This Activist Play Trades At Just 6x Free Cash Flow

A strong balance sheet, low valuation, and a recent activist win

Highlights:

• This oil and gas distributor has re-focused its business: ~40% of revenue now comes from more resilient end markets.

• At barely 6x EBITDA and free cash flow, with net leverage under 1x, the company can earn its market cap in a matter of years.

• Even a normalized scenario with modest multiple expansion suggests 25% upside in 12 months. Multiple potential tailwinds could drive much bigger gains.

• Capital allocation is a risk, but an activist win suggests a potential brake on risky M&A — and leaves open the possibility of a sale.