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Monday, October 26, 2026

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Merger Monday & Election Implications

EQT’s $50 billion merger with Range Resources and Ovintiv’s $1.26 billion acquisition of Logan Energy reshape North American oil and gas alongside Brazil and British Columbia election…

EQT $34BRRC $13B
Bison Insights 7 clicks

From X

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Fajasy on X

Elmet $ELMT expects Masan High-Tech Materials, its Vietnamese tungsten supplier, to stay its key refiner even after a U.S.-funded plant in Nevada comes online, and it bought 4.99% of the company for $124.75M on October 1. Masan High-Tech Materials (UPCoM: MSR) mines tungsten at Nui Phao in Vietnam, refines the concentrate into APT (ammonium paratungstate, the traded form of tungsten) and oxides, and calls itself the largest producer of processed tungsten outside China. Elmet, which turns tungsten into parts for U.S. missiles and jets, has bought from MSR for 12+ years, and the deal values MSR at $2.5B. The 55.1M shares came from a Masan Group (HOSE: MSN) subsidiary, so the $124.75M goes to MSR's parent, not into MSR. Along with the stake come (1) an MSR board seat, (2) an 18-month lockup on Elmet's MSR shares, and (3) 8+ years of supply that MSR puts at ~1,250 tonnes of WO₃ (tungsten trioxide, the standard measure of contained tungsten) a year, ~$1.5B of revenue to MSR at today's prices. That's ~$187.5M a year of spend with MSR ($1.5B / 8), equal to 82% of Elmet's $228.5M of TTM revenue. On September 14, Elmet's deck labeled ~$100M of the U.S. Department of War's (DoW) $450M "Strategic Investments in Elmet Refining & Trading," its new tungsten buying and trading division, to build a "diversified feedstock portfolio." The October 1 deck relabels the same ~$100M "Strategic Investment in Masan," and the stake cost $124.75M. At $2.5B, Elmet paid 10.7x the ~$233M of net profit MSR expects for 2026 ($2.5B / $233M). For context, APT was $3,040/MTU (metric ton unit, 10 kg of WO₃) on May 29, up from $330 in January 2025 per Elmet's deck, and Elmet's own 2031 targets assume $1,500/MTU. Elmet's 8-K also says it won't participate in MSR's 2026 interim dividends. On October 1, the day the shares traded, MSR's board proposed a second 2026 interim dividend of VND 5,000/share (Vietnamese dong). VND 5,000 is 8.5% of the VND 58,760/share Elmet paid, or ~$10.6M on its 55.1M shares. In September I wrote that Springer, the Nevada APT plant, gives Elmet the one step it didn't own: Turning tungsten concentrate into the oxide its powder line starts from. Elmet's deck calls MSR a "long-time supplier and processor of blue tungsten oxide (BTO)," so MSR already handles the conversion for Elmet. So the step Elmet didn't own in July stays with MSR, and Elmet paid 10.7x MSR's expected 2026 profit for its 4.99% while its own 2031 plan assumes APT at under half the May price.
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Fajasy on X

My investing thesis in a nutshell (w/examples): 1) Buy with a strong margin of safety or stock price near/below cash and/or book value. 2) Buy in industries and/or markets where the money is flowing. Makes it a lot easier. 3) Buy the best early and/or the most overlooked in that particular industry. 4) Pay up for unfair advantages, excellent mgmt teams, and companies with huge latent pricing power. 5) Sell when the thesis breaks. Or a much better risk/reward setup hits your desk. Otherwise continue to add/hold. Don't track stock prices. Track the main business KPIs like any competent mgmt team would. Example #1: Bought $NBIS 4x mid $20's (best overall). Then bought $BRUN common and warrants pre-merger (most overlooked). Example #2: Bought $FTEK $1.39. Cash floor new excellent operator CEO. Strong upside potential w/data centers. Example #3: Bought $BABA $70's. Strong margin of safety, market leader, unfair advantages. Sold $170 for better risk/reward. Example #4: Bought $ELMT @$19 and @$14. Unfair advantage. Strategic. Cheap. Critical in strong growth industries. Example #5: Bought $TOST @$24. Beaten down due to macro headwinds and new/early $DASH competition. But almost everything in business stronger and expanding to new verticals. Lastly, if you're unsure or don't fully understand the business. Just say no. In fact, say no to most stocks. Most probably your best idea is already in your portfolio. Don't lockup your money in a 3/5 setup, you're trying to make outsized returns! And sub to my newsletter (link in bio) if you want my deep dives. 😉

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Molina & Kinsale

Molina Healthcare and Kinsale Capital’s earnings are reassessed through a long-term lens, emphasizing conviction and detachment during…

MOH $11BKNSL $8.3B
Bearstone 8 clicks

Tower Semiconductor Deep Dive

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CV's Substack 10 clicks

Margin Call

Petrobras’s Morpho-1 well revived hopes that Brazil’s Equatorial Margin can become a major new oil frontier after hydrocarbons were…

PBR $81B
Doomberg 12 clicks

Our Views on CoreWeave

CoreWeave's financial statements point to a business model familiar to the authors after a closer review of the AI infrastructure company.

CRWV $34B
WHAT ARE WE DOING? “Contrarians At The Gate” 13 clicks

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