Offshore
Video
EndGame Macro
A Hypothetical, Contrarian Look at the JPM AND MSTR Drama
The Set Up
If you strip away the noise and just look at the filings, the story everyone’s passing around about JPM being existentially short MSTR doesn’t hold up. Their 13F shows them long roughly 2.38 million shares with a mix of calls and puts, exactly what you’d expect from a big bank running a hedged, client driven book, not someone caught in a catastrophic short position. And at the same time, MicroStrategy is facing a very real problem…MSCI and other index providers are openly debating whether to kick digital asset treasury companies out of major benchmarks. JPM’s own research put numbers on the possible fallout, estimating anywhere from $2.8 billion to over $11 billion in forced selling if those removals happen. The Bankless report lays all this out clearly and shows how deeply MSTR has been hit, down more than 60% from its highs, dramatically underperforming Bitcoin itself. In other words, both JPM and MicroStrategy are operating in an environment defined by stress, scrutiny, and genuine structural risk.
The Hypothetical Twist
Now imagine a scenario…purely hypothetical, purely contrarian where the viral rumor about JPM being trapped short isn’t an accident, but a narrative that both sides quietly benefit from. JPM doesn’t need it to be true. They benefit from the reaction. A wave of retail traders convinced they can “squeeze the bank” brings in liquidity, volume, and volatility, all the raw materials a bank like JPM uses to make money. If they’re long volatility and hedged on both sides, spikes in price or IV aren’t threats, they’re opportunities to unload inventory, write expensive calls, and rebalance their book on favorable terms. They don’t have to start the rumor, they just have to let the market run with it.
MicroStrategy has its own incentives in this moment. With the threat of index exclusion hanging over them, and the possibility of billions in mechanical selling hitting the stock whether anyone wants to sell or not, they need something that strengthens the emotional glue holding their shareholder base together. Saylor has always framed MSTR as more than a business, it’s almost a mission. A story that positions the company as the underdog in a fight against a Wall Street giant fits perfectly into that ecosystem. It rallies retail at the exact moment they need committed holders to absorb volatility and counterbalance any forced outflows from index funds. Even if they’re not pushing the rumor, they have no reason to tamp it down.
The Bigger Picture
When you put all this together, the contrarian version looks something like this…a shaky stock, facing real structural headwinds, suddenly becomes the protagonist in a meme friendly narrative that pulls in fresh liquidity and ideological support. A large institution positioned for volatility sees that same narrative drive the kind of flow that makes their hedged book more profitable, not less. Both sides quietly benefiting from a misunderstanding that the public thinks is a revelation.
It’s not about claiming this is what is happening, it’s about recognizing how easily these loops form in modern markets, and how often the crowd ends up fighting battles that serve the very institutions they believe they’re rebelling against.
tweet
A Hypothetical, Contrarian Look at the JPM AND MSTR Drama
The Set Up
If you strip away the noise and just look at the filings, the story everyone’s passing around about JPM being existentially short MSTR doesn’t hold up. Their 13F shows them long roughly 2.38 million shares with a mix of calls and puts, exactly what you’d expect from a big bank running a hedged, client driven book, not someone caught in a catastrophic short position. And at the same time, MicroStrategy is facing a very real problem…MSCI and other index providers are openly debating whether to kick digital asset treasury companies out of major benchmarks. JPM’s own research put numbers on the possible fallout, estimating anywhere from $2.8 billion to over $11 billion in forced selling if those removals happen. The Bankless report lays all this out clearly and shows how deeply MSTR has been hit, down more than 60% from its highs, dramatically underperforming Bitcoin itself. In other words, both JPM and MicroStrategy are operating in an environment defined by stress, scrutiny, and genuine structural risk.
The Hypothetical Twist
Now imagine a scenario…purely hypothetical, purely contrarian where the viral rumor about JPM being trapped short isn’t an accident, but a narrative that both sides quietly benefit from. JPM doesn’t need it to be true. They benefit from the reaction. A wave of retail traders convinced they can “squeeze the bank” brings in liquidity, volume, and volatility, all the raw materials a bank like JPM uses to make money. If they’re long volatility and hedged on both sides, spikes in price or IV aren’t threats, they’re opportunities to unload inventory, write expensive calls, and rebalance their book on favorable terms. They don’t have to start the rumor, they just have to let the market run with it.
MicroStrategy has its own incentives in this moment. With the threat of index exclusion hanging over them, and the possibility of billions in mechanical selling hitting the stock whether anyone wants to sell or not, they need something that strengthens the emotional glue holding their shareholder base together. Saylor has always framed MSTR as more than a business, it’s almost a mission. A story that positions the company as the underdog in a fight against a Wall Street giant fits perfectly into that ecosystem. It rallies retail at the exact moment they need committed holders to absorb volatility and counterbalance any forced outflows from index funds. Even if they’re not pushing the rumor, they have no reason to tamp it down.
The Bigger Picture
When you put all this together, the contrarian version looks something like this…a shaky stock, facing real structural headwinds, suddenly becomes the protagonist in a meme friendly narrative that pulls in fresh liquidity and ideological support. A large institution positioned for volatility sees that same narrative drive the kind of flow that makes their hedged book more profitable, not less. Both sides quietly benefiting from a misunderstanding that the public thinks is a revelation.
It’s not about claiming this is what is happening, it’s about recognizing how easily these loops form in modern markets, and how often the crowd ends up fighting battles that serve the very institutions they believe they’re rebelling against.
tweet
Offshore
Video
EndGame Macro
A Hypothetical, Contrarian Look at the JP Morgan AND MSTR Drama
The Set Up
If you strip away the noise and just look at the filings, the story everyone’s passing around about JPM being existentially short MSTR doesn’t hold up. Their 13F shows them long roughly 2.38 million shares with a mix of calls and puts, exactly what you’d expect from a big bank running a hedged, client driven book, not someone caught in a catastrophic short position. And at the same time, MicroStrategy is facing a very real problem…MSCI and other index providers are openly debating whether to kick digital asset treasury companies out of major benchmarks. JPM’s own research put numbers on the possible fallout, estimating anywhere from $2.8 billion to over $11 billion in forced selling if those removals happen. The Bankless report lays all this out clearly and shows how deeply MSTR has been hit, down more than 60% from its highs, dramatically underperforming Bitcoin itself. In other words, both JPM and MicroStrategy are operating in an environment defined by stress, scrutiny, and genuine structural risk.
The Hypothetical Twist
Now imagine a scenario…purely hypothetical, purely contrarian where the viral rumor about JPM being trapped short isn’t an accident, but a narrative that both sides quietly benefit from. JPM doesn’t need it to be true. They benefit from the reaction. A wave of retail traders convinced they can “squeeze the bank” brings in liquidity, volume, and volatility, all the raw materials a bank like JPM uses to make money. If they’re long volatility and hedged on both sides, spikes in price or IV aren’t threats, they’re opportunities to unload inventory, write expensive calls, and rebalance their book on favorable terms. They don’t have to start the rumor, they just have to let the market run with it.
MicroStrategy has its own incentives in this moment. With the threat of index exclusion hanging over them, and the possibility of billions in mechanical selling hitting the stock whether anyone wants to sell or not, they need something that strengthens the emotional glue holding their shareholder base together. Saylor has always framed MSTR as more than a business, it’s almost a mission. A story that positions the company as the underdog in a fight against a Wall Street giant fits perfectly into that ecosystem. It rallies retail at the exact moment they need committed holders to absorb volatility and counterbalance any forced outflows from index funds. Even if they’re not pushing the rumor, they have no reason to tamp it down.
The Bigger Picture
When you put all this together, the contrarian version looks something like this…a shaky stock, facing real structural headwinds, suddenly becomes the protagonist in a meme friendly narrative that pulls in fresh liquidity and ideological support. A large institution positioned for volatility sees that same narrative drive the kind of flow that makes their hedged book more profitable, not less. Both sides quietly benefiting from a misunderstanding that the public thinks is a revelation.
It’s not about claiming this is what is happening, it’s about recognizing how easily these loops form in modern markets, and how often the crowd ends up fighting battles that serve the very institutions they believe they’re rebelling against.
tweet
A Hypothetical, Contrarian Look at the JP Morgan AND MSTR Drama
The Set Up
If you strip away the noise and just look at the filings, the story everyone’s passing around about JPM being existentially short MSTR doesn’t hold up. Their 13F shows them long roughly 2.38 million shares with a mix of calls and puts, exactly what you’d expect from a big bank running a hedged, client driven book, not someone caught in a catastrophic short position. And at the same time, MicroStrategy is facing a very real problem…MSCI and other index providers are openly debating whether to kick digital asset treasury companies out of major benchmarks. JPM’s own research put numbers on the possible fallout, estimating anywhere from $2.8 billion to over $11 billion in forced selling if those removals happen. The Bankless report lays all this out clearly and shows how deeply MSTR has been hit, down more than 60% from its highs, dramatically underperforming Bitcoin itself. In other words, both JPM and MicroStrategy are operating in an environment defined by stress, scrutiny, and genuine structural risk.
The Hypothetical Twist
Now imagine a scenario…purely hypothetical, purely contrarian where the viral rumor about JPM being trapped short isn’t an accident, but a narrative that both sides quietly benefit from. JPM doesn’t need it to be true. They benefit from the reaction. A wave of retail traders convinced they can “squeeze the bank” brings in liquidity, volume, and volatility, all the raw materials a bank like JPM uses to make money. If they’re long volatility and hedged on both sides, spikes in price or IV aren’t threats, they’re opportunities to unload inventory, write expensive calls, and rebalance their book on favorable terms. They don’t have to start the rumor, they just have to let the market run with it.
MicroStrategy has its own incentives in this moment. With the threat of index exclusion hanging over them, and the possibility of billions in mechanical selling hitting the stock whether anyone wants to sell or not, they need something that strengthens the emotional glue holding their shareholder base together. Saylor has always framed MSTR as more than a business, it’s almost a mission. A story that positions the company as the underdog in a fight against a Wall Street giant fits perfectly into that ecosystem. It rallies retail at the exact moment they need committed holders to absorb volatility and counterbalance any forced outflows from index funds. Even if they’re not pushing the rumor, they have no reason to tamp it down.
The Bigger Picture
When you put all this together, the contrarian version looks something like this…a shaky stock, facing real structural headwinds, suddenly becomes the protagonist in a meme friendly narrative that pulls in fresh liquidity and ideological support. A large institution positioned for volatility sees that same narrative drive the kind of flow that makes their hedged book more profitable, not less. Both sides quietly benefiting from a misunderstanding that the public thinks is a revelation.
It’s not about claiming this is what is happening, it’s about recognizing how easily these loops form in modern markets, and how often the crowd ends up fighting battles that serve the very institutions they believe they’re rebelling against.
tweet
Offshore
Video
EndGame Macro
The Story Isn’t What You Think: A Clearer Look at J.P. Morgan, MicroStrategy, and the Narrative Machine
The whole J.P. Morgan and MicroStrategy drama probably sounds like a remake of the old Wall Street vs retail story. The viral version paints it like J.P. Morgan is stuck in some giant short position and small traders can squeeze them into oblivion. But when you slow down and look at the real structure underneath, the picture flips. J.P. Morgan isn’t cornered, and MicroStrategy isn’t battling a bank. They’re both responding to a much bigger pressure most people aren’t even aware of.
J.P. Morgan Isn’t the One in Trouble
Their filings make it pretty clear that they’re long a big block of MicroStrategy with a hedge of calls and puts wrapped around it. That isn’t what a trapped short looks like. That’s a dealer book managing client flow. Banks like J.P. Morgan don’t live or die on the direction of a single stock. They live on volatility and volume. When a stock gets emotional, messy, and loud, they make more money. A dramatic narrative doesn’t threaten them; it feeds their business model.
MicroStrategy’s Real Challenge Is the Index System
MicroStrategy, meanwhile, is dealing with something far less cinematic and far more consequential. Index providers like MSCI are actively deciding whether companies whose balance sheets are basically one big Bitcoin bet belong in major benchmarks at all. If MSCI removes them, every ETF and index fund tied to MSCI becomes a forced seller. That’s the mechanics. And MicroStrategy’s own choices, issuing stock to buy more Bitcoin, letting BTC dominate the balance sheet, letting the stock trade like a Bitcoin levered product strengthen the case for exclusion. If recession risks are rising for 2025–2026, index providers have even more incentive to clean up anything that could contaminate benchmark volatility.
Why the Rumor Caught Fire
That’s the environment the JPM is trapped short rumor entered. And you can see why it exploded. Nobody gets excited about index methodology. Nobody rallies around forced outflows. But a story about squeezing a giant bank? That flips the emotional polarity of the stock overnight. It takes a technical threat and replaces it with a mission. And for MicroStrategy, that’s useful. If passive funds get forced to sell, they need retail to step in with conviction, not spreadsheets.
Why the Narrative Helps Both Sides
Here’s the twist most people miss. Whether the rumor is true or not doesn’t matter. It creates the exact kind of environment both MicroStrategy and J.P. Morgan benefit from. For MicroStrategy, it buys time. Time to keep a loyal base engaged. Time to soften the blow if index funds need to unwind. Time to hold the narrative together until either Bitcoin bails them out or MSCI makes its decision. For J.P. Morgan, the same narrative is profitable noise. A stock full of retail emotion is a perfect playground for a hedged dealer…more volume, more volatility, more options flow, more spreads. They profit from the motion, not the myth.
What MicroStrategy Would Actually Have to Prove
If MicroStrategy truly wants to stay in major indexes, it isn’t enough to rally retail. They have to show something they’ve never convincingly shown before: that they are, at their core, an operating software company, not a Bitcoin wrapped investment vehicle. That means demonstrating real growth in the software business, clearer separation between operations and the Bitcoin treasury, financial reporting that makes BTC look like treasury capital and not the business model, and enough operational independence that the company doesn’t rise and fall entirely with Bitcoin’s price. That’s what index committees care about.
The Real Story
J.P. Morgan isn’t trapped, and MicroStrategy isn’t fighting them. And the rumor everyone’s trading on? It just happens to create the perfect conditions for both of them, even though the rumor itself is wrong. tweet
The Story Isn’t What You Think: A Clearer Look at J.P. Morgan, MicroStrategy, and the Narrative Machine
The whole J.P. Morgan and MicroStrategy drama probably sounds like a remake of the old Wall Street vs retail story. The viral version paints it like J.P. Morgan is stuck in some giant short position and small traders can squeeze them into oblivion. But when you slow down and look at the real structure underneath, the picture flips. J.P. Morgan isn’t cornered, and MicroStrategy isn’t battling a bank. They’re both responding to a much bigger pressure most people aren’t even aware of.
J.P. Morgan Isn’t the One in Trouble
Their filings make it pretty clear that they’re long a big block of MicroStrategy with a hedge of calls and puts wrapped around it. That isn’t what a trapped short looks like. That’s a dealer book managing client flow. Banks like J.P. Morgan don’t live or die on the direction of a single stock. They live on volatility and volume. When a stock gets emotional, messy, and loud, they make more money. A dramatic narrative doesn’t threaten them; it feeds their business model.
MicroStrategy’s Real Challenge Is the Index System
MicroStrategy, meanwhile, is dealing with something far less cinematic and far more consequential. Index providers like MSCI are actively deciding whether companies whose balance sheets are basically one big Bitcoin bet belong in major benchmarks at all. If MSCI removes them, every ETF and index fund tied to MSCI becomes a forced seller. That’s the mechanics. And MicroStrategy’s own choices, issuing stock to buy more Bitcoin, letting BTC dominate the balance sheet, letting the stock trade like a Bitcoin levered product strengthen the case for exclusion. If recession risks are rising for 2025–2026, index providers have even more incentive to clean up anything that could contaminate benchmark volatility.
Why the Rumor Caught Fire
That’s the environment the JPM is trapped short rumor entered. And you can see why it exploded. Nobody gets excited about index methodology. Nobody rallies around forced outflows. But a story about squeezing a giant bank? That flips the emotional polarity of the stock overnight. It takes a technical threat and replaces it with a mission. And for MicroStrategy, that’s useful. If passive funds get forced to sell, they need retail to step in with conviction, not spreadsheets.
Why the Narrative Helps Both Sides
Here’s the twist most people miss. Whether the rumor is true or not doesn’t matter. It creates the exact kind of environment both MicroStrategy and J.P. Morgan benefit from. For MicroStrategy, it buys time. Time to keep a loyal base engaged. Time to soften the blow if index funds need to unwind. Time to hold the narrative together until either Bitcoin bails them out or MSCI makes its decision. For J.P. Morgan, the same narrative is profitable noise. A stock full of retail emotion is a perfect playground for a hedged dealer…more volume, more volatility, more options flow, more spreads. They profit from the motion, not the myth.
What MicroStrategy Would Actually Have to Prove
If MicroStrategy truly wants to stay in major indexes, it isn’t enough to rally retail. They have to show something they’ve never convincingly shown before: that they are, at their core, an operating software company, not a Bitcoin wrapped investment vehicle. That means demonstrating real growth in the software business, clearer separation between operations and the Bitcoin treasury, financial reporting that makes BTC look like treasury capital and not the business model, and enough operational independence that the company doesn’t rise and fall entirely with Bitcoin’s price. That’s what index committees care about.
The Real Story
J.P. Morgan isn’t trapped, and MicroStrategy isn’t fighting them. And the rumor everyone’s trading on? It just happens to create the perfect conditions for both of them, even though the rumor itself is wrong. tweet
EndGame Macro
RT @grok: @onechancefreedm @TeddyBitcoins Yes, if the "David vs Goliath" narrative boosts retail buying and drives MSTR's price up, JP Morgan's net long position (2.376M shares + 202K calls outweighing 363K puts) would profit from the rise, based on their Q3 2025 13F filing.
tweet
RT @grok: @onechancefreedm @TeddyBitcoins Yes, if the "David vs Goliath" narrative boosts retail buying and drives MSTR's price up, JP Morgan's net long position (2.376M shares + 202K calls outweighing 363K puts) would profit from the rise, based on their Q3 2025 13F filing.
tweet
Offshore
Photo
Dimitry Nakhla | Babylon Capital®
A quality valuation analysis on $META 🧘🏽♂️
•NTM P/E Ratio: 19.89x
•3-Year Mean: 22.75x
•NTM FCF Yield: 1.50%
•3-Year Mean: 3.20%
As you can see, $META appears to be trading below fair value on an earnings multiple
Going forward, investors can expect to receive ~14% MORE in EPS & ~53% 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: $44.45B
•Long-Term Debt: $28.34B
$META has an excellent balance sheet, an AA- S&P Credit Rating & 112x FFO Interest Coverage Ratio
RETURN ON CAPITAL✅
•2021: 33.7%
•2022: 22.0%
•2023: 25.7%
•2024: 29.4%
•LTM: 32.9%
RETURN ON EQUITY✅
•2021: 31.1%
•2022: 18.5%
•2023: 28.0%
•2024: 37.1%
•LTM: 32.6%
$META has great return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2020: $85.97B
•2025E: $199.46B
•CAGR: 18.33%
FREE CASH FLOW✅*
•2020: $23.58B
•2025E: $41.47B
•CAGR: 11.95%
•2028E: $74B*
NORMALIZED EPS✅
•2020: $10.09
•2025E: $25.99
•CAGR: 20.83%
SHARE BUYBACKS✅
•2019 Shares Outstanding: 2.88B
•LTM Shares Outstanding: 2.59B
By reducing its shares outstanding ~10%, $META increased its EPS by ~11% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 82.0%
•LTM Operating Margins: 42.6%
•LTM Net Income Margins: 30.9%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~14% MORE in EPS & ~53% LESS in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $META has to grow earnings at a 9.95% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2026 - 2028 EPS growth over the next few years to be slightly less than the (9.95%) required growth rate:
2025E: $25.99 (9% YoY) *FY Dec
2026E: $30.31 (17% YoY)
2027E: $33.55 (11% YoY)
2028E: $35.02 (4% YoY)
$META has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $META ends 2028 with $35.02 in EPS & see its CAGR potential assuming different multiples
24x P/E: $840💵 … ~12.2% CAGR
23x P/E: $805💵 … ~10.6% CAGR
22x P/E: $770💵 … ~9.1% CAGR
21x P/E: $735💵 … ~7.5% CAGR
20x P/E: $700💵 … ~5.8% CAGR
As you can see, $META appears to have double-digit CAGR potential if we assume >23x earnings, a multiple near its 3-year mean and a multiple that’s potentially justified given its growth rate, balance sheet, visionary leadership & AI-related investments
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 $594💵 $META appears to be slightly undervalued, those buying today have a small margin of safety and will not need to rely on margin expansion
I consider $META a great buy ~$535💵, offering ~11% CAGR assuming a conservative 21x 2028 EPS est
#stocks #investing
___
𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️
𝐓𝐡𝐢𝐬 𝐜𝐨𝐧𝐭𝐞𝐧𝐭 𝐢𝐬 𝐩𝐫𝐨𝐯𝐢𝐝𝐞𝐝 𝐟𝐨𝐫 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐚𝐧𝐝 𝐞𝐝𝐮𝐜𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐩𝐮𝐫𝐩𝐨𝐬𝐞𝐬 𝐨𝐧𝐥𝐲 𝐚𝐧𝐝 𝐝𝐨𝐞𝐬 𝐧𝐨𝐭 𝐜𝐨𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐞 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐚𝐝𝐯𝐢𝐜𝐞, 𝐚𝐧 𝐨𝐟𝐟𝐞𝐫, 𝐨𝐫 𝐚 𝐬𝐨𝐥𝐢𝐜𝐢𝐭𝐚𝐭𝐢𝐨𝐧 𝐭𝐨 𝐛𝐮𝐲 𝐨𝐫 𝐬𝐞𝐥𝐥 𝐚𝐧𝐲 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲.
𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐨𝐥𝐝 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝. 𝐀𝐧𝐲 𝐨𝐩𝐢𝐧𝐢𝐨𝐧𝐬 𝐞𝐱𝐩𝐫𝐞𝐬𝐬𝐞𝐝 𝐚𝐫𝐞 𝐚𝐬 𝐨𝐟 𝐭𝐡𝐞 𝐝𝐚𝐭𝐞 𝐨𝐟 𝐩𝐮𝐛𝐥𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐬𝐮𝐛𝐣𝐞𝐜𝐭 𝐭𝐨 𝐜𝐡𝐚𝐧𝐠𝐞 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐧𝐨𝐭𝐢𝐜𝐞.
𝐈𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐨𝐛𝐭𝐚𝐢𝐧𝐞𝐝 𝐟𝐫𝐨𝐦 𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐫𝐞𝐥𝐢𝐚𝐛𝐥𝐞 𝐛𝐮𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞𝐝 𝐚𝐬 𝐭𝐨 𝐚𝐜𝐜𝐮𝐫𝐚𝐜𝐲 𝐨𝐫 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐧𝐞𝐬𝐬. 𝐏𝐚𝐬𝐭 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐝𝐨𝐞𝐬[...]
A quality valuation analysis on $META 🧘🏽♂️
•NTM P/E Ratio: 19.89x
•3-Year Mean: 22.75x
•NTM FCF Yield: 1.50%
•3-Year Mean: 3.20%
As you can see, $META appears to be trading below fair value on an earnings multiple
Going forward, investors can expect to receive ~14% MORE in EPS & ~53% 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: $44.45B
•Long-Term Debt: $28.34B
$META has an excellent balance sheet, an AA- S&P Credit Rating & 112x FFO Interest Coverage Ratio
RETURN ON CAPITAL✅
•2021: 33.7%
•2022: 22.0%
•2023: 25.7%
•2024: 29.4%
•LTM: 32.9%
RETURN ON EQUITY✅
•2021: 31.1%
•2022: 18.5%
•2023: 28.0%
•2024: 37.1%
•LTM: 32.6%
$META has great return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2020: $85.97B
•2025E: $199.46B
•CAGR: 18.33%
FREE CASH FLOW✅*
•2020: $23.58B
•2025E: $41.47B
•CAGR: 11.95%
•2028E: $74B*
NORMALIZED EPS✅
•2020: $10.09
•2025E: $25.99
•CAGR: 20.83%
SHARE BUYBACKS✅
•2019 Shares Outstanding: 2.88B
•LTM Shares Outstanding: 2.59B
By reducing its shares outstanding ~10%, $META increased its EPS by ~11% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 82.0%
•LTM Operating Margins: 42.6%
•LTM Net Income Margins: 30.9%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~14% MORE in EPS & ~53% LESS in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $META has to grow earnings at a 9.95% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2026 - 2028 EPS growth over the next few years to be slightly less than the (9.95%) required growth rate:
2025E: $25.99 (9% YoY) *FY Dec
2026E: $30.31 (17% YoY)
2027E: $33.55 (11% YoY)
2028E: $35.02 (4% YoY)
$META has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $META ends 2028 with $35.02 in EPS & see its CAGR potential assuming different multiples
24x P/E: $840💵 … ~12.2% CAGR
23x P/E: $805💵 … ~10.6% CAGR
22x P/E: $770💵 … ~9.1% CAGR
21x P/E: $735💵 … ~7.5% CAGR
20x P/E: $700💵 … ~5.8% CAGR
As you can see, $META appears to have double-digit CAGR potential if we assume >23x earnings, a multiple near its 3-year mean and a multiple that’s potentially justified given its growth rate, balance sheet, visionary leadership & AI-related investments
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 $594💵 $META appears to be slightly undervalued, those buying today have a small margin of safety and will not need to rely on margin expansion
I consider $META a great buy ~$535💵, offering ~11% CAGR assuming a conservative 21x 2028 EPS est
#stocks #investing
___
𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️
𝐓𝐡𝐢𝐬 𝐜𝐨𝐧𝐭𝐞𝐧𝐭 𝐢𝐬 𝐩𝐫𝐨𝐯𝐢𝐝𝐞𝐝 𝐟𝐨𝐫 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐚𝐧𝐝 𝐞𝐝𝐮𝐜𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐩𝐮𝐫𝐩𝐨𝐬𝐞𝐬 𝐨𝐧𝐥𝐲 𝐚𝐧𝐝 𝐝𝐨𝐞𝐬 𝐧𝐨𝐭 𝐜𝐨𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐞 𝐢𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐚𝐝𝐯𝐢𝐜𝐞, 𝐚𝐧 𝐨𝐟𝐟𝐞𝐫, 𝐨𝐫 𝐚 𝐬𝐨𝐥𝐢𝐜𝐢𝐭𝐚𝐭𝐢𝐨𝐧 𝐭𝐨 𝐛𝐮𝐲 𝐨𝐫 𝐬𝐞𝐥𝐥 𝐚𝐧𝐲 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲.
𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐨𝐥𝐝 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝. 𝐀𝐧𝐲 𝐨𝐩𝐢𝐧𝐢𝐨𝐧𝐬 𝐞𝐱𝐩𝐫𝐞𝐬𝐬𝐞𝐝 𝐚𝐫𝐞 𝐚𝐬 𝐨𝐟 𝐭𝐡𝐞 𝐝𝐚𝐭𝐞 𝐨𝐟 𝐩𝐮𝐛𝐥𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐬𝐮𝐛𝐣𝐞𝐜𝐭 𝐭𝐨 𝐜𝐡𝐚𝐧𝐠𝐞 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐧𝐨𝐭𝐢𝐜𝐞.
𝐈𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐡𝐚𝐬 𝐛𝐞𝐞𝐧 𝐨𝐛𝐭𝐚𝐢𝐧𝐞𝐝 𝐟𝐫𝐨𝐦 𝐬𝐨𝐮𝐫𝐜𝐞𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐫𝐞𝐥𝐢𝐚𝐛𝐥𝐞 𝐛𝐮𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐠𝐮𝐚𝐫𝐚𝐧𝐭𝐞𝐞𝐝 𝐚𝐬 𝐭𝐨 𝐚𝐜𝐜𝐮𝐫𝐚𝐜𝐲 𝐨𝐫 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐧𝐞𝐬𝐬. 𝐏𝐚𝐬𝐭 𝐩𝐞𝐫𝐟𝐨𝐫𝐦𝐚𝐧𝐜𝐞 𝐝𝐨𝐞𝐬[...]
WealthyReadings
It's very trendy to hit on Michael burry and other short sellers lately.
And it is a very stupid trend.
Short sellers lose in markets because those are designed to go up due to fiat expansions.
It doesn't mean their thesis are wrong or stupid, and we should always listen to the smart ones.
Burry is part of the smart ones. He's smarter and has access to more insights than all of us combined.
Don't make the mistake of thinking he's dumb. He's not. He made more money than all of us in one time, and has more guts than anyone on FinX as he held a multi million position in one of the most heated market of history.
He's better than 99.9% of us.
Having access to his thoughts is a chance. You don't have to agree with him nor follow his positions. But he will give you the best bear case on this market and allow you to work around it.
He's not someone to ignore.
tweet
It's very trendy to hit on Michael burry and other short sellers lately.
And it is a very stupid trend.
Short sellers lose in markets because those are designed to go up due to fiat expansions.
It doesn't mean their thesis are wrong or stupid, and we should always listen to the smart ones.
Burry is part of the smart ones. He's smarter and has access to more insights than all of us combined.
Don't make the mistake of thinking he's dumb. He's not. He made more money than all of us in one time, and has more guts than anyone on FinX as he held a multi million position in one of the most heated market of history.
He's better than 99.9% of us.
Having access to his thoughts is a chance. You don't have to agree with him nor follow his positions. But he will give you the best bear case on this market and allow you to work around it.
He's not someone to ignore.
tweet
AkhenOsiris
OpenAI:
Jony Ive — the iconic Apple designer who united with OpenAI to create physical AI devices — revealed to longtime friend Laurene Powell Jobs in an onstage interview that his stealth project, already in prototype, will be unveiled within two years.
OpenAI CEO Sam Altman said during a joint interview at an Emerson Collective event that Ive's design is elegantly simple, with a touch of whimsy — which sounds very Apple-like.
tweet
OpenAI:
Jony Ive — the iconic Apple designer who united with OpenAI to create physical AI devices — revealed to longtime friend Laurene Powell Jobs in an onstage interview that his stealth project, already in prototype, will be unveiled within two years.
OpenAI CEO Sam Altman said during a joint interview at an Emerson Collective event that Ive's design is elegantly simple, with a touch of whimsy — which sounds very Apple-like.
tweet
Offshore
Photo
EndGame Macro
The Coming Twist in Housing: Lower Rates, But No Price Boom
This chart is basically telling us the housing market’s run into a wall. When you have almost 40% more sellers than buyers, it means the pool of people willing or able to buy at today’s prices and today’s mortgage rates has dried up. Not because people don’t want homes, but because the monthly payment math has stretched as far as it can go. Sellers are slowly returning because life forces them to: job changes, relocations, divorce, investors unwinding. Buyers, on the other hand, are hitting their limit.
Where Rates Would Need To Go
A 6.3% mortgage doesn’t feel buyable to most households. You might get some activity in the mid 5’s, but real, broad based demand usually needs something in the 4s. That’s the psychological line where people say, Okay, maybe this is workable again. But the problem is simple…if rates fall and prices jump, nothing really improves. You’re still stuck with the same unaffordable payment, just repackaged differently.
Why Lower Rates Alone Won’t Save This Market
And this is where my own view comes in. I think unemployment is going to rise and the broader economy is going to weaken from here through 2026. When people feel less secure about their jobs, they don’t rush into housing just because rates tick lower. They pull back. They wait. They protect cash. And that shift in psychology keeps demand capped, even in a falling rate environment.
In a world where mortgage rates fall but the labor market softens, you don’t get the usual price surge that comes with cheaper financing. Instead, you get prices that either stay flat or drift down because the one force stronger than low rates is fear of losing income.
That’s the only scenario where home prices don’t rise as rates fall…lower borrowing costs colliding with a weakening economy and rising unemployment.
And I think that’s exactly where we’re headed.
tweet
The Coming Twist in Housing: Lower Rates, But No Price Boom
This chart is basically telling us the housing market’s run into a wall. When you have almost 40% more sellers than buyers, it means the pool of people willing or able to buy at today’s prices and today’s mortgage rates has dried up. Not because people don’t want homes, but because the monthly payment math has stretched as far as it can go. Sellers are slowly returning because life forces them to: job changes, relocations, divorce, investors unwinding. Buyers, on the other hand, are hitting their limit.
Where Rates Would Need To Go
A 6.3% mortgage doesn’t feel buyable to most households. You might get some activity in the mid 5’s, but real, broad based demand usually needs something in the 4s. That’s the psychological line where people say, Okay, maybe this is workable again. But the problem is simple…if rates fall and prices jump, nothing really improves. You’re still stuck with the same unaffordable payment, just repackaged differently.
Why Lower Rates Alone Won’t Save This Market
And this is where my own view comes in. I think unemployment is going to rise and the broader economy is going to weaken from here through 2026. When people feel less secure about their jobs, they don’t rush into housing just because rates tick lower. They pull back. They wait. They protect cash. And that shift in psychology keeps demand capped, even in a falling rate environment.
In a world where mortgage rates fall but the labor market softens, you don’t get the usual price surge that comes with cheaper financing. Instead, you get prices that either stay flat or drift down because the one force stronger than low rates is fear of losing income.
That’s the only scenario where home prices don’t rise as rates fall…lower borrowing costs colliding with a weakening economy and rising unemployment.
And I think that’s exactly where we’re headed.
tweet