⁠App Economy Insights
📉 Celsius went from red-hot to ice-cold.

$CELH is down 70% from its 2024 peak.

What went wrong?

⚡️Let's visualize energy drinks economics.
https://t.co/fsmWLdGUhz
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⁠Dimitry Nakhla | Babylon Capital®
A quality valuation analysis on $META 🧘🏽‍♂️

•NTM P/E Ratio: 23.14x
•5-Year Mean: 22.52x

•NTM FCF Yield: 3.17%
•5-Year Mean: 3.66%

As you can see, $META appears to be trading near fair value

Going forward, investors can expect to receive ~3% LESS in earnings per share & ~13% LESS in FCF per share🧠***

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

BALANCE SHEET✅
•Cash & Equivalents: $70.90B
•Long-Term Debt: $28.82B

$META has an excellent balance sheet, an AA- S&P Credit Rating & 138x FFO Interest Coverage Ratio

RETURN ON CAPITAL✅
•2019: 26.0%
•2020: 23.5%
•2021: 33.7%
•2022: 22.0%
•2023: 26.3%
•LTM: 30.4%

RETURN ON EQUITY✅
•2019: 20.0%
•2020: 25.4%
•2021: 31.1%
•2022: 18.5%
•2023: 28.0%
•LTM: 36.1%

$META has great return metrics, highlighting the financial efficiency of the business

REVENUES✅
•2018: $55.84B
•2023: $134.90B
•CAGR: 19.29%

FREE CASH FLOW✅
•2018: $15.36B
•2023: $43.85B
•CAGR: 23.34%

NORMALIZED EPS✅
•2018: $7.57
•2023: $14.87
•CAGR: 14.45%

SHARE BUYBACKS✅
•2018 Shares Outstanding: 2.92B
•LTM Shares Outstanding: 2.62B

By reducing its shares outstanding ~10.2%, $META increased its EPS by ~11.3% (assuming 0 growth)

MARGINS✅
•LTM Gross Margins: 81.5%
•LTM Operating Margins: 41.6%
•LTM Net Income Margins: 35.6%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~3% LESS in EPS & ~13% LESS in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $META has to grow earnings at an 11.07% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2025 - 2026 EPS growth over the next few years to be greater than the (11.07%) required growth rate:

2024E: $22.61 (52.0% YoY) *FY Dec

2025E: $25.36 (12.2% YoY)
2026E: $28.84 (13.7% YoY)

$META has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $META ends 2026 with $28.84 in EPS & see its CAGR potential assuming different multiples

26x P/E: $749.84💵 … ~14.7% CAGR

25x P/E: $721.00💵 … ~12.6% CAGR

24x P/E: $692.16💵 … ~10.5% CAGR

23x P/E: $663.32💵 … ~8.3% CAGR

22x P/E: $634.48💵 … ~6.1% CAGR

As you can see, $META appears to have double-digit CAGR potential if we assume >24x earnings, a multiple above its 5-year average (22.50x), however 24x is a multiple that’s justified given its mid-teens earnings growth rate, balance sheet, visionary CEO & investments in AI & LLMs

As I’ve mentioned before: “… the increased investment in future growth and necessary Al development, which has the potential to lead to better growth prospects, should be viewed with a bullish tone rather than a bearish one” — (which can lead to a sustainable re-rating over the next few years)

Today at $565💵 $META appears to be fairly valued, so those buying today won’t have a margin of safety and will be relying heavily on estimates being met

I’d consider $META a great buy ~$515💵, offering ~11% CAGR assuming 22x 2026 est

#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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⁠Stock Analysis Compilation
Miller Value on United Natural Foods $UNFI US

Thesis: UNFI’s strategic transformation plan and asset optimization offer a significant upside potential, supported by market share gains and a large margin expansion opportunity.

(Extract from their Q3 letter) https://t.co/X273zqp5RX
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⁠Quiver Quantitative
We recently caught a STOCK Act violation by Senator Markwayne Mullin.

He bought stock in a company called Stride, $LRN.

It's a for-profit education company.

Mullin sits on the Senate Committee on Education.

The stock has now risen 39% since his trade. https://t.co/SKvrpIb0vm
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⁠Quiver Quantitative
BREAKING: Nancy Pelosi's portfolio just hit another all-time high.

She has made $2.3M in the stock market so far today, per our estimates.

We estimate that she is now worth $264M: https://t.co/HhBcG3gosS
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⁠Investing visuals
I get regularly asked which (data) tool I use to make side-by-side visuals like $NVDA vs $AMD.

My go to source is TIKR (link in comments) which I find the easiest and most complete tool for side-by-side comparisons.

I don't recommend tools often, but give this one a try! https://t.co/XIz2BZeQ4W
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⁠Quiver Quantitative
RT @mattgaetz: Now that I’m not in congress I’m just going to follow Quiver and get rich!

BREAKING: Nancy Pelosi's portfolio just hit another all-time high.

She has made $2.3M in the stock market so far today, per our estimates.

We estimate that she is now worth $264M: https://t.co/HhBcG3gosS - Quiver Quantitative
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⁠Stock Analysis Compilation
Brandes on LKQ $LKQ US

Thesis: LKQ stands as a strong value play amid industry challenges, leveraging shareholder returns and market share gains, while a potential recovery in the auto repair market offers further upside

(Extract from their Q3 letter) https://t.co/d1ryqurIpE
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