Mike Melby, Founder and Portfolio Manager at Gate City Capital, makes a repeat appearance to discuss his investment in CATO. CATO is a small retailer with a rock solid balance sheet; Mike thinks their low multiple combined with a focus on returning cash flow to shareholders and some hidden tax and real estate assets creates an attractive investment opportunity.
Mike's first appearance on AXR: https://youtu.be/mSEgw2529Q4
Gate City Capital website: https://www.gatecitycap.com/
Chapters
0:00 Intro
1:00 Cato Overview
5:45 Cato's target demographics
8:45 Cato's online strategy (or lack thereof)
13:15 What's driven Cato's store base recently
15:30 Discussing CATO's management
22:05 Valuing CATO's land
27:35 Quantifying CATO's Sum of the Parts (SOTP)
30:15 What's the endgame for CATO?
37:25 Mike's closing thoughts on CATO
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