Theme of the Week
Nicotine Pouches
Even though we consider ourselves value investors, we are only interested in investing in industries with a tailwind. Most consumer businesses have been struggling for the better part of 4 years, and despite rock bottom valuations, consumer is a hard place to make money.
With that in mind, let’s talk about what has been fueling the universal soldier for many centuries: nicotine. Some of us portfolio managers might think of our trading as being in the trenches. In reality, being in the trenches means being cold, wet, and hungry.
Nicotine seems made for dealing with those discomforts. Admittedly, depending on how miserable or hopeless the war they are fighting, some soldiers opt for heavier artillery, but nicotine remains the baseline.
In the last couple of years, Nicotine pouch consumption has slowly started to take over from Snus consumption. Nicotine pouches began being sold outside Sweden in Norway, the UK, and the US. Unlike Snus, the EU has not formally banned nicotine pouches but leaves it up to the member states to regulate them – for now.
2026 Q1 Fund Letter Special report
For years, we’ve tracked hundreds of investment letters. That is a LOT of information to sift through.
So we finally decided to be more selective, distill the best insights, and consolidate them into a single report: our new cool-ass Fund Letter Special report.
We’ll be publishing this quarter, and will be a treasure trove of info. Check out the first full report here.
Kuppy’s Tweet of the Week
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Kliff Note of the Week
Spin Monitor: Gaming studio Embracer (EMBRACB SS) is moving to the next spin. After the Coffee Stain spin in December, Fellowship Entertainment is the next one, targeted for 2027.
Interesting, as Fellowship will house Embracer’s biggest IP, including The Lord of the Rings and Tomb Raider. The remaining Embracer will focus on smaller studios, mobile, distribution, and do some small M&A.
Announced Buyback Monitor: Lightspeed Commerce (LSPD) renewed its 10% NCIB, which is part of a larger $400m buyback (roughly 1/3 of shares outstanding).
The company still has plenty of cash, with net cash over 30% of market cap. The top line continues to grow at a decent pace, and the company should be hitting that operating leverage as we speak, but results continue to underwhelm, with the share price hitting new lows.
A reminder that LPDS conducted a strategic review, concluding it last year with just a mere buyback; the shares still have to recover.
Privatization Monitor: The German government is planning on cutting its stake in Uniper (UN0 GR). As we said in early February, Uniper is still very much seen as a state-owned, rescued zombie company (for all the right reasons).
Still, they are steadily moving more into core European energy infrastructure. Cold winters keep reminding policymakers who actually run the system. The real catalyst is a government sell-down: Germany is required to sell its stake under the EU rescue terms, making reprivatization the real catalyst.
Add a new gas-to-hydrogen plant with contracted returns, and there’s good rerating potential (eventually).
CEO Golden Handcuffs Monitor: Cogent (CCOI) has suffered a drawdown of more than 75%, with revenue declines, cash burn, and a 98% dividend cut, pushing the stock into full turnaround territory despite its structural exposure to AI‑driven bandwidth demand.
In response, the Board has granted CEO Dave Schaeffer a one‑time 1,000,000‑share performance award, vesting on a 60‑day VWAP ladder at $70 / $85 / $100 (4–5× from the current ~$18 base), with half of the shares only vesting at 100 and a five‑year window through 2031.
The BoD is all‑in on a Schaeffer‑led Sprint integration, AI‑and data‑center‑driven growth, and a deleveraging strategy.
13D Monitor: A small investor (but with a big mouth) is trying to push Porvair (PRV LN), a pollution control equipment company, to initiate a strategic review.
Porvair is actually not doing so poorly; 2025 was a relatively tough year, but the company seems back on track. Good growth, healthy margins, strong balance sheet, ~50% FCF conversion.
Roughly 10x EV/ EBITDA. Also, it is worth noting that both insiders and large shareholders have recently been adding.
Strategic Alternatives Monitor: Portuguese paperco Semapa (SEM PL) screens interesting. They recently closed the sale of a large division (Secil), bringing them to net cash and a rather cheap remainco valuation.
They own 70% of Navigator, Europe’s lowest‑cost paper producer. There’s a 10% buyback lined up for approval (May 28), which could bring the controlling family’s stake to over 90% and perhaps try another delisting (unsuccessful in 2021).
Capacity in this industry continues to tighten, and Navigator talks about raising prices.
