Blue Duck Capital

Avid Technology provides software and integrated hardware products for film and music editing. Their platform is the “industry standard”. I checked in with a friend who is a director and producer for the “Last Chance U” and “Cheer” franchises which are Netflix originals (and very good) and he said “whenever I am hiring an editor and I tell them that we don’t use Avid they always roll their eyes”.

I spoke to Clear Channel Outdoor (CCO) this week and came away feeling better about their structural position in the advertising space. I think a lot of investors have viewed outdoor as a structural loser – but the category has just 5-6% of global spend – a number that if anything could actually be more likely to grow than decline at this point.

I continue to be fascinated with the breakdown in consumer’s trust of the mainstream media. The relevance from an investment perspective is that as trust plumbs new lows almost daily, media stocks stand at or near all-time highs and command valuations which don’t jibe with fundamentals.

At this point in the reopening trade we’re looking for names that are a little less obvious than say theaters or OTAs. GPRO is one of the less obvious names. It’s made a nice move this past week – so might wait for a pull-back. But Around $10 / share, the R/R is still attractive with $1.50 or so down vs $7 up. Our bull case may be conservative too as we are not considering a substantial re-rate on the back of traction with their subscription product or soon to be launched app.

Checking in on the bets we have grouped by theme. I like doing this after crazy weeks to make sure that
the bets still make sense and jive with our view of the world. There’s nothing worse than having
positions that don’t sync with one’s world view. This exercise helps to stay on schedule. This week I’m
updating on our two largest thematic bets right now.