Nitor Capital Management - Undisclosed Position

[alxcii]

Notable shareholder in JOE just released their annual letter: https://nitorcapitalmanagement.com/annual-letters. Any COBAF sleuths out there can figure out what they were buying in the last two years?

 

 

[thepupil]

Sounds kind of like Tejon Ranch. They have JV’s on their interstate land with industrial RE that generate cash flow similar to that, it’s a $520mm market cap, it’s a terrible long term performer. 
 

the numbers don’t match exactly, but given Nitor’s penchant for JOE and TPL, TRC may be a decent guess.

[thepupil]

So running the below screen $200mm - $1B market cap, United States, Total Return since 1/1/2003 <4%/yr, Net Debt <$300mm, you get 100 companies.

 

then sorting by investment in affiliates/JV's you get 11 companies, the 5th of which is my number one contender Tejon Ranch Company, which also fits the net cash criteria whereas most don't 

 

I can say with pretty high confidence that if it's in the United States, it's probably Tejon Ranch, but maybe that's confirmation bias since that's what I thought it was before running the screen.

 

I also think Nitor likes difficult to value, long duration, unique assets often with irregular or unpredictable cash flows (JOE and TPL) and TRC is the very definition of all that stuff. 

 

 

 

 

 

 

Edited February 20, 2023 by thepupil

[thepupil]

also going back to TRC's 2003 10-K the company generated $18mm of revenue and $52K of operating cash flow...which is very similar to "$15mm of revenue and no reported cash flow"

 

I think it is beyond a reasonable doubt TRC. 

[Red Lion]

1 hour ago, thepupil said:

also going back to TRC's 2003 10-K the company generated $18mm of revenue and $52K of operating cash flow...which is very similar to "$15mm of revenue and no reported cash flow"

 

I think it is beyond a reasonable doubt TRC. 

 

You've got serious stock screening / sleuthing skills.

[thepupil]

5 minutes ago, RedLion said:

 

You've got serious stock screening / sleuthing skills.

unfair advantage on this one 

 

 

[Red Lion]

Haha, luck favors the prepared they say. 

[alxcii]

7 hours ago, thepupil said:

also going back to TRC's 2003 10-K the company generated $18mm of revenue and $52K of operating cash flow...which is very similar to "$15mm of revenue and no reported cash flow"

 

I think it is beyond a reasonable doubt TRC. 

 

Awesome detective work @thepupil, thanks for your wizardry!

[Spooky]

Does Nitor have a good track record?

[thowed]

As per a quick glance the latest annual letter, yes, good track record over 5 and 10 years. 

 

But I think you have to frame performance of funds like this through the environment of the past 15 years - i.e. the sort of stuff they do wasn't much in favour for a lot of it, but they've caught up a lot in the past 24 months or so.