There definitely seems to be some strong support at the $3.30s -...

There definitely seems to be some strong support at the $3.30s - the largest wall of buyers is at $3.37, which just so happens to coincide with my net asset valuations (NAVs).

As of now, Lark is trading at $258m market cap vs $251m NAV - I did the calculations on last nights close, before today's drop of 5%. To my mind, this will be a strong floor.


Forecasting to FY26 based on current capacity and whisky maturation period since the Pontville acquisition, I am estimating around 15% CAGR on the NAV:



Feel free to ping me if you have suggestions on my assumptions. I modelled out $150/l net sales revenue as an absoloute floor, and then you simply don't lose money from here. And I modelled a +20% NSR based on managements forecast in the 1H22 results, and you look closer to 20% CAGR (good upside, but not counting on that).

Beyond NAV, I looked at the earnings multiple as well. I slapped a really conservative 20x, which is well below the 30-35x that TWE pre-Covid traded at, LVMH, Diageo, etc. This is important, because they can arb the multiple difference in a takeover (i.e. they buy Lark and it gets re-rated to 30x because it is now part of Louis-Vuitton Moet Hennessey stable). Anyway, I modelled out the whisky bank and maturation based on Pontville expansion plans and a 1million litre target by FY30 (maybe ambitious). Right now Lark looks expensive as it's just passing the inflection point of profitablility. However even with some margin compression and increasing costs (more hospitality and sales team), on FY26 we're looking at 18% CAGR, on FY30 we're looking at 21% CAGR.



Again feel free to ping me if you have suggestions on my assumptions. I also modelled out $150/l and found it was slightly negative; but I excluded hosptiality rebounding for example which could add another $5-10m earnings or $100m MC by FY26 for example. So washes out.

Just a number excercise, but I feel there is downside protection from here. Full deets on FinTwit if you're interested. Bought another parcel today. GLTAH.