A quick recap of the strong performance of Medistim in H1 2025, and a valuation update.

Some companies always seems to trade at a low multiple. Charlie Munger hates that kind of business.

In this episode I go through the working capital cycle of a product company, and explain why they deserve a low multiple.

If I could go back in time to understand something early in my investing career, this would be high on the list.

Investors seems to be missing the forest for the trees. Short term noise have built an impression that Evolution deserves to trade at 12 times earnings. But remember, the P/E multiple is not only a component of growth.

Market valuations of sectors varies over time, and there is no permanent anti-ESG underperformance. If so, any quant with a screen would outperform the market.

I foresee a clear path towards multiple expansion, despite modest expectations for company performance. In this analysis, I try to explain what the returns could look like over 5 years.

A growing and stable internet service provider from Sweden. The company is founder-led with extreme earnings stability for such a small company.

The company is setting up for international expansion after having built a stable earnings base in the Swedish market.

Thanks for listening. Not financial advice

One cannot simply compare a swedish serial acquirer to another. They own vastly different assets, corresponding in vastly different expectations for organic growth.

Furthermore, some companies has a proven track record when it comes to capital allocation. Bergman & Beving is the OG in this regard.

Putting swedish serial acquirers in a spreadsheet comparing P/E multiples or other measures without context should be considered a sin.

A best in class IT concultancy firm from Norway. At a market cap of 800 MUSD, this quality compounder has great opportunity to continue outperforming the market.

The company is trading at a FCF-yield of 5%, and growing revenues 10% annually. Without the need to retain earnings in order to grow the investment could yield a 15% annual return, with very low risk of terminal capital loss.

There is risk of multiple compression in the near term as it trades at 20 times earnings. In such an event, Bouvet could be a fantastic opportunity.

This is not financial advice.

A capital efficient micro cap staffing company from Sweden. The company doesn't need to retain earnings to grow, but still grows 10% annually.

Trading at a FCF (and dividend) yield of 5%, it's destined to deliver shareholder returns of 15% annually. The company has a very low business risk, due to a simple, yet brilliant business model.

Investing doesn't get any more boring (nor better) than this.

Not financial advice.

When valuing a cyclical wholesale retailer one cannot simply apply a multiple. At depressed earnings after a post-covid bull-whip effect and economic downturn, AOs future earnings power is understated in my opinion.

The market's belief in a reversion to the mean doesn't factor in the substantial investments in IT and infrastructure made by the company pre-covid. This makes AO an attractive investment prospect with minimal risk of terminal capital loss.

$AOJ trades at an estimated forward FCF-yield of 10%, having historically grown FCF 15% per year. I foresee a solid shareholder return of about 15-25% per year for the next 3-5 years, when the increased earnings power is recognized by the market.

Not investment advice, but merely my take on an interesting company.

When valuing a cyclical wholesale retailer one cannot simply apply a multiple. At depressed earnings after a post-covid bull-whip effect and economic downturn, AOs future earnings power is understated in my opinion.

The market's belief in a reversion to the mean doesn't factor in the substantial investments in IT and infrastructure made by the company pre-covid. This makes AO an attractive investment prospect with minimal risk of terminal capital loss.

$AOJ trades at an estimated forward FCF-yield of 13%, having historically grown FCF 15% per year. I foresee a solid shareholder return of about 15-25% per year for the next 3-5 years, when the increased earnings power is recognized by the market.

Not investment advice, but merely my take on an interesting company.

Medistim ASA is a medical techonology company with a near monopoly within their niche and a razor-blade business model.

In a more than 50% draw-down due to macro-economic factors, this is a secular compounder available at a reasonable price. At a 4% FCF-yield, the company is in position to deliver double digit growth for the foreseeable future. The company has great margins, 30% ROE, and no need to retain earnings in order to grow.

Not financial advice, just my opinion on an interesting company.