New Constructs' Friday Webinar: Intelligent Capital Allocation 26 May 2023

Hello, welcome to the New Constructs Intelligent Capital Allocation Friday webinar. It is the 26th of May. We have a great group pulled together. Several of our analysts were able to join us today. Aside from the usual David, Kyle, and myself, we will also have Cody Fincher, Garrett O'Grady and Lee Mineta Kohler also commenting on our topics here today. Here's our disclosures and disclaimers. Good to go through these before we get to our discussion. We have a packed agenda today, as you can see. The agenda is on the right and on the left, I'm going to briefly go through the welcome and announcements because I know we have a lot to get through. We are going to try to hit 45 minutes this week. And we are going to mostly be focusing on the topics and questions that came up on the Online Community Society. I do hope that you're able to make it out there. There's some really great contribution happening from many of our amazing members. Speaking of members, we have an upcoming member survey that will be in your email inbox shortly. I would very much appreciate if you took the time to fill that out. It should take you a couple of minutes. And we're also planning a demo day, which might be interesting to both members and non-members to be able to see a lot more of the features of the products than we're able to go through here on Fridays. As usual, at the end of our Friday webinar today, please give us feedback in that survey as well. We do read those every week and take your feedback very seriously. Also in your email, look for a special Memorial Day offer. We have a great offer out right now. Don't forget, you can always see replays and slides on Society. We would love it if you asked your questions throughout. We definitely want to get to all of your questions. It's very important to us, so please don't hesitate to use the Q&A feature. We're not going to go through the research. Bit by bit as we have in the past. We don't want to spend time rehashing things here, but I did want to make sure since so much came out last week and this week to put together a reference here so that you can get to all of the new information as easily as possible. And also forthcoming is some great work on macro trends that we're excited about. I'm going to hand it over to David shortly to speak about the interesting headlines that he's pulled from this week. And then after he goes through those topics, we will all be jumping out to Society and hearing from the analyst team about several of the amazing topics that came up there. All right, handing it over to David for interesting headlines.

Yep, a lot of great research this week. And some very interesting headlines. The Bloomberg New Constructs Index is still on track to launch in June. Again, it's called the Bloomberg New Constructs True Earnings Index. We're excited. There's actually going to be a family of ETFs that we're going to be launching, and I think we're going to actually hopefully have 2 or 3 concepts, not just the True Earnings Index, but some related stuff as well around that. We're really excited for that to happen. And then there's Nvidia. We talked about Nvidia a couple weeks ago and just how it was priced for fantasy. And I'm really excited to see we got some traction on Twitter and on LinkedIn talking about what our reverse DCF model says. It's really interesting to take a look at Nvidia because this is what we call price for perfection. Most people remember when we looked at Nvidia a few weeks ago, I had created this optimistic scenario. And you can see here that this optimistic scenario in blue, you know, the growth appreciation period or the market applied growth appreciation period has been pushed way out. It's now 41 years. I think the last time we did this, it was maybe 7 or 8 at the optimistic side of things. But optimistic, my friends, is really optimistic here. I think we're looking at a return on invested capital. that gets as high as over 1,000% while also growing revenues at 10.7% compounded annually. Now, what I had to do this week to justify the— what I think the increase in Nvidia, which was like the amount of Intel's entire market cap in just a couple of days. So this week I went back and I modified my neutral scenario. It's actually more optimistic than the optimistic scenario. Don't let that confuse you. But I just modified it and jacked up the revenue growth rates up to 20% for a long, long time just so I could get this curve so steep that we would get to a stock price in a shorter amount of time. Most people like to look at these reverse DCFs, you know, with timeframes no more than 20, maybe 25 years. So you can always do that if you jack up the revenue and margins high enough. And that's what we did here. 18 years. of compounded annual revenue growth of close to 20% and a return on invested capital that gets up over 300% or 10 times higher than what it is today. I can actually tell you the exact number. If we go to the DCF review and we go to the neutral scenario, we can look at the values implied. You can see my 20% revenue growth, 10.4% is consensus. So we, you know, we left that in there, 20% going all the way out. Up to 18 years, that's where we get a price that's at $356 a share. In 19 years, we get $389, which is actually closer to where the price is today. So you could technically take data from this column. And what you'll see is that the return on invested capital gets up over— not 300%, I'm sorry, I was wrong— closer to over 700%. So 20 times higher than what it is today. Return on invested capital, 20 times higher than what it is today while growing revenue at 20% compounded annually for nearly 20 years. If that's not priced for perfection, I don't know what is. In the optimistic scenario, when we go out 41 years, I think we're looking at a return on invested capital that gets up over 1,000%. Yeah, 1,046%. Now, some of you who remember the last time we talked about this model, we We're talking about how the NOPAT margin we had in here was way higher than it had ever been. And you'll also see that the NOPAT margin stays the same. So how does the NOPAT margin stay the same and return on invested capital goes up? Well, that's because we've got some really low conservative expectations around how much capital is going to be needed to grow the business. You can see here we're talking about $1.3 billion in capital. And NOPAT is growing by $20 billion, right? That's our way of being conservative in terms of saying they're not going to need a lot of capital to grow the business. Now, is that realistic? No. But what it does do is make for a best-case scenario, right? And the best-case scenario is here to show you that we're not trying to play with the numbers. We're not trying to like figure out a way to make the revenue growth and NOPAT margins look really high because we're plowing so much capital into the balance sheet and making free cash flow highly negative. No, free cash flow is huge. It's almost the same as NOPAT. Is that probably too optimistic? Absolutely. But I think it only reinforces the point that the expectations baked into the stock price are extremely high. The future financial performance required to justify the current stock price The free cash flow, the return on invested capital, the margins, they're all extremely high. Here again is a look at the margins. We're showing a 45% pretax profit margin. Cash tax rate for this business has always been really low, right? Especially in the last few years. So this is kind of the number that's, that's the big change. And so in both the neutral and optimistic scenarios, we're giving them a credit for getting up to 45%, which is about 33% or 30% higher than what the company's ever done in the past. Best ever number is 35.4, 2019. It's a lot lower now. And anyway, that's again, super high future performance. And even when you put in these super optimistic scenarios, you're getting to really impressive amounts of time over which they have to achieve those super impressive performance numbers. So I think another way of talking about how this stock is priced for perfection. So let's take a look at another stock that I'd love to talk about, and it's an IPO. And I feel pretty strongly about this one because I think the bottom line is that Kava, our forthcoming IPO, is— it reminds me of WeWork. And you guys may remember what happened with WeWork. We put out a report saying WeWork is the most ridiculous IPO of 2019, and that IPO never happened. Now, yeah, the company made it public because it went through via SPAC. That's a way to get through rigorous IPO. It's a backdoor way into getting to be a public company. And I think Wall Street really did that as a favor to SoftBank. The WeWork IPO originally failed in no small part due to the work we showed just about how bad an investment that was. It was a way to rip off unsuspecting investors. And Kava, we don't believe to be very different. This is a business that's highly unprofitable, and it's only going to get more unprofitable. It's burning cash. It actually would be a zombie stock, right? Kyle wrote this up this week. It's out on our site, and you'll see that the business has never been profitable. And, you know, we think the reason they're pushing for this IPO soon is because the business is only going to get worse. Most of what they've been able to do is to fund their growth in stores by buying former Danger Zone pick Zoe's Kitchen, which went out of business— another Danger Zone pick— and they bought those stores, which was a cheap way to get a whole bunch of stores. I think they bought it out of bankruptcy, and that's been a very cheap way for them to grow the business. Well, the management themselves says, we anticipate that our operating expenses will increase substantially in the foreseeable future following the completion of the conversions of the remaining Zoe's Kitchen locations. We expect that the capital requirements to open a new restaurant will be significantly higher. In other words, cash flow burn is getting worse, not better. Now, this would be a zombie stock if it were actually public, and that's because they're burning about $120 million a year and they only got $23 million left as of about a month ago. From that point, they had 2 months of cash, so they're down to about a month left of cash right now unless they shut things down or really reduced executive pay.

Right.

And again, that's where the money goes in these businesses. Your shareholder capital, should this company go public, let me make no bones about it, your shareholder capital will line the pockets of Wall Street bankers and the executives running an unprofitable business. If this company goes public at a $1.5 billion valuation, that is a value transfer from the buyers of these IPO shares to the owners of the company today and the executives and the employees who get paid with that capital because we don't believe this business will ever make money. It's burning cash right now, and it's expected to burn cash more in the future. And a business that is super competitive— look how many businesses are in this fast casual space. This kind of reminds us of Sweetgreen, which is the same thing. They got no chance of being profitable. They're selling lettuce. All right. And they're not profitable, and we don't think they ever will be. And in order for Kava to get to the scale of the more profitable businesses, again, it's going to have to expend a ton of capital. We just don't think it's happening. So, you know, in certain terms, let me say that investors should at all costs avoid this stock. I think an IPO like this is bad for investors. It's bad for the market. It's bad for society because it represents a value transfer from less wealthy to more wealthy people. I guarantee you the Kava CEO, etc. I guarantee you they are not poor people. They're one percenters, probably. Not that being in the one percent is bad. Saying that they're wealthy, all right? And they're going to get more wealthy from this deal, and they're going to do so at the expense of the investors who choose to buy into this IPO. I think you should avoid it in case that's not clear. Now the silver lining here is that not all IPOs are bad. Every now and then. We come across an IPO that actually looks pretty good. I'm going to kick it over to Garrett to talk about Atmos, a company that actually is IPO'd. It's going public today and it's a little bit more interesting than Kava. You want to avoid Kava, you might want to take a good look at Atmos, but I'll let Garrett talk more about that.

Atmos Filtration, they opened today at $19.50. And we have them as very attractive in our system. And I'm just looking at their stock price right now. They're up 15%. So they're getting a pretty nice bump. Before we get to the Atmos slide, you guys hit on Cava. That's gonna be a cavastrophe as I coined and very unattractive in our system.

So Atmos is, is very attractive, even more than, even more attractive than GE Healthcare was. Do you know the last time We had a very attractive IPO in the system. I mean, it's been—

That's the crazy thing that threw me off because I've added a lot of these IPOs to coverage and almost every time it's very unattractive, unattractive. I don't think I've ever added a very attractive IPO. So this is a one-off. So this might be potentially a good investment. Tam, if you want to go to the next slide. I'm definitely not the guy to ask about filtration. Definitely don't know the business inside and out, but I wrote about a little bit in Society this week. Very attractive rating, return on invested capital at 28%. Free cash flow yield looks good and super low expectations. Pretty good sales growth. I think they have a billion in sales. As David alluded to, this is an established business. A 65-year history, presence in 150 countries, lots of employees. So this is a real business that you're looking at, and I did a reverse DCF on it, and in year 1, you can almost make an argument that it should be priced at $30 a share already. These spinoffs, for everyone out there, these might be good businesses, good investments for you guys to all look out. They might be, as I have at the bottom, maybe some buried treasure in plain sight. So instead of focusing on Cava and these hyped up IPOs, might just want to focus on these boring spinoffs.

The food at Atmos is not as good as it is at Cava, I think.

But the stock is okay.

It's a better stock though.

They're a wannabe Chipotle, but I prefer Chipotle. So.

Oh wow, that sounds like an arm wrestling match waiting to happen. Yeah, I had a question about this. Is it a thing to short IPOs, or can you not do that?

You know, I think it would be difficult. I mean, the question, um, is would there be shares you could borrow, right, at the IPO? And I don't know that there would be because they would not be on the market yet.

Okay.

So I don't, yeah, I don't know that you could short. And we're not necessarily looking to give advice about buying or shorting or actual trading. We're just saying, listen, in terms of risk reward, these things look bad and you gotta be careful.

You can always not buy.

Yes.

Correct. Yeah. And a lot of those IPOs that were on Garrett's list a minute ago that were down 70, 80 plus percent, they went up a whole bunch. If you actually look at how far they've fallen from their peak, you're talking 90-plus percent. So they IPO'd and went way up for a while and then came down. I wouldn't be that surprised. Look, I hope Kava never makes it public. As I said before, it's bad, but I would not be surprised if it did go public and it did spike up because Wall Street bankers who underwrite the, the, the deal have a responsibility to the company. And often they make promises they're going to make sure the stock does well. for a while, hopefully for as long as it takes for the original owners to unwind all of their shares. And that happens, and that's happened before, but that doesn't mean that there's no risk. Just like with Nvidia, just because it's been going up doesn't mean there isn't more risk in the stock. So be careful. Stephen makes a good point. Filters eat dirt.

I love that.

Anything else, Garrett, that you want to add out there before we head off to Johnson Johnson?

No, you're all, you're all set to move on. Yeah, thanks, Tim.

Thank you. I'm gonna make sure that this is big enough. I think so. So there's several things that we wanted to make sure to go through on society. I know that Lee wanted to touch on the Johnson Johnson, Microsoft, Was it J&J? Yeah.

I think we're not the only people in America or the world talking about the credit ceiling debate in Congress. I know also that Fitch noted earlier this week that they put US Treasuries on watch and that Johnson Johnson and Microsoft bonds have a lower yield than US Treasuries do right now. I think I'm more interested in what the market has to say here than what Fitch has to say or others. It's an interesting conversation. We'll see what happens through the Memorial Day weekend. I think we got very little time to get this figured out. And I would transition that too into the next question. I think we had a question about when, when to get in, when to get out, and if we can predict what, when, and for how long. Yeah, I mean, the answer there is, is a little bit like the answer that the market's given us about Treasuries is that it's really all about risk reward. We don't have a crystal ball and we can't predict what people are going to do, but what we can do is position ourselves in a way that we feel like in aggregate, we're going to make the right decisions. We've got these model portfolios that Kyle and David run, and sometimes we get it right and sometimes we get it wrong, but what you can do is try to guarantee that you're right more of the time and that you protect yourselves from big blowups. So it's impossible for us to predict what's going to happen either with the credit ceiling debate or, or with individual stocks. Timing is difficult, if not impossible. It's driven by human behavior. And so what we want to do is try to balance and manage risk and reward, and that's the best we can do. It's a good question, Jerry, and I wish I knew the answer to it as well. I wish we had a crystal ball, but we don't.

We'd have that new constructs. Yeah.

We'll let you know when it starts working.

That's right.

First to know.

Excellent. Anything else that you wanted to make sure to cover, Lee?

No, that's all on my list.

Okay, okay, great. Then I'm gonna hand this over to Cody. Cody, do you want to drive, or do you want me to move to Albertson's?

I think I will. Take over so I can go out to a model.

Awesome. And folks, please do ask questions as we go through this. We're at almost 9:30 now, so I know we have a lot to cover, but we definitely want to make sure that we're making time for your questions. That's very important to us.

Okay, can everyone see the screen that I have up for the Albertsons forecast?

Should make it bigger.

Okay, great. Yeah, so on society recently, we got a great Question from Roger Green about Albertsons. Albertsons is being acquired by Kroger. The acquisition price is a good bit higher than where the company's trading at right now. It's a unique acquisition in the sense that there was an acquisition price that included a special dividend that has since been paid. And now there's a good bit more upside if the acquisition goes through, but there's lingering questions about if this is going to be able to go through. Albertsons and Kroger are both very large grocery stores, so there's competitive questions there about if this could get blocked. But the question that Roger had is maybe this works in both scenarios because Albertsons looks like it could be a good company just on its own. So it might not be a bad holding if the acquisition gets blocked, and it would be a great holding if they're just going to get acquired here in a little bit at a much higher price. And looking into this, I did a little analysis on it and felt that I actually agreed with Roger. Full disclosure, I took a long position in this company just a few days ago. I want to go through the reverse DCF here. And explain why I think this could be a good opportunity. To start off with, I wanted to get a sense of where the business is currently at and what this could look like in a worst-case scenario. Albertsons, pretty much all grocery stores, is a business that is heavily driven by margins, super low-margin business. So going from a 2% to 3% margin is huge, and going from a 2% to 1% is huge in the other way. So we can see in the historicals here that Albertsons, like a lot of grocery stores, got a bump in margins during the pandemic. They've been able to hang on to some of that here lately, which makes them look— if you jump over to the decision page— really undervalued. The year 1 stock price implied here is $53, and it currently trades at $19.93. So pretty big discrepancy there. I think the question is, what could this look like if the company saw their margins come down to be what they were looking like pre-pandemic, or maybe even something that was lower than their pre-pandemic? And that I've captured In the neutral scenario here, this is kind of the pre-pandemic level, and then the pessimistic scenario here represents something that is 50 basis points lower than where they were pre-pandemic. So we jump over to the decision page. I'll pull up the neutral and the pessimistic. You can see in the pessimistic scenario, you got your gap year out here in 2038. Not ideal, but that's kind of a worst case. Even in a neutral scenario where you're budgeting a margin to come down a good bit from where it is today, you've got a gap year of 3 there. So I think even as a standalone business, Albertsons might not be tremendously exciting, but it doesn't look like a company that's going to blow up your portfolio in any way, looks very undervalued from this perspective. So I think having that along with the upside of them being acquired is an interesting opportunity. And it's really the reverse DCF here that gives me the confidence to take a shot on a company that I don't know the probability exactly of this acquisition going through, but since I can model this stuff out, I feel okay because I know even if it's a standalone business, it's not something I hate to own.

Cody, what's the proposed acquisition price? How much higher is that than the—

Yeah, I have it. It's— Roger did a great job. Let me share this tab of laying out the structure of the deal. So it was an offer at $34.10 per share, which included a special dividend of $6.85 that already got paid. So if you're getting it at this point, you're not going to get that $6.85, but you're going to kind of get the difference between those 2 numbers, which I wrote up as being— let's see, where'd it go? Yeah, $27.25 would be the difference, which at the time that I was writing up this comment was 34% upside from where the stock was trading at. So the thing that was really interesting to me is that the stock's really not trading at that much of a premium than where it was before the announcement of the acquisition. So usually you don't get the opportunity to learn something new about a company and, and then get into it at the same price. Normally, once the news is out, you're too late. But maybe that's the market saying that they don't think that this, this is going to go through. But once again, this is a holding that could work out either way.

It's like a cheap stock with a free option on the acquisition.

Exactly.

Yeah, I was about to say the same thing. Maybe the cost here is the opportunity cost. It looks like the merger is not likely to complete until 2024, so you may just have to wait a little while.

Yeah, I would— I'll take 34% in 2024 if that's— if all I gotta do is wait.

Yeah, yeah. No, there's— there are many worse options out there.

Yeah, there's a question about historical ratings. So when we get back to the New Constructs website, if we could go into historical ratings to look at those as well.

Yeah, that's— there is definitely historical ratings at the institutional level.

At the ratings breakdown?

Yes, on that page. Yes. So on the ratings page, Click ratings, stocks, whatever sectors here, ratings. And if you come down to here, you'll see the, the how the stocks performed, rating history here. And there's a button here. You click that, will give you the day by day of the date, the rating, and the price. So you can chart that pretty easily. If you want to chart that at scale, that's a different kind of arrangement. If you want a lot of data across a lot of companies, we'd need to execute a trial data licensing agreement. That's what we do with our quant clients. And that's an altogether different price point. Institutional is $3,600 a month, but quants are paying us closer to $10,000 a month for the ability to systematically trade and extract alpha with our data. It's the alpha that you've seen in the Harvard Business School and MIT Sloan papers, and then all of the other papers that we talk about on this page, the earnings distortion, the new value factor. But this is the path you go in order to get data to take advantage of what is a proven superior measure of earnings. All right. Back on track, Cody. Back to you on the next, next topic.

Excess cash. Jeff's question.

So excess cash. We saw this question because we did a quick check for listening devices in the office because we'd actually just had this conversation really around— I don't remember what the— what originally precipitated the conversation. But it was the difficulty of getting excess cash right. And then how we want to avoid changes in excess cash affecting free cash flow and how excess cash is an important adjustment, very important, but it's very difficult to apply to companies that have radically changing levels of profitability, radically changing levels of cash. Cody, I'll let you take over from here. There's a lot of great content here.

Yeah, I think the initial question was a great one, just trying to get at our methodology of how are we calculating excess cash, what's really going into that. And David touched on it a little bit there where what we're really trying to do is look at the level of profitability that the company's been at historically in their recent history and use that to figure out, okay, how much cash is it going to take for them to run this business? We've got to put some cash into invested capital because if you're constantly losing money, at some point you're going to be funding this business with that cash. So there's different thresholds that companies can hit. And generally speaking, our excess cash methodology does a great job of Factoring in a lot of different situations that could happen bouncing around between profitability or profitable and unprofitable.

Should we take a second, Cody, to talk about even what excess cash is? Because not everybody even may know what that means.

Sure. Yeah. I mean, just as it relates to required cash and total cash. Yeah.

I'll jump in real fast if you don't mind, Cody. So we're measuring return on invested capital. What we're looking to understand is how much profit the company generates relative to how much capital's gone into the business. And so, you know, we've got a definition of return on invested capital right here. Everybody ever wants to know it, multiple definitions. And so looking at average invested capital, it's a proxy for the balance sheet. Well, if you're a super profitable company, say an Apple or Microsoft, you've made a ton of money. And over time that money's accumulated into a huge cash balance on the balance sheet. And so measuring the profits relative to the cash flow that you've generated in the past maybe doesn't make a lot of sense. So we only want to hold in the denominator and the measure of return on invested capital, that amount of cash required to generate new cash flow, not the cash flow that's been generated in the past. Another way of putting it is we want to hold the amount of cash in the invested capital that's needed to run the business. You don't need the past cash flows to run the business. So we pull that out, we call it excess cash so that our return on invested capital gives us a better proxy for what the incremental return might be. And so that's excess cash. It's funny though, with a super unprofitable IPO, probably going to keep all the cash on the balance sheet in our invested capital in that situation because they're losing money and they're probably going to burn it all and they're going to need that. And as long as a company's burning capital, we don't give them a lot of excess cash or any. And so it's a tricky thing. As you can imagine, if you looked at a lot of companies, the number of scenarios around making money, losing money is infinite. So trying to get the excess cash right for all these edge cases, Can be tough. I think our methodology is best in the business. And again, if you ever want to change what it is we're doing with respect to excess cash, that's something you can very easily do. And if you were to go to the financials and go to invested capital, you could see how much exactly excess cash is in there. And if you wanted to change excess cash, all you got to do is go to the—

Okay.

Overrides page and say, okay, I got $12 billion in excess cash. Why don't I take— add that back? So that's going to give me now $34 billion roughly in invested capital and $33 billion in average invested capital. You'd save that off and you'd see a radically lower return on invested capital. We'll stop there, Cody. I'll let you come back to this topic if you want on next week.

No, I think that's last minute, Cody. You get the last minute before we go on to stock picks.

Okay. I think, David, what you just showed there is, is great. That's effectively what I was going to do is just demonstrate that we have the ability to use those overrides to test different assumptions and unique instances, Airbnb. Where they were unprofitable, but they had a crazy amount of cash on the balance sheet. And when that bounces in and out of invested capital, you're going to get some kind of wild free cash flow values. But generally speaking, the methodology works great across a ton of companies. And when it does produce some, maybe some weird results, we've got the modeling tools to make those adjustments.

Yeah, I wanted to throw in there that for most companies, it's 5% of revenue that we use for required cash, and the rest is excess. So we do have those other thresholds, but generally speaking, they're 5%. And we go out of our way to try to only change it in cases where we're certain that a change is happening. So like you said, Cody, it can change. We try not to let it change. It is true that it can sort of overwhelm the free cash flow calculation. When that happens, we try to make that not happen. But we also want to reflect the realities of the changing profitability of businesses over time.

It's a tough one. Kind of darned if you do, darned if you don't. If you make adjustments, you got to deal with the fact that companies can change pretty radically overnight in certain ways. So that's the challenge with a large-scale modeling platform like what we have, and we're very aware of it. I think we do about as good a job as anybody in the world at managing that.

All right, let's hand it over to Kyle for our last 90 seconds for some Stock Picks. Interesting stuff happening these days, Kyle.

Yeah, these are updated with the closes as of yesterday. Just touch on a few, but the big move today was actually a zombie stock, Tilray, ticker TLRY, down I think 21% right now, just today. Um, but the 2 I put together here was Express down 21% over the past week compared to S&P down 1%. It's down 77% since our original report, or which time the S&P was flat. This was once a meme stock, which doesn't seem like that long ago that these were trading at huge valuations, but it's since come way down. You can see the year to date there, almost 29%.

Down another 9% today.

Yep. Even, even falling further. I wanted to point that one out on the short slash danger zone side. And if you go to the next one, the long side, looking at Tyson, it was actually up 4% over the past week versus the S&P down 1%. I pulled up the 5-day chart there. Tyson over the past week has done well, um, and was a recent addition to our focus list long— on the long side. It's already seeing some good performance on a new addition there. And then I think If you want to get more on the focus list, short, long, and zombie stocks, there's actually some live indices you can go check out at these links once Tim posts the slides and everything, and they can track all of these portfolios day to day.

Yeah, and I wanted to note that those focus lists are ones that we actively curate, so that's got Kyle looking and David looking at those on a regular basis.

Excellent.

Thank you very much.

Have a great weekend.

Take care, everybody.

Bye-bye.