The Edge Group LLC

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The Edge Group - Global Fundamental Catalyst Investing. The Edge provides investors with access to hidden corporate value from Global Special Situations using a pioneering approach to investments. Founded in 2005 by fund management and investment banking professionals to provide high quality, private equity-level research on Global Corporate Divestitures for the benefit of fundamental event-driven, growth and value-oriented investors in this difficult to track, but proven investment space.

The Edge will look to screen and analyze include Spinoffs; Reverse Morris Trusts; Squeeze Outs; Privatizations; Demutualization; Deep Discounted; Rights Issues; Rights Offering; Restructuring; Insider Purchases / Buying Change of Management / CEO Change; Deteriorating fundamentals; Post-Bankruptcy; Reorganization; Tender Offer; M&A Deals; Secondary Offering; Share Swap; Thrift Conversions; Share Buybacks; Activist; Mergers. All analyzed from a fundamental point of view.

 

 

Regulatory Information

  • Regulatory Status: Financial Conduct Authority (FCA)

Alexander Korda
  • Alexander Korda
EUR 93.26
KAR KAR Auction Ser...

+20% Rally Since May 28 Entry, Revised Valuation Shows Further Upside

Recovering from the pandemic is at the forefront of KAR Auction Services, Inc.’s (KAR) most recent earnings, in which the company generated 91% of Y-o-Y revenues despite the nationwide lockdowns. The conclusion of $550m in private equity investments and a deep management pay cut have helped shore up the company’s cash position, positioning KAR to come out the other side of the pandemic stronger than ever. We continue to see upside even after the recent 20% rally. Earnings Update... On Augus...

KAR KAR AUCTION SERVICES INC.
08/14/20 August 14, 2020 2 EN
Alexander Korda
  • Alexander Korda
EUR 93.26
EA Electronic Arts...

Significant Upside Ahead for Major Games Publisher

Our findings on how major US video game makers and publishers can narrow their valuation gaps to Chinese media juggernaut Tencent pointed us to an MP entry into Electronic Arts, Inc. (EA). Its Q1FY21 earnings release was the company’s largest first quarterly report to date, and is only the beginning for EA’s upward trajectory into a new console generation. E-sports also remain at the forefront of our growth expectations as the new-age competitions gain traction. Earnings Update… On July 3...

EA ELECTRONIC ARTS INC.
08/14/20 August 14, 2020 2 EN
EUR 93.26
2IS Trane Technolog...
MOCORP FH Metso Outotec C...

Industrials Stocks Exit the MP with 37% and 54% Returns

Following their respective earnings releases, two industrials Spinoffs will exit the Model Portfolio after providing strong returns (though for both we do see further upside for longer-term investors). In its first earnings since the unique European Spin-Merger, Metso Outotec Corp. (MOCORP FH) has given a +37% return in less than two months, while Ingersoll Rand, Inc. (IR) beats estimates with signs of a recovery, and as returned an adjusted +54% since its entry in early March 2020. Earnings Up...

2IS TRANE TECHNOLOGIES PLC
MOCORP FH METSO OUTOTEC CORP.
08/13/20 August 13, 2020 2 EN
Alexander Korda
  • Alexander Korda
EUR 93.26
PFE PFIZER INC.

Smart Insider Buys Ahead of Spin, Enters MP

Over three years since being appointed to the Board, insider Ronald Blaylock late last week bought shares of Pfizer, Inc. (PFE) on the open market for the very first time. While every insider buy isn’t an opportunity to enter a stock, Mr. Blaylock's purchase holds all the ingredients of an entry based on the amount of shares bought, his track record and PFE’s upcoming catalyst of a Spinoff. What's Interesting? The Edge Intelligence... Last week (Aug 6, 2020), insider Ronald Blaylock bought ...

08/12/20 August 12, 2020 2 EN
EUR 93.26
HDS HD Supply Holdi...

Jumps on Sale Versus Spin, 21% Return Since Entry, Exits MP

Less than 2 months before its Spinoff, HD Supply Holdings, (HDS) announced today that it has opted to sell its Construction & Industrials business (Whitecap) for $2.9bn in cash to PE firm Clayton, Dubilier & Rice instead of Spinning it off to shareholders. Having entered our Model Portfolio in the lead up to the Spinoff, now that the short-term catalyst is gone and having generated a +21% return since our entry in June, we’ll be exiting HDS at the end of today’s (Aug 11, 2020) VWAP.

HDS HD SUPPLY HOLDINGS INC.
08/11/20 August 11, 2020 2 EN
Alexander Korda
  • Alexander Korda
EUR 466.30
CHE Chemed Corporat...

Potential Activist Break-Up of Leading Pure-Plays

Chemed Corp. (CHE) offers a rare opportunity to Spinoff into two pure-play services companies with very little leverage, creating immediate value for shareholders in the event of a split. This potential activist break-up would separate the currently unrelated hospice care (VITAS Healthcare) and plumbing services (Roto-Rooter) segments, both of which are dominant players in their respective spaces. Read the attached analysis for more of our thoughts on why this break-up makes sense. What's the O...

CHE CHEMED CORPORATION
07/30/20 July 30, 2020 7 EN
Alexander Korda
  • Alexander Korda
EUR 466.30
KAR KAR Auction Ser...

Pick of the Fallen Spins: KAR

Our previous Fallen Spinoff analysis (July 2019) saw value creation in Perspecta, Inc. (PRSP), and our entry recommendation at $23.70 rallied to its pre-pandemic high of $29.50 in February 2020 (a +25% return, now back to our recommendation levels dropping with the market). Our newest screening process yielded KAR Auction Services, Inc. (KAR), which we believe has several catalysts for growth and will create value in the post-pandemic used auto auctions space. Fallen Spinoff Screening Criteria....

KAR KAR AUCTION SERVICES INC.
05/28/20 May 28, 2020 4 EN
Alexander Korda
  • Alexander Korda
EUR 466.30
NOKIA NOKIA OYJ

Analysis: Historic Opportunity to Bring 5G to the United States Via Ac...

With no significant domestic 5G vendor, the US is losing to international players like Ericsson (Sweden), Nokia (Finland) and Huawei (China). Therefore, we believe there is a strong case for an activist investor to bring 5G to the US by pursuing a suitor to acquire Nokia, which is available at a discounted valuation. With the right leadership, financial muscle, and US government backing, Nokia will make a formidable competitor and eliminate US concerns over the risk of losing the 5G struggle. T...

04/24/20 April 24, 2020 5 EN
Alexander Korda
  • Alexander Korda
EUR 466.30
GILD Gilead Sciences...

Gilead’s Coronavirus Wonder-Drug Remdesivir Masks a Board Contagion ...

The Edge View... When Gilead Science, Inc.’s (GILD) CEO Daniel O’Day pushed the button on his March 28 open letter stating the firm’s new wonder-drug (the antiviral Remdesivir) could work against COVID-19, he had every hope the company's share price would soar - and he was right. The fact that GILD donated around 140,000 treatment courses to expedite its possible emergence into America’s emergency response offered a much-needed boost, and the company is now going full-steam ahead with th...

GILD GILEAD SCIENCES INC.
04/15/20 April 15, 2020 3 EN
Alexander Korda
  • Alexander Korda
EUR 466.30
BG BUNGE LIMITED

Strong Insider Buying Pattern Warrants Entry

One of the top players in the agribusiness and food industry and part of the big “ABCD” four that dominates the space (Archer Daniels Midland (ADM), Cargill and Louis Dreyfus), Bunge Ltd (BG) witnessed fourteen different open market purchases in 2020, with two of those buys holding a stronger buying signal than others. With additional factors at play include the presence of activist investors, new CEO and a potential separation on the table, we’re going to take an initial stake at current ...

04/09/20 April 9, 2020 3 EN

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