PORTFOLIO HOLDINGS
JBS Investments’ investment philosophy is centered on long term investments in world-class businesses. These investments encompass a broad range of leading businesses across a range of industries and geographies.
A snapshot of some of our key portfolio holdings
This is a snapshot of the current portfolio disposition of our Funds and their key holdings
RumbleOn
RumbleOn (RMBL) is the largest motorcycle retailer in the US. RMBL became the largest powersports retailer in the US following the August 2021 acquisition of RideNow, which has 47 brick & mortar dealership locations. RMBL’s acquisitions of RideNow and other brick and mortar dealerships have transformed the company’s economics. RMBL is now cash flow positive and is reinvesting that cash flow back into its business.
Motorcycle and powersports dealerships are a ~$100B business at retail: RMBL is now the dominant player in the industry and generates only $2B of revenues. In a niche industry still overwhelmingly made up of mom & pop operators, RMBL’s industry-leading scale and technology should allow it to become the dominant market maker and online marketplace for new and used motorcycles.
We think it can generate at least $125M of EBITDA this year, even in the current challenging macro environment. It seems amazing to us that you can obtain a business with $2 billion in sales for just over $100m. It is credible that the company keeps gaining market share such that it ends up being on 1x earnings in a few years.
Deterra
Deterra is a royalty company with direct exposure to revenues produced from one of the best iron ore resources in the World without any of the typical hassles we associate with the mining industry such as obtaining permits, paying for exploration, mining operations and rehabilitation following completion of the mining. We expect that the market will rerate the shares on the basis of the underlying yield, which implies substantial upside.
ACV Auctions
The $11.5B US wholesale dealer-to-dealer vehicle industry appears ripe for disruption. With unmatched vehicle inspection and condition report capabilities, ACVA appears best positioned to benefit from the industry’s ongoing shift from physical to digital wholesale vehicle auctions. Despite near-term industry headwinds related to new vehicle supply challenges and lower prices for wholesale vehicles, ACVA continues to take market share from physical auction incumbents.
Unlike many of its money losing automotive e-commerce peers, ACVA’s business model is relatively asset light. With $352M in net cash (excluding $152M in auction float) and minimal FCF cash burn, ACVA has more than sufficient liquidity and capital to support its current and future growth plans.
Evolution
Evolution Gaming provides live casino games, dominating the European market with 70%+ market share. Evolution is an exceptionally high-quality business due to its impressive returns on capital, long growth runway, increasing market dominance, and significant scale advantages. The majority of EVO’s revenue is derived from a ~10% take-rate of all revenue generated by casino operators licensing EVO’s games.
SHVA
SHVA is an Israeli monopoly in the credit card clearing market. It went public in June 2019 in response to legislation preventing banks in Israel to control businesses other than banks. After going public, each of the major banks in Israel as well as Visa and Mastercard holds exactly 10%. We see the business as world class with earnings growth supported by strong secular tailwinds.
Genesis Energy
Universal Music Group is the world’s leading music entertainment company. It is a high-quality business that is best placed to capitalise on the continuing growth in streamed music. In many ways, it can be thought of as a tax on the world’s streaming of music. The company has a very long-term growth trajectory. The music industry has recovered from its dark days of music piracy and is now more profitable than in the heyday of CDs. The great thing about streaming music is that the music companies don’t have to incur the cost of producing CDs with the risk of managing inventory.We believe that streaming music has many decades of growth ahead of it. Together with the development of new services, Universal should be able to grow its profits at double digit rates for the next ten years and beyond while requiring little in additional capital. There have been some concerns raised about the cost of recent acquisitions, such as USD $400 million to buy Bob Dylan’s song catalog and the recent purchase of Sting’s back catalog. We have considered this risk but believe it is manageable due to Universal’s ability to monetise such purchases and the irreplaceable and long-life nature of these assets.