Revealing My New Largest Stock Position

So, over the past few weeks, I have made a couple of videos discussing why I am trimming down my Brookfield allocation in my portfolio. And after I have trimmed down Brookfield, it is no longer the largest position in my portfolio. And since then, I have been asked a lot about what is the new largest position in my portfolio. And I have shared it a couple of times on X. And it's a business that I cover extensively over in my Patreon community. So, I have been asked by a lot of people to make a video on my largest position.

Now, this is a stock that I have never talked about on my channel before despite me owning the stock for over a year. And there's two main reasons for that. The first one is this is an Australian midcap company and I didn't think that it would interest a lot of people. And the second reason is because you can only buy this stock on Interactive Brokers because it trades on the Australian stock exchange. So, if you have a Robin Hood account, you can't buy it. If you have a Quest Trade or Wealth Simple account, you don't have access to it. You really only have access on Interactive Brokers, which is also why I have been saying that Interactive Brokers is my favorite brokerage because they give you access to international companies like this one. So, since it's an Australian company and I didn't think people would be interested in it and I also didn't think a lot of people could probably even buy it, that's why I just really haven't talked about it that much. But, since there has been a lot of interest in my new largest position and this business in specific, I wanted to make a video on it.

So, with that being said, I won't keep you waiting. And the stock is Tasmea with a ticker symbol TA. AX. The ticker symbol is really just T.A.X. And surprisingly, despite the stock being up over 100% over the past year and hitting fresh all-time highs, I still think it is undervalued, which I will explain in this video. And I have actually been buying a lot of it in the $7.50 range to about $8. I know it sounds crazy and I know a lot of people don't like buying when stocks are up and near all-time highs, but I genuinely believe that this business is still offering value when I look at all of the metrics, the price ratios and what I think this business could grow into in the future. So, this video is going to be a summary of my investment thesis and introducing you to the stock and why I decided to buy it over a year ago and why I'm continuing to buy it in the market today.

But I also want to let you know that I do have an overhour long deep dive stock analysis on this business over in my investment course. And the reason I'm bringing that up now specifically is because I am currently running a 40% off sale on my investment course that ends tomorrow at midnight. If you've been following my channel, you know that I do not do sales often. I only do two per year and right now is one of them. So, if you have been thinking about getting access to my investment course, then there's no better time than right now and don't wait because the sale will be ending tomorrow night.

Now, very quickly, my investment course has over 30 hours of content that dives into my entire investment strategy, how I analyze businesses, how I think about stock market volatility, and view it as opportunity. So, if you're someone who's looking to level up your investing, learn fundamental analysis, and also learn how to view stock market volatility as opportunity, then this course is for you. One last thing is that I do offer a 14-day money back guarantee, no questions asked. So, if you are interested in purchasing my course and getting 40% off and just checking it out, watching a few videos, but then you decide that it's not for you, that's no problem. Just shoot me an email and I'll give you a full refund within 14 days. Hundreds of people have already purchased it and the reviews have been incredible. So, I'm pretty confident that you will enjoy it and find value in it.

But with that being said, let's now hop into the video and let's start off by discussing what Tasmea's business actually does. Historically, Tasmea has been the company that mining businesses call to maintain, repair, and upgrade the massive equipment that runs their operations. Things like processing plants, electrical systems, and pipelines. Rather than employing thousands of electricians and mechanics themselves, these mining companies outsource that work to Tasmea, which provides skilled crews on a contract basis, generating steady recurring revenues from essential maintenance that has to happen regardless of what commodity prices and what the commodity cycle is doing. So, Tasa's main business historically again has been maintaining critical plants and infrastructure for mining businesses in Australia. You can think about this like an oil and gas plant, if you've ever worked in that industry, how an oil and gas facility will need to do a massive shutdown where they shut down the facility entirely for about a month to 6 weeks and then a bunch of contracting crews come in to do all of the critical maintenance that needs to happen while the plant is shut down. Now, the reason that the oil and gas company in this scenario doesn't hire their own internal workforce is because they need a lot of manpower, a lot of labor for about a month to 6 weeks out of the year. So, it doesn't make sense for them to hire a bunch of people for 6 weeks and then have to lay them all off or to keep these people on payroll for the entire year. That's where Tasmea comes in. They are the company that provides this critical work to these businesses that doesn't necessarily make sense for them to do on their own or have the workforce to do on their own. Tasmea's business is basically going from customer to customer to customer with their massive workforce to do this critical and necessary work for their customers. So Tasmea wins, the customer wins, and everyone is happy. That is what their legacy business has been and they're still doing it.

But Tasmania has also been acquiring their way into new high-growth industries because Australia is going through what I call an electrification revolution. Australia is investing massively into electrifying their grid, expanding their grid, and relying more on electrical power. They're also investing in batteries. And Tasmania has been acquiring electrical businesses that are exposed to this upgrading of Australia's electric infrastructure. Additionally, the recent massive spike that Tasmea has had on their stock, if you look at it over the past month, that spike was because Tasmea also just acquired one of Australia's main leading companies that is building out data centers. Australia is a few years behind the United States in terms of the data center buildout. So all of the craziness that we've seen in the United States with companies like Fix, IEC, PWR, all of those companies building data centers, that is now starting to happen over in Australia because Australia's data center sector is projected to boom. Google, Microsoft, Amazon have tens of billions of dollars of commitments for data center buildout in Australia. And again, Tasmea just acquired one of the leading companies in this industry. and there's only three main players. So now Tasmeia is one of the three main players for the data center buildout in Australia. And again, that is why the stock just saw a massive bump. And after that acquisition, I actually still think that the stock is looking quite undervalued. So that's what Tesa does. I think that they're a very awesome company. They're founder. Their management team is heavily incentivized with the business. They own 60% of the company. It's just been an incredible business that continues to find new ways to grow and has very strong recurring cash flows and earnings.

So now let's dive into some of the screenshots that I have taken throughout my years of owning this business. And I want to show you more about the investment thesis. So the way to really understand Tasmea's business now is that they own 27 different operating companies and applies a decentralized business model. So the founders and upper management have a central office, but they let all of these different companies operate on their own. And many of these companies are also still founderled. This is Tasa's acquisition strategy that you're looking at right here. And they operate in four critical industries again, electrical, mechanical, civil, water, and fluid. The electrical one is the one that I personally am the most bullish on because that is where the data center business is and also the electrical revolution that Australia is seeing.

This next screenshot highlights the company's organic and acquisition growth strategy. So on an organic basis, they're actually projecting to grow by 15% per year and they have beaten this historically. I believe last year they grew something like 30% organically in terms of EBIT and over the long term they are expecting to continue being able to grow by 15% annually. However, the growth of the business is further accelerated by their acquisition strategy and they like to buy businesses that have a maintenance bias with that recurring cash flows and revenues coming in and they like to buy the number one or number two operator in their geographic region. And then they also say that they acquire businesses at fair market value and they do not overpay. And as someone who has now held this stock and been following it pretty much religiously over the past year or so, I can confirm that they pay very fair prices for businesses. In fact, I think that they they almost get too good of prices on businesses. And what I have noticed with Tasmea since they did their IPO in 2024 is every single time that they acquire a business, it is immediately earnings per share accretive. So on day one, it is already creating shareholder value, which derisks the investment and the acquisition and also suggests and proves that they're getting very attractive prices on their acquisitions. For example, the recent acquisition that they just did of the Maxim group, that's the data center company. On day one, it is projected to be 31% earnings per share accretive. And Maxim has been growing by 70% per year over the past couple of years. while the data center industry is seeing so much growth and momentum in Australia. So they paid a very low price 31% earnings per share growth through the acquisition on day one and that business is seeing tremendous amounts of growth. So somehow they're able to find these companies and convince their founders that you know they this is the price that we should pay for your business and they've done a very good job creating shareholder value through acquisitions.

Now typically the businesses that they acquire also have complimentary services that their existing customers want. So basically Tasmania can acquire a specialist company in one area of the country then offer those services to their customers across the country. Cross-selling these services is one way the company achieves such strong organic growth once a company is acquired. Additionally, now that they have built so many different services, customers prefer going to Tasmeia to have a single point of contact for all of their maintenance needs. And this is causing Tasmeia to win even more work and get more of their customers wallet share.

So now let's talk about the fundamental growth of this business. And since fiscal year 2021, they have compounded revenue by 34% annually. And 2026 is projected to be another massive year. This next slide shows us that the pro- forma EBIT has compounded by 34% per year since 2021. Pro-forma earnings have compounded by 34% as well. Statutory EBIT at 45% and statutory net profit after tax at 49%. Again, this is the earnings metric. Now, the Proforma number is the best metric to use when analyzing TASMA in my opinion because they're always acquiring businesses. And what the proforma number is is how much revenue earnings EBIT the company would have produced if it owned all of its acquired businesses for the entire year. So when I'm analyzing Tasmea I am looking at the proforma numbers because I think it is the most accurate reflection as to what the business today is producing or in other words when I am buying the stock today the proforma number is the best reflection of the business that I am actually buying. So again, I would focus on the proforma numbers and the proforma numbers have been compounding again by 34% per year since 2021.

Now this next screenshot was their previous guidance for 2026 and we can see that they were projecting to grow their EBIT by 57% again in 2026 and they were projecting to grow their earnings by 37%. So in their fiscal year 2026, which ends at the end of this month, by the way, that's very important to keep note of. But they were still projecting to have another massive year of over 50% EBIT growth and again nearly 40% earnings growth this year. Yeah, they're doing an incredible job growing the business to say the least.

So now let's talk more about the Maxim acquisition and again this is the data center acquisition that they just recently did. So here this says Maxim Group is a leading electrical specialist contractor serving Victorian data centers battery energy storage and infrastructure markets underpinned by long-term customer relationships and multi-year visible pipeline. And then they say that Maxim has high exposure to the Australian data center buildout and they have a long-term contracted pipeline with strong visibility. For example, Maxim has their full year revenue for fiscal year 2027 already secured. It's 100% secured. Then they have 85% of their fiscal year 2028 revenue already secured as well. So Tasmeia nearly had 100% guaranteed insight into how much revenue and cash flows Maxim's business is going to produce next year and in fiscal year 2028. Then we can see in this next box that Tasmea said immediately earnings per share accretive with 31% forecast proforma EPS accretion based on fiscal year 2026 excluding any synergies. Maximum Group has delivered organic revenue growth of roughly 70% per year from 2024 to 2026. Tasmea paid an enterprise value to EBIT multiple of 5.4x and Maxim has strong organic growth expected under Tasmea's ownership. Then lastly, Tasmea wrote that Tasmea's electrical division is one of the largest electrical contractors on the Australian stock exchange now. So for investors who are looking for exposure to the electrification of Australia's economy, Tasmea is actually now one of the best options in the public stock market because they are one of the businesses producing the most amount of EBIT again on the Australian stock exchange.

This next screenshot shows us Tasmeia's new updated guidance for their fiscal year 2026 after the maximum acquisition. And Tasamea is now guiding for $175 million in ProForma EBIT, $107 million in Proforma earnings, and again 39 cents per share in earnings per share. And again, this is as if they owned all of their acquired companies for the full year of 2026. So to me, once again, this is the best representation of the business as it stands right now and what I am actually paying for today.

This next screenshot shows a table of Tasmeia's historical pro- forma numbers. And we can see that Tasmeia did $62.5 million in pro- former earnings for the fiscal year of 2025. And as we just saw, they're now at $17 million of pro- former earnings based on their fiscal year 2026, which again ends in about 18 days. This means that Tasmea's pro- former earnings are up about $71.2% this year. So after the maximum acquisition, their earnings have grown by over 70% in 2026. That is absolutely ridiculous. In the table, you can also see that the company's margins have continually expanded over the years. And this is one of the focuses on management is to get the profit margins as high as possible.

This next slide shows us about the data center market in Australia. And you can see that it is expected to grow at 21% annually all the way out to 2030. And Australia is projected to build about 3.9 gawatts of data center capacity by 2030. And again, Tasmea now has access and exposure to this growing industry.

Now, one of the main reasons why I like TASMA so much, why it became one of the largest positions in my portfolio, and also why I had so much conviction on this business is because of the insider alignment. As I briefly said earlier, insiders own about 60% of the company shares. They have also never sold a single share. Not a single insider has ever sold a single share and they are continually buying more on the open market. So think about that. These guys own 60% of the company. They have never sold a share and they are actively buying in the open market and they're constantly reinvesting their dividends as well. Even after their escrow period and their share lockup ended, there was no selling. So, they have a ton of skin in the game and they show that they are extremely bullish on the long term of their business.

Now, quickly talking about the TAM, the mining support services industry is projected to be worth about 18.3 billion and has over 1,700 businesses. And the reason why I wanted to point this out is because, as we saw earlier, Tasmea has about 27 business units right now. So, there's over 1,700 firms and businesses left in that one industry. So I think that there's a long runway for them to continue acquiring and growing the business. Also, data centers have a 9 gawatt pipeline in Australia over the coming decades. Batteries have a 33 gawatt pipeline and batteries grew 62% year-over-year in Australia. And again, Tasmania operates in all of these industries. Now, these are very high growth industries and Tasmania is one of the leaders in all of them.

This next slide is one that Tasmeia themselves made in one of their recent investor presentations. when the stock was in a correction. And I believe that this is a very intelligent slide to put out to the public because it explains the thesis very very cleanly and simply. So what this slide is doing is comparing Tasmeia's price and main metrics and growth rates versus all of their competitors in Australia. And here we can see in the first chart that Tasmea's EBIT's margin was 13.6% at the time of producing this slide. Its EBIT's compounded annual growth rate since fiscal year 2021 was 42% which is the best once again. Its earnings per share compounded annual growth rate was 46.8% which again was the best in their peer group. However, the company was trading for the lowest price to earnings ratio of only 15.5. And this is really when I was buying a lot of Tasmania shares and I was really making it one of the largest positions in my portfolio because I was seeing the same thing before the management put out this slide. This is what I was also telling my Patreon community. Tasmea had the highest margins. It was growing the fastest and it was trading for the cheapest price multiple out of all of its peers. And the thesis basically was that this would not last forever. eventually the market would catch on to this business and arguably Tasmania should actually trade for a premium to its peers since it is the most profitable and the fastest growing company. So that's really when I built out my position a lot and now the stock has more than doubled and it has produced the largest returns I have ever had in the stock market and the position has organically grown into a very large position in my portfolio.

So now let's go over to stock unlock quickly and I want to talk about Tasmea's valuation and ultimately why I think that the stock surprisingly is still looking not overvalued today and I would say that it's actually still below fair value. So here we can see that the stock is trading for $859 based on the last close and as we saw earlier on in the video TASMA is projecting about 39 in earnings per share for their fiscal year 2026 which ends at the end of this month. So this 39 cents in earnings per share figure right here is almost a trailing 12 months metric right now. In 18 days it will be a trailing 12 months metric. This means that Tasmea is trading for about 22 times trailing 12 months earnings per share right now in the market. I don't think that this is a very expensive price multiple for a business that has such a strong management team with such a great track record of execution, acquiring businesses, growing the business, creating shareholder value, and the business has also been consistently growing by over 30% per year since 2021. And they have a 15% organic growth guidance. So, in the worst case scenario, in my opinion, this is a business that's trading for about 22 times earnings with 15% organic growth. In the best case scenario, they'll continue acquiring companies, seeing very strong growth, and probably growing by over 20% per year. That is my realistic scenario based on the company's history and based on their acquisition history. Again, I know it's trading for all-time highs. I know the stock chart looks like, you know, this thing must be overvalued, but all logic is telling me that it still looks cheap. It's only trading for about 22 times earnings with so much execution and insider alignment.

Now, additionally, Tasmeia is projecting about 15% annual organic growth and they're about to release their fiscal year 2027 guidance within the next couple of weeks. That is what they have put out to the market. So on the low end, if they do no acquisitions next year and they hit that 15% earnings per share growth target, then the stock or their guidance for next year would be about 45 in earnings per share. So if we take the share price once again and we divide it by 45, then we get a forward price to earnings ratio of only 19.1. I think that this is like the low bare estimate for their earnings per share guidance for next year since 15% annual growth is their low-end organic growth guidance with no acquisitions factored in. Maximum, the business they just acquired, is also growing at 70% per year. So personally, I think that Tasmeia could post at least 20% earnings per share growth guidance for fiscal year 2027, which would mean about 47 in earnings per share that they're about to report. So if we take the share price of $859 here and we divide it by47, which would be another 20% growth year, then their forward PE is about 18.3. I don't think that this is insane. I think that this is a very very fair multiple for this business and I feel like the video is getting a little bit long right now, but Tasmea's competitors also trade for forward PE multiples of well above 20 and even into 25. So when I compare Tasmea to its competitors, the stock still does look cheap in my opinion, but there's also an argument that you can make that maybe their competitors are expensive and overvalued. And I can actually buy into that argument. So then in that scenario, I would just look at Tasmea on its own. And again, this is a business that has consistently grown by over 30% per year. They're going to have a 70% growth year in fiscal year 2026. They're probably going to grow by over 20% again next year. And it's trading for forward PE of anywhere from 18 to 19 right now. That is not very expensive in my opinion. I think that this is a very fair price for such a high quality compounding business. And I think this is also why the insiders haven't sold a single share is because they also think that the stock is very cheap and just unloved in the market which is crazy to say. I know the stock is up over 100% since I started buying it and you know 100% since uh February of this year but I think it was ridiculously undervalued before and now I think that it is approaching more fair value but still undervalued. And the reason why the stock jumped so much just over the past month is again because they acquired Maxim. Maxim is providing 31% earnings per share growth. And what's funny is Tasmeia's stock jumped about 15% on the acquisition news. But when you think about it, a 15% stock price jump versus 31% earnings per share growth actually means the multiple compressed. All right, that's how the math works. I know again I know people don't like buying stocks when they're going up but after the acquisition the stock was up but it was actually cheaper. The price multiple compressed and it is still compressed. That's why I have continued to buy. That's why I bought a lot after the acquisition was announced because right after the acquisition I was like this thing's trading for like 17 times earnings because the acquisition created so much shareholder value. So, I bought a lot be like the day that acquisition was announced. And uh yeah, it's it's the largest position in my portfolio. I think it's going to continue to compound for years. And I think it's a great little company. And that's why I made it the largest position in my portfolio. And it has done very very well for me. Um as I said, it's produced the largest returns I've had in the stock market now by far. It has really been a winner. I think it will continue to be a winner. And it's pretty much due to this one stock that my portfolio continues to outperform the S&P 500, which I'm very happy to say is happening once again, especially after the acquisition announcement. But that's basically the TLDDR on Tasmea. I feel like this video is getting a little bit too long already. I could talk about Tasmea all day. I think it is such a good little business with such a great founding management team that has proven themselves and proven that they truly believe in the business. And again, as I said, they continue to buy more in the market still.

Now, as I said near the beginning of the video, you can only buy this stock on Interactive Brokers. So, I will leave a link in the description. It is an affiliate link. I am an affiliate with Interactive Brokers, but I genuinely use them because they give me access to stocks like Tasmea and they're pretty much the only brokerage where you can get access to stocks like this. So, again, I'll leave a link in the description to Interactive Brokers. It is an affiliate link. And the last thing that I need to remind you of before we wrap up this video is that my investment course sale is ending tomorrow at midnight. I'll leave a link in the description to that as well if you want to go and check it out and get 40% off my 30hour plus long investment course that dives into my investment strategy and again also has the over hourong deep dive video that I did on Tasmea when I first purchased this business because I put that video in my course as well. So, if you want to see that video and get access to my course at 40% off, click the link in the description as well. And don't wait because that sale is ending tomorrow.

But with all that being said, that's going to wrap up today's video. So, as always, thank you so much for tuning in. I truly do appreciate it and I hope to see you again in my next.