 2033. The reality has been quite brutal; aggressive Chinese generic entry has shrunk the company’s market share much faster than anticipated.

Whilst the company headquarters focused on assuaging investors’ concerns with press releases, Chinese and Indian generics developed manufacturing capabilities faster. And the market quickly accepted quality generics.

2025 was one of the worst years in the company’s modern history:

• Q4 2024 earnings missed expectations. Full-year revenue guidance of $4.15-4.35 billion disappointed against a $4.40 billion consensus. The stock began its descent.

• In March 2025, FMC was removed from the S&P 500 index entirely and demoted to the S&P small-cap index. A humiliating fall for a company that was once a mid-cap stalwart.

• The Q3 2025 report was a disaster. Revenue of $542 million was down 49% versus Q3 2024. The company reported GAAP net loss of $569M. Free cash flow guidance was slashed to -$200M. The quarterly dividend was cut 86% to preserve cash for debt reduction.

• FMC recorded a $1.36 billion goodwill impairment, writing off its entire goodwill balance. The company posted a full-year net loss of approximately $2.2 billion, a significant swing from a $ 3.21-per-share profit in FY 2024.

Caught in a conundrum

Fmc stock is down -85% in 5 years

FMC looks like a company frozen in the middle of the road like a deer caught in the headlights. Chinese and Indian generic manufacturers have squeezed its margins by aggressively flooding the market with cheap off-patent alternatives to its flagship insecticide, Rynaxypyr (chlorantraniliprole). Generics now account for a large majority of the global crop protection market by value estimates. Estimates range from 70% to as high as 93% depending on the source and definition.

This massive supply surge collapsed global active ingredient prices and compressed FMC’s revenues, forcing the chemical producer into severe financial restructuring.

The company is therefore stuck in a survival conundrum after exhausting its capital armory. The B word, aka Bankruptcy has been mentioned quite often. The company’s capital structure and negative cash flow give skeptics reasons to doubt the 148-year-old company's ability to survive what amounts to its most severe existential crisis.

The Brondeau’s Asymmetry:

I believe Brondeau’s return at the helm ought to be cheered by investors and seen as a valuable catalyst for contrarian rerating. The merger or sale of the company is back on the table. Pierre Brondeau is reputed for his ability to remove operational bottlenecks, deleverage balance sheets, and clean up enough for a valuation repricing. And he has moved quite swiftly:

• In May 2026, FMC priced a $1.2 billion offering of 8% senior secured notes due in 2031. Proceeds were earmarked to retire the company’s 3.2% note due in October 2026, repay debt, and for other general corporate purposes. This was a junk-rate coupon, but it bought time and pushed out maturities.

• In June 2026, FMC announced a $400M minority equity investment from Belgium’s Tessenderlo Group, for a 20% stake. In parallel, the company agreed to sell its India commercial business to Crystal Crop Protection for $252M with all proceeds allocated to debt reduction.

• The company also amended its revolving credit facility to include covenant relief, rescheduled a $200M prepayment under a strategic supply agreement with Corteva, and signed a $114M sale-and-leaseback of its Newark, Delaware property.

All combined, these actions represent a credible path to reducing debt by up to $1 billion. This might not solve the company’s problems entirely, but it marks a significant positive step forward to push bankruptcy off the table and give Brondeau enough leeway and room to operate.

He was the architect of previous transformation. There is no better candidate to clean up the current mess and potentially get a decent takeover bid.

The asymmetry is clear: the market is pricing FMC as an extreme distress case. But with Pierre Brondeau back at the helm, I believe the bankruptcy risks are overblown and the upside multi-baggers completely ignored by general consensus.

The Valuation pessimism.

FMC trades at a P/B of 0.8x, below book value, and at an EV/EBITDA that is roughly 1/2 of the industry average. The combination of dividend cuts, debt load, generic competition, the patent cliff, and negative cash flow has led many analysts to rate the company at a high probability of bankruptcy.

But the market is underweighting Brondeau’s recent actions and ignoring the aggressive transformation. The facts are clear: the agrochemical industry will be forced to consolidate to compete with Asian generics.

The Tessenderlo investment and the company’s bond refinancing have bought 2-3 years of runway. The India subs sale and other asset divestitures are generating real cash for deleveraging.

A strategic buyer, likely a larger Agrochemical firm interested in FMC’s patent portfolio—including Rynaxypyr, CYazypyr, and the diamide platform—along with manufacturing capabilities and Latin American distribution, might purchase the company at a distressed price of $25 to $35 per share. Well below its replacement cost. Private equity is also an option if the debt can be further reduced and the cash flow profile stabilized.

The market consensus overlooks that the downside is already priced in, while the upside is priced at near-zero probability. The optionality lies in exploiting this valuation mispricing.

At 8.1x, FMC trades below its peers’ EV/EBITDA average of 12x. The agrochemical and fertilizer sector saw M&A multiples averaging 14-18x for high-growth and strategically critical assets. For a distressed but valuable entity such as FMC, a buyer should nominally bid up to 12x EBITDA. With Pierre Brondeau's premium included, investors can be confident in an experienced operator who knows exactly what his assets are worth and in an exec with deep relationships across the agrochemical industry who can facilitate a smooth transition.

Most investors and analysts have not fully priced in Pierre Brondeau's “unique premium”. Without him, the company would lack a clear restructuring plan, potentially setting the stage for bankruptcy within 12-18 months. Brondeau's presence alone represents a huge margin of credibility that has yet to be priced in.

Conclusion: A risky optionality bet selling at extreme discount.

FMC Corporation is facing its worst existential crisis. The market consensus has completely abandoned any hope for its future, with many experts comparing its current situation to the fate of drug manufacturers’ patent-expiration crisis in 2016.

The rehiring of Pierre Brondeau represents a premium hedge against the loud bankruptcy noise. That alone constitutes a baseline that the company stock price misses. Brondeau’s restructuring expertise and ongoing, swift debt-reduction push are equally mispriced and ignored in analysts’ reports.

To be fair, FMC is not a clear-cut contrarian discount selling below cash flow or Net Asset. FMC is a seriously distressed entity trying to clean up decades of capital misallocation and debt accumulation for a profitable sum-of-the-parts sale to a deep-pocketed competitor.

Consequently, I will not directly hold the equity itself but mitigate the stock's current risk profile by buying its deeply discounted out-of-the-money call option expiring in 2028.

Why? Because Brondeau is 68 years old, and FMC’s own proxy disclosures show the board explicitly wrestling with succession terms tied to his tenure. Age and energy are non-negligible factors given the scale of energy and effort required to turn what amounts to a sinking ship.

Is Pierre Brondeau the last CEO of an independent FMC Corporation? Much of the proxies language points to that. For a contrarian, risk-tolerant hedger, 2 years of optionality margins of error is a safe bet against extreme uncertainty while maintaining a premium discount in case the turnaround or sale pans out.

Not investment advice. Always consult a trusted investment advisor before buying or selling financial securities. Wall Street is not your Friend.

For nearly a century, mainstream economic history has cast Andrew W. Mellon as the Great Depression’s ultimate villain. As Treasury Secretary, he is routinely portrayed in textbooks for advising “liquidate labor, liquidate stocks, liquidate the farmers,” which is presented as the epitome of callous, hands-off laissez-faire dogmatism.

However, viewed through a modern lens—characterized by compounding systemic failures, structural economic distortions, and unpayable debt overhangs generated by decades of Keynesian interventionism—Mellon’s philosophy demands a rigorous rehabilitation.

Far from being an unfeeling relic of the Gilded Age, Mellon understood a fundamental economic truth that contemporary policymakers have spent trillions trying to avoid: you cannot print, spend, or borrow your way out of a structural credit bubble; you can only delay the clearing process, compounding the final cost.

fee.org

Why Andrew Mellon Was the Best Treasury Secretary the US Has Ever Had

The 1920s Record: Prosperity Without Perpetual Stimulus

As Treasury Secretary (1921–1932) under Harding, Coolidge, and Hoover, Mellon oversaw sharp reductions in top marginal tax rates (from over 70% post-WWI to 24–25%), aggressive debt paydown, and spending restraint.

The national debt fell dramatically while revenues rose as economic activity expanded. Unemployment averaged low single digits for much of the decade; real GDP growth was robust; productivity surged in autos, manufacturing, and consumer goods. This was not a speculative frenzy fueled by easy money but genuine expansion under hard budget constraints and lower tax barriers to enterprise.

thebalancemoney.com 1920s Economy With Timeline and Statistics

The short, sharp 1920–1921 depression that preceded this boom was allowed to quickly liquidate wartime distortions. Recovery followed without massive intervention—the last major episode treated with classical “let the market clear” methods. Mellon’s Taxation: The People’s Business (1924) articulated a coherent philosophy: tax policy must raise necessary revenue, minimize burden on the productive, and remove obstacles to business development. High rates, he argued, bred evasion and stifled growth. The results validated the approach.

The Depression Smear and the Real Doctrine

The infamous “liquidate” quote appears in Hoover’s memoirs, written years later. Historians note that it lacks corroboration in Mellon’s public statements or in contemporary records; Lawrence H. White and others have shown that Hoover likely caricatured Mellon to portray himself as the activist savior against a supposed do-nothing Treasury chief.

Mellon supported Fed rate cuts in 1930, temporary tax relief, and some early stabilization steps. He opposed endless propping up of weak businesses, viewing recessions as necessary purges of speculative excess and inefficiency—consistent with pre-Keynesian understanding that credit-fueled booms distort capital allocation.

The deeper problem in the 1930s was not insufficient intervention but monetary contraction, trade wars (Smoot-Hawley), and inconsistent policy that turned a necessary correction into prolonged collapse.

Mellon’s insistence on eventually balancing the budget amid falling revenues was procyclical and painful, yet the alternative—unlimited deficits and moral hazard—has its own modern track record of bigger, more frequent crises.

Creative Destruction vs. the Preservation of Rottenness

Mellon’s worldview aligned with Schumpeterian creative destruction and Austrian business-cycle insights: artificial credit expansion misallocates resources into unsustainable projects; liquidation reallocates them to stronger hands, lowers inflated costs, restores incentives, and enables renewal by more prudent actors.

This is “market democracy” in action—flushing out mediocrity rather than subsidizing it.

The Mainstream Critique (Keynesian & Monetarist)

To mainstream economists such as John Maynard Keynes, Milton Friedman, and, later, Ben Bernanke, liquidationism was a catastrophic intellectual failure.

Mellon’s stance aligned with classical and some Austrian-influenced thinking of the time. Panics and depressions were seen as medicine after speculative excesses—exacerbated here by 1920s credit expansion and stock speculation, which Mellon and the Fed tried (belatedly) to curb with rate hikes in 1928–1929.

Critics, including emerging Keynesians and Democrats like FDR, portrayed this as heartless social Darwinism that favored the rich. Mellon, a wealthy industrialist with conflicts-of-interest accusations, became a symbol of elite indifference.

Keynesians argue that during a balance-sheet recession, forcing wage and price liquidation causes a lethal deflationary spiral. As prices fall, the real value of nominal debt rises, triggering widespread bankruptcies and total demand destruction.

Later on, the Monetarists, spearheaded by Friedman, argued that by allowing the banking system to collapse, the Federal Reserve inadvertently allowed the money supply to contract by one-third, turning a standard recession into an unprecedented Depression.

Andrew Mellon was Right!

Today’s economy offers an interesting contrast to Andrew Mellon’s prescriptions. Decades of QE, zero rates, and bailouts have inflated serial bubbles (tech, housing, AI infrastructure, speculative microcaps) while enabling a golden age of fraud: dilution-heavy stock promotions, circular financing, related-party tunneling, SPAC hype, crypto boom-and-bust, and zombie firms sustained by cheap credit.

Easy money has not eliminated risk—it has socialized losses, privatized gains, eroded societal trust, transferred wealth, and impoverished the masses.

Andrew Mellon understood that economic pain is an unavoidable law of thermodynamics: when you misallocate capital on a massive scale, the loss must eventually be realized. You can either take the pain up front through a swift, intense market clearance, or drag that pain out over decades through inflation, stagnant growth, and generational debt burdens.

Mellon’s liquidationism was not an act of cruelty; it was the ultimate form of economic realism. In an era currently buckling under the weight of unpayable debts and currency debasement, Mellon’s defense of balanced budgets, sound money, and letting the market find its true floor looks less like an antiquated error—and more like a prophetic warning.

As a wealthy industrialist, Mellon was well placed to recognize the pattern: interventionism preserves “bankrupted elites” and distorts market signals, breeding the excesses that eventually burst.

Although liquidation might be harsh in the short term, it ultimately clears space for genuine value creation in the future.

The caricature of Andrew Mellon served its political purpose in the 1930s, but his ideas are worthy of reconsideration. He was a successful industrialist, banker, and policymaker who delivered measurable prosperity through discipline laissez faired policies, and whose diagnosis of boom-time excesses remains more than prescient in today's dominant interventionist consensus.

Sources:

Core Historical & Biographical Sources

• Wikipedia: Andrew Mellon — Comprehensive overview of his career, tax reforms, Depression-era actions, and the Hoover quote attribution. Excellent starting point with citations. en.wikipedia.org/wiki/Andrew_Mellon

• U.S. Department of the Treasury: Andrew W. Mellon (1921–1932) — Official biography highlighting debt reduction, tax policy, and philosophy of balanced budgets. home.treasury.gov/about/history/prior-secretaries/andrew-w-mellon-1921-1932

• ITR Foundation: Andrew Mellon’s Pro-Growth Fiscal Policy (2024) — Strong defense of Mellon’s 1920s tax cuts, spending restraint, and economic outcomes (GDP growth, unemployment, debt reduction).itrfoundation.org/andrew-mellons-pro-growth-fiscal-policy

Liquidationism Debate & Scholarly Analysis

• Lawrence H. White, “Did Hayek and Robbins Deepen the Great Depression?” (Journal of Money, Credit, and Banking) — Key debunking of the “liquidationist myth,” showing Mellon supported some easing and that the extreme quote is largely Hoover’s framing. Essential for rehabilitation. Related discussion: macromarketmusings.blogspot.com/2008/05/debunking-liquidationist-myth.html

• Herbert Hoover Memoirs (quoted widely) — Source of the famous “liquidate” passage; context shows Hoover’s self-portrayal. Cross-referenced in Econlib and other analyses.

Economic Data & 1920s Context

• Federal Reserve History: Andrew W. Mellon — Covers tax reforms, interest rate views, and transition to Depression. federalreservehistory.org/people/andrew-w-mellon

• FRED (St. Louis Fed) Data — GDP growth, unemployment, national debt, and inflation series for 1920s vs. later periods (search “GDPA”, debt metrics). Visual timelines of Roaring Twenties prosperity.

Modern Critiques & Parallels

• Paul Krugman, “The Mellon Doctrine” (NYT, 2011) — Prominent invocation of Mellon as cautionary tale against austerity; useful for contrasting views. nytimes.com/2011/04/01/opinion/01krugman.html

• Broader readings on bubbles, moral hazard, and creative destruction: Austrian/Schumpeterian perspectives (e.g., White’s work on monetary institutions); analyses of post-2008/2020 interventions, zombie firms, and financialization.

Additional Visual & Archival Materials

• Public-domain portraits of Mellon (e.g., Library of Congress/Harris & Ewing photos, 1920s).

• Roaring Twenties timelines/infographics illustrating growth metrics under Mellon policies.

Quick “bust-up” analysis: Julong Holding Limited () is a zero!

Julong Holding Limited, a Beijing-based provider of smart infrastructure engineering and intelligence-integrated technology solutions, went public on June 26, 2025, listing its Class A ordinary shares on the Nasdaq Capital Market under the ticker symbol “JLHL.”

The company priced its IPO at $4.00 per share, offering 1,250,000 shares to raise approximately $5.0 million. The offering was underwritten by US Tiger Securities.

Julong Holdings Limited fits the characteristics of a stereotypical China hustle pump-and-dump scheme:

• A shady China-based VIE shell entity registered in the Cayman Islands and listed on the US market.

• A CEO who controls 93% of the company's ordinary shares and 99% of voting power in all corporate matters.

• Untrustworthy and unreliable financial reporting.

  The company claims to have earned $3.6M in profit and shows $7.4M in net cash on its balance sheet. Meanwhile, the Cash flow statement is structurally misaligned with reported earnings, showing only $36,000 in operating cash flow and $38,000 in Free Cash. Such a diametrical disconnect between cash flow and net earnings is unbecoming of a serious company and flags either pure fraud or unprofessional neglect by the company’s CFO and auditors.

• Fortuna CPA, Inc, the company's auditor, is of questionable repute.

  Its list of clients raises serious red flags in the light of their financial and valuation records: ZK International Group Co., Ltd. ; Global Tech Industries Group, Inc. $GTII; Fly-E Group, Inc. , NetSol Technologies, Inc. : All of the aforementioned names have either gone bankrupt, been delisted, or are currently trading at or near all-time lows.

• A ridiculously cheap-looking corporate website written in Mandarin script for a Western audience…

  

  English, do you speak it? ( website)

  In all, the whole thing reads like a ridiculous joke even though vast sums of money are involved. This is a company valued at almost $250 million. The company’s investors deserve at least a semi-decent English-translated website for the devil’s sake!

The stock’s trading volume has recently exploded on no known news, with 91 million shares “traded” on a tiny 1.2 million-share float.

The usual suspects’ promoters on social media have been raving about its recent 317% spike in value, high-fiving each other and promoting the stock to their “students” and trading community.

If history is a precedent, may likely implode within the next few weeks as its undertakers eventually exit out with their bounty before they get halted.

It is a real race against time for the schemers given the SEC's recent approval of rule IM-5101-4, a new regulatory framework that enables a faster delisting of manipulated stocks. This new development should lead to a rapid unraveling of fraudulent stocks.

The above-mentioned facts should be sufficient to consider a “ Vampirestock” condemned to crash to its fair value: zero.

The company is a worthless shell issued solely to pirate wealth out of gullible and naive Western and Asian investors.

In a normal world, the story should end here: a “vampirestock” ramp-and-dump operation, like hundreds of others, issued and promoted by criminal outfits and unscrupulous underwriters.

But there is a lot more to the Julong Holding story than meets the eye.

In fact, there is a bigger fish in the pond, a listed whale ruling the sea and most deserving of attention, especially in light of recent regulatory developments in China: Up Fintech Holdings, the holding company behind US Tiger Brokers, and JULONG HOLDING’s underwriter.

Up Fintech Holdings: A value trap and a penny stock promoter.

1-Origin:

Up Fintech Holdings (TIGR) operates Tiger Broker, an online brokerage focused on Chinese investors in New Zealand, the Cayman Islands, Singapore, the United States, and other international markets. Through its Tiger Trade platform, investors can trade stocks, options, warrants, and other financial instruments. Tiger Broker also provides investor education, community engagement, and IR platform services.

Tianhua Wu founded the company in 2014 after leaving NetEase to develop a better mobile trading app for Chinese investors interested in US stocks. Wu was inspired to start the company after receiving stock options and finding existing US stock trading platforms cumbersome and difficult to use.

Jim Rogers' early sponsorship was instrumental in helping the company achieve unicorn status before going public in 2019. Rogers was a key early investor, participating in several of its primary funding rounds, including Series B and Series C. As a legendary Wall Street figure and drew interest from other major institutional investors such as Xiaomi and Interactive Brokers.

Interestingly, the company was even on the receiving end of laudatory praise from “short boutique” Kerrisdale Capital in February 2021, which published a bullish report, calling Tiger Brokers “the Robinhood of China” and praising its rapid expansion and capture of overseas Chinese retail investment.

2-The regulatory overhang comes home to roost.

Up Fintech Holdings (Nasdaq: TIGR), along with Futu Holdings Limited ( Nasdaq: FUTU) and Long Bridge Securities, has recently made headlines1 for its role in illegally facilitating Chinese citizens’ trading in US securities, which is tantamount to money laundering in the CCP’s tight capital-control financial system. The stock collapsed 25% on the news and is now down 55% Y/Y.

On May 22, 2026, the CSRC Beijing Bureau formally concluded its investigations into UP Fintech’s China-based subsidiaries, finding that they engaged in unlicensed cross-border securities business and illegal fund and futures activities in mainland China. This enforcement was coordinated across eight Chinese government departments simultaneously — the CSRC, Ministry of Public Security (criminal enforcement), Ministry of Industry and Information Technology (internet blocking), People’s Bank of China (payment controls), National Financial Regulatory Administration, State Administration of Foreign Exchange, Cyberspace Administration of China, and additional coordinating bodies.

The combined RMB 411.2 million penalty (~USD $58.7 million) against Tiger’s subsidiaries, plus personal sanctions against CEO Tianhua Wu, was not an isolated action. Futu Holdings and Longbridge Securities received simultaneous enforcement under the same framework, signaling a sector-wide, coordinated regulatory closure.

For decades, Up Fintech operated in a regulatory grey zone that has undermined the company’s growth rate and investors’ confidence. That is particularly evident when the company's valuation is compared with that of popular trading applications such as Robinhood, whose stock has risen nearly 200% since its IPO. Interactive Brokers, another popular Western trading platform, has risen by up to 400% in five years, while has lost more than 50% of its value in a year and close to 70% over five years.

3-The Discovery: A “quasi” Illegal Business Model?

While hailed as a unicorn by institutional investors and benefiting from the support of Wall Street legends like Jim Rogers and Xiaomi’s founder Lei Jun, the company has always operated in the crosshairs of the law.

Behind its veneer as the world's manufacturing center, China remains a top-down authoritarian regime ruled through the fits and moods of the CCP apparatchiks.

Recently, the government has intensified its crackdown on cross-border capital flights to stem record outflows, which have reached an estimated $1 trillion. Driven by a weakening domestic economy, declining real estate values, and the search for global diversification, citizens have increasingly sought ways to move money offshore.

To choke off illegal and quasi-legal capital flight channels, Beijing has implemented several strict enforcement measures and regulatory actions.

• Tiger was flagged by the CSRC as an unauthorized platform as far back as 2016.

  A crucial element of the overall governance picture is corroborated by a 2016 South China Morning Post report archived on Tiger Brokers’ own website, is that the recent CSRC’s concerns about Tiger Brokers’ cross-border securities activities are not a sudden 2026 revelation.

In July 2016, the CSRC explicitly identified Tiger Brokers (alongside Futu Network and Jimu Stock) as ‘unauthorized platforms’ for transacting financial instruments involving mainland Chinese investors in overseas securities.

The CSRC issued a formal risk alert at that time, stating: ‘A number of mainland internet companies have emerged recently. They cooperate with overseas brokerage companies, providing channels and services for domestic investors to trade the overseas equity market. These activities lack legal protection.’

Tianhua Wu and UP Fintech leadership knew, from the company’s earliest operating days in 2016, that the CSRC considered its mainland client acquisition and cross-border trading facilitation to be operating in an illegal grey zone.

• On December 30, 2022, the China Securities Regulatory Commission (CSRC) officially announced that UP Fintech Holding Limited (the parent company of Tiger Brokers) had violated domestic laws by conducting unlicensed cross-border securities activities.

The CSRC took specific enforcement steps during this initial crackdown by:

1. Banning New Client Acquisition: UP Fintech was ordered to immediately cease soliciting or accepting new clients from mainland China.

2. Banned New Account Openings: The regulator prohibited the firm from opening any new accounts for domestic mainland investors.

3. On-Site Inspections: The CSRC dispatched regulatory officers to conduct direct, on-site inspections of the firm’s operations.

The company continued, expanded, and benefited financially from its activities for nearly a decade — fully aware of the risk entailed through its 2019 NASDAQ listing, the 2022 FINRA communications violations, the 2025 FINRA AML censure, until the 2026 CSRC formal enforcement.

Basically, Tiger Brokers had been operating in a regulatory grey zone in China long before and after going public. All the while, the company's execs kept its investors and shareholders unaware of the compliance risks and potential negative impact of government enforcement on the company's operational model and future earnings.

The May 2026 CRSC enforcement measures banning the company's operations inside mainland China were therefore not a matter of " if" but rather a matter of " when."

4-The Undervaluation narrative.

At face value, screens as a classic deep-value opportunity for “uglystocks” hunters.

This undervaluation has been recognized by a number of financial analysts in popular Newsletters, in investment websites, and even some innovative and popular “Value Investing” AI Valuation platforms.

The company’s trailing P/E is around 7.5x, with a reported net profit of $114M. The stock sells below Net Assets. Its balance sheet shows $4.49 billion in cash and $66.17 million in debt, with a net cash position of $4.43 billion, or $24.87 per share.

The stock has been crushed by 50% from its 52-week high amid broader China -related sentiment.

Many investors have deemed the CSRC’s regulatory action overblown, citing the company's global diversification pivot and growing revenue as evidence.

In Q1 2026, retail net asset inflows broke historical records; surpassing $2 billion in a single quarter, with 90% coming out of China.

While the CSRC penalty completely wiped out Q1 2026 profitability to a net loss of $26.9M ( compared to GAAP net profit of $30.4M the prior year) and triggered panic selling and class action investigations across the investment landscape, management has reiterated confidence in its business model by authorizing a $50M share repurchase program running from June 2026 to June 2027.

Up Fintech basically trades like a dying business relative to its peers and to its own growth rate. This may be considered a rare opportunity for investors to purchase a dominant Asian brand at a cheap premium. Its Fortress's balance sheet and core operating momentum provide a margin of safety for patient investors focused on the earnings discount.

Wall Street consensus estimates the stock at a target price of $8.12 to $8.58 per share, with some DCF models assigning a baseline intrinsic value of $12.00 to $21.00 per share.

5-The Value “ crapers” thesis.

5-1 The gamification conundrum

Playing (with) the markets: Gamification and playfulness in brokerage platforms

Research into “Gamification brokers”2 has yielded controversial societal and financial issues that have alarmed regulators.

“Gamification brokers” refer to online trading platforms, often “neo-brokers,” that incorporate video game-like features—such as points, badges, leaderboards, and digital confetti, to encourage users to trade more frequently. While these apps boost engagement and learning, they are closely scrutinized by regulators for nudging investors toward riskier, more impulsive decisions.

Tiger Brokers (UP Fintech) was famously modeled after Robinhood3 to offer Chinese retail investors a sleek, mobile-first platform for trading international equities. The App is popular with Chinese-speaking (and increasingly international) retail users trading US equities, options, HK stocks, and more.

Tiger Brokers’ features include trending/heatmaps, “discover” tools, hot stock/ETF rankings, community discussions, AI-assisted insights (TigerGPT), and low barriers (e.g., $1 minimums, margin financing).

These tools surface and encourage trading in momentum-driven or speculative names — exactly the environment where mediocre or questionable penny stocks, biotechs, meme plays, and low-float US-listed microcaps thrive.

The economics reinforce this: revenue depends in large part on commissions, margin interest, and securities lending. High turnover in volatile, low-quality names drives the engine.

While discloses standard penny stock/OTC risks (manipulation, fraud, pump-and-dump potential, illiquidity) in its agreements — a tacit admission of the activity its platform hosts — the model benefits from that very volume.

In an article titled: The Gamification of Investment: A comparative approach between the US and EU, Tommaso Mambrini states that:

“Platforms like Robinhood, Webull, and crypto exchanges are increasingly turning financial investing into a game, using elements taken from the gambling and video game sector such as nudging, interface designs that subtly steers users toward specific actions, confetti animations that celebrate completed trades, badges that mark milestones or achievements and more.

These techniques, collectively known as digital engagement practices (DEPs), are designed to draw users' attention, lower psychological barriers, and attract new investors. But DEPs are also encouraging behavioral biases that can lead to impulsive trades.”

Tiger Brokers is not a neutral utility like a pure institutional broker; it is optimized for active, speculative retail users who often gravitate toward the riskiest segments of the US market, just like Robinhood, the company most recognized for popularizing “ gamification brokerage” to retail investors in the US. On top of its quasi-illegal China-centric business model, Tiger Brokers' high-engagement casino-like features have attracted the ire of regulators.

5-2 The elephant in the room: The Micro-cap Pennie stocks underwriting business.

Tiger Brokers, a VampireStocks underwriter

US Tiger Securities, Inc. — the FINRA-registered, New York-based subsidiary of UP Fintech, and one of the most active book-running managers of small Chinese-company U.S. IPOs — has become the focal point of a pattern of alleged market manipulation that extends far beyond any single offering.

Recently, the retail investigative platform Reddit (“r/vampirestocks”) brought intense scrutiny to UP Fintech’s US-based underwriting arm, US Tiger Securities. The community alleges that the firm operates as a primary underwriter and clearing pipeline for microcap "pump-and-dump" penny stocks, exposing retail investors to catastrophic losses.

In a detailed November 2025 post on r/VampireStocks (”Beware of any stock tied to US Tiger Brokers!”), users highlighted TIGR’s US-facing entities as underwriter or key service provider for multiple collapsed or highly questionable names. The post explicitly ties recent collapses — such as Smart Digital Group ($SDM) — to this involvement and lists prior examples of sharp drawdowns in stocks associated with the platform’s operations:

• TRSG (TUNGRAY TECH Inc.): Down ~68%

• YMT (YIMUTIAN Inc.): Down ~72%

• FGL (FOUNDER GROUP LIMITED): Down ~90%

• DKI (DARKIRIS Inc.): Down ~89%

• NIPG (NIP GROUP Inc.): Down ~84%

These are presented as part of a pattern of “questionable and fraudulent stock schemes” enabled through the brokerage’s services.

The allegations are anchored in verifiable regulatory action: FINRA fined US Tiger and TradeUP a combined $950,000 for AML program deficiencies. Specifically, between late 2019 and mid-2023, the firms’ anti-money laundering controls were “not reasonably designed to detect and report potentially suspicious transactions” in thinly traded, low-priced securities. They also failed to conduct appropriate due diligence on correspondent accounts for foreign financial institutions.

r/VampireStocks focuses on exposing pump-and-dump schemes, Chinese-linked ramps, and stocks that “suck” retail capital. The post frames TIGR’s US brokerage as a conduit that serviced the very omnibus accounts enabling volume in these names. While not every allegation is independently verified in court, the FINRA settlement provides hard evidence of compliance gaps precisely in the low-priced securities segment.

The following list highlights microcap and small-cap initial public offerings underwritten or co-managed by US Tiger Securities that have experienced catastrophic crashes:

1. Smart Digital Group Limited

• IPO Date: May 5, 2025

• IPO Price: $4.00 per share

• Peak vs. Valley: Driven by low-float dynamics and aggressive promotions, the stock was pumped to an intraday high of $29.40 on July 28, 2025.

• The Crash: On September 26, 2025, the stock collapsed 86.4% in minutes, closing at $1.85 per share. The crash triggered an immediate, prolonged SEC trading suspension due to “potential manipulation” carried out by unknown operators via social media networks. It is now the subject of a massive class-action lawsuit naming US Tiger Securities as a primary defendant for failing to disclose the risk of structural manipulation.
  

2. DarkIris Inc. ( New ticker)

• IPO Date: August 11, 2025

• IPO Price: $4.00

• The Setup: US Tiger Securities acted as the sole bookrunner, raising a tiny $6.9 million in gross proceeds.

• The Crash: Following the classic low-float microcap script, the stock experienced massive volatility post-listing before losing the vast majority of its trading value, leaving retail investors with severe losses. It is actively cited in litigation as a benchmark example of Tiger’s microcap pipeline.

3. Top KingWin Ltd ( New ticker)

• IPO Date: April 2023

• IPO Price: $4.00 per share

• The Lifecycle: This training and advisory firm was one of the early, classic examples of the US Tiger microcap pipeline. Post-listing, it experienced temporary, vertical upward spikes on zero fundamental corporate news, followed by an aggressive, permanent down-draw into deeply distressed penny-stock territory (trading well under $0.50).

4. Agroz Inc.

• IPO Date: October 1, 2025

• IPO Price: $4.00

• The Crash: Unlike the stocks that pump before they dump, Agroz struggled almost immediately upon entering public markets. It closed down roughly 22% shortly after its listing window and continued its downward trajectory toward penny-stock status as retail liquidity dried up.

The Compliance Connection: These specific stock failures are heavily tied to regulatory findings. In April 2025, FINRA formally censured and fined US Tiger Securities (alongside its affiliate TradeUP Securities) specifically for failing to maintain proper anti-money laundering (AML) programs. FINRA noted that the firm failed to properly monitor, detect, and report suspicious cross-border trading activity in exactly these types of thinly traded, low-priced securities.

Here is the consolidated master list of microcap and small-cap stocks underwritten, co-managed, or distributed through the US Tiger Securities/Tiger Brokers pipeline that I have compiled, along with their official stock ticker symbols. The list is not exhaustive.

This pattern of engaging in low-priced securities trading and small IPOs, which comes with compliance gaps, highlights an operational risk that makes TIGR -3.98%↓ a potential value trap. Although the stock appears inexpensive based on multiples, these could conceal hidden liabilities stemming from supporting speculative or questionable activities, leading to persistent regulatory, reputational, and volume-related challenges.

Conclusion: Up Fintech Holdings valuation multiples hide its true Nature.

Julong Holding Limited is down 23% in pre-market as of today ( Monday July 13th ). I expect the stock to eventually follow the trajectory of all the stocks issued and promoted by US Tiger Securities, the US brokerage arm of Up Fintech Holdings ( ).

Talking is cheap, writing even more so. Many financial analysts have recklessly highlighted Up Fintech as a rare bird, a strong brand equity popular Financial App that can successfully pivot out of its recent regulatory issues within the heavy handed Chinese Financial market.

I disagree with their thesis. Unlike other popular financial apps that merely gamify their operations to attract unsophisticated retail traders, the case against Up Fintech rests on its long history of issuing and promoting “Vampirestocks.” Thus, the case against Up Fintech leads to a clear conclusion: Up Fintech Holdings (TIGR -3.98%↓) is a structurally impaired asset.

The low valuation multiples are completely justified because the market is factoring in a toxic underlying revenue mix, persistent legal defense costs, and a business model structurally built on underwriting high-risk microcap promotions.

True value investing relies on buying a mispriced stream of future cash flows; buying TIGR means buying a compounding stream of regulatory penalties and litigation.

VERDICT: AVOID!!!!!!!

( Let’s all watch and follow for a live case study of Speculative vampirism.)

I expect US Tiger Brokers to speed up its issuance of micro-cap junk in the future, given the cutoff of its profit center around its formerly China-exit, money-laundering Silk Road.

( Not Financial advice. Always consult a professional investment advisor before buying or shorting a stock. I write for my own intellectual stimulation. Wall Street is not your friend.)

“The three stocks sellers”

Introduction to The Game: “Get Rich or Ipo trying!”

A distinctive yet often overlooked aspect of the dominant Financial Regime is the emergence of an elite class known as Fiat Oligarchs—individuals and organizations whose wealth and power mainly stem from issuing, accumulating, and selling Fiat Financial products and securities.

Because monetary policy incentivizes credit flow into speculative and structurally unviable ventures where profitability is secondary to orchestrating public share offerings, the industry of “ Get Rich or IPO trying” has exploded to unheard-of heights in recent years.

What has emerged is not a functioning capitalism rooted in productive value creation, but rather its corruption into excessive financial engineering.

As credit-capital has artificially sustained the financial economy, securities holders’ wealth has increased faster than the net returns of their underlying businesses whilst consumers and real producers have been left to bear the burden of higher prices.

This “Fiat” Financial system has thus morphed into a mechanism for wealth transfer, in which securities issuers dump their overvalued, often fraudulent, and zombified stock issues onto the public exit-liquidity market.

Rather than fulfilling its stated mission of democratizing the ownership of industries across all segments of society, the financial market has been essentially bastardized into a welfarist and parasitic means of wealth extraction for a tiny class of securities undertakers.

1- CoreWeave, Inc., a pivot hustle?

The story of CoreWeave is intimately tied to two failed companies that preceded it: Hudson Ridge Asset Management LLC and Atlantic Crypto. Without beating around the bush, a clear question must be asked: Will CoreWeave be any different?

From January 2013 to January 2018, Michael Intrator served as co-founder and CEO of Hudson Ridge Asset Management, LLC, a fundamental, systematic natural gas hedge fund.

Natural gas trading is notoriously volatile, and Hudson Ridge attempted to algorithmically and systematically trade natural gas futures. Unfortunately, the company became a casualty of the post-2015 energy market oversupply of NG. The prolonged shale boom suppressed volatility, compressing trading margins. The cost of capital and data infrastructure began to outpace returns, forcing Intrator to quietly shut down the operations.

In September 2017, as Hudson Bridge was reeling from the effects of the long NGs bull market, Intrator teamed up with fellow energy traders Brian Venturo and Brannin McBee to chase after a new kind of digital volatility: Ethereum mining. They founded Atlantic Crypto Corp.

The trio bought thousands of Graphics cards ( Mostly Nvidia GPUs), built custom rigs and leased warehouses with cheap power access. At its peak, Atlantic Crypto was one of the largest private GPU inventories in the USA.

The 2018 cryptocurrency crash obliterated Ethereum's price, driving mining profitability to near zero. Compounding this, the Ethereum network was openly preparing to transition from GPU-heavy proof of work to proof of stake, which would render GPU mining completely obsolete.

The company rebranded as CoreWeave in 2019 and pivoted its hardware stack toward GPU rendering for visual effects studios, then toward AI compute when ChatGPT's 2022 launch triggered a global GPU shortage that hyperscalers couldn't meet fast enough.

The company went public on March 28, 2025, at a price of $40 per share (raising $1.5 billion, scaled back from the initial target of $40 billion) and listing under the ticker CRWV. The stock later surged (peaking near $119 in mid-2026) before settling around $95–96 as of late June 2026, implying a market capitalization of roughly $50+ billion.

“ The three founders instantly became Billionaires.”

2-From failed commodity traders to hyperscaler commodity billionaires.

CoreWeave’s execs have seemingly gone from nearly burning down a Manhattan office building while plugging Nvidia GPUs to mine Ethereum, to the status of Billionaires without ever earning a profit in their operating business!

How was that possible?

Short seller Kerrisdale Capital (September 2025) has characterized CoreWeave as a “debt-fueled GPU rental business with no moat,” arguing it is undifferentiated, financially engineered rather than innovative, and that lenders capture front-loaded returns while equity is left with residual claims on rapidly obsolescing hardware.

Famed investor Jim Chanos has called the company a risky leasing and finance company rather than a technology business. He views Coreweave (and similar “neoclouds”) as middlemen that buy chips from Nvidia and rent them out to hyperscalers. He therefore argues that premium valuation multiples should not apply to a company that does not build AI models.

The stock dropped 11% on July 1st after Meta announced plans to establish a cloud infrastructure division to sell surplus AI computing power.

The market declined amid concerns that a large hyperscaler such as Meta might soon rival independent “neocloud” providers. This vulnerability aligns with Kerrisdale Capital's calls and Jim Chanos’ criticisms of the company as a debt-funded GPU real estate operation lacking a competitive moat.

The continuous insider share exit pressure is beginning to make sense.

Pre-IPO cash-out: All three founders pocketed over $150 million apiece by cashing out shares ahead of the IPO. Collectively, the founders and early investor Jack Cogen sold $660 million of CoreWeave stock before the March 2025 IPO, and another $640 million since.

The company’s execs have sold over $2.3 billion of stock since the IPO lockup expired in August 2025. Its institutional backers, such as Magnetar Financial, have sold over $5.5 billion in stock, cutting its stake in half.

3-It’s a small club and you ain’t in it.

1-Micheal Intrator: The founder.

Is the CEO and co-founder of CoreWeave ( ) and its most recognizable public figure. He embodies the company’s multiple pivots from its origin as an Ethereum miner into today’s AI hyperscaler infrastructure.

Michael Intrator has an estimated personal fortune of $6.7 billion, according to the latest figures tracked by Forbes. This represents an adjustment from mid-2025, when a rapid post-IPO stock surge briefly drove his net worth to an estimated $10 billion. Still, the scale and the speed of the wealth acquisition are staggering. In less than a decade, Michael Intrator went from a failed Natural Gas trader to a Billionaire in the novel AI Real Estate business.

Some would see through his journey a story of resilience and opportunity taken; others will judge him as an opportunistic theme rider waving through an artificial narrative built on easy-credit access for the AI/adjacent industry.

Nevertheless, Michael Intrator appears to be the most gun-shy stock-selling insider among his co-founders.

Estimated total sales post lock-up are valued at around $600M with the bulk of his fortune still tied to his holding of nearly 10.4% of the company’s shares outstanding.

2-Brian Venturo

Chief Strategy Officer, co-founder. Got his start at Intrator's hedge fund after cold-calling Intrator every morning at 6 a.m. for five months until Intrator finally answered. Forbes estimates his ownership at roughly 6% of the company.

Per Forbes' September 2025 report, he is listed with a net worth of roughly $1.4 billion. He has cashed out an estimated $1.3 billion by selling about 13.5 million shares since the company's public debut. Brian Venturo has filed a total of 467 insider trades since 2021. His most recent trade was a sale of 15,380 shares made on July 1st, 2026.

3-Brannin McBee

Chief Development Officer, co-founder. Brannin McBee is one of our co-founders and has served as our Chief Development Officer since March 2024. He has an estimated net worth ranging between $2.2 billion and $4.7 billion.

From September 2017 to March 2024, Mr. McBee served as the company’s Chief Strategy Officer. Previously, he worked as a Proprietary Trader at Active Power Investments, a company in the North American Natural Gas, Power and Agriculture markets from April 2020 to January 2021. From March 2017 to August 2018, Mr. McBee was Vice President at Fourth Floor Coastal LLC, an exploration and production company in the oil and gas industry. Prior to that, from January 2013 to January 2018, he was a proprietary trader at Windy Bay Power LLC, a commodity-focused hedge fund. Mr. McBee earned a B.S. in Finance from the University of Colorado Boulder.

Has been one of the most active insider sellers, offloading over $57 million in stock in a short window, and is named as a defendant in the pending securities fraud suit.

Jack Cogen: Early believer, early exiter.

Jack Cogen was a director and early investor in CoreWeave. He was an early investor in Atlantic Crypto, which ultimately shuttered / pivoted into becoming Coreweave.

Coreweave went public in 2025 at an approximately $23 billion valuation; Cogen owned approximately 5% of the company. Jack D Cogen has an estimated net worth of at least $1.6 Billion, is a private investor in early-stage companies. Before that, he was the founder and CEO of greenhouse gas asset manager Natsource. He was also a director at natural gas hedge fund Hudson Ridge Asset Management, where two of CoreWeave’s cofounders worked.

Jack Cogen has sold an estimated total of 8.4 million shares of stock since 2021, bringing his total sales value to approximately $753 million.

Over the span of just a few days in May 2026, Jack Cogen cashed out exactly 2M shares for a total value of $221M.

He also chose not to renew his seat on the Board of Directors and effectively resigned as a Director on June 8th, 2026.

Magnetar Financials:

is a multi-product, multi-strategy alternative asset management firm based in Evanston, Illinois. The firm was founded in 2005 and invests in alternative credit and fixed-income, quantitative investing, venture, and fundamental and event-driven investing strategies

Magnetar Financial is the largest institutional investor in CoreWeave, owning a multi-billion-dollar stake built from early-stage convertible notes and major debt financing. Magnetar has been a crucial backer, helping fund CoreWeave’s pivot from crypto mining to specialized GPU cloud computing.

Magnetar invested $50 million in convertible notes as early as 2021 when CoreWeave was focused on Ethereum mining.

In 2023 and 2024, Magnetar partnered with Blackstone to lead multi-billion-dollar debt and credit facilities to help CoreWeave rapidly expand its data center footprint.

When CoreWeave (NASDAQ: CRWV) went public, Magnetar’s initial $50 million investment grew into a massive equity stake worth over $12.5 billion.

Although executives initially stated they had no plans to sell, SEC filings revealed that Magnetar and its affiliates later divested hundreds of millions of dollars in CoreWeave shares, while retaining a majority of their holdings.

Magnetar Financial has reportedly sold more than $5 Billion worth of stock in the AI infrastructure company, reducing its stake by 1/2 since the IPO lockup expiration.

CoreWeave Inc. might be a relatively new company to most investors, but its origin and its founders’ ties can be traced to an unknown natural gas commodity trading entity named Hudson Ridge Asset Management in 2013.

The story of a failed Natural Gas prop firm turning into a multi-billion-dollar AI infrastructure company would be the stuff of legend were it not for its questionable business model and suspect capital structure.

The concentration of related-party circular transactions and links with financiers of doubtful repute involved in past financial scandals, as well as aggressive insider stock sales, raise significant issues about the economic validity of the entire enterprise and even mark the company as a potential scheme for its connected parties’ share-exit enrichment.

A small “ gang” of former commodity traders/financiers has essentially gotten rich by successfully riding the AI hype and left enough juice in the bag for retail to hold.

It is a small club indeed, and you weren’t invited the first time around. Will you take the bait for a second go around?

4-Red flag! The circularity problem!

CoreWeave, Inc.'s aggressive insider share exit is not a random coincidence; it is just a tree that hides a venomous snakes filled forest. But the issue of related-party circular financing warrants a thorough breakdown. My short perspective could not possibly do the matter Justice.

https://io-fund.com/ai-stocks/nvidia-coreweave-nebius-circular-financing-gpu-boom

AI infrastructure financing, An extension cord plugged into itself?

Critics have explicitly compared the CoreWeave-Nvidia relationship to the telecom bubble of the late 1990s, in which vendor financing masked weak underlying demand.

The mechanics: Nvidia owns roughly 7% of CoreWeave and supplies it chips, which CoreWeave then rents largely to Microsoft and OpenAI — two of Nvidia’s own largest direct customers.

In September 2025, Nvidia committed to purchasing up to $6.3 billion of CoreWeave’s unsold cloud capacity through April 2032 — effectively acting as a financial backstop for its own customer/portfolio company.

CoreWeave’s own prospectus discloses extensive related-party transactions: Magnetar funded early convertible notes, Nvidia is simultaneously a supplier and an equity holder, and OpenAI’s capacity contracts were partly paid for with CoreWeave’s own private shares.

OpenAI invested $350 million into CoreWeave via private placement at the same time it was signing an $11.9 billion compute contract, a deal later expanded to roughly $22.4 billion in total commitments through 2031, with CoreWeave financing a dedicated $2.6 billion debt facility specifically to build the infrastructure for that same contract, using the contract itself as loan collateral.

Legendary short-seller Jim Chanos has flagged the deeper assumption underpinning all of it: Nvidia’s six-year depreciation schedules for GPUs are, in his view, unrealistic given the pace of chip obsolescence, and if the hardware loses value in three to four years instead, CoreWeave and peers like Oracle face what he calls “massive financial risk.”

Every dollar of “investment-grade” CoreWeave debt rests on two unproven assumptions: that hyperscaler demand for capacity is durable rather than circular, and that yesterday’s Nvidia silicon retains tomorrow’s collateral value. Both assumptions are, not coincidentally, the same assumptions that made the dot-com fiber-optic buildout look rational in 1999.

CoreWeave's stock (NASDAQ: CRWV) tumbled nearly 14% after a Bloomberg report revealed Meta Platforms is developing a cloud business to sell its excess AI computing capacity. This news sent specialized AI infrastructure providers—including CoreWeave and Nebius Group—sharply lower.

5-Trivia: You can tell a person by his friends; you can tell a company by its backers.

Magnetar Capital, CoreWeave, Inc. largest institutional backer, faced major controversy for its role in the 2008 financial crisis through a strategy dubbed the “Magnetar Trade.” The hedge fund allegedly helped create and finance risky Collateralized Debt Obligations (CDOs) while simultaneously betting that these same investments would collapse.

The Magnetar Trade generated significant backlash and media scrutiny, most notably through an investigative series by ProPublica. Critics accused Magnetar of intentionally encouraging investment banks to bundle the riskiest, lowest-quality subprime mortgages into CDOs.

Because Magnetar had protected itself against losses by purchasing credit default swaps, it stood to make massive profits when the housing market inevitably crashed and the CDOs became worthless:

“ In late 2005, the booming U.S. housing market seemed to be slowing. The Federal Reserve had begun raising interest rates. Subprime mortgage company shares were falling. Investors began to balk at buying complex mortgage securities. The housing bubble, which had propelled a historic growth in home prices, seemed poised to deflate. And if it had, the great financial crisis of 2008, which produced the Great Recession of 2008-09, might have come sooner and been less severe.

At just that moment, a few savvy financial engineers at a suburban Chicago hedge fund helped revive the Wall Street money machine, spawning billions of dollars of securities ultimately backed by home mortgages.

When the crash came, nearly all of these securities became worthless, a loss of an estimated $40 billion paid by investors, the investment banks who helped bring them into the world, and, eventually, American taxpayers.

Yet the hedge fund, named Magnetar for the super-magnetic field created by the last moments of a dying star, earned outsized returns in the year the financial crisis began.

How Magnetar pulled this off is one of the untold stories of the meltdown. Only a small group of Wall Street insiders was privy to what became known as the Magnetar Trade.”

The Magnetar connection is a serious red flag that ought to be a major issue of concern for potential investors.

6-Conclusion: CoreWeave, Inc., An unprofitable exit liquidity on the edge of discovery.

CoreWeave, Inc. () fits the “fiat oligarchy” lens particularly well. The company has benefited from a series of macroeconomic and speculative themes that have helped it grow into an influential AI hyperscaler and infrastructure provider and to sign multi-billion-dollar contracts with giant tech companies such as Microsoft, Meta, and OpenAI.

Loose post-pandemic monetary conditions, abundant venture and growth capital, and the powerful AI narrative enabled rapid scaling, leading to lofty private valuations and culminating in a successful IPO.

Its small cadre of founders—most of whom had transitioned from failed energy trading and crypto mining ventures—has captured billions in paper wealth on liquidity-driven hype while retaining decisive voting control.

With a combined net worth hovering around $21 Billion, they have been the clear winners by effectively capturing the AI narrative in their stock holdings and selling to the public despite their company’s derelict capital structure, mediocre earnings, and questionable related-party circular transactions.

In fact, there is high uncertainty about the company’s ability to become profitable in the near future, and the stock has even begun to feel the effects of the winding-down AI bubble.

CoreWeave, Inc. is now defending a federal securities fraud class action alleging it concealed known construction and supplier risks from public investors during the same window when insiders were selling — resulting in a roughly 34% stock decline and a $14 billion market-cap loss for the shareholders left holding the bag.

While it is clear that CoreWeave's equity holders are betting the entire enterprise on hyperscaler demand remaining durable and on GPU collateral retaining its value for six-plus years — an assumption contested by credible skeptics — the people who built the company have already extracted well over 7 billion dollars in pre- and post-IPO liquidity.

If that isn’t a form of Fiat Oligarchs shares exit dumping I don’t know what else it is.

Sources Material:

Official Company & Regulatory Filings

• CoreWeave Investor Relations (Quarterly Results, Earnings, Presentations): https://investors.coreweave.com/financials/quarterly-results/default.aspx

• CoreWeave Governance / Executive Bios: https://investors.coreweave.com/governance/executive-management/default.aspx

• IPO Prospectus (424B4, March 2025): https://www.sec.gov/Archives/edgar/data/1769628/000119312525067651/d899798d424b4.htm

• SEC Form 4 Insider Transactions: https://www.secform4.com/insider-trading/1769628.htm (detailed filings) and https://finance.yahoo.com/quote/CRWV/insider-transactions/

• 10-K / 10-Q Examples: Searchable via SEC EDGAR (e.g., https://www.sec.gov/edgar/browse/?CIK=1769628)

Financial Data & Stock Information

• Yahoo Finance CRWV Quote & Data: https://finance.yahoo.com/quote/CRWV/

• Nasdaq CRWV Page: https://www.nasdaq.com/market-activity/stocks/crwv

Insider & Founder Wealth Profiles

• Forbes Real-Time Net Worth (Michael Intrator): https://www.forbes.com/profile/michael-intrator/

• CoreWeave Leadership Bios (e.g., Intrator, Venturo): https://www.coreweave.com/leadership/mike-intrator and https://www.coreweave.com/leadership/brian-venturo

Critical Research & Short Reports

• Kerrisdale Capital Short Thesis (PDF, Sep 2025): https://www.kerrisdalecap.com/wp-content/uploads/2025/09/Kerrisdale-CoreWeave.pdf

• New Constructs IPO Analysis (Hidden Debt / Valuation Critique): https://www.newconstructs.com/ipo-report-valuation-rotten-to-the-core/

News & History Coverage

• IPO Announcement & Details (e.g., CNBC, Company PR): https://investors.coreweave.com/news/news-details/2025/CoreWeave-Announces-Pricing-of-Initial-Public-Offering/default.aspx

• Crypto-to-AI Pivot Article: https://finance.yahoo.com/news/coreweave-turned-crypto-crash-ai-173700140.html

• Insider Selling Coverage: Various, including MarketWatch and Investing.com articles on specific Form 4s (e.g., https://www.marketwatch.com/story/coreweaves-stock-slides-as-insider-selling-sparks-investor-concerns-fef032fe)

• Lancaster PA Data Center Opposition: Community sites (e.g.,

https://pastandsup.org/

• ) and local news (e.g., FOX43, GovTech reports on zoning fights)

This report is for informational and educational purposes. It is not investment advice. I write for intellectual stimulation only. Conduct independent due diligence and consult a licensed financial advisor before making any investment decision.

The mainstream financial industry lives in its own dystopian reality. Warning to the wise: Don’t you dare telling them that to their face.

Stocks have risen for many years and continue to do so, so the economy must be doing great. Got a problem?

I mean, a “brilliant” Financial Media Cheerleader had the toupee of calling the great Jeremy Grantham a loser the other day. Why listen to the ominous call of a 70-year-old investment legend when all you have to do is turn on CNBC at 6:00 AM Eastern Time to get the secret sauce to market success!

The bonuses have been flowing, billionaires are popping out like wild mushrooms, many with revenue-less companies going public at ridiculously high valuations.

It just hit me: Revenues and profits are binary in today’s Market. Accounting is patriarchal and exploitative.

“Down with the G.A.A.P tyranny! The revolution shall be Fintwited.”

Just buy the industries mentioned below in the name of equality.

“No profits no problems.”

Crypto innovations that will change the world are at the cusp of widespread embrace, I mean, only ten thousand of them minus Bitcoin and Ethereum. You see, you have a diversity of choice. Make sure to pick the right one.

Quantum computing is just a few weeks away from revolutionizing computing. Make sure to grab that “amazing” quantum stock selling at a 677x sales ratio and 14x Tangible Book. That’s an opportunity of a lifetime.

AI, not Allan Iverson the basketball legend, but AI for “ Artificial Intelligence.” The term “ Artificial” actually hits in the gut when you take a second to tinker. I mean, whence “ intelligence” is artificialized, what is the need for “ real-natural” intelligence then? Ok! I am overthinking: just buy the stocks, anything with AI in it, no need to overthink like a philosopher.

Don’t forget Space Travel -some people want to settle colonies on Mars- with your money, not theirs of course. Let them issue stock and then finance bonds a few days later because, just in case you didn’t know, it takes a lot of money to travel intergalactically, buddy! So shut up hater.

Who cares about beef prices? Buy the stocks.

And small modular reactors (SMRs)? They have only been tried for 70 years; give it a few more months. What’s the hurry? Just make sure to buy the stocks issued by former nighclubs managers and nanocap Canadian mining stocks promoters currently innovating this amazing revolution made in “ PowerPoints” and LLMs generated videos.

Anyway, shut up and buy the stocks, they will go up.

Just in case you didn’t get my corny sarcasm, I was merely “keeding.”

The intelligent investor would be doing himself a lot of harm “ trusting” these fools. The reality of the market, when adjusted to real “money,” paints a whole different picture of the indices and the quality of financial assets that are invisible under the keynesian trope.

What “Priced in Gold” Actually Measures

The S&P 500 has effectively been in a recession, or at least in a prolonged stagnation when priced in #Gold since the 2000 dot-com peak. While nominal charts show a massive, multi-decade secular bull market, when priced in real money, we get a whole different picture.

Dividing the S&P 500 index level by the spot gold price (both in USD) gives the number of ounces of gold required to “buy” the index. It serves as a proxy for real purchasing power using gold as a relatively stable store of value and monetary benchmark, rather than inflated fiat dollars subject to central bank policy. And this is a systematic framework across the globe in all major indices.

This long-term log-scale chart of the S&P 500 / gold ratio (annotated with major events) illustrates the point vividly. The ratio captures how equities perform relative to hard money across eras of inflation, war, policy shifts, and bubbles.

The Post-2000 Reality in Gold Terms

At the 2000 dot-com peak, it took roughly 5.1 ounces of gold to buy the S&P 500—the highest level in over a century.

By contrast, as of mid-2026, the ratio is around (with the S&P 500 near 7,300–7,500 and gold recently in the $4,000+ range). That represents massive compression: stocks have become dramatically cheaper in gold terms since the 2000 extreme. 1.66–1.85 ounce.

Key observations from the data and analyses:

• Post-2000 bear market in real terms: After the 2000 peak, the ratio collapsed. It never sustainably recovered to prior highs despite nominal stock market rallies. Priced in gold, U.S. stocks peaked in 1999–2000 and entered a clear bear phase.

• Illusory recoveries: The post-2008 and post-2020 “bull markets” look impressive in dollars but appear flat-to-down or only modestly recovering when measured in gold. Much of the nominal rise stemmed from quantitative easing, zero/negative real rates, bailouts, and monetary debasement rather than broad-based real earnings growth or productivity.

• Gold’s outperformance: Since 2000, gold has risen dramatically more than the S&P 500 in nominal terms (roughly 1,500% vs. ~400% in one common comparison, with gold still ahead even after including reinvested dividends in some analyses).

Why This Feels Like a “Recession Phase”

In Austrian or hard-money frameworks, aggressive monetary intervention (the Greenspan/Bernanke/Yellen/Powell era of puts, QE, and liquidity floods) distorts price signals, props up malinvestment, and transfers wealth via the Cantillon effect. Nominal asset prices rise, but real capital allocation suffers. Gold, as a hard monetary asset with limited supply growth, reveals the underlying stagnation or contraction in real terms.

Multiple crises since 2000 (dot-com bust, Global Financial Crisis, COVID, inflation spikes) were met with ever-larger policy responses that inflated financial assets without delivering commensurate real growth for the broader economy or equity holders in stable-value terms. The result: a multi-decade period where owning the broad market delivered disappointing real returns relative to history or to gold itself.

This does not mean the economy has been in continuous technical recession by GDP measures. It means equity investors, in real purchasing-power terms, have experienced something closer to a lost decade, especially outside the largest growth/momentum names that benefited most from liquidity.

Implications for Value Investors: Uglystocks all the way.

If the broad market has been treading water (or worse) in gold terms for 25+ years, many individual stocks—particularly unloved value names, small-caps, internationals, and deep-discount situations—likely trade at even more compelling real valuations.

Why this favors “ Uglystocks:

• Margin of safety in real terms: A stock trading at a low multiple of tangible book, net current asset value (NCAV), or liquidation value, or with high free-cash-flow yield, offers protection against further debasement or stagnation. These “cigar-butt” or Walter Schloss-style ideas become even more attractive when the index itself is cheap in gold.

• Nominal vs. real disconnect: High nominal valuations (elevated P/E ratios driven by AI hype, buybacks, or multiple expansion) can coexist with attractive real prices. The market looks expensive on the surface but offers selective opportunities underneath.

• Global and contrarian edge: Information asymmetries, governance issues, language barriers, and thinner coverage make international small-caps (e.g., certain Korean or other Asian names) even cheaper in real terms. Many trade at new lows or extreme discounts to fair/liquidation value precisely because they are ignored in a liquidity-driven nominal bull market.

• Historical playbook: The best value opportunities often emerge after prolonged real-price compression (late 1970s/early 1980s being the textbook case). Patient capital that buys quality or deep-value businesses with strong balance sheets and owner-operator alignment can compound powerfully when mean reversion or creative destruction eventually plays out.

Basically, the era of trend following easy credit is over. Entrepreneurial investors with deep investigative processes and patience will be able to find quality even when the market crashes. In a market where the overall equity-to-gold ratio is falling, the average company is becoming deeply discounted. Value investors should screen for structural valuation anomalies—such as unloved industrial cyclicals, deep-value international equities (including the structural "discounts" in Asian markets), and cash-generative businesses trading at low single-digit multiples of true free cash flow.

Bottom Line: Uglystocks and Gold forever.

Pricing the stock market in gold uncovers a sobering reality: the majority of the post-2000s “bull market” has been driven by monetary illusion and has rewarded the dystopian financial economy.

In inflation-adjusted terms, equities have shown significantly less growth than nominal figures suggest, reflecting a prolonged period of weak real returns and concealed malinvestment.

For disciplined value investors—especially those focused on extreme discounts, net-nets, global contrarian ideas, and high margins of safety—this environment is fertile ground.

The bargains are there for those willing to look past the nominal noise and buy real businesses cheaply in stable value terms. Platforms and approaches emphasizing rigorous, skeptical analysis of global uglystocks and deep-value opportunities are particularly well-suited to capitalize on this dynamic. The patient hunter who focuses on asymmetric risk/reward in inefficient corners of the market stands to benefit when (or if) real normalization eventually arrives.

(Not investment advice. I write for entertainment and intellectual stimulation only. Always do your own due diligence, consider diversification, position sizing, and personal circumstances. Markets can remain irrational longer than expected. AI was used in the writing and editing of this article.)

I’m interested in “uglystocks” for a simple reason: I’ve lost faith in the current pricing system. I believe its discovery function has been compromised, making it extremely challenging to perform reliable economic calculations and value projections.

I believe buying undervalued stock issues, Ben Graham Net-nets, Walter Schloss cheap TBV, and contrarian international /oversold stocks (selling at their 5- to 10-year lows) is an intriguing proposition because these assets have already shed their “inflationary” excesses, making them leaner, healthier investments with potential for a turnaround. More importantly, the wider investment public and the US centric pros are rarely privy to such opportunities.

“ At the end of the day, the history of Business is ultimately the History of Men.”

Introduction: The Apes are onto something.

Wendy’s is at the center of a huge meme-driven “ stonk” euphoria. The stock is currently trading upward to +40% above its recent lows with the expectation of a continuous rally in the next few weeks.

The famed fast-food company has struggled in recent years due to a multitude of negative factors that a simple observer like me cannot begin to list. Let’s just say the laundry list is more than exhaustive.

Watch video below for a full rise and fall history.

The bottom line is simple: many people are nostalgic for the old-fashioned Dave Thomas’ motto of “ never cutting corners,“ a distinctive call that set Wendy's apart from its competitors for its sit-down diner feel and homey interior, creating a "premium" fast-food identity.

Customers believe the company has lost its unique touch and has become a mere profit-extraction tool for corporate raiders and financiers.

Someone commented that Wendy’s looked like a prison visitor's parlor.

The stock recently touched its 5-year low, an attractive marker for an “uglystocks” hunter like me. The share count has decreased by 6% y/y, with a P/E of 9.42 and a P/S of 0.64. Wendy’s pays a generous dividend yield, averaging 7% on an absolute basis, with a 72% payout ratio.

is statistically cheap enough to warrant consideration by bottom-barrel stocks pickers. If anything, the recent “Apes” driven euphoria is evidence of the power of “brand equity,” a major asset class often ignored by LLM-generated valuation models.

Wendy’s is nearly 60 years old and has been a staple of the US fast-casual food industry. Millions of Americans have worked, eaten, and hung out there. The company is an important part of American restaurant identity and of its folksy culture.

The company has also expanded globally and enjoys a respectable reputation, with 7,000 restaurants in more than 30 countries and US territories.

Wendy’s still enjoys a considerable goodwill that cannot be easily wiped out.

With an EV/EBITDA of 15.5, a fat dividend yield, and close to 18.6% FCF Yield, is not a complete clunker despite its $4B debt load.

Many “Wall Street” analysts are deriding the “WallStreetBets” stonk-bros as a bunch of financially illiterates betting on a dead carcass. They ignore that the securities market does not reward “formal expertise” or generated financial modeling.

Instead, the market is a dynamic and complex ecosystem driven by real-world action and entrepreneurial decisions.

Investing is more art than science, and the right touch and the right personality at the helm of a company can be the engine that sparks a turnaround.

The human factor cannot be easily translated into a balance sheet or in a discounted cash flow, but that factor is probably the most important gauge of value.

Wendy’s is still a respectable business, a struggling one maybe, but a valuable and profitable enterprise worthy of a fair appraisal.

Nostalgia 101: “We really had it all and we threw it away.”

The (potential) bull case for Wendy’s.

Beyond social media-driven speculative craze and the unending back-and-forth-ism between the pros and the cons camps lies an important factor that could systematically re-rate the company’s value: leadership.

The story of Wendy’s is the story of its leaders, or to be more precise, its founder: Dave Thomas.

Since his passing, the company has lost its unique cache and personality. Its near-term and long-term future will thus hinge on finding the right personality and character fit to reconnect the restaurant with its customers in the age of AI.

Wendy’s brought Bob Wright back to lead its turnaround project after going through 3 CEOs changes in less than 3 years.

I believe the market ( the Apes and analysts ) is neglecting this important game-changing development.

Wendy’s; an orphaned company in search of an identity.

Many customers believe that Wendy’s died the day Dave Thomas was buried in 2002. And rightfully so! Dave Thomas was more than a founder; he was literally and figuratively the company’s patriarch.

An orphan and high school dropout, he built the chain from a single Columbus, Ohio, location in 1969 into a global powerhouse by emphasizing simple, folksy values and qualities, fresh beef, premium service, and its unique differentiated square burgers.

His personal story of overcoming abandonment infused the brand with genuine warmth, customer focus, and hands-on excellence.

“The passing of Dave Thomas also marked the loss of its Iconic Spokesman and Human Face.”

Dave appeared in over 800 TV commercials between 1989-2002, making him one of the most recognized founders in US history. A survey showed that nearly 90% of Americans knew who he was.

His simple, trustworthy, grandfatherly persona differentiated Wendy’s from its competitors (McDonald's, Burger King), setting the company apart in a crowded, low-barrier-to-entry quick-service restaurant business.

After his death, the company struggled to maintain an identity long defined by a single persona. To many, Wendy’s lost its authentic voice, moral compass, and public persona that made it feel like a family operation rather than just another corporate chain.

This remains a foundational part of its ongoing turnaround struggles.

Wendy’s in the days of Dave. Wendy’s after Dave.

Ignore WallStreetBets: Robert “Bob” Wright is the real catalyst.

Nostalgics may be yearning for the glorious days of Dave Thomas; meanwhile, skeptics are rightfully exposing the company’s records:

300 planned restaurant closures, 5 consecutive quarters of same-store sales declines, and an 11.3% sales drop in a single quarter. A vulture investor and the largest shareholders circling around to take the company private at a lower price than in previous attempts.

It is difficult to rationalize the business performance and reputation and agree with Reddit’s WallStreetBets exuberance.

On the other hand, Wendy’s is still a major operator vowing to expand its footprints across the world. The company is actively executing a massive international expansion, targeting 2,000 global locations by 2028.

So while the closure of restaurants in the US makes the headlines, Wendy’s is betting on the world for its growth.

Its shareholders’ expectations are high, and only a well-seasoned captain can rightfully steer Wendy’s ship in the right direction.

I believe Robert “Bob” Wright is the right leader to mitigate Wendy’s decline and the most apt to steer it back its planned turnaround strategy.

Robert “ Bob” Wright, the Man and the leader.

Wright is a career restaurant industry executive with deep familiarity with Wendy's and a proven track record in both fast-casual and quick-service restaurant turnarounds. He enjoys challenges and is willing to embrace the job and leave a mark. By bringing Bob Wright back, Wendy’s is betting on:

• A turnaround proof of concept with documented results.

Bob's most recent stint was at Potbelly, a chain that was hemorrhaging through eleven consecutive quarters of same-store sales declines before he arrived. Wright delivered a 39% increase in average unit volumes, 42% system-wide sales growth, a thriving digital platform built from scratch, and ultimately a $566 million exit to RaceTrac. He fixed the unit economics and let the outcome speak to the delight of shareholders.

challenges are urgent and require immediate attention. Robert Wright's success in turning around Potbelly during the height of the COVID pandemic is noteworthy for shareholders. He orchestrated a comprehensive, post-pandemic operational turnaround, expanded the brand footprint, and built one of the industry’s fastest-growing digital ordering platforms. His tenure at Potbelly has set him up as a capable shareholders friendly executive. He will be expected to replicate his post-COVID success at Wendy’s, a company he knows from top to bottom.

• Franchisee credibility trust.

Bob Wright spent years as Wendy's COO. But his stint with the company goes back to 1998, when he was a franchise area director responsible for all aspects of franchise relations with over 90 franchises restaurants and 12 Wendy’s Franchisees in the West Virginia, Kentucky, and Ohio markets.

The franchise community already knows him well. In a system that is almost entirely franchised, you cannot execute a turnaround without operators’ buy-in. Most external CEO hires spend eighteen months earning that trust. Wright walks in with it on day one. Decades of Wendy’s field-to-corporate office experience give him instant credibility. Franchisee economics and system health are make-or-break for Wendy’s predominantly franchised model.

Wendy’s appears to be betting that Wright’s combination of operational expertise, prior company familiarity, and franchise credibility can help stabilize execution while positioning the company for more sustainable growth.

• genuine digital upside lever.

A primary driver of Potbelly's turnaround under Wright was a swift, aggressive pivot to digital ordering infrastructure. With Wendy's currently navigating an industry-wide shift toward mobile apps, drive-thru automation, and loyalty reward ecosystem capture, Bob Wright’s technical implementation history at Potbelly serves as a direct blueprint. Wendy's mobile and loyalty infrastructure remains a fraction of what McDonald's and even Burger King have captured. Margin improvement from digital order mix is a real, near-term driver that the market is not pricing in.

Wright’s hands-on success in building a high-performing digital/loyalty engine at Potbelly is one of his strongest credentials for Wendy’s. It provides a repeatable framework to close the gap with McDonald’s/BK, capture more high-margin digital mix, and drive the operational excellence pillar of Project Fresh. If he replicates even a portion of Potbelly’s digital momentum, especially accelerating loyalty growth and owned-channel shift while scaling FreshAi, it could be a material near-term catalyst for traffic, AUV, margins, and franchisee economics.

• A kitchen floor up executive.

Bob Wright began his career at age 19 in the food industry, delivering pizza, and his leadership style is therefore grounded in operational reality rather than corporate gamesmanship. He is reputed to be empathetic and people-centric.

He frequently credits his early days as a pizza delivery driver for giving him a genuine appreciation for the daily hustle of restaurant staff. He is equally disciplined and process-oriented. And more importantly, Wright intentionally fights against the pitfalls of large corporate structures which he describes as getting “big and fat and slow.”

Bob Wright’s leadership philosophy is deeply rooted in blue-collar operational grit, frontline empathy, and a deliberate resistance to bureaucratic bloat, traits forged from humble beginnings that make him a culturally resonant choice for Wendy’s “Dave’s Place” heritage and Project Fresh turnaround.

The re-rating catalyst: “Taking opportunities that are presented to you.”

Bob Wright is the right fit to revamp WEN -11.72% and salvage one of America’s most recognizable fast-casual restaurants.

His selection aligns with the company’s founder ethos of simplicity, customer focus, quality, affordability, and premium service. More importantly, Bob Wright was brought back to re-engineer his successful turnaround of Potbelly at Wendy’s.

His career trajectory, including multiple leadership roles at Wendy’s and stints at Charleys Philly Steaks, Checkers, Domino’s, and Potbelly, shows a consistent focus on executional excellence.

At Potbelly, he completely rebuilt the management team and the organization to deliver industry-leading results.

He delivered approximately 785% total shareholder returns over 5 years, resulting in the company’s sale for $17.12 per share. He grew market capitalization from $50M to $566M in that same 5-year period.

He would be joined in his effort to revitalize the company by Steve Cirulis, Potbelly’s CFO, with whom he successfully steered the company out of near bankruptcy.

Bob Wright is a winner, but more importantly, a decent human principled floor general. And that’s exactly what Wendy needs.

Conclusion: Wendy’s is a two years turnaround workout.

The WallStreetBets’ “Operation Save Wendy’s” is not a silly speculative call by a bunch of ignoramus degenerates. It is a fair and just assessment of a mismanaged American fast-food institution.

Wendy’s still holds significant goodwill among its customers and stakeholders, which warrants patience as the company tries to turn around.

The “Apes” might be driven by short-term stock-squeeze tactics, but in the long run and with the right leadership, Wendy’s can return to a respectable standing in its industry.

As an “uglystocks” investor, I sail only with a ship captain I trust and forget the rest. Bob Wright's reputation is stellar, and he comes across as a decent bloke. That’s all I need to know.

Struggling companies cannot be systematically ascertained through quantitative financial metrics alone. Businesses are not “spreadsheets” but the byproducts of human action and vision.

In that regard, the “Apes” are far smarter than professional analysts at gauging Wendy’s value. In fact, Wendy’s was built in the image of its founder, and its success or failure hinges on the management's ability to maintain Dave Thomas’s vision and ethos, something that has been neglected by the rating agencies.

I believe the market has not yet fully grasped the unique skillset Bob Wright brings to the table; once his plans are in place and his operational discipline and organizational skills are put to work, the current share price will be seen as an absolute bargain.

Meanwhile, I expect a lot of near-term volatility and I have appraised the risks of a market crash caused by general market uncertainty and macroeconomic dynamics. This is a high-risk, high-reward turnaround opportunity that can take up to 2 years to work out.

Things might get worse before they get better.

Extreme patience is warranted.

( Not Investment advice. I write for entertainment and for intellectual stimulation only. Always contact a professional investment advisor before trading a stock. )

Uglystock Report (2): Kumulus Vape S.A. (EPA:ALVAP)

I’m interested in “uglystocks” for a simple reason: I’ve lost faith in the current pricing system. I believe its discovery function has been compromised, making it extremely challenging to perform reliable economic calculations and value projections.

I believe buying undervalued stock issues, Ben Graham Net-nets, Walter Schloss cheap TBV, and contrarian international /oversold stocks (selling at their 5- to 10-year lows) is an intriguing proposition because these assets have already shed their “inflationary” excesses, making them leaner, healthier investments with potential for a turnaround. More importantly, the wider investment public and the US-centric crowd are rarely privy to such opportunities.

https://www.kumulusvape.fr

Kumulus Vape is a tiny French nano-cap that operates primarily through its e-commerce flagship, kumulusvape.fr, which retails electronic cigarettes, e-liquids, DIY vaping components, and ancillary accessories. The company maintains a catalog of over 11,000 product references, targeting two distinct customer segments: traditional smokers seeking harm-reduction aids and dedicated vaping enthusiasts.

Kumulus Vape S.A. (EPA: ALVAP) presents a classic micro-cap contrarian setup that fits Benjamin Graham’s “net-net” or a Walter Schloss-style deep tangible asset play. As of mid-June 2026, the stock trades at approximately €2.93, with a micro-cap market capitalization of €8.9M amid heavily compressed earnings, intense regulatory scrutiny in the European vaping sector, and unregulated Chinese competition. The stock is “ ugly”, tiny, and French! But it has also consistently returned dividends and maintained positive free cash flow. Let’s deconstruct a valuation.

The stock is down -70% over 5 years. Just the way I like them. ugly and ignored.

Execs skin in the Game: The catalyst.

Uglystock investing goes beyond simple valuation asymmetries; the company’s story is equally important. If a stock’s story doesn’t grab my attention immediately, I rarely take a second look and move on. That wasn’t the case with this tiny company. I wasn’t particularly blindsighted, but I found the company’s background story fairly intriguing, enough to make me “ wanna know more.”

What I discovered was quite interesting: a passionate founder and CEO supported by a strong team that has worked together since the company’s inception in 2012 to build France’s most trusted vape platform.

Founder/CEO Rémi Baert (self-made entrepreneur) and the team (including CFO Laetitia Touchet and COO Lionel Hugues) are true believers with significant skin in the game. They collectively hold a substantial portion (37%, according to some shareholder breakdowns). Alignment is clear as insiders are exposed to the same challenges and upside. The company has conducted share buybacks/capital reductions and pays dividends, signaling a focus on capital returns to shareholders.

Vaping goes beyond a mere business for these folks; the business was developed as an outlet for a group of former smokers wanting to break free from traditional tobacco nicotine addiction. Remi Baert is also the President of “ France Vapotage”, a lobbying group defending the interests of French Vaping merchants and manufacturers. Also:

• The retailer boasts an outstanding 4.9 out of 5-star rating on independent, verified platforms like Trustpilot.

• Buyers frequently note that orders are shipped promptly, often with small complimentary gifts added to packages.

• Beyond retail, the company is actively engaged in promoting the use of e-cigarettes as a recognized smoking cessation tool, frequently commissioning independent health surveys regarding vaping efficacy.

The fundamental principles of good management are explicitly aligned: ethical, skin in the Game, honest leadership that strives for more than just profit.

The company grew from these values rather than forcing its way into the market. It’s often much easier when natural market demand drives the product than when it doesn’t.

Though the story seems small and insignificant given the company’s size and market cap, in business, size isn’t everything.

Great businesses are defined by their quality, story, and value, not solely by scale. When employees and executives enjoy their work doing something they find important and meaningful, I want to be part of that journey and share in its success as a shareholder.

The reviews speak for themselves.

The Ugly:

Despite carving out a competitive niche in France via compliance transparency and customer education, the company is battling structural and cyclical headwinds:

• Product Shift: A structural market shift from premium refillables to low-margin disposable vapes.

• Macro Pressures: Regulatory tightening across the EU and aggressive price competition from illicit, unauthorized Chinese imports.

• Margin Compression: These dynamics culminated in a challenging FY2025, where revenue fell 5% YoY to €57.5M and gross margins tightened to 14.3%.

The stock peaked at EU14 per share in 2021 and has lost nearly 70% of its value over the past 5 years. This is a hard pill to swallow for a shareholder and a telltale sign of the underlying operational reality on the ground. Clearly, forces are at work eroding the company’s strategic niche. Maybe large tobacco corporations have decided to enter the field and flood it with competitive alternatives, or the effect of murky French regulatory complexity on the market1, or the unregulated, cheap Chinese platforms. It is really hard to pinpoint a specific issue, but the fact is that “Kumulus” is not a growth story but rather a resilient, passion-driven platform. Can it turnaround?

The beauty:

Early Q1 2026 data points to revenue stabilization, suggesting that the worst of the operational degradation may be bottoming out.

Let’s be clear: Kumulus is a lot more than a mere online retailer of vaping products. It strives to grow as a premier ecosystem controlling the direct consumer retail side with its flagship website (1), business-to-business logistics delivery, which accounts for 85% of the company’s revenues with “ KMLS Pro” (2), and, in 2023, the Group acquired “Cigarverte”, a franchised vaping retail boutique network where vaping enthusiasts can gather(3). The network has expanded to more than 60 branded stores, further cementing its role as a key player in the physical retail market. In January 2026, the Group inaugurated “Labster”, a state-of-the-art production facility that brings the company’s clear ambition to life — regaining control over the manufacturing of select proprietary brands while maintaining strong complementarity with the partner ecosystem that makes the Kumulus Vape catalog so rich (4).

From 2027 onward, the facility will pursue ISO 9001 (quality management) and Origine France Garantie certifications, confirming its premium positioning and its dedication to traceability and transparency.

The company also boasts Ziplock in its ecosystem (5), a retailer of vaping accessories, “Strategik”, a marketing agency (6).

Quantitative Valuation: Graham NCAV & Schloss TBV

To quantify the margin of safety, we strip out all subjective long-term growth assumptions and evaluate Kumulus Vape strictly through a liquidating-asset lens, using audited FY2025 balance sheet data (ended Dec 31, 2025).

Balance Sheet Breakdown (in €M)

• Cash & Cash Equivalents: €6.47M

• Trade Receivables: €7.84M

• Inventory: €8.57M

• Total Current Assets: €22.87M

• Total Assets: €27.52M

• Total Liabilities: €10.57M (Current Liabilities: €7.9M)

• Shareholders’ Equity: €16.95M

1. Ben Graham Net Current Asset Value (NCAV)

Graham’s NCAV metric measures a company’s liquidation value by looking solely at current assets and subtracting all liabilities, treating fixed assets (property, plant, and equipment) and intangibles as completely worthless in a distress scenario.

NCAV=Total Current Assets−Total Liabilities

NCAV=€22.87M−€10.57M=€12.30M

With 3.02M shares outstanding, this translates to an NCAV per share of €4.07. At a current share price of €2.93, Kumulus Vape trades at 0.72x NCAV—representing a massive 28% discount to its net liquidating value. While it does not fully breach Graham’s ultra-strict rule of trading at less than two-thirds of NCAV (≤0.67x), a 28% discount for a business that remains structurally profitable is a rare anomaly in today’s market.

2. Walter Schloss Tangible Book Value (TBV) Analysis

Legendary value investor Walter Schloss looked for companies trading at deep discounts to tangible book value, backed by clean balance sheets and zero debt.

Kumulus Vape holds a positive Net Cash position of approximately €3.0M and working capital of €14.97M. If we strip away goodwill and intangible assets from total equity, we arrive at a highly conservative Tangible Book Value:

• Tangible Book Value (TBV): ~€14.01M

• TBV Per Share: ~€4.63

• Price / TBV: 0.63x

Buying a company with positive net cash, no long-term solvency threat, and a history of generating free cash flow at just 63% of its physical net worth aligns perfectly with classic deep-value criteria.

A well entrenched platform in its niche

Conclusion: Ugly, Abandoned, and Statistically Cheap acquisition premium.

Kumulus Vape is not a compounder. It is not a growth story. It is an ugly stock in a shunned industry operating in a complicated regulatory environment, with earnings that have collapsed 62% in a single year. The consensus hates it. The market has ignored it.

I disagree!

I see a lot of potential in the company, but the human factor is even more compelling to me. The founder and his team are truly dedicated to vaping as an alternative to smoking. They are true believers and are building an entire production-to-retail and marketing ecosystem in France. That's all I look for in management: integrity, 100% focus, and dedication. I am looking for a buy-and-forget situation, and in Baert and his team's case, the trust factor is seriously compelling.

Here is an important cherry on the cake that I have kept for last in this report: Key Article 23 of France’s 2026 Finance Bill, introduced in late 2025 to tighten regulations on vaping products, was defeated in January 20262. The Bill was hanging like a “ sword of Damocles” over the head of the country’s vaping industry, threatening as many as 20,000 jobs and putting thousands of SMEs at risk. This important development should be appraised as a positive baseline for vaping growth, which in turn could benefit $ALVP.PA long term.3

At €2.93, the stock trades at 0.72× NCAV and 0.63× Tangible Book Value, against a backdrop of positive net income and net cash, zero long-term debt, and 37% insider ownership. The bear case is already fully priced in. The upside, even a partial revaluation to NCAV, represents approximately 39% return from current levels. Moreover, the company has carved a strong brand equity in its niche and could easily be the target of an attractive acquisition offer from a richer, deep-pocketed European or international distributor looking to consolidate the French vape market.

(Not investment advice. Consult a professional and trustworthy advisor before trading financial securities. I write as a hobby and for intellectual stimulation. Wall Street is not your friend.)

Uglystocks’ investing seeks to purchase roadkills trading at multi-year lows, selling below net asset intrinsic value within the Ben Graham/Schloss/ Templeton framework. I have lost all faith in the current price economy trust-value discovery process. Most financial assets trade at an extreme premium to their net fair returns due to artificial liquidity sustaining the market. Quantitative accounting metrics are unreliable and untrustworthy due to the preeminence of cheap debt financing and short-term incentive mechanisms. I believe buying 1/3 rotten-tomatoes gives me a better picture of the asset’s true worth because “ugly” asset prices are better aligned with reality. I want to deal with real “facts,” and ugly companies tend to better reflect their underlying economics unlike artificially stimulated high-techs and popular theme-driven oversubscribed securities.

Premise:

Grange Resources Limited (ASX: GRR) is Australia’s oldest continuous magnetite iron ore producer, operating the Savage River integrated mine and pellet plant in Tasmania for over 55 years. At a price of A$0.16 per share, the company trades at a deep discount to its net-tangible asset value of A$0.93 per share. Its balance sheet is loaded with A$284 million in cash and liquid investments against a market capitalization of only A$185–231 million. The implied deeply negative enterprise value of approximately A$95 million looks interesting.

The market is essentially paying you to own the underlying operating business, the Port Latta pellet plant, the world-class Southdown Magnetite Project optionality, and the rights to over 1.2 billion tonnes of mineral resources.

Yet the discount exists for reasons. Iron ore pellet prices have fallen sharply from their post-COVID peaks. The company has deferred its flagship North Pit Underground (NPUG) project multiple times. Dividend payments have been eliminated. Profit after tax declined 61% in FY2024 and a further 48% in H1 2025. The controlling Chinese shareholders (Jiugang Group) add governance opacity. This report tries to deconstruct the ugly side and extract the beautiful opportunity underneath the company’s trashy appearance.

The Edge: Grange’s Pellet premium.

Grange’s magnetite pellets occupy a distinct and strategically valuable niche. Magnetite is a naturally occurring mineral commonly refined into an iron ore concentrate and used for steel production. Iron ore makes up about five per cent of the Earth’s crust and most commonly occurs in the form of haematite or magnetite. Most of the magnetite mined is usually used to produce concentrate for pellet feed or pellets which are used to make steel. Magnetite concentrate has internal thermal energy, meaning less energy is required to convert the magnetite into haematite pellets. This results in lower carbon dioxide emissions. The blast furnace chemically reduces iron oxide into liquid iron called ‘hot metal’. The iron ore and reducing agents (coke, coal and limestone) are combined. Pre-heated air is injected at the bottom of the combination for up to eight hours. The final product is a liquid which is drained and eventually refined to produce steel. Mining magnetite ore is capital-intensive and requires significant downstream processing infrastructure, including a beneficiation plant, a pellet plant, and port facilities. Magnetite products command a value premium over hematite ore products such as fines and lump. This premium is derived from two sources, namely additional iron content and a quality premium. As magnetite concentrate is a refined product, it usually has a higher iron content and lower impurity levels. This can have beneficial effects and environmental outcomes for the steelmaker.

The Ugly factors:

Grange Resources looks terrible on the surface (depleting pits, project risk, cyclical commodity, small/illiquid/foreign-controlled, volatile earnings). That ugliness drives the extreme discount to net cash and book value.

The most significant and immediate risk facing Grange Resources is the cyclical nature of iron ore and pellet pricing. The company’s entire revenue stream derives from selling iron ore pellets and concentrates into Asian steel markets, primarily China. The benchmark 65% Fe iron ore fines price declined approximately 21% from US$146/t in late 2023 to US$115/t by December 2024. Pellet premiums have compressed as Chinese steel demand faces structural headwinds from the country’s property sector downturn.

The Savage River magnetite mine in Tasmania (its core asset) has open-pit reserves depleting, particularly at North Pit. The company is transitioning to underground mining through the North Pit Underground (NPUG) project, a complex, capital-intensive block-cave/sub-level-cave development. This was paused/delayed earlier due to softer iron ore price forecasts; it is now advancing with due diligence and funding work in 2025–2026, with development targeted to ramp up in +2026.

Grange Resources is effectively controlled by Shagang Group or Shasteel, a large Chinese state-owned steel enterprise. While the company is listed on the ASX and subject to Australian corporate law and ASIC oversight, the concentration of ownership by a SOE introduces governance considerations that value investors must price:

Shagang International (Australia) Pty Ltd (26%) and Jiangsu Shagang Group (21.5%) are major shareholders. This brings long-term offtake contracts, Letters of Credit for credit risk mitigation, and historical strategic support. But it creates perception risks for many investors: governance concerns (past shareholder complaints about influence), potential conflicts, or geopolitical overhang in Australia-China relations. It can feel like “a Chinese steel mill subsidiary” rather than a pure independent ASX play.

Also, while the company remains debt-free and operationally stable, its backward-looking financial metrics show severe deceleration.

Revenues and Profits have collapsed dramatically over 5 years

Between FY2022 and FY2024, revenue collapsed from A$572M to A$451M, and net profit after tax fell from A$150M to A$58.5M. Operating leverage is substantial: a US$10/t change in realized price for ~2.5 Mt of annual pellet production translates into an A$35–40M EBITDA impact. The FY25 full-year results, released in February 2026, confirmed that revenue fell 8% to A$477.9 million and net profit after tax declined 21% to A$46.6 million, with no final dividend declared – a decision that disappointed income-focused investors who had previously enjoyed average annual yields of approximately 11% over five years. The earnings pressure stems from iron ore prices, which have been under sustained pressure rather than any fundamental operational failure.

At current price levels (US$126/t realized as of Q1 2026), margins remain acceptable but thin, and any further deterioration would rapidly erode the profitability that underpins the balance sheet accumulation story.

The dividend trajectory tells a stark story of deteriorating free cash flow and management caution. GRR paid A$0.10 per share in FY2022 — implying a yield of 5–6% at prevailing prices. By FY2024, this had fallen to A$0.02, and Q1 2025 saw no interim dividend. While the balance sheet remains robust (A$284M in cash), the decision not to return capital to minority shareholders as cash accumulates on the balance sheet is a point of tension. The cash is nominally owned by shareholders, but its deployment is at management’s and the board’s discretion, and the board is majority-influenced by Jiugang.

Finally, Grange frequently highlights its Southdown Magnetite Project in Western Australia as a world-class optionality asset, boasting a massive resource capable of producing 5 million tonnes per annum (mtpa) of premium direct-reduction grade concentrate over a 28-year mine life. However, looking at the Feasibility Study reveals why the market values this asset at near-zero:

The capital expenditure required to build Southdown has risen to A$2.34 billion due to inflation and the scale of the infrastructure. Grange cannot advance this project alone. It has explicitly stated that Southdown is dormant until it finds a strategic equity partner willing to bankroll construction. Until a partner signs on the dotted line, Southdown remains an expensive piece of paper rather than a cash-generating asset.

In all, a combination of a maturing open-pit operation, uncertainty around a high-stakes underground transition, cyclical small iron ore, a tiny, illiquid, neglected small-cap, and Chinese majority ownership might explain the stock's underperformance and investors' skepticism. The equity has effectively crashed to its 5-year lows, with further uncertainty tied to the slowdown in steel demand and macroeconomic deceleration that could push iron ore below $100.

The undervaluation beauty.

With a market cap hovering between A$185 million and A$275 million cash in hand, and a rock-bottom P/E ratio of under 4x, the market is pricing Grange as if it is headed straight into a wall. However, a deep-value, contrarian thesis reveals several massive structural mispricings.

Grange does not mine standard 62% Fe iron ore fines (the stuff that heavyweights like BHP and Rio Tinto dump onto the market, which is highly sensitive to the cooling Chinese property sector). Instead, it produces premium 65%+ Fe magnetite pellets.

Even in a softer global iron ore environment, Grange achieved a stable average realized product price of US$ 126.29/t (A$182.61/t) for the March 2026 quarter. This reflects a major, structural premium (18%) over the standard 65% Fe benchmark.

The global steel industry is under intense pressure to decarbonize. Blast furnaces require significantly less energy and emit far less carbon dioxide when using high-grade pellets than when using low-grade fines. As steelmakers transition to Electric Arc Furnaces (EAF) and Direct Reduced Iron (DRI) technologies, the structural premium for Grange’s specific product is poised to widen, decoupled from standard iron ore price slumps.

With a market cap of A$185M at A$0.16 per share, and A$275M in cash and liquid investments (with nearly zero debt), the enterprise value is negative A$90M. You’re essentially getting the entire operating business (Savage River mine, Port Latta pellet plant, premium product capability, Southdown resources, inventory, etc.) for free or at a discount to cash. This provides a rock-solid floor: limited downside in a worst-case scenario (e.g., prolonged weak iron ore prices or transition hiccups), as the cash hoard funds operations, potential dividends/buybacks, or self-funded optimizations. This is an interesting “ugly statistical asymmetry” where time decay works in your favor through cash preservation and potential distributions.

The market crushed the stock because of the looming A$890 million capex required to transition the Savage River mine underground. While retail investors fled, management has been systematically de-risking the project behind the scenes:

In the Q1 2026 update, Grange confirmed that independent technical and legal due diligence reviews for the North Pit Underground (NPUG) project financing are fully complete.

The company is currently progressing with lender engagement to secure project debt. More importantly, they are seeking a project completion guarantee from their majority shareholder, Shagang Group (China’s largest private steelmaker). If Shagang steps up to guarantee the completion, the existential funding risk evaporates, exposing the market’s “value trap” narrative as overly pessimistic.

The Southdown project near Albany, Western Australia, contains 1.2 billion tonnes of mineral resources and 412 million tonnes of ore reserves — a world-scale deposit by any measure. In isolation, this represents one of the largest undeveloped high-grade magnetite projects globally. The pre-feasibility study indicated an initial production capacity of 5 million tonnes per annum of premium magnetite concentrate — double Savage River’s current output. Grange recently reacquired its partner’s stake, now holding 100% ownership.

The development capex is substantial (multiple billions of dollars) and well beyond Grange’s current independent financial capacity. However, a strategic partnership, sale, or joint venture with a major steel producer seeking long-term supply security could unlock enormous value. At normalized magnetite concentrate valuations of US$8–15/t NPV per tonne of annual capacity, a 5Mt/year operation represents US$40–75M of annual EBITDA potential — implying a project NPV (appropriately risk-adjusted) that could dwarf Grange’s entire current market capitalization.

At A$0.16 per share, the market ascribes zero value to Southdown. A deep value investor would view this as a free embedded option on a world-scale asset.

The Valuation: Ben Graham/ Walter Schloss perspective:

The Ben Graham/Walter Schloss perspectives are my valuation anchors. Sir John Templeton has inspired me to look globally for potential bargains and contrarian value brand equity. The current untrustworthiness in economic calculation has led me to focus on the core assets’ net worth before any other financial metrics. I am interested in sound, healthy, low-debt stocks.

My analytical starting point is the balance sheet. As of March 2026, Grange holds A$284 million in cash and liquid investments. With a market capitalization of approximately A$185, the company’s enterprise value is a deeply negative figure of approximately negative A$95 million. This means an investor buying GRR at current prices is receiving.

A$1.54 of cash per A$1.00 of market value paid (based on A$185M cap, A$284M cash.)

The full operating business (Savage River / Port Latta) effectively for free.

100% of the Southdown Magnetite Project (1.2Bt resource, 412Mt reserves) for free.

The NPUG underground optionality for free.

Graham’s description of the net-net investor’s advantage was simple: you are buying a dollar for fifty cents. In Grange’s case, the arithmetic is arguably more compelling — you are buying a dollar of cash for roughly 65 cents, plus a free operating business producing A$400M+ of annual revenue.

GRR currently trades near or at its NCAV — an extremely rare occurrence for a company with positive earnings. The NCAV analysis establishes a hard downside floor at ~A$0.11–0.17 (2/3 NCAV to full NCAV), implying extremely limited downside from current levels in a Graham framework. The company would need to actively destroy its cash balance through value-destructive capex or losses to breach this floor — which, given its current operational profitability and rising cash balance, appears unlikely.

Walter Schloss, who ran a concentrated net-net value portfolio at the Graham-Newman fund and later independently for 45 years, famously focused on price-to-book value (P/B) as his primary entry criterion. He sought stocks trading at meaningful discounts to book, typically below 0.5x.

GRR’s current price-to-NTA ratio is approximately 0.18–0.22x. This is extraordinary even by Schloss’s demanding standards. The NTA of A$0.93 per share includes tangible mining assets — mine infrastructure, the pipeline, the Port Latta pellet plant, and port facilities — that have genuine replacement value.

GRR’s NTA is A$0.93/share (confirmed H1 2025). A 50% discount to NTA — Schloss’s minimum comfort level for deep value — implies A$0.465. A 60% discount (approximately 0.18–0.22x NTA) is what the market offers. Historically, mining companies with operating businesses trade at 0.5–1.2x NTA through the cycle. Mean reversion to even 0.5x NTA yields A$0.465, while normalization to 0.7x NTA implies A$0.651.

Target implied by P/NTA reversion: A$0.37–0.65 depending on multiple applied.

Even applying a severe 50% haircut to the carrying value of all non-cash tangible assets (to account for distressed sale or cyclical impairment), the resulting adjusted NTA would still be materially above the current share price. The margin of safety, even after stress testing, is substantial.

Even when applying other valuation methodologies (Sum of the Parts, Earnings Power Value, Discounted Cash Flow, Technical analysis), the company remains at a significant discount to fair value, with a relatively safe margin of safety protecting against downside uncertainty. I tend to be particularly interested in companies trading at 10-year lows, and $ GRR's 2/3 NACV is A$0.11, which aligns with 2015’s entry price.

Applying a conservative 25–30% governance/liquidity/single-asset discount to the base composite of A$0.52 yields a published price target of A$0.38. This represents approximately 90–138% upside from the prevailing price of A$0.16 and remains well below the reported NTA of A$0.93.

Conclusion:

The market is valuing Grange Resources as if it were on the brink of bankruptcy. That isn’t true. The company has operated for nearly 60 years. In fact, it is a highly profitable, debt-free operation with a mountain of cash that exceeds its market capitalization. If Grange secures institutional debt funding for the underground transition over the coming quarters—backed by its Chinese parent—the capital wall overhang disappears. Once the capital expenditure uncertainties pass, the business will be positioned to resume its historic role as a massive cash generator and dividend machine. A value investor with a 3-5 year time horizon, willing to accept the genuine risks of Chinese governance, commodity cyclicality, and single-asset concentration, is being offered an extreme margin of safety that compensates for these risks.

This report is for informational purposes only and does not constitute financial advice. The author may hold positions in the securities discussed. Past performance is no guarantee of future results. Equity research involves the risk of total capital loss.

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“ I must force myself to laugh at everything lest I be obliged to weep.” Figaro: The Barber of Seville.

THESIS IN ONE SENTENCE

NNE is not a nuclear company; it is an insider liquidity machine wearing nuclear clothes, engineered by a serial micro-cap promoter with a psychology degree and a history of penny-stock promotions, deployed into the most capital-intensive, regulation-intensive industry on earth, with zero proof of concept and zero institutional backing.

Introduction: A fitting story befitting an insane hype cycle.

Nano Nuclear Energy ( ) is a boldfaced wealth-extraction scheme by the lowest common-denominator group of financial piranhas. How a company with no working prototype, zero revenue, a part-time CEO, and a marketing budget larger than its R&D loudly claims to be the ‘first publicly listed, vertically integrated advanced nuclear micro modular reactor company in the United States’ is almost comical.

I highlighted the "scheme” two years ago. Hunterbrook wrote a detailed analysis of the company, and J Capital followed suit. But the “thing” kept metastasizing, at one point valued at nearly four billion dollars, as its operators grew increasingly emboldened in their misguided sense of respectability, even daring to appear in official mainstream financial news accessible to everyday investors.

It is rather simple, however: the entire SMR industry is riding the coattails of hype around small nuclear reactors. But the harsh reality is that the SMR’s magic elixir may be a sham. It is benefiting from an euphoric conceit, aided and abetted by cheap capital and a near-religious zeal against fossil fuels, which often grabs headlines every few years, with a momentous peak, with new ‘magical’ solutions promoted as alternatives to the so-called ‘big oil.’ SMRs are the new buzzword in the energy world, the hot-chic money-maker for both Wall Street Elite investment-banking fees-hustling, stock-pushing houses and for “side streets” upstarts, curb-side OTC hustlers tussling to get their big opportunity to feed their vanity for success and fame as “successful Wall Street Entrepreneurs.”

Thus, beneath the appearance of a complex technological energy innovation in need of adaptation to current market demands lies an all-too-human theme: Ego, conceit, hubris, and delusion.

1-THE SCIENTIFIC FACTOR: Small modular reactors are inferior to conventional reactors.

In its Annual Report mission statement, Nano Nuclear Energy Management boldly claims:

“A key pillar of our business plan is to provide readily replaceable mobile reactors which we can provide to customers, along with operative personnel, to power projects, residential and commercial enterprises, and major development projects. Our vision is to be a commercial and domestic energy supply leader within the U.S. nuclear industry, and to advance U.S. domestic and foreign policy and national security priorities. The mobile, lower-cost and ultra-safe solid core model of our micro-reactor vision will provide a clean energy option that supports initiatives for sustained international engagement and promotes enhanced and more efficient cooperation and assistance in the application of peaceful uses of nuclear energy, science, and technology. We will also drive resources to projects and activities in developing countries of greatest need by supplying energy to areas removed from the grid.”

The nuclear industry’s latest pitch is not a revolution, but a rerun — an expensive distraction from real climate solutions.

Arnie Gundersen would probably scoff at Nano Nuclear Energy’s execs’ bold claims; he would cynically read their mission statement and quickly pinpoint their self-serving objectives. Without even knowing ’s execs’ professional history and financial standing, his years of experience within the field of Nuclear energy production have already led him to deconstruct the whole SMRs business apparatus, and deal a decisive punch in the guts to pretense.

"SMRs only exist in the imagination of the nuclear industry and its supporters. SMRs can only be found on glossy PowerPoint slides. That is why Mycle Schneider dubbed SMRs “power point reactors.” There are no engineering plans, no blueprints, no working prototypes.

Indeed, NNE 7.26%↑ looks a lot like a PowerPoint company filled with promising ideas about the energy revolution. But 50 years of industry expertise can help filter the nonsense from the essence. And it appears that, for all their flaws, conventional nuclear plants are far preferable to the uncertainty and risk associated with SMRs.

According to Arnie Gundersen, SMRs require the use of higher-enriched uranium, close to weapons-grade, raising serious proliferation and safety concerns.

Their smaller size exacerbates certain problems due to their compact cores. They are far more likely to leak neutrons than conventional reactors. In that regard, their small size remains a massive hindrance and a dangerous piece of radioactive infrastructure that requires the same level of security, emergency planning, and long-term waste management as any other nuclear reactor.

Stanford-led research finds that small modular reactors will actually generate more radioactive waste than conventional nuclear power plants.

While nuclear reactors generate reliable electricity with limited greenhouse gas emissions, they also produce radioactive waste that must be isolated from the environment for hundreds of thousands of years. Small modular reactors have been touted as an alternative to expensive conventional reactors because of their design flexibility (they can be assembled in factories) and lower levels of radioactive byproducts.

The study shows that most small modular reactor designs will actually increase the volume of nuclear waste requiring management and disposal by factors of 2 to 30 in some cases. These findings stand in sharp contrast to the cost- and waste-reduction benefits that advocates have claimed for SMRs.

In an article written on cleanTechnica, Micheal Barnard clearly states that:

Small modular reactors won’t achieve economies of manufacturing scale, won’t be faster to construct, forego efficiency of vertical scaling, won’t be cheaper, aren’t suitable for remote or brownfield coal sites, still face very large security costs, will still be costly and slow to decommission, and still require liability insurance caps. They don’t solve any of the problems that they purport to while intentionally choosing to be less efficient than they could be. They’ve existed since the 1950s and they aren’t any better now than they were then.

In fact, the history of SMRs is a history of failure. They were first commissioned and operated by the U.S. Army in the 50s but proved unreliable and expensive. The program was shut in 1977. The same trajectory was followed in the U.K., India, Canada, France, and Japan.

“ Without exception, small reactors cost too much for the little electricity they produce. The result of both their low output and their poor performance.”

Pr M.W. Ramana

The recent failure of NuScale highlights the complexity and challenges facing potential entrants into the SMRs industry. The company abandoned its flagship project in Idaho after securing up to $4 billion dollars in subsidies from the U.S. government. The same thing occurred with mPower, whose project was abandoned in 2017 despite more than $375M spent, plus a $111M contribution from the DOE.

In reality, nothing in the history of small nuclear reactors suggests that they would be more economical than full-size ones. In fact, the record is pretty clear: Without exception, small reactors cost too much for the little electricity they produce, due to both their low output and their poor performance. In the end, as an analyst for General Electric pronounced in 1966, “Nuclear power is a big-plant business: it is most competitive in the large plant sizes.” And if large nuclear reactors are not competitive, small reactors are unlikely to do any better. Worse, attempts to make them cheaper might end up exacerbating nuclear power’s other problems: production of long-lived radioactive waste, linkage with nuclear weapons, and the occasional catastrophic accident.

ZEUS design, not even prototype.

2-The quantitative factors: Zombified capital raise scheme.

Nano Nuclear Energy, Inc. is a pre-revenue, capital-raising, loss-accumulating developmental-stage technology vehicle. It currently functions like an early-stage biotechnology firm operating in the heavily regulated, capital-intensive nuclear energy sector. Significant progress on engineering, site characterization, regulatory filings, and team expansion has been noted. However, the company's asset-light capital structure and the absence of a recorded revenue source raise significant questions about its long-term viability in a sector reputed for its slow multi-hundred-million-dollar licensing process.

It recorded $14M in operating losses in Q1 March 2026, with only $5.6M invested in research and development, nearly the same amount as was paid in equity-based compensation. The company has recorded an accumulated deficit of up to $73M as of March 2026. The company’s timeline for breaking ground on its Kronos micro reactor prototype is set for late 2027 with the plans for full commercialization set for 2030 and 2031.

“We estimate that the development, construction, testing and licensing of our microreactors (notably the KRONOS MMR) will continue from 2026 to 2030, with the full-scale, first-of-its-kind KRONOS energy system expected to be fully operational and licensed by 2030. Our microreactor construction permit application (CPA) for KRONOS is expected to be filed in 2026, with full construction activities commencing after NRC approval of our CPA is completed. Our KRONOS microreactors are expected to be commercially launched around 2030. We also plan on providing nuclear service support and consultation services for the expanding and resurgent nuclear energy industry in 2026, both domestically and internationally.”

Meanwhile, the company has continuously raised hundreds of millions through common stock issuances, consistent with a series of capital raises since the May 7th, 2024 IPO. These include the July and October 2024 firm commitments, in which the company raised a net total of $52.1M; the November 2024 private placement of $55M; and the May 2025 and October 2025 private placements, which raised a net total of $47.7M. In total, the company has raised up to $600M in cash through dilutive offerings amid zero revenue and rising expenses. The vast majority of the company’s executive team works on a part-time basis, with the CEO, President, and CFO concurrently working for a wide array of micro-cap TSX mining companies, as well as their involvement with the founder’s privately owned NNE’s shareholders-funded Laser Uranium Enrichment technology.

“Our business plans will require us to raise substantial additional amounts of capital. Future capital needs will require us to sell additional equity or debt securities that will dilute or subordinate the rights of our common stockholders. In addition, we may be unable to secure government grants as part of our funding strategy.”

And to add a little cherry on top, the company has already set itself up for a next dilutive equity raise, with an effective July 2025 ATM offering of up to $900M. That announcement is particularly concerning for current shareholders who should likely feel the brunt of their holdings’ dilution.

Bottom line: Contrary to press releases and marketing articles, microreactor construction and operation is a billion-dollar industry, as expensive, if not more strenuously complicated than traditional nuclear facilities. NNE -3.63%↓ is currently operating as an equity-funded R&D vehicle with a venture capital risk profile minus a venture backer. Most venture capital firms crash and burn within a few years of going into business; when dilution is added to the equation, the risk premium rises even higher. Can be the exception to the rule?

The math is unambiguous. NNE’s $569M in cash would be consumed long before the company could generate a single dollar of nuclear energy revenue. Estimates for the cost of moving from prototype to commercialization range from $6 to $9 billion. The gap between current capitalization and actual commercialization capital requirements is not a rounding error; it is an existential chasm that the current company’s structure can’t miraculously bridge even with its most aggressive dilution push.

That alone should bring into question the entire premise and real intention behind the company’s existence and raise significant red flags for current or potential public equity shareholders.

The nitty-gritty: Insiders share dump!

According to Quiverquant Jiang Yu, the company’s founder, has an estimated net worth of at least $291.8 million, as of June 3, 2026. He owns 8.4 million shares of $NNE stock and has sold 2.5 million shares since 2021, for an estimated $55.7 million. He and his executive team have been aggressively dumping shares over the past 12-18 months, with essentially zero open market purchases recorded. They have sold an estimated $168M worth of shares through option exercises.

So far in 2026, the most aggressive share dumper has been none other than “el presidente” Jiang Yu, who has sold close to 745,900 shares or $19M directly and more than 700,000 shares indirectly through I Financial Ventures Group LLC as of June 2026.

Jiang Yu has filed a total of 31 insider trades in $NNE since 2021. The most recent trade was a sale of 2,085 shares, made on Jun 03, 2026 and largest trade was a sale of 888,000 shares, made on Dec 24, 2025

“Figurehead,” I mean” CEO” Johnny Walker, hasn’t been too shy either in selling his holdings, albeit not as aggressively as the company’s founder. But with up to $20M in shares sold since December 2025, it would be fair to say that the man has come a long way from his miserable debut as a TSX nano-cap operator.

Others execs such as CFO Jaisun Garcha, director Seth Berl and CTO Florent Heidet have equally monetized their options/RSUs profitably.

Van Eck associates and Blackrock own a few million shares of$NNE

Despite its multi-billion-dollar market cap, $NNE’s underlying financial reality couldn’t be more questionable, given its lack of revenue, massive equity dilution, absence of institutional financing, and aggressive insider cash-outs. The company’s conceptual tech and distant commercialization prospects truly make the entire enterprise an extremely risky investment, on top of its founder’s own risk profile.

3-The man, the myth, and the ridicule: The ubuesque founder’s psyche!

“If humility was a sin, Jiang Yu would be an angel.”

While the lack of a working prototype, revenue line, and the absence of clear technological breakthroughs are alarming enough to paint $NNE as a risky promise, the company’s founder’s egomaniacal self-aggrandizement tendencies further diminish its prospects to a farcical construct designed to feed both the greed and the savior complex of a corporate buffoon.

In literature, an ubuesque figure (from Alfred Jarry’s 1896 satirical play Ubu roi) is a bloated, greedy character who hoards ridiculous titles, rules with infantile incompetence, and treats the realm as a personal piggy bank.

Jiang Yu holds the titles of Founder, Executive Chairman, President, Secretary, and Treasurer himself! In a parallel universe, he would be a satirical reminiscent of the North Korean dictator Kim Jong Un’s series of titles, or of the much more colorful yet equally dark triad’s psychopathic Ugandan tyrant Idi Amin’s grandiose epithets: His Excellency, President for Life, Field Marshal Al Hadji Doctor Idi Amin Dada, VC, DSO, MC, CBE, Lord of All the Beasts of the Earth and Fishes of the Seas and Conqueror of the British Empire in Africa in General and Uganda in Particular.

While the comparison between a company’s founder and an absolute dictator might seem forced, the psychological similarities speak volumes.

It looks as if Yu has established absolute structural dominion over $NNE’s financing, recruitment, branding, and board oversight. That leaves virtually no room for independent governance or checks and balances.

Yu holds a B.A. in Psychology and has a background in retail brokerage and investor relations. He possesses no advanced degrees or a strong background in nuclear physics, thermodynamics, or industrial energy engineering. A behavioral analysis of Yu’s public persona reveals a textbook high-agency, low-humility archetype frequently seen in speculative market bubbles:

Yu exhibits a deep-seated need for admiration, framing himself as an untouchable visionary with a “Midas touch.” Critical realities—such as his history with hyper-dilutive penny-stock promotions, or the fact that $NNE relies heavily on unpaid interns and marketing affiliates rather than on teams of nuclear scientists are completely erased from the corporate narrative. Despite having no deep nuclear footprint, company media routinely frames Yu as a “leading U.S. advanced nuclear technology entrepreneur” steering a “Wall Street Cinderella story.”

Yu is an expert in narrative capture—knowing exactly “what motivates retail investors. When faced with harsh short reports, like J Capital’s label of $NNE as a “shameless grift,” or lawsuits over exaggerated timelines, he doesn’t admit fault. Instead, he shifts blame outward, becomes even more optimistic, and pushes strong counter-narratives to keep market attention and validation.” Such behavior clearly paint the picture of “narcissistic supply.

Yu’s career trajectory follows the classic serial promoter pattern observed repeatedly in micro-cap markets: identify a macro hype cycle, rapidly construct a corporate vehicle to capture the narrative, execute an IPO to access public capital, dilute early, and monetize. The specific sector is incidental—the mechanics are consistent.

His prior professional involvements include a pattern of micro-cap and penny-stock promotions in prior hype cycles (cannabis, mining, clean technology) before he identified nuclear energy as his most lucrative opportunity to date.

He is genuinely skilled at identifying what the retail market wants to buy and constructing a corporate story to satisfy that demand. But this skill is entirely insufficient for the actual execution challenge of developing, licensing, fueling, constructing, and commercializing a first-of-a-kind Generation IV nuclear microreactor.

His marketability savviness is admirable. He has gradually managed to insert himself into the mainstream media, first through popular albeit fringe media platforms such as Shawn Ryan’s Podcast, which is followed by Millions of optimistic go-getters taking the world by the “cojones” types of Alpha-male wannabes. But recently, he has also inserted himself into the mainstream by appearing on Fox News Business and other respectable outlets, all of which serve a single purpose: to bait the gullible public into investing in his company’s shares.

Compensation? That is probably the best term to define Jay Yu's approach to management. Titles hoarding, aggressive press releases, sector pivots, and all sorts of gymnastics cannot hide the fact that is a business, but on paper only. In a way, Jiang Yu is still that little boy vying to escape his humble origins but perpetually getting caught by his own limitations in education, competence, and skill. That fact alone marks him as a tragic character.

Conclusion: Get rich or lie trying? Thy shall be diluted.

The story of Nano Nuclear Energy, Inc. is intimately tied to the persona and ambition of its founder: Jay Jiang Yu. In fact, the business itself does not matter: there is no real operational viability across the entire SMRs spectrum right now. The hype shall fade; and it is fading quite a bit already, especially since the collapse of NuScale Power ( ) $9 billion small modular reactors plants in Utah in 2024. Nearly all the companies in the sector are trading on momentum-driven crowd exuberance.

Nuclear energy, while seemingly less polluting than other energy sources, has a long-established track record as the most expensive approach to large-scale energy production. SMRs, rather than lowering that cost-hindrance factor with their apparent small size, merely add another layer of complexity and risk tied to their design flaws and a higher probability of accidents and leaks. Therefore, NNE 7.76%↑ is simply a "terrible project” in a sector filled with equally bad ideas, all destined to crash sooner or later.

But is also unique in that it fully captures the psyche of a recurrent tragic-comedic-cynical archetype that often makes a splash during speculative bull runs with its colorful, hyper-machismo, uber-confident, cult-leader-like personality. Jay Jiang Yu depicts such an ubuesque profile to the tie.

What isn’t exactly funny is that Jay Jiang Yu has managed to improve his economic standing by bullshitting the public with his vacuous company. With a fortune recently estimated at more than $200M, Jay Yu has somewhat earned the right to speak and be heard. His interview on the Shawn Ryan Show is an absolute must-see study in grandiose narcissism: a combination of humble-brag, self-made success masturbation, and his revolutionary technological innovation-changes-the-world grandiosity is otherworldly. And the audience bought into the nonsense. Whole!

As an example, Jay tells the interviewer that he recognized the value of acting fast by observing his slow-moving mother being outworked and out-earned in a Chinese sweatshop in New York when he was three years old!

While his crash-bag company is likely destined to flounder, Jay Jiang has effectively succeeded in “making something out of nothing” by quickly dumping millions of shares on the public before the market comes to its senses. Jay Yu is essentially confessing. The “miracle” isn’t a valuable product or service, nor is it a marketable innovation that improves millions of people’s lives. The “miracle” is him. Jay from the “Ghetto of NY” taking advantage of any opportunity presented to him to improve his lot, regardless of the ethical and moral implications.

Jay Jiang Yu's psychological profile says it all; he will maintain the facade as long as necessary. Therefore, the slew of “revolutionary ideas” press releases will keep flowing, dilutive capital raises will continue, and the share-exit dump will never stop. He and his team will suck as much blood as the “Game” permits from their listed “corpse,” and you, the believer holding onto the shares, will only have your pride to cry out to.

Potential investors should seriously re-analyze their investment thesis and investigate the company’s founder and executive structure. The business is one but in name only as is the whole SMR theme altogether. Expect more dilution for real capital has rightfully avoided the company and for a good reason.

Verdict: Expect more dilution going forward. Vampirestock! Avoid.

Disclaimer:

This report is published for informational and educational purposes only. It represents the analytical opinion of the author as of June 2026 and is based exclusively on publicly available information including SEC filings on EDGAR, company press releases, market data, and publicly available research. Nothing in this report constitutes financial advice, an offer or solicitation to buy or sell any security, or a recommendation to engage in any investment strategy.

Sources:

1. SEC Filings & Insider Transactions (Form 4, 10-K, 10-Q)

• SEC EDGAR / secform4.com / OpenInsider: Primary source for all Form 4 insider sales (e.g., Jay Jiang Yu / I Financial ~745,900 shares June 2026 for ~$19.9M; James Walker 123,688 shares; others like Garcha, Berl, Hare, Heidet). Tracks ~5.6M+ shares sold in recent periods, mostly exercise-and-sell under 10b5-1 plans.

• 10-K / 10-Q (via SEC, company IR, MarketBeat, StockTitan): Zero revenue confirmation, net losses (e.g., FY2025 ~$40M, Q2 FY2026 ~$9.2M), cash positions post-raises (~$203M–$569M), dilution details, accumulated deficits, and R&D/cash burn. Includes timelines (e.g., licensing 2026–2031, commercialization 2030–2031).

• Company S-1/S-3 and other registrations: IPO and follow-on details, dilution history.

2. Company Disclosures & Press Releases

• Official Website (nanonuclearenergy.com): KRONOS MMR™ concept art/renderings, timelines, partnerships (e.g., University of Illinois), executive bios (Jay Jiang Yu background), subsidiaries, and updates on NRC CPA acceptance, site work, and funding.

3. Stock Data, Charts & Market Context

• Yahoo Finance, Nasdaq, Barchart, TradingView: Insider rosters, price history, volatility charts (run-ups/corrections), market cap, and volume.

• MarketBeat, Simply Wall St, Quiver Quantitative: Aggregated insider stats, financial summaries, and dilution tracking.

4. Short Seller & Critical Reports

• J Capital Research (Oct 2024 report): Detailed critique on promotion, founder/insider penny-stock history, related parties (e.g., LIST), lack of nuclear expertise, governance, and “stock promote” thesis. Onsite observations and promotion tactics.

• Hunterbrook Media (2024 report): Investigative short thesis on hype vs. substance; company response via legal threats (Alex Spiro/Quinn Emanuel).

• Class Action Lawsuit Filings (e.g., Rosen Law, Law360): Allegations on overstated timelines/”laughable” regulatory claims involving Yu and Walker.

5. Founder & Executive Background

• Company Announcements / LinkedIn / Yahoo Finance: Jay Jiang Yu (Founder/Chairman/President) Wall Street analyst/entrepreneur background, philanthropy, serial ventures; no deep nuclear expertise noted. CEO James Walker profile.

• Interviews & Profiles: Self-promotional framing as visionary (e.g., Innovation Zero, podcasts).

6. Technology, Timelines & Expert/Regulatory Context

• NRC / University of Illinois Announcements: CPA acceptance, site characterization, review estimates (2027 construction potential).

• Industry News (ANS, NucNet, etc.): Contracts (e.g., Air Force), partnerships, and realism critiques on microreactor delays/costs.

• Independent Analyses (Substack, etc.): Reviews of reactors, red flags on milestones/promotion.

7. Additional Context (Reddit, Media, Visuals)

• Community discussions (e.g., Reddit on promotion/grift concerns).

• Stock charts and concept renderings (from company site, Barchart, TradingView) for hype vs. performance visuals.

• www.utilitydive.com

• https://medium.com/enrique-dans/small-reactors-big-problems-the-nuclear-mirage-behind-ais-energy-hype-77f93a3a4460