BuzzFeed, Inc.: The Elephant In The Room Can Pirouette

Summary

  • BuzzFeed's Q3 FY 2024 guidance is the highest ever, showcasing a strong business turnaround with significant improvements in engagement and advertising revenues.
  • The $120 million 8.5% convertible debt put option due December 3, 2024, poses a major risk, but management has multiple strategies to address it.
  • Selling First We Feast, refinancing the debt, or extending the put option with warrants are viable solutions to defuse the debt issue.
  • The 2024 Presidential election cycle and Kamala Harris's nomination could drive substantial free cash flow in the second half of 2024 for BuzzFeed.
  • This idea was discussed in more depth with members of my private investing community, Second Wind Capital. Learn More »

Elephant dancing on stage

John M Lund Photography Inc/DigitalVision via Getty Images

Second Wind Capital is a value oriented investment service with a strong recent track record of exceptional outperformance. The focus is mostly small cap value and special situation equities. From January 1, 2020 - December 31, 2023, the flagship account has compounded at 46% (pre-tax) per year. 

This article was written by

Courage & Conviction has been investing for over twenty years and has spent five years working as a buy-side analyst within a $45 billion investment-grade bond department, 3.5 years as an energy analyst, in addition to various other corporate finance roles. He has been a full time investor and author since 2020.

He leads the investing group Second Wind Capital, providing in-depth analysis on under-the-radar smallcap value ideas. He shares his real-money portfolio and does research based on fundamentals, synthesizing industry ecosystems and regularly interviewing management teams. He teaches community members to embrace volatility and exercise patience to drive alpha creation.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BZFD 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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