VSE Corporation (VSEC), mcap=$524m, price $40.95 vs $36.50

– Provider of after market-parts and MRO services for transportation assets – routine maintenance and upkeep of customers’ assets.
– Poorly communicated, but necessary, long-term investments drove margin compression and limited FCF generation.
– These investments are beginning to dissipate and start bearing fruit, leading to expected improvement in profitability.

– Trades at 7.8x ’23 EBITDA and 13% equity FCF yield.
– Referencing the peer/historical multiples SOTP model leads $70 target.

Exp. gain: +92% to $70/share in 3 years.

Full $VSEC write-up (free guest account required):

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