Clearly not investment advice, just tossing shit to the wall, and maybe it spurs some ideas for me.
Nobody gives a flying fuck about Helsinki right now, which is precisely why my interest in it is growing.
Nordea 15.7.2024
Alright, let's hit Nordea, jester-style:
Nordea. Trading at €10-11
Prime student syndrome: Top grades, but in a class where the curve's rigged.
Regulatory straitjacket: ECB's puppet, dancing to bureaucrat’s tunes.
Hivemind trap: Finnish investor’s groupthink favorite. Red flag always.
Compliance queen: Great at following rules. They've mastered the art of standing still while pretending to move forward.
Asymmetry void: Where's the hidden gem? The mispriced opportunity?
Sure, 17.9% ROE looks pretty. But in this overregulated sandbox? Why is it not trading at a premium valuation?
Bullish case? Maybe if you're betting on regulatory Armageddon wiping out competition. Or if you think “meh” is the new awesome.
Risks? How about death by a thousand paper cuts? More taxes, more rules, more stupid ECB.
In 10 years, will Nordea be the disruptor or the disrupted?
Bottom line: There's no magic here. It's a glorified savings account with a stock ticker - when your actual Nordea savings account pays 0% interest. What could go wrong?
WITHSECURE CORPORATION 16.7
This is a supposedly hot sector. Why is the stock not hot? Now that we have the CrowdStrike bamboozlement… will it become an even hotter sector? Yes, but does it make Withsecure hotter?
Cybersecurity play from Finland/Europe. Focuses on smaller companies.
Where is the growth? Where is the profitability? 13% ARR growth in Elements Cloud? Lukewarm at best.
Negative EBITDA across all segments.
Risks? How about everything? Market irrelevance? cash burn? Are bigger players eating their lunch?
WithSecure's 2024 outlook: “We promise to do slightly better than absolutely terrible.”
I don’t find anything that excites me, except that they operate in a rapidly growing cybersecurity market.
Sidenote: Most of their new job listings are listed in Poland. It is a classic cost-cutting strategy for Finnish companies… Or is it even nowadays? Poland > Finland?
Kemira 17.7
“Chemistry with a purpose”
Good company. The stock has performed nicely recently.
The recent drop is due to some pulp and paper pricing weaknesses. The stock price could have gotten ahead and priced in all the bullish narratives. Management also sold to the recent “pump” a little bit.
It's still a quality company. Heavily investing in water treatment. Water play for the future?
Solid performance
Operative EBITDA margin increased to 19.2%, up from 18.0%.
Strategic focus: The pivot towards water treatment is forward-thinking. With global water issues looming, Kemira's positioning itself well. (The Oil & Gas divestment)
Ok cash flow: €109.4 million in Q2.
Pulp & Paper recovery? Pricing pressures persist.
Industry & Water strength: Impressive 22.6% operative EBITDA margin.
The Oil & Gas divestment initially impacted top-line figures, but adjusted numbers reveal underlying strength. I have, again, zero fucking clue about their business.
Long-term prospects in water treatment and “sustainable chemistry” look promising. This is a good company! It's a solid candidate for those believing in the long-term value of water treatment.
It could be an okay long-term hold, but is it wonderful? It is a top-tier company in Finland.
Nokia 18.7
This is a classic example of a value trap. The company and the management have underperformed over two decades… It is so cheap! Now must be the time to buy it! EU will ban Huawei! Even if these fuckers had a monopoly and all the patents on the planet, they would probably fumble it.
Are they developing new products and services? Are they making new and awesome acquisitions? Let’s hope the new 2,3Bn Infinera deal spurs something. Their innovation seems limited to finding new ways to underwhelm.
Everything screams meh.
Wärtsilä 19.7
Wärtsilä: The Finnish industrial phoenix rising from the ashes.
Impressive turnaround: Q2 order intake up 10% to €1,854 million, with organic growth at 12%.
Profitability surge: Comparable operating results skyrocketed 63% to €176 million.
Cash flow: Operating cash flow at €216 million, up from €75 million. Awesome.
Future-proofing? Hybrid ferry conversions are cool shit.
Marine market resilience: Longer shipping routes, yeah. I wonder why? And decarbonization efforts driving demand.
Wärtsilä reached a significant milestone by launching the world’s first large-scale 100% hydrogen-ready engine power plant concept. This solution can use natural gas today to provide flexibility and balancing. Energy solutions tapping into the AI boom?
Improved outlook: Management expects better demand for the next 12 months in both Marine and Energy segments.
At over 18€, Wärtsilä is not cheap, but the recent performance suggests they're not just talking the talk but walking the walk.
Risks? Sure. European political landscape and global trade tensions could throw wrenches in the works. Dependence on policy decisions is a big concern for me.
Is it the bet of the decade? Maybe not. But it's a solid play on global energy transition and maritime evolution. Plus, it's a much-needed success story for Finland's industrial sector. This is so good for Finland.
Anyway, coffee tastes especially good this morning, and there are opportunities in Helsinki to find good businesses and make money.
Wärtsilä deserves a spot on the watchlist.
Stay vigilant,
Best of the week:
My go-to guy when it comes to China. I have followed him since 2010, read and follow him!
Great stuff here.