Value Situations' Conor Maguire on why strategic review at Dowlais $DWL.L indicates a live catalyst

Sep 17, 2024

Conor Maguire, founder and editor of the Value Situations Newsletter, returns to share insights on Dowlais Group Plc, focusing on its pivotal role in the transition to sustainable vehicles. He highlights what the market may overlook about Dowlais, including its strategic review and management performance. The discussion dives into trends in the automotive industry, the impact of China's market, and investment strategies in undervalued stocks. Conor also tackles concerns like goodwill write-offs and the cyclical nature of powder metallurgy, providing a comprehensive view of potential growth opportunities.

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Intro

00:00 • 2min

Exploring the Value Proposition of a Mid-Cap Auto Parts Spin-Off

02:23 • 5min

Navigating China's Automotive Influence

06:54 • 14min

Analyzing the Shifting Landscape of Auto Sales Rates

20:41 • 2min

Revving Up: Automotive Industry Challenges and Opportunities

22:54 • 15min

Navigating Management Performance and Strategy

38:04 • 22min

Evaluating Carrying Value and Market Dynamics

59:50 • 5min

Understanding Goodwill Write-Offs

01:04:54 • 4min

Conor Maguire, Founder and Editor of the Value Situations Newsletter, joins the podcast for his third appearance to share his thesis on Dowlais Group Plc (DWL), a portfolio of market leading, high-technology engineering businesses that advance the world's transition to sustainable vehicles.

For more information about Conor Maguire and Value Situations Substack: https://valuesits.substack.com/

DWL write up on Value Situations Newsletter: https://valuesits.substack.com/p/dowlais-spinning-wheels

Chapters:

[0:00] Introduction + Episode sponsor: Tegus

[2:15] What is Dowlais Group Plc (DWL) and why are they interesting to Conor

[9:18] What is Conor seeing about Dowlais that the market is missing

[16:42] Dowlais recent history

[21:45] Trends in the auto industry

[27:43] Bidding war time from 2018

[32:29] Margin expansion

[38:03] Management and incentive structure

[49:08] Capital allocation scenarios

[53:25] Who's the buyer of Powdermet

[58:50] Cyclicality of Powdermet business?

[1:02:16] Final thoughts on Dowlais / one more question about goodwill on the balance sheet

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