The Few Bets That Matter
Concentrated Equity Investor, AI Infrastructure
ZIM and Frontline could gain as blocked traditional shipping routes raise the value of alternatives. The disrupted oil supply chain is already hurting economies, and if it is not resolved within days, inflation will spike. Escalation into longer disruptions, more combat or a ground invasion would deepen both the economic damage and fear. The move in these shipping names has already started but could be only the beginning. x.com
ZIM is a stock to own, not trade, over the next two years, because both outcomes of the takeover talk look favorable. A deal near the discussed $35, plus about $5 in dividends, would mean a total return near 30% from about $30.50. If it fails, the stock might drop toward $27, but ZIM should hold over $30 a share in cash by year-end while staying profitable, so $27 is near a floor. Independent, ZIM would have to return that cash; Israeli investors have reportedly urged big buybacks. x.com
CF Industries should surge as the Middle East crisis cuts fertilizer supply just as planting demand peaks. Roughly a third of the world's fertilizer moves through the Strait of Hormuz, winter planting is starting, and farmers cannot delay, so they must pay whatever the price is. Surging gas prices also raise production costs. The stock pulled back as the market priced in the strait reopening, which has not happened, and could reach $150 short term. Oil is the obvious, mostly priced trade. x.com … Show more
US energy stocks should catch a bid now that Iran's IRGC navy has closed the Strait of Hormuz indefinitely, effectively a blockade. About 20% of global oil supply moves through it, including crude from Saudi Arabia, Kuwait, Iraq and the UAE, with no alternative route for that volume. Tanker insurance should spike and rerouting around the Cape of Good Hope adds weeks on stretched supply, pushing crude higher. Fertilizer and plastics costs get squeezed, complicating the Fed's inflation view. x.com … Show more
Delta, United and Alaska should see margin expansion as the US-Iran deal and the lifted Hormuz naval blockade push oil lower into summer travel season. Crude fell from $92.16 on June 1 to $70.24, and fuel was 17–21% of their FY2025 opex; Alaska is the highest-beta name, with each $0.10/gallon move worth about $0.75 of EPS. Demand is at record highs and some fares are about 20% above last year. It is a high-risk macro trade, since the ceasefire is fragile and has been repeatedly violated. x.com
Top Ships is a serial diluter worth fading after an 82% spike. The Greek shipper is notorious for shareholder destruction, with an active ATM and a reverse-split history, a $10M market cap and a 4.1M share float. Short interest is 7.7%, with 0.27 days to cover, and the downside target is $0.90. x.com
Mosaic is a catch-up play to the rest of fertilizers, since energy, fertilizers, grains and chemicals should all skyrocket while the Strait of Hormuz stays closed. April 2025 was likely a 4-5 year cycle low, and the stock has made a weekly breakout and retest, with multi-x upside possible over the next few years. More basing in mid-2026, possibly undercutting $20, could still come; daily strength and a close above the 50-day average would confirm. x.com
Linde, the dominant global supplier of semiconductor-grade helium, stands to surge as the Strait of Hormuz conflict chokes helium supply. A third of world helium supply is stuck in the strait, and Qatar's Ras Laffan, one of only two plants making semiconductor-grade helium, was hit by missiles in early March and may take years to rebuild. The largest industrial gas companies have told chipmakers they cannot guarantee supply, putting a speed limit on AI. x.com x.com x.com x.com x.com x.com
All three routes for Middle East oil out of the war zone shut within 72 hours, and the Fed cannot fix that. Strait of Hormuz traffic fell from over 130 ships a day before the war to 31, then zero. Iraqi drones hit pump stations on the Saudi East-West pipeline, leaving Riyadh five to seven days of crude stored at its end. In the Red Sea, a militia seized Mokha, Perim and the Hanish Islands and bars Saudi ships. Iran only needs to wait: America votes in 49 days, Iran not until 2028. x.com x.com … Show more
Diesel stocks are the play, and US refiners Valero, PBF Energy and HF Sinclair work until an expected US export ban arrives. This answers @bubbleboi, who sees diesel or jet fuel as the best way to play the move and wonders whether it ties to the bombing of Saudi refiners. With the ban coming, the bigger focus should be European refiners OMV and Repsol, while Calumet offers the most torque through aviation fuels. x.com
Crude oil should reprice higher because the Iran conflict looks like a multi-year regime, not a short event, and no model carries a 2029 duration. The WSJ reported Vance and Rubio privately warned Trump it could last through his presidency, while the White House floats the biggest naval blockade in history. August PPI rose 5.4% year on year, above estimates, before any blockade effect. Houthis took Mocha and are moving on Bab al-Mandeb, with Brent above $100; $120 talk is the early repricing. … Show more
