Offshore
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โ Hidden Value Gems
RT @HiddenValueGems: Q3 Oakmark's portfolio changes:
Sold $AXP $MO $GOOG
Purchased $DGE.L $RI.PA $GPC $MKKGY $AKZA.AS $AZE.BR
Summary of Buy theses ๐งต๐๐ฝ
1โฃ Diageo & Pernod Ricard
1/4 https://t.co/7tSE6LlprV
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RT @HiddenValueGems: Q3 Oakmark's portfolio changes:
Sold $AXP $MO $GOOG
Purchased $DGE.L $RI.PA $GPC $MKKGY $AKZA.AS $AZE.BR
Summary of Buy theses ๐งต๐๐ฝ
1โฃ Diageo & Pernod Ricard
1/4 https://t.co/7tSE6LlprV
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โ Librarian Capital
Barry Diller FT interview quotes:
On Hollywood: "It is no more. Netflix, Amazon and Apple are really the controllers of the worldwide film & television business"
On Trump: "I did not like him. It is 45 years now since my first encounter [and] I have never spoken to him since"
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Barry Diller FT interview quotes:
On Hollywood: "It is no more. Netflix, Amazon and Apple are really the controllers of the worldwide film & television business"
On Trump: "I did not like him. It is 45 years now since my first encounter [and] I have never spoken to him since"
Barry Diller: Hollywoodโs hold over entertainment โis no moreโ https://t.co/2looDHfcuc tweet
twitter.com
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Offshore
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โ Librarian Capital
"The total returns from the Fundโs three Swiss healthcare companies โ Alcon, Novartis, and Roche โ have each outperformed the Nasdaq index"
- Troy Global Equity Fund (Aug-24 update)
This appears to be no longer true
And it was not true on longer periods
$ALC $NOVN $ROG https://t.co/J9ocgx2PnE
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"The total returns from the Fundโs three Swiss healthcare companies โ Alcon, Novartis, and Roche โ have each outperformed the Nasdaq index"
- Troy Global Equity Fund (Aug-24 update)
This appears to be no longer true
And it was not true on longer periods
$ALC $NOVN $ROG https://t.co/J9ocgx2PnE
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Offshore
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โ Capital Employed
Interesting idea by @HiddenRockCap on Mammoth Energy Services $TUSK
Deep value idea with majority of market value in net cash.
Full write-up here ๐
https://t.co/rKp8wFMY9B
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Interesting idea by @HiddenRockCap on Mammoth Energy Services $TUSK
Deep value idea with majority of market value in net cash.
Full write-up here ๐
https://t.co/rKp8wFMY9B
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Offshore
Video
โ Startup Archive
Flexport CEO Ryan Petersen explains why your initial vision for your company is probably wrong
When Ryan first applied to Y Combinator he wanted Flexport to be โTurboTax for customs.โ But that vision changed a lot. As Ryan explains:
โThe more you learn and the more customers you talk to and the more vendors you talk to, the more you realize how screwed up the world is in this space. Then [the vision] actually gets bigger and bigger and keeps expanding.โ
Y Combinator CEO Garry Tan says this is a common pattern he sees in startups too:
โThereโs a misconception that you wake up from a haze and youโre like โThis is it. This is the vision.โ But the story is actually โOh hereโs this thing that I know I can solve.โ And then once you solve it and people really like it, it sort of expands and expands.โ
Ryan concludes:
โIf a founder is too certain of exactly what the vision is and what the productโs going to look like and how itโs all going to work, theyโre probably wrong. The world is super messy.โ
Video source: @garrytan (2022)
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Flexport CEO Ryan Petersen explains why your initial vision for your company is probably wrong
When Ryan first applied to Y Combinator he wanted Flexport to be โTurboTax for customs.โ But that vision changed a lot. As Ryan explains:
โThe more you learn and the more customers you talk to and the more vendors you talk to, the more you realize how screwed up the world is in this space. Then [the vision] actually gets bigger and bigger and keeps expanding.โ
Y Combinator CEO Garry Tan says this is a common pattern he sees in startups too:
โThereโs a misconception that you wake up from a haze and youโre like โThis is it. This is the vision.โ But the story is actually โOh hereโs this thing that I know I can solve.โ And then once you solve it and people really like it, it sort of expands and expands.โ
Ryan concludes:
โIf a founder is too certain of exactly what the vision is and what the productโs going to look like and how itโs all going to work, theyโre probably wrong. The world is super messy.โ
Video source: @garrytan (2022)
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Offshore
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โ Stock Analysis Compilation
Praetorian Capital on St. Joe $JOE US
Thesis: St. Joeโs massive land holdings and high growth potential in a booming region position it as a key beneficiary of migration and inflation-driven appreciation
(Extract from their Q2 letter) https://t.co/pWhYuMXKjO
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Praetorian Capital on St. Joe $JOE US
Thesis: St. Joeโs massive land holdings and high growth potential in a booming region position it as a key beneficiary of migration and inflation-driven appreciation
(Extract from their Q2 letter) https://t.co/pWhYuMXKjO
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Offshore
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โ Dimitry Nakhla | Babylon Capitalยฎ
A sober valuation analysis on $INTU ๐ง๐ฝโโ๏ธ
โขNTM P/E Ratio: 31.89x
โข10-Year Mean: 33.66x
โขNTM FCF Yield: 3.44%
โข10-Year Mean: 3.70%
As you can see, $INTU appears to be trading somewhere near fair value & over fair value
Going forward, investors can receive ~5% MORE in earnings per share & ~7# LESS in FCF per share ๐ง ***
Before we get into valuation, letโs take a look at why $INTU is a good business
BALANCE SHEETโ
โขCash & Short-Term Inv: $4.07B
โขLong-Term Debt: $5.54B
$INTU has a strong balance sheet, an A- S&P Credit Rating & 20x FFO Interest Coverage
RETURN ON CAPITALโ
โข2019: 43.9%
โข2020: 25.2%
โข2021: 19.7%
โข2022: 10.7%
โข2023: 13.1%
โข2024: 15.5%
RETURN ON EQUITYโ
โข2019: 47.4%
โข2020: 41.2%
โข2021: 27.5%
โข2022: 15.7%
โข2023: 14.1%
โข2024: 16.6%
$INTU has strong return metrics, highlighting the financial efficiency of the business
REVENUESโ
โข2014: $4.51
โข2024: $16.29B
โขCAGR: 13.70%
FREE CASH FLOWโ *
โข2014: $1.34B
โข2024: $4.69B
โขCAGR: 13.34%
NORMALIZED EPSโ
โข2014: $16.94
โข2024: $3.49
โขCAGR: 17.11%
PAID DIVIDENDSโ
โข2014: $0.76
โข2024: $3.60
โขCAGR: 16.82%
SHARE BUYBACKS๐
โข2014 Shares Outstanding: 291.00M
โขLTM Shares Outstanding: 284.00M
By reducing its shares outstanding ~2.4%, $INTU increased its EPS by ~2.5% (assuming 0 growth)
MARGINSโ
โขLTM Gross Margins: 79.6%
โขLTM Operating Margins: 23.7%
โขLTM Net Income Margins: 18.2%
***NOW TO VALUATION ๐ง
As stated above, investors can expect to receive ~5% MORE in EPS & ~7% LESS in FCF per share
Using Benjamin Grahamโs 2G rule of thumb, $INTU has to grow earnings at a 15.95% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be less than the (15.95%) required growth rate:
2025E: $19.34 (14.1% YoY) *FY Jul
2026E: $22.24 (15.0% YoY)
2027E: $25.41 (14.3% YoY)
$INTU has a great track record of meeting analyst estimates ~2 years out, but letโs assume $INTU ends 2027 with $25.41 in EPS & see its CAGR potential assuming different multiples:
32x P/E: $708.16๐ต โฆ ~10.9% CAGR
31x P/E: $686.03๐ต โฆ ~9.6% CAGR
30x P/E: $663.90๐ต โฆ ~8.4% CAGR
29x P/E: $641.77๐ต โฆ ~7.1% CAGR
While itโs certainly reasonable for $INTU to trade for 32x, I wouldnโt want to rely on that assumption as it doesnโt leave us with a substantial margin of safety (given todayโs $619๐ต share price)
Iโd consider $INTU a strong purchase with a substantial margin of safety closer to $570๐ต, or ~29.40 NTM earnings (~8% below todays price)
Given todayโs estimates, at $570๐ต I can reasonably expect ~10.3% CAGR while assuming a 29x end multiple
#stocks #investing
___
๐๐๐๐๐๐๐๐๐๐โผ๏ธ: ๐๐ก๐ข๐ฌ ๐ข๐ฌ ๐๐๐ ๐๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐๐๐ฏ๐ข๐๐. ๐๐๐๐ฒ๐ฅ๐จ๐ง ๐๐๐ฉ๐ข๐ญ๐๐ฅยฎ ๐๐ง๐ ๐ข๐ญ๐ฌ ๐ซ๐๐ฉ๐ซ๐๐ฌ๐๐ง๐ญ๐๐ญ๐ข๐ฏ๐๐ฌ ๐ฆ๐๐ฒ ๐ก๐๐ฏ๐ ๐ฉ๐จ๐ฌ๐ข๐ญ๐ข๐จ๐ง๐ฌ ๐ข๐ง ๐ญ๐ก๐ ๐ฌ๐๐๐ฎ๐ซ๐ข๐ญ๐ข๐๐ฌ ๐๐ข๐ฌ๐๐ฎ๐ฌ๐ฌ๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ.
๐๐ก๐ ๐ข๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง ๐๐จ๐ง๐ญ๐๐ข๐ง๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ ๐ข๐ฌ ๐ข๐ง๐ญ๐๐ง๐๐๐ ๐๐จ๐ซ ๐ข๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง๐๐ฅ ๐ฉ๐ฎ๐ซ๐ฉ๐จ๐ฌ๐๐ฌ ๐จ๐ง๐ฅ๐ฒ ๐๐ง๐ ๐ฌ๐ก๐จ๐ฎ๐ฅ๐ ๐ง๐จ๐ญ ๐๐ ๐๐จ๐ง๐ฌ๐ญ๐ซ๐ฎ๐๐ ๐๐ฌ ๐ข๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐๐๐ฏ๐ข๐๐ ๐ญ๐จ ๐ฆ๐๐๐ญ ๐ญ๐ก๐ ๐ฌ๐ฉ๐๐๐ข๐๐ข๐ ๐ง๐๐๐๐ฌ ๐จ๐ ๐๐ง๐ฒ ๐ข๐ง๐๐ข๐ฏ๐ข๐๐ฎ๐๐ฅ ๐จ๐ซ ๐ฌ๐ข๐ญ๐ฎ๐๐ญ๐ข๐จ๐ง. ๐๐๐ฌ๐ญ ๐ฉ๐๐ซ๐๐จ๐ซ๐ฆ๐๐ง๐๐ ๐ข๐ฌ ๐ง๐จ ๐ ๐ฎ๐๐ซ๐๐ง๐ญ๐๐ ๐จ๐ ๐๐ฎ๐ญ๐ฎ๐ซ๐ ๐ซ๐๐ฌ๐ฎ๐ฅ๐ญ๐ฌ.
๐๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง ๐๐จ๐ง๐ญ๐๐ข๐ง๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ ๐ก๐๐ฌ ๐๐๐๐ง ๐จ๐๐ญ๐๐ข๐ง๐๐ ๐๐ซ๐จ๐ฆ ๐ฌ๐จ๐ฎ๐ซ๐๐๐ฌ ๐๐๐ฅ๐ข๐๐ฏ๐๐ ๐ญ๐จ ๐๐ ๐ซ๐๐ฅ๐ข๐๐๐ฅ๐, ๐๐ฎ๐ญ ๐ข๐ฌ ๐ง๐จ๐ญ ๐ ๐ฎ๐๐ซ๐๐ง๐ญ๐๐๐ ๐๐ฌ ๐ญ๐จ ๐๐จ๐ฆ๐ฉ๐ฅ๐๐ญ๐๐ง๐๐ฌ๐ฌ ๐จ๐ซ ๐๐๐๐ฎ๐ซ๐๐๐ฒ.
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A sober valuation analysis on $INTU ๐ง๐ฝโโ๏ธ
โขNTM P/E Ratio: 31.89x
โข10-Year Mean: 33.66x
โขNTM FCF Yield: 3.44%
โข10-Year Mean: 3.70%
As you can see, $INTU appears to be trading somewhere near fair value & over fair value
Going forward, investors can receive ~5% MORE in earnings per share & ~7# LESS in FCF per share ๐ง ***
Before we get into valuation, letโs take a look at why $INTU is a good business
BALANCE SHEETโ
โขCash & Short-Term Inv: $4.07B
โขLong-Term Debt: $5.54B
$INTU has a strong balance sheet, an A- S&P Credit Rating & 20x FFO Interest Coverage
RETURN ON CAPITALโ
โข2019: 43.9%
โข2020: 25.2%
โข2021: 19.7%
โข2022: 10.7%
โข2023: 13.1%
โข2024: 15.5%
RETURN ON EQUITYโ
โข2019: 47.4%
โข2020: 41.2%
โข2021: 27.5%
โข2022: 15.7%
โข2023: 14.1%
โข2024: 16.6%
$INTU has strong return metrics, highlighting the financial efficiency of the business
REVENUESโ
โข2014: $4.51
โข2024: $16.29B
โขCAGR: 13.70%
FREE CASH FLOWโ *
โข2014: $1.34B
โข2024: $4.69B
โขCAGR: 13.34%
NORMALIZED EPSโ
โข2014: $16.94
โข2024: $3.49
โขCAGR: 17.11%
PAID DIVIDENDSโ
โข2014: $0.76
โข2024: $3.60
โขCAGR: 16.82%
SHARE BUYBACKS๐
โข2014 Shares Outstanding: 291.00M
โขLTM Shares Outstanding: 284.00M
By reducing its shares outstanding ~2.4%, $INTU increased its EPS by ~2.5% (assuming 0 growth)
MARGINSโ
โขLTM Gross Margins: 79.6%
โขLTM Operating Margins: 23.7%
โขLTM Net Income Margins: 18.2%
***NOW TO VALUATION ๐ง
As stated above, investors can expect to receive ~5% MORE in EPS & ~7% LESS in FCF per share
Using Benjamin Grahamโs 2G rule of thumb, $INTU has to grow earnings at a 15.95% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be less than the (15.95%) required growth rate:
2025E: $19.34 (14.1% YoY) *FY Jul
2026E: $22.24 (15.0% YoY)
2027E: $25.41 (14.3% YoY)
$INTU has a great track record of meeting analyst estimates ~2 years out, but letโs assume $INTU ends 2027 with $25.41 in EPS & see its CAGR potential assuming different multiples:
32x P/E: $708.16๐ต โฆ ~10.9% CAGR
31x P/E: $686.03๐ต โฆ ~9.6% CAGR
30x P/E: $663.90๐ต โฆ ~8.4% CAGR
29x P/E: $641.77๐ต โฆ ~7.1% CAGR
While itโs certainly reasonable for $INTU to trade for 32x, I wouldnโt want to rely on that assumption as it doesnโt leave us with a substantial margin of safety (given todayโs $619๐ต share price)
Iโd consider $INTU a strong purchase with a substantial margin of safety closer to $570๐ต, or ~29.40 NTM earnings (~8% below todays price)
Given todayโs estimates, at $570๐ต I can reasonably expect ~10.3% CAGR while assuming a 29x end multiple
#stocks #investing
___
๐๐๐๐๐๐๐๐๐๐โผ๏ธ: ๐๐ก๐ข๐ฌ ๐ข๐ฌ ๐๐๐ ๐๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐๐๐ฏ๐ข๐๐. ๐๐๐๐ฒ๐ฅ๐จ๐ง ๐๐๐ฉ๐ข๐ญ๐๐ฅยฎ ๐๐ง๐ ๐ข๐ญ๐ฌ ๐ซ๐๐ฉ๐ซ๐๐ฌ๐๐ง๐ญ๐๐ญ๐ข๐ฏ๐๐ฌ ๐ฆ๐๐ฒ ๐ก๐๐ฏ๐ ๐ฉ๐จ๐ฌ๐ข๐ญ๐ข๐จ๐ง๐ฌ ๐ข๐ง ๐ญ๐ก๐ ๐ฌ๐๐๐ฎ๐ซ๐ข๐ญ๐ข๐๐ฌ ๐๐ข๐ฌ๐๐ฎ๐ฌ๐ฌ๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ.
๐๐ก๐ ๐ข๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง ๐๐จ๐ง๐ญ๐๐ข๐ง๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ ๐ข๐ฌ ๐ข๐ง๐ญ๐๐ง๐๐๐ ๐๐จ๐ซ ๐ข๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง๐๐ฅ ๐ฉ๐ฎ๐ซ๐ฉ๐จ๐ฌ๐๐ฌ ๐จ๐ง๐ฅ๐ฒ ๐๐ง๐ ๐ฌ๐ก๐จ๐ฎ๐ฅ๐ ๐ง๐จ๐ญ ๐๐ ๐๐จ๐ง๐ฌ๐ญ๐ซ๐ฎ๐๐ ๐๐ฌ ๐ข๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐๐๐ฏ๐ข๐๐ ๐ญ๐จ ๐ฆ๐๐๐ญ ๐ญ๐ก๐ ๐ฌ๐ฉ๐๐๐ข๐๐ข๐ ๐ง๐๐๐๐ฌ ๐จ๐ ๐๐ง๐ฒ ๐ข๐ง๐๐ข๐ฏ๐ข๐๐ฎ๐๐ฅ ๐จ๐ซ ๐ฌ๐ข๐ญ๐ฎ๐๐ญ๐ข๐จ๐ง. ๐๐๐ฌ๐ญ ๐ฉ๐๐ซ๐๐จ๐ซ๐ฆ๐๐ง๐๐ ๐ข๐ฌ ๐ง๐จ ๐ ๐ฎ๐๐ซ๐๐ง๐ญ๐๐ ๐จ๐ ๐๐ฎ๐ญ๐ฎ๐ซ๐ ๐ซ๐๐ฌ๐ฎ๐ฅ๐ญ๐ฌ.
๐๐ง๐๐จ๐ซ๐ฆ๐๐ญ๐ข๐จ๐ง ๐๐จ๐ง๐ญ๐๐ข๐ง๐๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐๐๐ญ ๐ก๐๐ฌ ๐๐๐๐ง ๐จ๐๐ญ๐๐ข๐ง๐๐ ๐๐ซ๐จ๐ฆ ๐ฌ๐จ๐ฎ๐ซ๐๐๐ฌ ๐๐๐ฅ๐ข๐๐ฏ๐๐ ๐ญ๐จ ๐๐ ๐ซ๐๐ฅ๐ข๐๐๐ฅ๐, ๐๐ฎ๐ญ ๐ข๐ฌ ๐ง๐จ๐ญ ๐ ๐ฎ๐๐ซ๐๐ง๐ญ๐๐๐ ๐๐ฌ ๐ญ๐จ ๐๐จ๐ฆ๐ฉ๐ฅ๐๐ญ๐๐ง๐๐ฌ๐ฌ ๐จ๐ซ ๐๐๐๐ฎ๐ซ๐๐๐ฒ.
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