Matthews International - Backbone Of Tesla's Battery Gigafactory

Lucid Capital
352 Followers

Summary

  • On the surface, Matthews (MATW) is a classic boring industrial conglomerate with two cash-cow businesses: leading the burial solutions market and Pre-press for CPG packaging.
  • Yet, buried inside is a subsidiary (Saueressig) that provides rotary machines to battery factories (especially dry cells) and it is expected to double its revenues to $100M in 2022.
  • Tesla is currently the largest customer of Saueressig and upcoming partnership with SalesForce Group, a JV lead by Porsche will propel the battery business toward $400-500M in 2025.
  • Assuming ultra conservative EV/EBITDA assumption, only the Saueressig part of the company is worth the current market cap of MATW.

Tesla car factory, Shanghai

Sky_Blue/iStock Unreleased via Getty Images

Company Overview

Matthews International Corporation (NASDAQ:MATW) is an industrial conglomerate with diverse lines of business. The company offers automation and brand solutions to a variety of companies, it is present in more than 20

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We are time travelers, disguised as tech investors. Our belief is that only when one truly fathoms industry, lucidity is formed. Unlike many asset managers who have financial backgrounds but lack in-depth tech & product understanding, Lucid Capital was founded by tech executives with software engineering roots who were in the trenches of scaling tech companies. Instead of solely relying on the usual CFO's bullsh*t, we rather fathom the fundamentals by conversing with the CTOs of our portfolio candidatesThe fund is supported by an advisory board composed of ex-CTO/CEO who sold their companies, product, and R&D executives within the top 100 tech firms, industry journalists.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of MATW either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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