RICK - San Antonio Value Creation

Equity Value creation from RICK's announced franchise deal in San Antonio

RCI Holdings (RICK) announced a deal to franchise 3 locations in San Antonio, TX. This is the first test of franchising the Bombshells concept the company has developed over the past ~5 years; The stock jumped $5.37 (15.53%) on the back of the announcement.

Generating $5.25mm in average unit volume (AUV) the San Antonio deal will directly generate $0.47 of equity value per share (see below). This is a great win for management and shareholders, and if the company does ~10 more deals of this size the market will have correctly priced the opportunity!

- Typhon Value

Disclosure: Long RICK & Short RICK puts