/biz/ - Business & Finance

https://seekingalpha.com/article/4538808-party-city-stock-stock-safety-margin-potential-upside
https://archive .ph/MzAuJ
Sep. 03, 2022 5:02 AM ET
>Party City at 2x FY2021 operating income and $200 million market cap is priced like future bankruptcy is likely.
>Party City has a confluence of factors that makes it compelling as a trade, especially Halloween being soon.
>The fundamental thesis provides margin of safety for a near-term trade and target of 50% upside.
>We should also note that Party City’s largest shareholder, hedge fund CAS Investment Partners added to its holdings at above $6 earlier this year.
>I view Party City to be most interesting as a near-term trade for a significant potential return in the lead up to Halloween.
>a lingering concern that its largest shareholder – CAS Investment Partners - might need to sell its stake amidst the fund’s decline this year should have lifted amidst a rebound in its top positions
>Party City does not face any major debt repayment soon. It has a senior note due in 2023 with a carrying amount of $22.779 million which is not sizeable, whilst its next major debt repayment is due in 2025 ($206 million).
>its next major debt repayment is due in 2025 ($206 million).
>Risk Factors: Any negative news on Halloween consumer trends, retail peer performance or company updates may sour the Halloween trade thesis. Further, the continuing market sell-off is not conducive for Party City stock and it cannot be expected to defy a negative broader market trend.

https://seekingalpha.com/article/4538808-party-city-stock-stock-safety-margin-potential-upside
https://archive .ph/MzAuJ
Sep. 03, 2022 5:02 AM ET
>Party City at 2x FY2021 operating income and $200 million market cap is priced like future bankruptcy is likely.
>Party City has a confluence of factors that makes it compelling as a trade, especially Halloween being soon.
>The fundamental thesis provides margin of safety for a near-term trade and target of 50% upside.
>We should also note that Party City’s largest shareholder, hedge fund CAS Investment Partners added to its holdings at above $6 earlier this year.
>I view Party City to be most interesting as a near-term trade for a significant potential return in the lead up to Halloween.
>a lingering concern that its largest shareholder – CAS Investment Partners - might need to sell its stake amidst the fund’s decline this year should have lifted amidst a rebound in its top positions
>Party City does not face any major debt repayment soon. It has a senior note due in 2023 with a carrying amount of $22.779 million which is not sizeable, whilst its next major debt repayment is due in 2025 ($206 million).
>its next major debt repayment is due in 2025 ($206 million).
>Risk Factors: Any negative news on Halloween consumer trends, retail peer performance or company updates may sour the Halloween trade thesis. Further, the continuing market sell-off is not conducive for Party City stock and it cannot be expected to defy a negative broader market trend.