El Club del Value Investing

He participado en una iniciativa de @somosbiz escribiendo el caso de inversión de nuestra primera posición en Sigma Internacional: Constellation Oil Services ($COSH) Espero que os guste! somosbiz.substack.com/p/sect…

$KOS It’s encouraging to see the market's surprising resilience: Kosmos remains relatively flat, only slightly down, while Tullow is down over 40%, despite premarket indications that Kosmos might be heavily impacted. I wanted to increase my already sizable position, taking profit on the market's ignorance, but the opportunity faded quickly. That said, the current stock price is quite disappointing given oil market conditions—with dated Brent trading at a substantial premium—and the assets performing strongly. Over the coming months, we expect the company to clean up the balance sheet by refinancing all upcoming maturities through 2030 and generating high FCF numbers that will drive the company to beat its leverage guidance. Tullow's stock has plunged after losing an arbitration over $196.5 million in Ghanaian taxes, adding pressure to an already highly indebted company. Its market capitalization now falls short of the arbitration amount it owes Ghana, with net debt around $1.4 billion. Tullow’s situation is widely recognized as unsustainable, prompting plans for either a sale or a capital raise in the coming months. While both options would significantly affect shareholders, a recapitalization appears to be the more favorable outcome. Conversely, credit holders are likely to favor a sale—though this would probably mean minimal proceeds for shareholders, as the only potential buyer with meaningful synergies, Kosmos, isn’t currently in a position to make an offer. Regarding Kosmos, the key issue is ensuring that all parties remain committed to investing in Ghana. Tullow, especially the creditors, Kosmos, and the Ghana government, recognize the importance of ongoing investments in the fields, as returns are realized within roughly 6 months, and just 2 to 3 months given current oil prices. Significant investments have already been made in 4D and OBN seismic surveys, and there is a commitment to a rig for drilling 10 wells, expected to arrive around mid-year, leveraging the prior seismic investments. I had the pleasure of meeting Tullow's CFO, who assured me that all parties are now aligned. Despite potential financial difficulties, neither the creditors nor the government wants to halt investments or repeat last year's mistakes. Therefore, we can expect high production levels from the assets, even if a Chapter 11 scenario occurs. It remains uncertain whether Tullow will manage to recapitalize the company or sell it to a strategic Asian buyer eager to secure high-quality oil. I can envision a scenario where Kosmos becomes the operator, given its proven ability to operate to high standards in some fields in the Gulf of America—unsurprisingly, those that perform best within its portfolio.

Carta del segundo trimestre de Sigma Internacional. Actualización de Kinépolis, Asmodee, Nagacorp y Alibaba singularam.es/wp-content/upl…

Kinépolis: Today, we have the August box office figures for the US and France. Both countries experienced their strongest month of the year, significantly surpassing pre-COVID levels. In the US/Canada, August box office revenue increased by 86% year-over-year and surpassed pre-COVID figures by 51%, driven by films like 'Spider-Man: Brand New Day’ and 'The Odyssey ’. In France, box office attendance doubled, marking the best August since record-keeping began in 1980. It also exceeded pre-COVID attendance by 24%, reflecting not only higher box office numbers, which are affected by pricing, but also increased viewer turnout. This is particularly significant for Kinepolis, as by 2026, the US and Canada are expected to account for 40% of Kinepolis EBITDAL and 51% of visitor estimates, whereas France will represent 18% of EBITDAL and 16% of visitors. Be aware that 'Spider-Man: Brand New Day' is now among the top three films in history. The Sony and Marvel Studios blockbuster has surpassed $2.33 billion worldwide and still has room to grow. Let’s see if it approaches the $2.7 billion earned by Avengers: Endgame or the $2.9 billion collected by Avatar. However, I believe that 'Avengers: Doomsday', set for release in December this year, will surpass Spider-Man's success. December is an exciting month with releases like Dune 3, Avengers, Jumanji 3, and The Angry Birds 3. While blockbusters are important, we shouldn’t overlook the impact of films like Resident Evil, The Hunger Games sequel, Digger (featuring Tom Cruise), or Practical Magic 2 (with Sandra Bullock and Nicole Kidman) that will be released from now until December. Studios are returning to theaters, and data shows this industry is highly profitable. The issue has been more about supply than demand. For example, Marvel Studios is re-releasing Avengers: Endgame at the end of September as Avengers: Endgame Encore, a few months before Avengers: Doomsday. This exclusive theatrical run will feature about four minutes of additional content compared to the 2019 version, including a custom intro, unreleased footage, and a new post-credits scene that serves as a narrative link to Avengers: Doomsday. All of the above not only demonstrate that Kinepolis will set records in Q3 and 2026 but also provide encouraging evidence of the cinema industry's long-term sustainability. This creates a virtuous cycle that will likely support future supply and theatrical release windows, ultimately justifying a higher share valuation.