[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]  Dalius - Special Sits [@InvestSpecial](/creator/twitter/InvestSpecial) on x 30K followers Created: 2025-07-16 08:55:00 UTC Interesting setup over at $CVEO with a highly reputable activist involved. At its core, the pitch rests on a combination of hidden assets, growing earning power, and the presence of a reputable activist, Engine Capital (which owns 10%), already driving significant changes in capital allocation. My conservative estimate of upside, excluding the value of underutilized assets, suggests a XX% gain over XXX years, compared to Engine Capital’s estimate of 100%+ over the same period. A key aspect of the thesis is the ongoing capital return program. Engine Capital began its campaign in March 2025, pushing management to pivot away from dividends toward aggressive share repurchases. This led to a newly authorized plan to buy back up to XX% of outstanding shares. In the Q1 2025 call, management explicitly kept the door open for an expedited tender offer (as proposed by Engine), which could significantly accelerate value realization given the company’s thin float and tightly held shareholder base (with XX% owned by 3–4 large shareholders). Additionally, with XXX% of free cash flow earmarked for buybacks, transitioning to XX% once the XX% repurchase target is reached, the capital return story is front-loaded here. CVEO operates workforce lodges and mobile camps primarily in Canada and Australia, serving resource companies in remote areas. Its asset-heavy Canadian operations have underutilized capacity that could either be repurposed or sold, while its Australian, asset-light services segment is on a solid growth trajectory, backed by multi-year contracts. The Canadian assets are currently at a cyclical low in utilization, but could be reactivated quickly if demand returns or sold otherwise. In late 2023, CVEO sold one of its Canadian lodges (McClelland Lake) for $33m. At their peak in 2022, underutilized assets were generating between $20–36m in EBITDA, compared to the expected 2025 EBITDA of $97m. Any new contracts for these idle assets would materially enhance the company’s earning power. Valuation-wise, CVEO trades at just 5x forward EBITDA (including the recent acquisition), compared to peers trading at 5.5–7.5x. This is particularly attractive given the stability of its long-term contracts, the expansion potential in Australia, and the likelihood of further cost reductions in Canada (large overhead that could be eliminated). Using a conservative estimate of $102m in 2027 EBITDA—and assuming only the currently authorized XX% buyback—the base case implies ~40% upside. Engine Capital’s more aggressive buyback assumptions yield potential upside of over 100%. Finally, CVEO is not overly exposed to commodity price swings with its current asset base. Its Canadian segment is anchored by long-life oil sands maintenance projects, while its Australian business benefits from tight labor markets and long-term contracts with metallurgical coal miners. XXXXXX engagements  **Related Topics** [$cveo](/topic/$cveo) [Post Link](https://x.com/InvestSpecial/status/1945406803250122943)
[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]
Dalius - Special Sits @InvestSpecial on x 30K followers
Created: 2025-07-16 08:55:00 UTC
Interesting setup over at $CVEO with a highly reputable activist involved.
At its core, the pitch rests on a combination of hidden assets, growing earning power, and the presence of a reputable activist, Engine Capital (which owns 10%), already driving significant changes in capital allocation. My conservative estimate of upside, excluding the value of underutilized assets, suggests a XX% gain over XXX years, compared to Engine Capital’s estimate of 100%+ over the same period.
A key aspect of the thesis is the ongoing capital return program. Engine Capital began its campaign in March 2025, pushing management to pivot away from dividends toward aggressive share repurchases. This led to a newly authorized plan to buy back up to XX% of outstanding shares. In the Q1 2025 call, management explicitly kept the door open for an expedited tender offer (as proposed by Engine), which could significantly accelerate value realization given the company’s thin float and tightly held shareholder base (with XX% owned by 3–4 large shareholders). Additionally, with XXX% of free cash flow earmarked for buybacks, transitioning to XX% once the XX% repurchase target is reached, the capital return story is front-loaded here.
CVEO operates workforce lodges and mobile camps primarily in Canada and Australia, serving resource companies in remote areas. Its asset-heavy Canadian operations have underutilized capacity that could either be repurposed or sold, while its Australian, asset-light services segment is on a solid growth trajectory, backed by multi-year contracts.
The Canadian assets are currently at a cyclical low in utilization, but could be reactivated quickly if demand returns or sold otherwise. In late 2023, CVEO sold one of its Canadian lodges (McClelland Lake) for $33m. At their peak in 2022, underutilized assets were generating between $20–36m in EBITDA, compared to the expected 2025 EBITDA of $97m. Any new contracts for these idle assets would materially enhance the company’s earning power.
Valuation-wise, CVEO trades at just 5x forward EBITDA (including the recent acquisition), compared to peers trading at 5.5–7.5x. This is particularly attractive given the stability of its long-term contracts, the expansion potential in Australia, and the likelihood of further cost reductions in Canada (large overhead that could be eliminated). Using a conservative estimate of $102m in 2027 EBITDA—and assuming only the currently authorized XX% buyback—the base case implies ~40% upside. Engine Capital’s more aggressive buyback assumptions yield potential upside of over 100%.
Finally, CVEO is not overly exposed to commodity price swings with its current asset base. Its Canadian segment is anchored by long-life oil sands maintenance projects, while its Australian business benefits from tight labor markets and long-term contracts with metallurgical coal miners.
XXXXXX engagements
Related Topics $cveo