Another 3 interesting ideas
Owner of proprietary healthcare data; China’s largest private gas utility; South Korea’s top private educator
Last week, Reuters reported Stripe and Advent are looking to buy PayPal Holdings, Inc. (PYPL US) for ~ USD 60.50 per share.1
I shortlisted PYPL last month at USD 42, but I was still working on my thesis. Sad!
In any case, I found another 3 interesting ideas with a similar setup.
As usual, let me know which idea looks the most interesting. That may be the next idea I analyse in detail. You can vote using the poll at the end of this email.
GlobalData Plc (DATA LN)
About (17 Jul 2026)
Share price: GBP 0.74
Market capitalisation: GBP 535 mn (USD 721 mn)
Enterprise value (EV): GBP 697 mn (USD 939 mn)
Average daily volume (ADV): GBP 1 mn (USD 2 mn)
NTM P/E: 10x
DATA sells proprietary data mainly through subscription plans.
As an example, healthcare clients subscribe to access its daily-updated database tracking over 190,000 drugs, detailing their exact stages from early preclinical development through to the regulatory approval process.
My initial estimate suggests ~ 6% free cash flow yield on EV, a premium of ~ 1% over UK 10y gilt.
This may be attractive given its growth potential. DATA is expected to grow its EPS by +6% p.a. over the next 2 years.
Good business, temporary headwinds?
Decelerating underlying organic growth. After peaking at +10% in 2022, underlying organic growth decelerated to +1% in 2025. This caused DATA’s share price to fall back to pre-COVID levels.
According to management, DATA’s organic growth deceleration stems from a combination of macroeconomic headwinds and operational hiccups.
Weaker macroeconomic environment tightened enterprise budgets, lengthened sales cycles and stalled upselling efforts. At the same time, the integration of multiple recent acquisitions was slower than expected, diverting resources from organic growth.
Headwinds seem temporary. However, there are some signs that these headwinds are temporary, and DATA is still a good business.
Unearned revenue grew +3% YoY in 2025. In H1’26, value renewal rate grew slightly to ~89%, up from 88% in 2025.
Hidden asset?
Healthcare division > market capitalisation. In mid-2024, private equity firm Inflexion bought a 40% minority stake in DATA’s Healthcare division for GBP 434 mn. This deal valued that single division at ~ GBP 1 bn.2
DATA’s 60% retained stake in that unit is theoretically worth ~ GBP 650 mn. Yet, the entire company’s current market cap sits at only GBP 535 mn today.
In its latest trading update, DATA stated “The Board believes that the ‘sum-of-the-parts’ value of the Group’s portfolio of products and services has the potential to be much greater than the Group’s current market capitalisation.”
This suggests potential spin-off or sale to unlock the value hidden in the Healthcare division.3
Capital return?
In 2025, DATA returned GBP 123 mn to shareholders, mainly through buybacks.
So far in 2026, it has announced ~ GBP 45 mn of capital returns. This is ~ 8.4% of today’s market capitalisation.
Takeover?
Major shareholder/CEO may be looking to sell at a better price. In Apr 2025, private equity firms (PE) KKR and ICG made separate takeover approaches.
Bloomberg reported that any deal could value DATA “well above $2 bn” (~ GBP 1.5 bn).4 This is more than twice today’s enterprise value (GBP 700 mn).
The takeover talks collapsed. I suspect the founder/major shareholder/CEO Mike Danson decided he could get a better price if DATA completes its three-year growth transformation plan.
CEO Danson made his name by founding Datamonitor in 1990, selling it to Informa plc (INF LN) for ~ GBP 500 mn before buying back divisions for just GBP 25 mn.
In any case, the takeover talks signal that CEO Mike Danson may be looking to sell. At 63 years old, he is near retirement age. There seems to be no clear successor.
New CFO brings experience in selling to PE. Perhaps the strongest hint is the new CFO. Robert Kingston was the CFO of Keywords Studio, an AIM-listed video game services provider that was acquired by EQT AB, another PE firm.
Robert will join DATA in Sep 2026.5
Factors to focus on
What is the probability and timing of a recovery in underlying organic growth?
Threat from AI seems low. DATA mainly sells proprietary data. Gather more evidence on this.
ENN Energy Holdings Limited (2688 HK)
About (17 Jul 2026)
Share price: HKD 42.02
Market capitalisation: HKD 46,720 mn (USD 5,959 mn)
Enterprise value (EV): HKD 67,580 mn (USD 8,620 mn)
Average daily volume (ADV): HKD 198 mn (USD 25 mn)
NTM P/E: 6x
ENN Energy is one of the largest private distributors of natural gas in mainland China. It sells to both residential and commercial & industrial (C&I) customers.
My initial estimate suggests ~ 7% free cash flow yield on EV, which is an attractive ~5% premium over China 10y government bond yield.
Good business, temporary headwinds?
Growth and margins pressure look temporary. Revenue growth decelerated in recent years because the real estate downturn meant lower installation and connection fees. These fees carry higher margins.
The war in the Middle East also caused natural gas to become more expensive. This squeezed ENN Energy’s margins.
However, the regulator (NDRC), has been pushing a price linkage mechanism that allows city gas distributors to pass upstream cost increases down to end-users. As of Dec 2025, ENN achieved a ~72% completion rate for residential price adjustments.6
The real estate market is cyclical. When the cycle eventually turns, installation and connection fees can recover.
Capital returns?
Dividend yield could increase above 7%. Over the past few years, cash capex has been exceeding depreciation and amortisation. When the infrastructure is completed, could ENN Energy return more capital to shareholders?
Privatisation?
Privatisation failed. Last month, the major shareholder shelved plans to privatise ENN Energy because of regulatory delays. Offer was HKD 80 per share. The shares now trade at HKD 42.
Major shareholder may want to try again. There is a good chance ENN Natural Gas, the major shareholder, will try again. Despite the setback, ENN Natural Gas said it intends to gradually increase its shareholding in ENN Energy.7
ENN Natural Gas can attempt privatisation again from Jun 2027 onwards.
Factors to focus on
More details on why revenue growth and margins deteriorated, and what is the outlook?
Why did the regulators not approve on time? Is it simply due to the complexity of how the privatisation is structured?
MegaStudyEdu Co. Ltd (215200 KS)
About (17 Jul 2026)
Share price: KRW 38,150
Market capitalisation: KRW 395 bn (USD 267 mn)
Enterprise value (EV): KRW 313 bn (USD 212 mn)
Average daily volume (ADV): KRW 2 bn (USD 1 mn)
NTM P/E: 4x
Last month, I published my thesis on MegaStudyEdu: Why South Korea’s top private educator can be a 3x.
In Feb 2026, MegaStudyEdu clarified that its founders have no plans to sell their stake. Since then, there has been no takeover news.
However, the company has been increasing capital returns, as I expected. At a board meeting earlier this month, MegaStudyEdu announced another dividend. Total dividends so far in 2026 amount to KRW 4,000. ~10.5% dividend yield.
The Board also authorised another share buyback program, valid through Jan 2027. MegaStudyEdu will repurchase up to KRW 10 bn worth of shares. This is ~2.5% of market cap.
With capital returns ~13% of current market cap. and aging founders, there seems to be a good chance of a takeover eventually.
Vote for the best idea
Vote for the most interesting idea. That may be the next idea I analyse in detail.
Coming up next
I will look deeper into Pets at Home Group Plc (PETS LN) this week. This was the idea voted the most interesting in my previous email.
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Published by Andrew Wong, ACA, CFA
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Disclaimer
This publication is for informational, educational, and entertainment purposes only and does not constitute financial, investment, legal, or tax advice. The content herein is a record of my personal research and investment process, and all analysis, forecasts, and opinions expressed are solely my own.
I make no representation or warranty, express or implied, as to the accuracy, completeness, or timeliness of the information provided. The stock market is highly volatile, and my forecasts, estimates, and assumptions may prove incorrect.
I am not acting as your financial advisor or fiduciary. You should not rely on any information in this publication to make investment decisions. Under no circumstances will I be held liable for any direct, indirect, or consequential losses or damages arising from your reliance on the content of this publication.
At the time of publication, I do not hold any positions in DATA, 2688, either long or short. I own shares in 215200. I may change my views, predictions, or personal portfolio positioning at any time without notice.