A big catalyst has the potential to double revenue and triple EBITDA...

all while trading at merely 5x EV/EBITDA

Every stock has a different risk/reward profile and varying levels of certainty. I believe this stock has a higher risk profile than my usual picks, but also offers a higher potential reward. Overall, if sized correctly, these situations can significantly increase your returns without hurting you too much if they don’t work out.

An overview:

• The stock is currently trading at just 5x EV/EBITDA.

• Negatives: In addition to significant net debt, the company's current products face headwinds and are expected to decline over time

• The potential upside: A new product has the potential to double the company's revenue and even triple its EBITDA, according to management.

However, it will take up to five years for the new product to reach its full revenue and EBITDA potential. Things will get worse before they get better, a situation that suits investors willing to wait at least a year or two.