Playboy Hits All-time High; Grab Goes Public; And A Possible New Rule For Warrants

This week has been an interesting one for SPACs as we got some big announcements, SEC commentary, and saw Playboy Group Inc. (Nasdaq: PLBY) reach all-time highs after being added to Hedgeye’s best idea list.

Merging with a SPAC in October 2020 and trading under the symbol PLBY this past February, the stock price is up more than 300%. Hedgeye sees massive upside, projecting Playboy Enterprises could be a $10 billion company from its current $1.5 billion market cap.

Realizing that it had to be more than a magazine, the company is in the midst of a major transformation as they make the brand more relevant to younger consumers; operating in the sexual wellness, style & apparel, and the beauty & grooming markets could help them continue to grow.

Playboy now even has a real-money casino game on Android.

This Week’s Major Deal

We also saw some major deals announced this week including one I want to focus on: Altimeter Growth Corp. (Nasdaq: AGC).

As I’ve talked about in the past, I always like to keep an eye out for great management, and the team behind Altimeter is second to none, being part of both the Roblox Corp. (NYSE: RBLX) and Stripe deals that valued these companies at double-digit billions.

This time Altimeter is bringing SoftBank Group Corp. (OTCMKTS: SFTBY) -backed Grab public in a deal that could value this giant at $40 billion. Grab is the #1 Superapp in Southeast Asia’s offering ride-hailing, deliveries, and financial services with its digital wallet, GrabPay Card, and even loans and investments through its partners.

What I really like about this market is that Southeast Asia is still in the early innings of online disruption.

The penetration rate for food delivery is roughly half that of the U.S. and its electronic transaction volume is only 17% versus the US at 82%. Grab is a category leader and is projected to grow on average 40% a year through 2023. On top of that, they are also a profitable business.

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