One of the key themes running through many of my recent investment ideas includes highly leveraged companies (both financial and operating leverage) with visible revenue streams. The idea is that as a subject company deleverages, value should shift to the equity as debt is retired, all else being equal.
Intelsat (NYSE:I) is a good example of this theme given Intelsat's $2 billion market cap makes up only a small 12% sliver of its $17 billion enterprise value. As such, Intelsat has multiple levers to drive value, including restructuring/retiring debt and improving utilization of its fleet which leads to significant incremental profit due to the high operating leverage for this fixed services satellite firm. To give an idea of...
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