One chocolate giant got buried when cocoa prices exploded, and the market treated margin pressure like a permanent problem. 

Now cocoa is falling, pricing power remains intact, and the valuation has become genuinely interesting. Stay with this and you will also get more discounted names with catalysts ahead.

Energy Infrastructure

Energy Transfer LP (NYSE: ET) trades near $20.50 after TD Cowen raised its price target to $25 from $24, pointing to stronger marketing results, higher EBITDA guidance, and new long-term volume contracts. The units are up about 2%, but the income case still carries a meaningful discount.

Second-quarter adjusted distributable cash flow reached $2.59 billion, up 32% year over year, while partner distributions totaled about $1.17 billion. That leaves payout coverage near 2.2 times and puts the annualized distribution yield around 6.6%, giving your valuation case support from cash already being generated.

Management also raised 2026 adjusted EBITDA guidance to $18.8 billion to $19.1 billion. Q2 adjusted EBITDA climbed 31% to $5.07 billion, while crude transportation, NGL volumes, and exports all posted strong results.

Cash Flow Is Running Ahead of the Payout

Energy Transfer generated $5.29 billion of adjusted distributable cash flow during the first half alone. When you combine that cash production with 19 consecutive quarterly distribution increases, the current yield looks better supported than the headline percentage suggests.

Big Spending Still Has to Earn Its Keep

Growth capital spending is expected to reach $5.6 billion to $5.9 billion this year, while long-term debt stands above $68 billion. You still need the new export capacity, pipelines, and contracted volumes to produce enough EBITDA to justify that capital load.

Government Services

CoreCivic Inc. (NYSE: CXW) trades near $33.23 after announcing a $500 million accelerated share repurchase, equal to roughly 15% of its current market value. The company expects an initial delivery of about 12.4 million shares, potentially removing more than 12% of the share count almost immediately.

The repurchase follows the $2.2 billion sale of four detention facilities, which should produce about $1.6 billion in net proceeds. CoreCivic has already directed much of that capital toward debt reduction, with total debt expected to fall toward $739 million, giving you a cleaner balance sheet alongside the shrinking equity base.

Normalized FFO guidance now stands at $2.68 to $2.77 per share, putting the stock near 12 times the midpoint. Revenue grew 27% in the second quarter, while the diluted share count was already down nearly 9% before today’s accelerated repurchase.

Real Estate Value Is Turning Into Fewer Shares

Selling four properties for $2.2 billion provided a tangible marker for your asset-value case. CoreCivic can still manage those facilities under existing contracts, so you are not simply exchanging operating revenue for cash.

Government Exposure Still Sets the Discount

Federal customers account for more than half of revenue, leaving contract renewals and funding decisions as major risks. The buyback can improve per-share results quickly, but those gains still depend on CoreCivic maintaining utilization and replacing earnings lost through asset sales.

Advertising Technology

Perion Network Ltd. (NASDAQ: PERI) trades near $9.07 after second-quarter revenue fell 5% to $98.2 million and adjusted EBITDA dropped to $2.8 million. The weaker headline numbers pushed shares down about 7.5%, even as spending through Perion One increased 15% year over year.

The balance sheet changes the valuation. Perion holds $267.8 million in cash, deposits, and marketable securities against $22.1 million of debt, leaving $245.7 million in net cash, or $6.25 per share. At today’s price, roughly 69% of the equity value sits in net cash, leaving you with an operating business valued near $111 million.

Management narrowed full-year adjusted EBITDA guidance to $51 million to $53 million. Against the current enterprise value, that puts the business near 2.1 times the midpoint, while CTV spend rose 56%, retail media 60%, digital out-of-home 45%, and Outmax AI agent spend 136%.

The New Channels Have to Replace the Old Ones

Perion’s growth engines are moving quickly, but total revenue is still shrinking and operating cash flow fell to $2.5 million from $21.3 million a year earlier. The newer channels give your valuation case substance only if they rebuild margins as legacy web and search activity fades.

Buybacks Shrink the Cushion Too

Perion repurchased $24.5 million of stock during the quarter and has used $166.8 million of its $200 million authorization. The share count is already down 12.2% year over year, but if you want the cash-backed discount to hold, repurchases and acquisitions cannot outrun the operating recovery.

Organon (NYSE: OGN)

Organon reports Tuesday, August 11, and this is the cleanest catalyst on the list, but be clear about what you are buying. The stock sat in the penalty box for years after the Merck spinoff over the women’s health portfolio and the debt load, and management cut the dividend to a token $0.02 a quarter to attack that debt.

That was the right call, and the market has started paying up for it, with shares closing Friday at $13.60, a fresh 52 week high and up roughly 47% over the past year. This is no longer a deep value bargain on price; it is a re-rating already underway with cost cuts landing and biosimilar revenue growing faster than the Street models. Keep the position small into the print and add on confirmation rather than hope.

Vail Resorts (NYSE: MTN)

Vail has been beaten down on soft ski visitation and cost concerns, and at roughly $149 a share, the $8.88 annual dividend works out to about a 6% yield. That is a lot of compensation for waiting on a business with genuine structural advantages.

The season pass model gives you deferred revenue visibility that most consumer discretionary names would envy, because a meaningful share of the season is already sold before the first snowflake falls. If the coming ski season prints even in line with normal, the stock re-rates from a depressed base. The risk is another warm winter, which is exactly the kind of thing the pass model was designed to insulate against but cannot fully offset.

Southwest Gas (NYSE: SWX)

Southwest Gas already handed you its proof point, reporting Q2 on August 5 and reaffirming full year guidance, which is precisely what you want from a regulated utility. The regulated side is boring in the best possible way, and the ongoing Centuri infrastructure services separation is the catalyst most of the market still has not priced.

Once Centuri is fully out, what remains is a clean rate base compounder that should trade closer to peer multiples. Shares sit around $92 near the top of the 52 week range, so you are not stealing it here. Build on pullbacks, collect the dividend, and let the Centuri separation do the work into 2027.

That's our coverage for today; thanks for reading! Reply to this email with feedback or any stocks you want me to check out.

Best Regards,
—Noah Zelvis
Undervalued Edge