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Russian (RU) Ricardo Pillai
Mon, Jun 9, 2025, 6:30 AM 3 min read
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We came across a bullish thesis on Mativ Holdings, Inc. (MATV) on Value Degen’s Substack. In this article, we will summarize the bulls’ thesis on MATV. Mativ Holdings, Inc. (MATV)'s share was trading at $6.53 as of 3rd June. MATV’s forward P/E was 11.65 according to Yahoo Finance.
An aerial view of a factory specializing in the production of raw materials.
Magnera (MAGN), the newly formed entity resulting from the merger of Glatfelter and a Berry Global subsidiary, stands as a potentially undervalued industrial player, albeit with limited operating history. With just one quarter of combined results available post-merger, investors are working with sparse data, but early signals are intriguing.
The company’s trailing twelve-month EBITDA sits at $228 million against $156 million in annual interest expense—an elevated burden at first glance. However, management has issued full-year 2025 guidance of $360 million in adjusted EBITDA, which, if realized, would reduce the interest coverage ratio to a more comfortable 2.3x, the strongest among its small-cap peers like RYAM and MATV. That forward estimate, along with anticipated post-merger cost savings, introduces a degree of upside optionality not yet reflected in market valuation.
Magnera currently trades at a rock-bottom 0.13x price-to-sales ratio, notably lower than its peers, despite being roughly 50% larger. This relative size could lead to index inclusion and future multiple expansion. Insiders appear to share this optimism. CEO Curt Begle made sizable open-market purchases—$280,000 in May and $500,000 in February—at significantly higher prices than today’s $12.17, signaling confidence in long-term value. Four directors also made meaningful insider buys, each over $200,000. Debt-wise, Magnera holds the cheapest capital structure among the three comps, with long-dated maturities at 4.75% and 7.25%, and a recently added term loan.
While the investment case hinges on pro forma execution and remains uncertain in the near term, Magnera may be a hidden gem with multiple re-rating catalysts ahead.
We previously covered a bullish thesis on Element Solutions Inc (ESI) in September 2024 written by ValueInvestorsClub, a $6.5 billion specialty chemicals company with strong free cash flow, high-margin electronics exposure, offering a useful comparison point for evaluating emerging industrial plays like Magnera.
Mativ Holdings, Inc. (MATV) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held MATV at the end of the first quarter which was 21 in the previous quarter. While we acknowledge the risk and potential of MATV as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
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