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โ Hidden Value Gems
Too early to go for a victory lap on $ABNB but the progress is encouraging and is in line with what I have outlined earlier.

In the near term, going beyond the Top5 countries (70% of GBV) and benefiting from economy of scale, AI in customer service + concierge.

Longer term, adding new services around and beyond travel. 6bn annual web visits, 1.6bn users - this is a huge and fully monetised platform.

See my earlier reports๐Ÿ‘‡
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โ Stock Analysis Compilation
Artisan Sustainable Emerging Markets Strategy on HD Hyundai Electric 267260 KS

Thesis: HD Hyundai Electric is a leading global player in the energy sector, excelling in power transformer manufacturing and poised to benefit from increasing demand in the US as the country transitions to a sustainable energy infrastructure.

(Extract from their Q4 letter)
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โ Finding Compounders
An article on Margin of Safety https://t.co/xTgvlhOWHs
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Offshore
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โ Startup Archive
Ben Horowitz explains the biggest mistake founders make pitching VCs

โ€œThe big mistake people make is they try to appeal too much to the venture capitalists. Thatโ€™ll drive us crazy because itโ€™s a little bit of a sign of anti-courage.โ€

Ben shares an example of being pitched by founders who are conservative in their estimates because they know โ€˜VCs like conservatism.โ€™ However, what VCs want to hear is what you actually believe โ€” not what you think they want to hear.

โ€œAnything that shows a lack of conviction or courage or belief in what youโ€™re doing is what always ends up worrying me. Either you believe it or you donโ€™t. Either youโ€™re committed or youโ€™re not. Either you have the courage to build the company or you donโ€™t.โ€

Importantly though, as Ben points out, courage doesnโ€™t mean that you donโ€™t feel fear. He recalls the quote from boxing coach Cus Dโ€™Amato:

โ€œThe hero and the coward both feel the same thing, but the hero uses his fear, projects it onto his opponent, while the coward runs. Itโ€™s the same thing, fear, but itโ€™s what you do with it that matters.โ€

Video source: @kevinrose (2012)
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โ Investing visuals
NVIDIA $NVDA just released their 13-F HR๐Ÿ‘‡ https://t.co/rSsG91ARy5
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โ Stock Analysis Compilation
Artisan International Explorer Strategy on Sabre $SBRE LN

Thesis: Sabre is a UK auto insurance company with a 1%โ€“2% market share, boasting the industry's most profitable business due to conservative pricing and a new growth strategy aimed at achieving a 10% profit CAGR without sacrificing underwriting discipline, while currently offering a nearly 10% total yield in dividends.

(Extract from their Q4 letter)
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โ Read
RT @TihoBrkan: Alibabaโ€™s $BABA new CEO disagrees with US large techโ€™s insane R&D and CapEx spend.

If youโ€™re read between the words, he is suggesting that much of those billions is wasted in an arms race which will most likely not deliver ROIs.

Instead of making the best possible model by spending ridiculous amounts of money, the focus should be on real world applications โ€” solving the important issues and problems of humanity.
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โ Dimitry Nakhla | Babylon Capitalยฎ
A quality valuation analysis on $TMO ๐Ÿง˜๐Ÿฝโ€โ™‚๏ธ

โ€ขNTM P/E Ratio: 22.83x
โ€ข5-Year Mean: 24.89x

โ€ขNTM FCF Yield: 3.89%
โ€ข5-Year Mean: 3.61%

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

Going forward, investors can receive ~9% MORE in earnings per share & ~8% MORE in FCF per share ๐Ÿง ***

Before we get into valuation, letโ€™s take a look at why $TMO is a great business

BALANCE SHEET๐Ÿ†—
โ€ขCash & Short-Term Inv: $5.57B
โ€ขLong-Term Debt: $29.06B

$TMO has a good balance sheet (acquisitions a big growth driver), a A- S&P Credit Rating & 6x FFO Interest Coverage

RETURN ON CAPITALโœ…*
โ€ข2019: 8.3%
โ€ข2020: 13.4%
โ€ข2021: 12.8%
โ€ข2022: 10.3%
โ€ข2023: 8.7%
โ€ข2024: 9.6%

*lower ROIC due to acquisition strategy

RETURN ON EQUITYโœ…
โ€ข2019: 12.9%
โ€ข2020: 19.9%
โ€ข2021: 20.5%
โ€ข2022: 16.4%
โ€ข2023: 13.1%
โ€ข2024: 13.1%

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

REVENUESโœ…
โ€ข2014: $16.89B
โ€ข2024: $42.88B
โ€ขCAGR: 9.76%

FREE CASH FLOWโœ…
โ€ข2014: $2.19B
โ€ข2024: $7.27B
โ€ขCAGR: 12.74%

NORMALIZED EPSโœ…
โ€ข2014: $6.96
โ€ข2024: $21.86
โ€ขCAGR: 12.12%

SHARE BUYBACKS๐Ÿ†—
โ€ข2014 Shares Outstanding: 402.30M
โ€ขLTM Shares Outstanding: 384.25M

MARGINSโœ…
โ€ขLTM Gross Margins: 42.2%
โ€ขLTM Operating Margins: 18.1%
โ€ขLTM Net Income Margins: 14.8%

***NOW TO VALUATION ๐Ÿง 

As stated above, investors can expect to receive ~9% MORE in EPS & ~8% MORE in FCF per share

Using Benjamin Grahamโ€™s 2G rule of thumb, $TMO has to grow earnings at an 11.42% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be slightly less than the (11.42%) required growth rate:

2025E: $23.33 (6.7% YoY) *FY Dec
2026E: $25.82 (10.7% YoY)
2027E: $29.11 (12.7% YoY)

$TMO has an excellent track record of meeting analyst estimates ~2 years out, but letโ€™s assume $TMO ends 2027 with $29.11 in EPS & see its CAGR potential assuming different multiples

26x P/E: $756.86๐Ÿ’ต โ€ฆ ~13.2% CAGR

25x P/E: $727.75๐Ÿ’ต โ€ฆ ~11.7% CAGR

24x P/E: $698.64๐Ÿ’ต โ€ฆ ~10.2% CAGR

23x P/E: $669.53๐Ÿ’ต โ€ฆ ~8.5% CAGR

As you can see, $TMO appears to have attractive return potential IF we assume >25x earnings and decent return potential at 24x

Also, $TMO maintains strong support ~20x earnings (roughly 12.4% below todayโ€™s price)

$TMO is an excellent business with a wide moat & will benefit from future ongoing sector demand (AI tailwinds in scientific research), especially their next-gen sequencing machines & chromatography machines

Those buying $TMO today at $532๐Ÿ’ต are buying it for a good price, with some margin of safety

I consider $TMO a strong purchase at $500๐Ÿ’ต (6% below todayโ€™s price) where I can reasonably expect ~11% to ~12% CAGR while assuming a 23x - 24x end multiple, ensuring a comfortable margin of safety

#stocks #investing
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๐ƒ๐ˆ๐’๐‚๐‹๐Ž๐’๐”๐‘๐„โ€ผ๏ธ: ๐“๐ก๐ข๐ฌ ๐ข๐ฌ ๐๐Ž๐“ ๐ˆ๐ง๐ฏ๐ž๐ฌ๐ญ๐ฆ๐ž๐ง๐ญ ๐€๐๐ฏ๐ข๐œ๐ž. ๐๐š๐›๐ฒ๐ฅ๐จ๐ง ๐‚๐š๐ฉ๐ข๐ญ๐š๐ฅยฎ ๐š๐ง๐ ๐ข๐ญ๐ฌ ๐ซ๐ž๐ฉ๐ซ๐ž๐ฌ๐ž๐ง๐ญ๐š๐ญ๐ข๐ฏ๐ž๐ฌ ๐ฆ๐š๐ฒ ๐ก๐š๐ฏ๐ž ๐ฉ๐จ๐ฌ๐ข๐ญ๐ข๐จ๐ง๐ฌ ๐ข๐ง ๐ญ๐ก๐ž ๐ฌ๐ž๐œ๐ฎ๐ซ๐ข๐ญ๐ข๐ž๐ฌ ๐๐ข๐ฌ๐œ๐ฎ๐ฌ๐ฌ๐ž๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐ž๐ž๐ญ.

๐“๐ก๐ž ๐ข๐ง๐Ÿ๐จ๐ซ๐ฆ๐š๐ญ๐ข๐จ๐ง ๐œ๐จ๐ง๐ญ๐š๐ข๐ง๐ž๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐ž๐ž๐ญ ๐ข๐ฌ ๐ข๐ง๐ญ๐ž๐ง๐๐ž๐ ๐Ÿ๐จ๐ซ ๐ข๐ง๐Ÿ๐จ๐ซ๐ฆ๐š๐ญ๐ข๐จ๐ง๐š๐ฅ ๐ฉ๐ฎ๐ซ๐ฉ๐จ๐ฌ๐ž๐ฌ ๐จ๐ง๐ฅ๐ฒ ๐š๐ง๐ ๐ฌ๐ก๐จ๐ฎ๐ฅ๐ ๐ง๐จ๐ญ ๐›๐ž ๐œ๐จ๐ง๐ฌ๐ญ๐ซ๐ฎ๐ž๐ ๐š๐ฌ ๐ข๐ง๐ฏ๐ž๐ฌ๐ญ๐ฆ๐ž๐ง๐ญ ๐š๐๐ฏ๐ข๐œ๐ž ๐ญ๐จ ๐ฆ๐ž๐ž๐ญ ๐ญ๐ก๐ž ๐ฌ๐ฉ๐ž๐œ๐ข๐Ÿ๐ข๐œ ๐ง๐ž๐ž๐๐ฌ ๐จ๐Ÿ ๐š๐ง๐ฒ ๐ข๐ง๐๐ข๐ฏ๐ข๐๐ฎ๐š๐ฅ ๐จ๐ซ ๐ฌ๐ข๐ญ๐ฎ๐š๐ญ๐ข๐จ๐ง. ๐๐š๐ฌ๐ญ ๐ฉ๐ž๐ซ๐Ÿ๐จ๐ซ๐ฆ๐š๐ง๐œ๐ž ๐ข๐ฌ ๐ง๐จ ๐ ๐ฎ๐š๐ซ๐š๐ง๐ญ๐ž๐ž ๐จ๐Ÿ ๐Ÿ๐ฎ๐ญ๐ฎ๐ซ๐ž ๐ซ๐ž๐ฌ๐ฎ๐ฅ๐ญ๐ฌ.

๐ˆ๐ง๐Ÿ๐จ๐ซ๐ฆ๐š๐ญ๐ข๐จ๐ง ๐œ๐จ๐ง๐ญ๐š๐ข๐ง๐ž๐ ๐ข๐ง ๐ญ๐ก๐ข๐ฌ ๐ญ๐ฐ๐ž๐ž๐ญ ๐ก๐š๐ฌ ๐›๐ž๐ž๐ง ๐จ๐›๐ญ๐š๐ข๐ง๐ž๐ ๐Ÿ๐ซ๐จ๐ฆ ๐ฌ๐จ๐ฎ๐ซ๐œ๐ž๐ฌ ๐›๐ž๐ฅ๐ข๐ž๐ฏ๐ž๐ ๐ญ๐จ ๐›๐ž ๐ซ๐ž๐ฅ๐ข๐š๐›๐ฅ๐ž, ๐›๐ฎ๐ญ ๐ข๐ฌ ๐ง๐จ๐ญ ๐ ๐ฎ๏ฟฝ[...]