OBEBLD 9½ 04/15/30

Oldcastle BuildingEnvelope Inc

Credit, Industrial/Transportation


Publicly traded companies mentioned herein: CRH PLC (CRH LN)

Highlights

The presenter is long Oldcastle BuildingEnvelope’s 9.5% senior notes due in 2030 that are trading at 84 for a 13% YTW. OBE is the North American leader in architectural glass and architectural glass hardware. Architectural glass is coated glass that can be found on building exteriors and also interiors where it is used for shower glass. The company not only markets a range of glass solutions, but it also markets and distributes the hardware and parts utilized in those systems. OBE is 65% exposed to non-residential and commercial spend, with the balance ~25% single-family residential, albeit almost entirely repair and renovation (R&R) associated with shower remodels; the profit split is ~50% glass manufacturing and ~50% hardware distribution. Over the next 12 months, he sees a path to make a 20%+ IRR using a normalized CCC spread (~750bps) based on strong demand, deleveraging opportunities, defensibility through the cycle, and an intriguing ownership structure.

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Idea Discussion

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