⁠Invest In Assets 📈
The perfect company has:

• Steady growth
• Organic growth
• Diversified growth
• Expanding growth
• Recurring revenue

Let's break it down https://t.co/3zcOGLODYt
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⁠Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: $GOOG $GOOGL Q2 2024 Highlights 👇🏽

•Total Cash & Equiv: $100.72B
•Long-Term Debt: $13.23B

A solid report from $GOOG with +28.83% YoY growth in Google Cloud ☁️

#stocks #investing https://t.co/9YjejR0H1I
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⁠Dimitry Nakhla | Babylon Capital®
15 Quality Stocks Double-Digit EPS Growth 2025-2026 | LTM ROIC | FFO Int Coverage 💵

🖨️ ASML Holding $ASML
•2025E: $29.85 (58.7% YoY)
•2026E: $34.61 (16.0% YoY)
•LTM ROIC: 39.7%
•FFO Int Coverage: 33.92x

💳 Mastercard $MA
•2025E: $16.57 (16.1% YoY)
•2026E: $19.33 (16.7% YoY)
•LTM ROIC: 64.1%
•FFO Int Coverage: 19.79x

📈 S&P Global $SPGI
•2025E: $16.15 (12.7% YoY)
•2026E: $18.16 (12.5% YoY)
•LTM ROIC: 9.0%
•FFO Int Coverage: 12.58x

💸 Visa $V
•2025E: $11.08 (11.7% YoY)
•2026E: $12.56 (13.4% YoY)
•LTM ROIC: 35.7%
•FFO Int Coverage: 31.19x

📊 Salesforce $CRM
•2025E: $11.01 (11.2% YoY)
•2026E: $12.60 (14.4% YoY)
•LTM ROIC: 9.0%
•FFO Int Coverage: 413.45x

🖱️ Alphabet $GOOG $GOOGL
•2025E: $8.73 (14.0% YoY)
•2026E: $9.95 (14.0% YoY)
•LTM ROIC: 31.7%
•FFO Int Coverage: 341.10x

📸 Meta Platforms $META
•2025E: $23.19 (14.4% YoY)
•2026E: $26.28 (13.3% YoY)
•LTM ROIC: 30.1%
•FFO Int Coverage: 147.42x

🧬 Thermo Fisher Scientific $TMO
•2025E: $24.09 (10.8% YoY)
•2026E: $26.97 (11.9% YoY)
•LTM ROIC: 9.0%
•FFO Int Coverage: 6.38x

🏦 Intercontinental Exchange $ICE
•2025E: $6.68 (11.2% YoY)
•2026E: $7.41 (11.0% YoY)
•LTM ROIC: 7.7%
•FFO Int Coverage: 4.47x

📑 Intuit $INTU
•2025E: $19.20 (13.8% YoY)
•2026E: $22.09 (15.1% YoY)
•LTM ROIC: 15.0%
•FFO Int Coverage: 21.24x

🚛 Old Dominion Freight $ODFL
•2025E: $6.66 (16.8% YoY)
•2026E: $7.56 (13.6% YoY)
•LTM ROIC: 40.1%
•FFO Int Coverage: 3,381x

🚘 Copart $CPRT
•2025E: $1.63 (13.2% YoY)
•2026E: $1.80 (10.5% YoY)
•LTM ROIC: 21.7%
•FFO Int Coverage: n/a (nominal debt)

🌐 MSCI Inc $MSCI
•2025E: $16.76 (13.1% YoY)
•2026E: $19.06 (13.7% YoY)
•LTM ROIC: 36.3%
•FFO Int Coverage: 7.10x

🧾 PayPal $PYPL
•2025E: $4.58 (10.2% YoY)
•2026E: $5.08 (11.0% YoY)
•LTM ROIC: 15.7%
•FFO Int Coverage: 16.16x

🥤 Monster Beverage $MNST
•2025E: $2.03 (14.7% YoY)
•2026E: $2.29 (12.9% YoY)
•LTM ROIC: 24.0%
•FFO Int Coverage: 5,136x

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The FFO (Funds From Operations) interest coverage ratio is a financial metric that measures a company's ability to pay its interest expenses from its cash flow. It's calculated by dividing the company's FFO by its interest expenses. FFO is a measure of a company's cash flow from its core business operations, excluding non-cash items like depreciation and amortization.

A higher FFO interest coverage ratio is considered good because it indicates that a company has sufficient cash flow to cover its interest expenses, making it less likely to default on its debt obligations. A higher ratio also suggests that a company has more flexibility to take on additional debt, invest in growth opportunities, or return capital to shareholders. Generally, a ratio of 4.00x or higher is considered healthy, but the ideal ratio can vary depending on the industry and company-specific factors.
________

#stocks #investing
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⁠Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: On April 10, 2024, I posted my analysis on $MSCI, arguing it was overvalued at $542💵 and an attractive buy at $450💵

Since then, the stock has fallen over -17%, dipping just below my target price of $450💵

Shortly after hitting my $450💵 price target, $MSCI shares rebounded, surging over 23% 📈

As I stated in my analysis:

“As you can see, $MSCI appears to have attractive return potential if we assume >34x earnings, leaving us with no margin of safety

Given the multiple expansion over the last 10 years, deteriorating balance sheet, & a reduction in the growth rate, I’d demand greater value from $MSCI

I’d likely get more interested in $MSCI closer to $450💵 or at ~31x earnings (~16.5% 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."

A sober valuation analysis on $MSCI 🧘🏽‍♂️

•NTM P/E Ratio: 37.26x
•10-Year Mean: 34.88x

•NTM FCF Yield: 2.94%
•10-Year Mean: 3.39%

As you can see, $MSCI appears to be trading above fair value

Going forward, investors can receive ~7% LESS in earnings per share & ~13% LESS in FCF per share 🧠***

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

BALANCE SHEET🆗
•Cash & Short-Term Inv: $457.82M
•Long-Term Debt: $4.49B

$MSCI has an ok balance sheet, a BBB- S&P Credit Rating, & 6.62x FFO Interest Coverate

RETURN ON CAPITAL✅
•2019: 23.4%
•2020: 28.6%
•2021: 26.5%
•2022: 33.0%
•2023: 35.2%

RETURN ON EQUITY🆗
•2019: (463.5%)
•2020: (231.5%)
•2021: (239.3%)
•2022: (148.6%)
•2023: (131.4%)

*ROE negative due to heavy use of debt

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

REVENUES✅
•2013: $0.91B
•2023: $2.53B
•CAGR: 10.76%

FREE CASH FLOW✅
•2013: $280.93M
•2023: $1.21B
•CAGR: 15.75%

NORMALIZED EPS✅
•2013: $2.16
•2023: $13.52
•CAGR: 20.13%

SHARE BUYBACKS✅
•2013 Shares Outstanding: 121.07M
•LTM Shares Outstanding: 79.84M

By reducing its shares outstanding 34%, $MSCI increased its EPS by 51% (assuming 0 growth)

MARGINS✅
•LTM Gross Margins: 82.3%
•LTM Operating Margins: 54.8%
•LTM Net Income Margins: 45.4%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~7% LESS in EPS & ~13% LESS in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $MSCI has to grow earnings at an 18.63% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be less than the (18.63%) required growth rate:

2024E: $14.89 (10.1% YoY) *FY Dec
2025E: $17.05 (14.5% YoY)
2026E: $19.45 (14.1% YoY)

$MSCI has a great track record of meeting analyst estimates ~2 years out, but let’s assume $MSCI ends 2026 with $19.45 in EPS & see its CAGR potential assuming different multiples[...]

34x P/E: $661.30💵 … ~8.9% CAGR

32x P/E: $622.40💵 … ~6.5% CAGR

30x P/E: $583.50💵 … ~4.0% CAGR

28x P/E: $544.60💵 … ~1.5% CAGR

As you can see, $MSCI appears to have attractive return potential if we assume >34x earnings, leaving us with no margin of safety

Given the multiple expansion over the last 10 years, deteriorating balance sheet, & a reduction in the growth rate, I’d demand greater value from $MSCI

I’d likely get more interested in $MSCI closer to $450💵 or at ~31x earnings (~16.5% 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. "- Dimitry Nakhla | Babylon Capital®
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⁠Brandon Beylo
I hope you guys enjoy our 1H 2024 Macro Ops Portfolio Review.

We are off to a decent start with a lot of room for improvement.

Here's to a great second half of the year.
https://t.co/XqRomZdi0K
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⁠Bamboo
What do you spend most of your money on?

Be completely honest. https://t.co/sGbzplZRA8
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AkhenOsiris
$AMZN Citi Earnings Preview

Analysts project Amazon’s Q2 revenue to be around $149 billion, which is 40 basis points above the consensus estimates.

They also estimate an 18% year-over-year growth for Amazon Web Services (AWS), slightly above the Street's estimate of 17%.

Amazon’s cloud business stands to benefit from the strong Q4 backlog growth and increasing consumption spend around model training, analysts noted. They believe that $1 billion quarter-over-quarter growth to 18% year-over-year would be healthy compared to peers.

"We saw GCP results as a positive read-thru for AWS, with a 1pt q/q accel. & margin upside suggesting limited pricing pressure," they wrote.

Operating profit is anticipated to come in at $14 billion, 1% above the consensus expectation, but analysts suggest there could be upside potential towards buyside expectations, possibly reaching $15-16 billion, given the beat in Q1, new third-party fees, Prime ad ramp, and limited growth in fulfillment center square footage.

"Biggest risk is 3Q margin guide given high Street expectations, higher freight costs & propensity to bring new fulfillment capacity online in 3Q ahead of holidays,” Citi cautioned.

For guidance, analysts expect Q3 revenue to be between $155.5 billion and $160.5 billion (with the Street at $158.4 billion), suggesting 5% quarter-over-quarter growth at the midpoint.

They project GAAP operating profit to be between $12 billion and $15.5 billion, compared to the consensus of $15.4 billion.

Despite signs of consumer softening, the bank believes Amazon is gaining market share. In terms of margins, recent history and typical Q3 conservatism suggest a profit guide midpoint below the Street, although Q3 margins have improved quarter-over-quarter in retail harvest years.

Given expanding retail margins supported by Prime ad growth and expected AWS acceleration, analysts believe the stock is positioned for a multiple expansion in 2024. AMZN currently trades at 12.8x EV/EBITDA, below its 10-year average of 17x.

"We have highlighted that improving margins support a more traditional P/E valuation framework, and see Amazon's 30.7x Street '25 GAAP EPS as reasonable given 27% expected 2-year GAAP earnings growth CAGR," they said, maintaining a Buy rating on the stock.
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⁠Dimitry Nakhla | Babylon Capital®
NOTABLE EARNINGS REPORTS THIS WEEK 7/30 - 8/2 🗓️

𝐓𝐮𝐞𝐬𝐝𝐚𝐲🗓️
AM☀️
$SPGI $PG $PFE $ITW $PYPL $WSO $AMT

PM🌓
$MSFT $AMD $SYK $SBUX $CP

𝐖𝐞𝐝𝐧𝐞𝐬𝐝𝐚𝐲🗓️
AM☀️
$MA $ADP $TMUS $HUM $BA $GEHC $KKR $WAT $WING

PM🌓
$META $QCOM $ARM $LRCX $FICO $AFL

𝐓𝐡𝐮𝐫𝐬𝐝𝐚𝐲🗓️
AM☀️
$CI $ICE $RACE $APD $GWW $MRNA $CMI $HSY $XPO

PM🌓
$AAPL $AMZN $VRTX $MELI $INTC $COIN $BKNG $NET $RMD $OLED $DKNG

𝐅𝐫𝐢𝐝𝐚𝐲🗓️
AM☀️
$XOM $CVX $CHD

#stocks #investing
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