In this clip from THE PITCH, we give you an inside look at how a research analyst's high-conviction stock idea becomes a manager's winning position.
Watch below as Retail analyst Brian McGough pitches Hedgeye CEO Keith McCullough on Dufry (DUFN), McGough's new 'Best Idea' Long position.
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Click here to watch the entire hour long The Pitch, including 5 other analysts' Best Ideas.
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"I want to talk about DUFRY (DUFN-CH) or (DFRYF-USA). This is the mother of all reopening plays.
What is DUFRY? In a nutshell, the primary business is Duty Free in airports. 90% of the business is tied to airports and airport sales. If you take a 10,000 foot view, find me any other brick-and-mortar retailer where the customer is literally land-locked in the store for an hour, there's zero Amazon competition, and the company is a globally diversified monopolist in every market that it operates.. the simple answer is you can't find one.
It doesn't exist.
Anyone investing in DUFRY today has to look through a lot of turmoil in the current numbers, given it's a travel-oriented company.
But here's a number of underappreciated angles.
- It only has roughly 10% of the global Duty Free market.
- We're seeing an accelerating trend where private operators are taking over airports, and trying to upscale the shopping experience.
- This is a company that's going the route of luxury and evolving into a boutique model.
- There are a number of key strategic partners to grow their luxury portfolio, who are investing and will be adding a ton of value for DUFRY.
This is very much a story of the entire Duty Free experience changing. This is a multi-year, multibagger."
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The Call is our morning research call hosted by Hedgeye CEO Keith McCullough with our 40+ analyst research team. It helps small and large investors alike make better decisions via unique and investable stock/sector updates. Click here to learn more.