Offshore
Photo
Stock Analysis Compilation
Kingdom Capital Advisors on ECC Capital $ECRO US
Thesis: Despite terminal value risks, ECRO presents a low-market-cap opportunity with strong cash flow from local power sales and local initiatives supporting margins
(Extract from their Q3 letter) https://t.co/X5LckUrdLq
tweet
Kingdom Capital Advisors on ECC Capital $ECRO US
Thesis: Despite terminal value risks, ECRO presents a low-market-cap opportunity with strong cash flow from local power sales and local initiatives supporting margins
(Extract from their Q3 letter) https://t.co/X5LckUrdLq
tweet
Offshore
Photo
Stock Analysis Compilation
Platinium on Nice $NICE US
Thesis: Nice Ltd offers an essential SaaS solution for call centers, and despite concerns over AI, its strong position and discounted valuation make it a solid investment.
(Extract from their Q3 letter) https://t.co/cYlWpPVXCH
tweet
Platinium on Nice $NICE US
Thesis: Nice Ltd offers an essential SaaS solution for call centers, and despite concerns over AI, its strong position and discounted valuation make it a solid investment.
(Extract from their Q3 letter) https://t.co/cYlWpPVXCH
tweet
Offshore
Photo
Capital Employed
Best Stock Pitches newsletter being sent to inbox's tomorrow.
Over 40 quality pitches. Lots of great ideas out there at the moment.
https://t.co/jEccgMyfbM
tweet
Best Stock Pitches newsletter being sent to inbox's tomorrow.
Over 40 quality pitches. Lots of great ideas out there at the moment.
https://t.co/jEccgMyfbM
tweet
Offshore
Photo
Stock Analysis Compilation
Ariel Investments on Tesco $TSCO LN
Thesis: Tesco’s strengthened market position and diversification into new revenue streams position it as a resilient growth story in the UK retail sector.
(Extract from their Q3 letter) https://t.co/Z4HOTlJfcJ
tweet
Ariel Investments on Tesco $TSCO LN
Thesis: Tesco’s strengthened market position and diversification into new revenue streams position it as a resilient growth story in the UK retail sector.
(Extract from their Q3 letter) https://t.co/Z4HOTlJfcJ
tweet
Offshore
Video
Startup Archive
Sam Altman: “This is probably the best time - maybe ever - to be starting your career”
When asked how startup founders should handle a failed venture or pivot, Sam responds:
“First of all, I think this is probably the best time — maybe ever — to be starting out your career because you will get to surf the greatest technological wave, maybe ever. And what that means is you can change course many times because you will have this unbelievable tailwind.”
He advises founders to not get too hung up on any particular setback or failure — or even just changing your mind if you find something more exciting to go after:
“I think this is going to be an unusual time in how much it rewards adaptability and decisive and quick movement. And I would trust that… And not get hung up on the fact that you decided to pivot or something didn’t work because you are just going to be flooded with opportunities for the next few years.”
He concludes:
“It’s still hard. It still always feels like a setback. But take the time you need to go on vacation, go for a hike, or just stew over it for a little while. But when you get back up, get back up with vigor.”
Video source: @HarvardHBS (2024)
tweet
Sam Altman: “This is probably the best time - maybe ever - to be starting your career”
When asked how startup founders should handle a failed venture or pivot, Sam responds:
“First of all, I think this is probably the best time — maybe ever — to be starting out your career because you will get to surf the greatest technological wave, maybe ever. And what that means is you can change course many times because you will have this unbelievable tailwind.”
He advises founders to not get too hung up on any particular setback or failure — or even just changing your mind if you find something more exciting to go after:
“I think this is going to be an unusual time in how much it rewards adaptability and decisive and quick movement. And I would trust that… And not get hung up on the fact that you decided to pivot or something didn’t work because you are just going to be flooded with opportunities for the next few years.”
He concludes:
“It’s still hard. It still always feels like a setback. But take the time you need to go on vacation, go for a hike, or just stew over it for a little while. But when you get back up, get back up with vigor.”
Video source: @HarvardHBS (2024)
tweet
Offshore
Photo
Dimitry Nakhla | Babylon Capital®
A sober valuation analysis on $META 🧘🏽♂️
•NTM P/E Ratio: 26.11x
•5-Year Mean: 22.49x
•NTM FCF Yield: 3.05%
•5-Year Mean: 3.67%
As you can see, $META appears to be slightly overvalued
Going forward, investors can expect to receive ~14% LESS in earnings per share & ~16% 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: $65.40B
•Long-Term Debt: $18.39B
$META has an excellent balance sheet, an AA- S&P Credit Rating & 159x FFO Interest Coverage Ratio
RETURN ON CAPITAL✅
•2019: 26.0%
•2020: 23.5%
•2021: 33.7%
•2022: 22.0%
•2023: 26.3%
•LTM: 31.7%
RETURN ON EQUITY✅
•2019: 20.0%
•2020: 25.4%
•2021: 31.1%
•2022: 18.5%
•2023: 28.0%
•LTM: 35.4%
$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: 2.64B
By reducing its shares outstanding ~9.5%, $META increased its EPS by ~10.5% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 81.5%
•LTM Operating Margins: 41.2%
•LTM Net Income Margins: 34.3%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~14% MORE in EPS & ~16% MORE in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $META has to grow earnings at a 13.06% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be greater than the (13.06%) required growth rate:
2024E: $21.42 (44.9% YoY) *FY Dec
2025E: $24.62 (14.9% YoY)
2026E: $28.35 (15.2% YoY)
$META has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $META ends 2026 with $28.35 in EPS & see its CAGR potential assuming different multiples
26x P/E: $639.84💵 … ~10.9% CAGR
25x P/E: $639.84💵 … ~8.9% CAGR
24x P/E: $639.84💵 … ~6.9% CAGR
23x P/E: $613.18💵 … ~4.8% CAGR
22x P/E: $586.52💵 … ~2.7% CAGR
As you can see, $META appears to have double-digit CAGR potential if we assume >26x earnings, a multiple above its 5-year average (22.49x), however 26x 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)
Mark Zuckerberg continues to execute exceptionally well, as he has always done
Today at $593💵 $META appears to be fairly valued, those buying today won’t have a margin of safety and will be relying heavily on estimates being met & revised upwards
#stocks #investing
___
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.
tweet
A sober valuation analysis on $META 🧘🏽♂️
•NTM P/E Ratio: 26.11x
•5-Year Mean: 22.49x
•NTM FCF Yield: 3.05%
•5-Year Mean: 3.67%
As you can see, $META appears to be slightly overvalued
Going forward, investors can expect to receive ~14% LESS in earnings per share & ~16% 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: $65.40B
•Long-Term Debt: $18.39B
$META has an excellent balance sheet, an AA- S&P Credit Rating & 159x FFO Interest Coverage Ratio
RETURN ON CAPITAL✅
•2019: 26.0%
•2020: 23.5%
•2021: 33.7%
•2022: 22.0%
•2023: 26.3%
•LTM: 31.7%
RETURN ON EQUITY✅
•2019: 20.0%
•2020: 25.4%
•2021: 31.1%
•2022: 18.5%
•2023: 28.0%
•LTM: 35.4%
$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: 2.64B
By reducing its shares outstanding ~9.5%, $META increased its EPS by ~10.5% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 81.5%
•LTM Operating Margins: 41.2%
•LTM Net Income Margins: 34.3%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~14% MORE in EPS & ~16% MORE in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $META has to grow earnings at a 13.06% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be greater than the (13.06%) required growth rate:
2024E: $21.42 (44.9% YoY) *FY Dec
2025E: $24.62 (14.9% YoY)
2026E: $28.35 (15.2% YoY)
$META has a decent track record of meeting analyst estimates ~2 years out, so let’s assume $META ends 2026 with $28.35 in EPS & see its CAGR potential assuming different multiples
26x P/E: $639.84💵 … ~10.9% CAGR
25x P/E: $639.84💵 … ~8.9% CAGR
24x P/E: $639.84💵 … ~6.9% CAGR
23x P/E: $613.18💵 … ~4.8% CAGR
22x P/E: $586.52💵 … ~2.7% CAGR
As you can see, $META appears to have double-digit CAGR potential if we assume >26x earnings, a multiple above its 5-year average (22.49x), however 26x 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)
Mark Zuckerberg continues to execute exceptionally well, as he has always done
Today at $593💵 $META appears to be fairly valued, those buying today won’t have a margin of safety and will be relying heavily on estimates being met & revised upwards
#stocks #investing
___
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.
tweet
Offshore
Photo
App Economy Insights
Google kicked off Big Tech earnings!
☢️ AI investments
🚖 Waymo expansion
🔎 Search competition
☁️ Cloud reacceleration
▶️ YouTube market share
Let's visualize the quarter!👇 $GOOG
https://t.co/EGnmUnPeC8
tweet
Google kicked off Big Tech earnings!
☢️ AI investments
🚖 Waymo expansion
🔎 Search competition
☁️ Cloud reacceleration
▶️ YouTube market share
Let's visualize the quarter!👇 $GOOG
https://t.co/EGnmUnPeC8
tweet
Offshore
Photo
Hidden Value Gems
Spending a few days in Bristol during the half term. I wish Concorde was still running. From London to NYC in just 3 hrs 20 min! https://t.co/DrA5cex3Fe
tweet
Spending a few days in Bristol during the half term. I wish Concorde was still running. From London to NYC in just 3 hrs 20 min! https://t.co/DrA5cex3Fe
tweet