Bullpen.News From Edwin Dorsey
Get Daily Recap Feedback

Monday, September 28, 2026

Back to today

Quick Value #332 - Gentherm (THRM)

Gentherm’s Oct. 1 Reverse Morris Trust with Modine adds commercial and off-highway operations, leaving THRM at 7.4x pro forma EBITDA with under 1x leverage.

MOD $9.9B
Value Don't Lie 3 clicks

From X

@marginofdanger 2 clicks

marginofdanger on X

I pasted two screenshots from $PS's 424B4. If you look at fee paying AUM, it's $16 bn excl HHH which has a de minimis mgmt fee/carry. Add in $PSUS and you are at $21 bn of fee paying AUM. $PS discloses pro forma mgmt fees of $238 mm but that is net of $91 mm of non-cash amort related to the IPO. So I'm going to give them credit for $329 mm of mgmt fees. Assuming a 65% operating margin and a 20% tax rate, that gives me effective fee paying earnings of $171 mm. $PSH.LN has a 16% incentive fee and $PS is entitled to the performance fees on the first 5% (the team gets beyond that). On $15 bn, this is $15 bn * 5% * 16% = $120 mm or $96 mm after tax. Add up the mgmt fee and performance fee share, and I get $267 mm of expected earnings or $0.67/share. Implies $PS is trading at around ~50x EPS vs. $KKR at 17x, $ARES at 20x, $BX at 21x. Of course you can layer in some minor $HHH economics and it takes down the multiple a couple of turns. But you could also layer in a few years of sub 5% returns and that takes away the performance fee too. Certainly a 50x EPS valuation is pretty common for a fast growing higher ROIC biz. But it's by no means cheap. The question is, how will Ackman raise any money from here? $PSH.LN is at a discount to NAV, $PSUS is at a discount to NAV and $HHH is at a discount to NAV. One thing that will allow $PS to grow into its valuation is great results as that will 1) scale up the earnings (as it's based on % of AUM) and 2) facilitate new investors. Another way to contextualize the valuation is to simply look at fee paying AUM of $21 bn and compare that to the equity value of $13 bn. That is pretty unprecedented in the land of asset managers but reflects in part the permanent capital and the limited float (I think its just the 20mm shares given in the IPO). Could easily see a lot of price pressure once the 380mm non-IPO related investors are free to sell.

Investor Letters

All letters

Research Roundup Vol. LIII

Micron’s customer agreements, Analog Devices’ acquisitions, Ondas’ GATE deal and Baker Hughes’ power systems position them for AI…

ONDS $4.3B
Monte Independent Investment Research 4 clicks
SFM · long

Sprouts Farmers Market

Sprouts Farmers Market benefits from GLP-1 adoption, scrutiny of ultra-processed foods and dietary restrictions driving demand for natural…

SFM $6B
Value Investors Club 1 click

[CoStar] Homes are different

CoStar spent more than $1 billion building Homes.com to challenge Zillow, betting seller-agent leads, proprietary listing content and…

ZG $6.3B
scuttleblurb 4 clicks

Publications we follow

Every publication on this site, hand-picked.

110 publications

Newsletters 93

YouTube 4

Blogs 12

Seeking Alpha 42 of 206

Nominate a publication

X accounts we follow

Every account on this site, hand-picked.

72 accounts
Nominate an account

Investor letters we follow

189 firms

Sectors

Ordered by how often our editor reaches for them.