Speedwell Research's News Update and Weekly Recap
New RH Business Recap, CSU & Copart Dialogue, Magnetic Hurdle Rates, 1P vs 3P Impacts, Axon Fulfilling an Essential Need
Welcome to Speedwell Research’s Newsletter. We write about business and investing. Our paid research product can be found at SpeedwellResearch.com. You can learn more about us here.
This is a weekly recap, where we summarize recent content you may have missed.
Table of Contents:
Speedwell Releases & Upcoming
Spotlight
Coverage Updates
Sharing Links
1. Speedwell Releases & Upcoming.
Research.
We released a short business recap on RH. You can read it here: RH 1Q25 Business Recap.
The Synopsis Podcast.
We released a dialogue episode on CSU and Copart. We cover CSU & Copart’s latest quarter, CSU AGM, Copart losing market share, and how negative insurance volumes are impacting Copart. Listen or read below!
Upcoming.
Podcast
This week, we have a special interview with a portfolio manager who specializes in Precision Medicine and Life Sciences!
Research
We are now working on LVMH as our next in-depth research report!
Coverage
There are no scheduled earnings or conferences for our coverage companies this week.
Become a Speedwell Member today to get access to all of our research updates and our in-depth research reports!
2. Spotlight.
Below are select quotes from our various writings and podcast.
RH 1Q25 Business Recap.
Large Distribution of Outcomes: “However, at $185 a share, or a market cap of ~$3.5bn, upside is very large too. Just achieving $5bn in sales (the low end of their goals for just North America) would yield a $12bn enterprise value at 20x earnings. Their intention though is that the international business will be even larger than America. While there may be much to debate about RH, one thing is quite clear: the distribution of outcomes are quite large.”
Read the full recap here: RH 1Q25 Business Recap
The Synopsis Podcast. CSU & CPRT Dialogue
Magnetic Hurdle Rates: “He (Mark Leonard) felt that hurdle rates were kind of magnetic. And so, if he were to set the company-wide hurdle rate to 15%, then all of their investments would kind of gravitate toward 15%, and you'd lose those investments that did 20%.”
Memo. Understanding the Impact of 1P vs 3P on Financial Statements
1P vs 3P: “Whether a company records a transaction as 1P or 3P is largely just an accounting difference, but it can change how the business is run. 1P denotes more involvement in every step of the sale, whereas 3P typically just matches buyers to sellers and hands off the transactions.”
Read the full memo here: Accounting Insights: Understanding the Impact of 1P vs 3P on Financial Statements
Company Report Snippet. Axon
The Essential Need for Safety Technology: “Public spending on safety has tended to only go up over time, with a few occasional setbacks whether from recessions or political movements. However, even if there was a focus to cut back on police budgets, it would be rational to rely more on technology to replace some personnel.”
*This is an excerpt from our company report on Axon.
If you are a Speedwell Research Member, read the full report here: Axon
If you are not already a Speedwell Research member, you can purchase it here: Axon Individual Report
3. Coverage Updates.
DFH
META
Meta is in talks to buy PlayAI, a startup that specializes in generating AI human-like voices.
This is another effort by Mark Zuckerberg to acquire talent for Meta’s “superintelligence group.”
U.S. House of Representatives bans WhatsApp on government devices.
"The Office of Cybersecurity has deemed WhatsApp a high-risk to users due to the lack of transparency in how it protects user data, absence of stored data encryption, and potential security risks involved with its use," -U.S. House's chief administrative officer
4. Sharing Links.
Check out Speedwell Research’s Drew Cohen’s YouTube Channel. It is focused on general investing and business content.
Other Links.
A Letter a Day: Fred Smith 1998 Shareholder Letter (link)
How Chuck Akre Finds and Invests in Wonderful Businesses (link)
Leandro of Best Anchor Stocks: Never Sell (link)
Turtle Creek: Why the Market Gets it So Wrong, So Often (link)
And a special thank you to Matthew Harbaugh for helping put this weekly recap together!
The Synopsis Podcast.
Follow our Podcast below. We have four episode formats: “company” episodes that breakdown in-depth each business we write a report on, “dialogue” episodes that cover various business and investing topics, “article” episodes where we read our weekly memos, and “interviews”.
Speedwell Research Reports.
Become a Speedwell Research Member to receive all of our in-depth research reports, shorter exploratory reports, updates, and Members Plus also receive Excels.
(Many members have gotten their memberships expensed. If you need us to talk with your compliance department to become an approved vendor, please reach out at info@speedwellresearch.com).
