⁠The Long Investor
RT @TheLongInvest: $BABA

47 analysts have weighed in on $BABA

83% say Buy
17% say Hold
0% say Sell

Average PT is $106
High PT of $145

TLI 2024 Target is $121 https://t.co/rrg3r95i6K
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⁠Brandon Beylo
“We need to mine as much copper in the next 20-25 years as we've mined in last 10,000 years.” - Robert Friedland (@robert_ivanhoe)

Here’s why 👇

#copper https://t.co/FnvYTuHsTi
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⁠The Long Investor
I need someone who can write an algo for me, DM me if you are the best at what you do
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⁠Dimitry Nakhla | Babylon Capital®
A sober valuation analysis on $AMAT 🧘🏽‍♂️

•NTM P/E Ratio: 26.21x
•5-Year Mean: 17.04x

•NTM FCF Yield: 3.75%
•5-Year Mean: 6.27%

As you can see, $AMAT appears to be trading below fair value

Going forward, investors can receive ~35% LESS in earnings per share & ~40% LESS in FCF per share 🧠***

Before we get into valuation, let’s take a look at why $AMAT is a quality business

BALANCE SHEET✅
•Cash & Short-Term Inv: $7.49B
•Long-Term Debt: $7.08B

$AMAT has a great balance sheet, an A S&P Credit Rating, & 36x FFO Interest Coverage Ratio

RETURN ON CAPITAL✅
•2019: 24.9%
•2020: 27.4%
•2021: 40.0%
•2022: 43.2%
•2023: 34.2%

RETURN ON EQUITY✅
•2019: 35.9%
•2020: 38.5%
•2021: 51.6%
•2022: 53.4%
•2023: 48.0%

$AMAT has strong return metrics, highlighting the financial efficiency of the business

REVENUES✅
•2013: $7.51B
•2023: $26.52B
•CAGR: 13.44%

FREE CASH FLOW✅
•2013: $0.43B
•2023: $7.59B
•CAGR: 33.25%

NORMALIZED EPS✅
•2013: $0.59
•2023: $8.05
•CAGR: 29.86%

SHARE BUYBACKS✅
•2013 Shares Outstanding: 1.22B
•LTM Shares Outstanding: 0.84B

By reducing its shares outstanding 31%, $AMAT increased its EPS by 45% (assuming 0 growth)

MARGINS✅
•LTM Gross Margins: 47.0%
•LTM Operating Margins: 28.9%
•LTM Net Income Margins: 27.0%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~35% LESS in EPS & ~40% LESS in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $AMAT has to grow earnings at a 13.11% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be slightly less than the (13.11%) required growth rate:

2024E: $8.24 (2.3% YoY) *FY Oct
2025E: $9.59 (16.4% YoY)
2026E: $10.97 (14.4% YoY)

$AMAT has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $AMAT ends 2026 with $10.97 in EPS & see its CAGR potential assuming different multiples

28x P/E: $307.16💵 … ~16.6% CAGR

26x P/E: $285.22💵 … ~13.1% CAGR

24x P/E: $263.28💵 … ~9.5% CAGR

22x P/E: $241.34💵 … ~5.6% CAGR

As you can see, $AMAT appears to have attractive return potential if we assume >26x earnings, a multiple well above its 10-year mean & on the higher end of its historical range

Of course demand for semiconductor equipment & materials is expected to see a huge increase over the next several years & this has gotten priced in, to an extent

So $AMAT could justify its current multiple if estimates continue to be fairly aggressive & the company executes

However, those looking to accumulate today leave themselves with no margin of safety — and we know how volatile semiconductors can be at times of uncertainty

Today at $215💵 $AMAT appears to be a bit rich

I’d reconsider $AMAT closer to 20x NTM earnings or at $160💵 (roughly 24% below todays price)

#stocks #investing
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𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️: 𝐓𝐡𝐢𝐬 𝐢𝐬 𝐍𝐎𝐓 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐀𝐝𝐯𝐢𝐜𝐞. 𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐚𝐯𝐞 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐭𝐰𝐞𝐞𝐭.

𝐓𝐡𝐞 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐜𝐨𝐧𝐭𝐚𝐢𝐧𝐞𝐝 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐭𝐰𝐞𝐞𝐭 𝐢𝐬 𝐢𝐧𝐭𝐞𝐧𝐝𝐞𝐝 𝐟𝐨𝐫 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐩𝐮𝐫𝐩𝐨𝐬𝐞𝐬 𝐨𝐧𝐥𝐲 𝐚𝐧𝐝 𝐬𝐡𝐨𝐮𝐥𝐝 𝐧𝐨𝐭 𝐛𝐞 𝐜𝐨𝐧𝐬𝐭𝐫𝐮𝐞𝐝 𝐚𝐬 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐚𝐝𝐯𝐢𝐜𝐞 𝐭𝐨 𝐦𝐞𝐞𝐭 𝐭𝐡𝐞 𝐬𝐩𝐞𝐜𝐢𝐟𝐢𝐜 𝐧𝐞𝐞𝐝𝐬 𝐨𝐟 𝐚𝐧𝐲 𝐢𝐧𝐝𝐢𝐯𝐢𝐝𝐮𝐚𝐥 𝐨𝐫 𝐬𝐢𝐭𝐮𝐚𝐭𝐢𝐨𝐧. 𝐏𝐚𝐬𝐭 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐢𝐬 𝐧𝐨 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞 𝐨𝐟 𝐟𝐮𝐭𝐮𝐫𝐞 𝐫𝐞𝐬𝐮𝐥𝐭𝐬.

𝐈𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐜𝐨𝐧𝐭𝐚𝐢𝐧𝐞𝐝 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐭𝐰𝐞𝐞𝐭 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐨𝐛𝐭𝐚𝐢𝐧𝐞𝐝 𝐟𝐫𝐨𝐦 𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐫𝐞𝐥𝐢𝐚𝐛𝐥𝐞, 𝐛𝐮𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞𝐝 𝐚𝐬 𝐭𝐨 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐧𝐞𝐬𝐬 𝐨𝐫 𝐚𝐜𝐜𝐮𝐫𝐚𝐜𝐲.
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⁠ Q-Cap 
David Einhorn being a comedian and prettyyy good reply guy was not on my bingo card lol https://t.co/zlVl1XAecd
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⁠The Long Investor
$BABA

First TLI buys.

Then Institutions Buy

Then Sovereign Wealth funds Buy

Then investors buy

Then retail chase

The cycle continues

BREAKING: SAUDIA ARABIA'S PUBLIC INVESTMENT FUND (PIF) NOW OWNS 1.6 MILLION SHARES IN $BABA 😱 https://t.co/vehSiKemMn - Daily Compounding
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⁠The Long Investor
$HIMS is up 23% since the CEO decided to let the fundamentals speak for itself.
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⁠ Q-Cap 
$TTWO just announced officially that GTA6 will launch in the fall of 2025

It's not about guidance, it's not about EBITDA.

When this game is released next year in this new YT, TikTok, Discord, Reddit world where Youtubers are more popular than politicians and athletes, I believe a major re-rating will happen.
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⁠The Long Investor
HSI

$BABA
$BIDU
$JD
$YINN
$KWEB

Never forget.

Hang Seng Index

When I say you are buying the Chinese market at the bottom, here are the facts:

The Green support line was held during:

-The Asian Financial Crisis in 1998
-The Dot Com bubble Crash
-The 2008 Great Financial Crash
-The 2020 Covid Crash
-And the 2023 Real Estate/deflation issues.

Each time the Chinese Government stepped in, as XI announced again yesterday to increase recovery and stimulus.

Once this line is held, there will be a recovery.

$BABA $KWEB $NIO $LI $BIDU - The Long Investor
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⁠The Long Investor
Bullish on $VSCO

Healthy is sexy.

🔥🚨DEVELOPING: The Victoria's Secret Fashion Show is finally back after being canceled by Liberal feminists in 2019 during the rise of ‘Woke political correctness.’ The iconic lingerie merchant says it’s no secret “Sexy is Back.” https://t.co/ihB8fUCySU - Dom Lucre | Breaker of Narratives
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