⁠Bourbon Capital
Life pro tips:

Adopt a long-term buy-and-hold strategy. Significant gains are often achieved by those who maintain patience and avoid frequent trading
tweet

⁠PitchDeckGuy
Have a good holiday🫡 https://t.co/0u2hnyWDeR
tweet

AkhenOsiris
Badmouthing AI and now going to attribute RIF to it! Sneaky bastards...

GOLDMAN SACHS TO LAY OFF OVER 1,300 WORKERS: WSJ - First Squawk
tweet

⁠Librarian Capital
"Cocoa Deficit to Be Deeper Than Prior Estimates, ICCO Says" (Bloomberg)

"New York futures are up around 80% this year ... though prices have pared back from record highs"

cc: $HSY

Cocoa’s shortage is set to deepen further this season amid persistent production challenges from poor weather and disease https://t.co/Q3g2DMRUNL - Bloomberg
tweet

⁠Dimitry Nakhla | Babylon Capital®
One month ago I shared my analysis on $MA, suggesting it was a strong consideration for investment at $429💵

Since then, $MA share price increased +12.5% ✅ … as I stated towards the end of my analysis:

“… let’s assume $MA ends 2026 with $19.33 in EPS & see its CAGR potential assuming different multiples

31x P/E: $599.23💵 … ~14.9% CAGR

30x P/E: $579.90💵 … ~13.4% CAGR

29x P/E: $560.57💵 … ~11.9% CAGR

28x P/E: $541.24💵 … ~10.6% CAGR As you can see, $MA appears to have attractive return potential EVEN if we assume greater or equal to 28x earnings (well-below the 10-year mean & more than justified given its quality & growth rate)

$MA is such a high-quality business & has the potential to compound in the mid teens for the next 5 years & companies with strong & consistent earnings growth tend to look cheap years later (even if investors thought they were “expensive” or even better, slightly undervalued, at the time)

Today at $429💵 $MA appears to be a strong consideration for investment”

#stocks #investing"

A sober valuation analysis on $MA 🧘🏽‍♂️

•NTM P/E Ratio: 29.16x
•10-Year Mean: 31.32x

•NTM FCF Yield: 3.48%
•10-Year Mean: 3.41%

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

Going forward, investors can receive ~7% MORE in earnings per share & ~2% MORE in FCF per share 🧠***

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

BALANCE SHEET✅
•Cash & Short Term Inv: $7.66B
•Long-Term Debt: $13.54B

$MA has a strong balance sheet, an A+ S&P Credit Rating & 19.79x FFO Interest Coverage

RETURN ON CAPITAL✅
•2019: 62.9%
•2020: 40.6%
•2021: 45.7%
•2022: 58.5%
•2023: 61.1%
•LTM: 64.1%

RETURN ON EQUITY✅
•2019: 141.4%
•2020: 102.5%
•2021: 124.7%
•2022: 144.0%
•2023: 167.4%
•LTM: 186.3%

$MA has excellent return metrics, highlighting the financial efficiency of the business

REVENUES✅
•2013: $8.31B
•2023: $25.10B
•CAGR: 11.68%

FREE CASH FLOW✅
•2013: $3.98B
•2023: $11.61B
•CAGR: 11.30%

NORMALIZED EPS✅
•2013: $2.61
•2023: $12.26
•CAGR: 16.73%

PAID DIVIDENDS✅
•2013: $0.29
•2023: $2.37
•CAGR: 23.37%

SHARE BUYBACKS✅
•2013 Shares Outstanding: 1.21B
•LTM Shares Outstanding: 939M

By reducing its shares outstanding ~22.4%, $MA increased its EPS by ~28.8% (assuming 0 growth)

MARGINS✅
•LTM Gross Margins: 100.0%
•LTM Operating Margins: 58.1%
•LTM Net Income Margins: 46.1%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~7% MORE in EPS & ~2% MORE in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $MA has to grow earnings at a 14.58% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be slightly more than the (14.58%) required growth rate:

2024E: $14.27 (16.4% YoY) *FY Dec
2025E: $16.57 (16.1% YoY)
2026E: $19.33 (16.7% YoY)

$MA has a good track record of meeting analyst estimates ~2 years out, but let’s assume $MA ends 2026 with $19.33 in EPS & see its CAGR potential assuming different multiples

31x P/E: $599.23💵 … ~14.9% CAGR

30x P/E: $579.90💵 … ~13.4% CAGR

29x P/E: $560.57💵 … ~11.9% CAGR

28x P/E: $541.24💵 … ~10.6% CAGR

As you can see, $MA appears to have attractive return potential EVEN if we assume greater or equal to 28x earnings (well-below the 10-year mean & more than justified given its quality & growth rate)

$MA is such a high-quality business & has the potential to compound in the mid teens for the next 5 years & companies with strong & consistent earnings growth tend to look cheap years later (even if investors thought they were “expensive” or even better, slightly undervalued, at the time)

Today at $429💵 $MA appears to be a strong consideration [...]

for investment

Given that $MA has historically bottomed near 26x earnings, I'd also leave some room to purchase additional shares if the stock were to trade at that multiple, which would be about 10% lower, or around $386💵

#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. "- Dimitry Nakhla | Babylon Capital®
tweet

⁠Stock Analysis Compilation
Brown Capital on Camtek $CAMT US

Thesis: Camtek is positioned to capitalize on the surging demand for chips, with its specialized inspection technology driving strong long-term revenue growth

(Extract from their Q2 letter) https://t.co/l4kWNrfI5q
tweet

⁠Quality Investing with Aria
$CRM in the past 3 years has completely transformed their business

They not only stopped the wild dilution they used to do in the 2021 euphoria period.

They've started buying back shares, and a lot of it!!

Currently $CRM is reducing shares outstanding by around 1% per quarter.

This, alongside the new found focus on margin expansion will translate to rapid FCF growth in the ensuing quarters and years.

What do you think 🤔👇
tweet

⁠Bourbon Capital
I've found the perfect business:

- Net Debt < 0🟢
- ROIC > 15000%🟢
- Revenue growth > 12000%🟢
- Free cash flow growth > 15000%🟢
- No increase in outstanding shares🟢

Should we buy it? https://t.co/uII6gkooYF
tweet

⁠Quality Stocks
🎢 The month of August has been a rollercoaster on the stock market

With a strong drop at the beginning, the month is almost flat

⚠️ However, I find it shows the nervosity in the markets. Maybe not a so good sign for the next months. How do you analyze it?
tweet