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- Inside The Buy-Side No. 8
Inside The Buy-Side No. 8
JAZZ Episode Release / 5x Risk-Reward ● CRWV Short Squeeze Color ● Checklist to be a Pod Shop PM ● Ken Griffin What's Next? Survey Results
Doug Garber
June 09, 2025
Pipeline
Coming up:
● The “GPU Whisperer” with Aaron Ginn, CEO of Hydra Host a private SaaS GPU management for data centers. Ginn is one of the country’s leading AI experts frequently writing oped’s. We discuss the rapidly evolving GPU industry including:
1) What America (i.e. Nvidia) needs to do to win vs China long-term in AI.
2) Why Nvidia is winning. And long-term semi margins potentially being much lower.
3) The grim reality for Amazon, Google & Microsoft clouds in the GPU data center
environment.
On Deck:
● New Episode launch: “Deep Value: 20% below cash, 60% below NAV & PIVOTING to Higher Return Industrials” with the CFO of Mammoth Energy Services, Mark Layton. Subscribe to YouTube episodes here.
More:
● Pitch The PM’s Job Board. Now direct to your inbox in the Newsletter. Sign-up now to never miss a new opportunity.
● Sign-up for the Pitch The PM Apprentice Program Group on Linkedin to review case studies, learn the mental models I learned throughout my career and hear from former PM’s like Hugh Anderson of SAC/Lombard & Jonathan Kasen of Fidelity.
JAZZ Episode Release
Value with an Oncology Catalyst: 5x Risk Reward Ratio
In this new episode of Pitch The PM, Doug speaks with biotech expert, Sriker Nadipuram from Critical Value Asset Management, about Jazz Pharmaceuticals (JAZZ). Although outside Doug’s typical investment lane, the conversation highlights shared frameworks and rigorous research methodologies. Sriker unpacks Jazz’s business model, detailing its base business in neurology and the high-potential oncology pipeline. They examine the firm’s risk-reward setup, political uncertainty from tariffs and drug pricing, and why the market may be overlooking a potentially transformational oncology outcome in 2H’25. Tune in to learn more about JAZZ’s value proposition amid healthcare uncertainty.
10 Step Variant View Checklist
1) What ACTION do I want the Portfolio Manager to take?
- Waiting on tax uncertainty for Irish-domiciled company to clear despite compelling fundamental oncology clinical catalyst opportunity
- JAZZ is framed with $15 downside vs. $70–80 of upside potential with clinical success.
2) Do I UNDERSTAND this business?
- Sriker is an expert in biotech with extensive training and experience.
- Breakdown of Jazz’s neurology and epilepsy base, including Xyrem/Xywav and Epidiolex.
- Outside of Doug’s circle of competence. No position. Difficult to form a view on the potential impact of drug pricing, taxes, and the clinical outcome. Although Sriker does provide a rational view for the clinical outcome being partially de-risked and the potential value uplift to JAZZ.
3) Is the stock available at a REASONABLE price today?
- Striker’s valuation view shows the stock is undervalued even without pipeline contributions at a 5x 2026 P/E.
- They discuss that DCF valuation is front-loaded with little terminal value due to the patent expiring eventually.
4) Why is this stock MIS-PRICED?
- Jazz is wrongly lumped with speculative biopharma names despite durable earnings.
- Generalists are avoiding the space due to uncertainty around drug pricing. JAZZ also has earnings uncertainty due to its Irish domicile.
5) What is the VARIANT VIEW vs the street?
- Generalists have exited biopharma.
- Sriker sees a solid base valuation from the existing portfolio and a potential clinical catalyst that is being overlooked due to the lack of interest in the biotech space.
6) What is the EVIDENCE?
- Sriker outlines research methods including AlphaSense transcripts and expert networks that build on top of his education in pharmaceuticals and investment experience.
7) What are the CATALYSTS for the street to realize my view?
- A Phase 3 gastric cancer trial readout expected in H2 2025 could be positive for JAZZ.
- Clarity on Irish domiciled tax policies and drug pricing changes.
8)What is it WORTH if the bet is right?
- Sriker sees potential upside to ~$180+ based on projected oncology sales and expanded FCF.
9) What is the OTHER SIDE of the bet?
- Sriker $15 of downside per Sriker.
- Risks: Clinical trial failure, competition, drug price changes & Irish tax changes
10) Is management ALIGNED with ownership?
- FCF is typically reinvested in the product pipeline or M&A and not returned.
CRWV Short Squeeze Color
For context, CoreWeave’s share were up 40% this week. Following a $7B data center lease deal with Applied Digital. That momentum follows its first earnings report just two weeks ago, since then, the stock’s surged more than 150%.
1) This is a classic short squeeze. 216% cost to borrow. 0 shares available to borrow (from what I see) and 1 month borrow cost range of 8%-330%. Got up to 430% cost to borrow after the IPO.
- There is the S&D of GPU's, then the S&D of CRWV, then there is the S&D to borrow (or short) CRWV stock and that is what is causing the imbalance.
2) There is/was fundamental news that likely sparked this with the increase in backlog and addition of customers.
- This is the fundamental driver. Backlog growing is the leading indicator.
3) What CRWV is worth is another question that Gil Luria discusses in his video below. He discusses the customer contracts being sufficient to support the debt for the first five years and the equity holders value being the residual 5 year old GPU with that value unknown at this time due to the rapid technological innovation. This implies the CRWV value is worth about 10% of its capex.
- My two cents: The capital markets are open and innovating for AI. Digging into the debt capital markets for GPU's seems like the next layer of the onion to peel back.
Use this link to watch the discussion with Gil Luria.
Checklist to be a Pod Shop PM
The ability to demonstrate ownership of PnL (ideally alpha) generation for a minimum of 2 years with $10 MM + per year (hopefully more, but market has been tight with new shops seeding analysts who have managed risk).
With at least a 1.5 Sharpe ratio or info ratio (Sharpe ratio using alpha)
And a minimum $200 MM of GMV ($100 MM Equity L+S).
Communicate a “repeatable” investment process to BD and the division Head. Earnings revisions, domain expertise, management relationships is typical; being an investigative journalist is excellent differentiation.
In a multi-factor model with a vol (on equity) of 5% ideally, maybe up to 7.5% or a touch higher in rare cases. This can change once you’re in the door. Note the risk limits are typically discussed or in a survey typically and not in the contract. Gulp.
With an idio of 80 %+ (preferred 85 %+) or being factor aware. Of course, it depends on the risk model and what factors are included, but even most tenured BD people don’t truly get this nuance. Idio can move around depending on which risk model is applied!
And the ability to recruit, close, train, and retain a team. This is the key to long term success in my opinion. The PM picks the Analysts, the Analysts pick most of the stocks, the PM holds them accountable and takes the risk, sizing, tilt, etc…
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What’s Next for Ken Griffin Survey Are In
- 46% of respondents think Ken Griffin will be in politics next (10% think a run for the Oval and 36% think a run for Florida Governor is next)
- 43% think Ken Griffin will continue at Citadel & Citadel Securities
- 11% think he will be a stay at home Dad
Interestingly, the former Citadel employees were disproportionately in the "Stay at Home Dad" category. I found that odd given his children are almost all college age.
My two cents is he would be good in the Oval, very effective leader, surrounds himself with the best and is smart and honest. He has conquered the business world, what's next?
*Not affiliated with Citadel
About Us
My goal, as Charlie would say, “is to try to be useful.”
Pitch The PM is the Professional Investor's Podcast that provides a deep-dive into a stock's investment case using the Variant View Investment Checklist. It is an open exploration of the research process in real time using high-conviction ideas from top PM’s and Analysts. Join the journey as Doug fills out his Buffett advised, 20-slot lifetime punch card. We learn and laugh together.
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Pitch The PM is hosted by Doug Garber, a former Citadel Analyst and Millennium Senior Portfolio Manager. Doug was initially trained at Citadel by a former SAC/Point 72 Analyst who worked directly for Steve Cohen before becoming a PM at Citadel. Doug was ranked as a top five analyst while at Citadel’s Surveyor Capital and was the only one to receive that designation twice during his tenure. He managed a multi-sector, multi-strategy team at Millennium under Katahdin Capital. Prior to his buy-side career, Doug worked in sell-side equity research honing modeling and primary research skills. Doug is currently the CIO and DoR at the Westport Alpha Group.
Doug graduated from Tulane University with a BSM and Master of Finance. He was selected to participate in the Darwin Fenner Student Managed Endowment Fund that utilized quantitative factors to outperform its benchmark and be an Investment Research Manager in the Burkenroad Reports “Stocks Under Rocks” equity research program. Doug has a passion for iterating on the investment process and a quirky sense of humor. He lives in Westport, CT with his wife, Lexi, and three kids. When he is not reading a 10-K, you can find him coaching youth soccer, inverted on his yoga mat or on an eFoil looking for Zuck.
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