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Startup Archive
Jeff Bezos explains why he didn’t take additional equity building Amazon
Jeff is asked why he only paid himself $80,000 per year and never took additional equity during his tenure as CEO of Amazon. He responds:
“I asked the comp committee of the board not to give me any comp. My view was I was a founder. I already owned a significant amount of the company, and I just didn’t feel good about taking more. I felt I had plenty of incentive. I owned more than 10% of the company, and earlier — before it was diluted by various things — more than 20% of the company. I just felt how could I possibly need more incentive?”
Jeff continues:
“Most founders own big chunks of the company. They’re more like owner-operators. The way they increase their wealth is not by getting more equity. They just want to make the equity they have more valuable. And so I just would have felt icky about it. And I’m actually very proud of that decision.”
Jeff is especially proud of how much wealth he’s created for other people:
“Somebody needs to make a list where they rank people by how much wealth they’ve created for other people — instead of the Forbes list where it ranks you by your own wealth. Amazon’s market cap is $2.3 trillion today. I own about $200 billion-ish of it. So if you take $2.3 trillion and subtract out the piece I kept for myself, then I’ve created something like $2.1 trillion of wealth for other people. That should put me pretty high on some kind of list. And that’s a better list — how much wealth have you created for other people?”
Video source: @nytimesevents (2024)
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Jeff Bezos explains why he didn’t take additional equity building Amazon
Jeff is asked why he only paid himself $80,000 per year and never took additional equity during his tenure as CEO of Amazon. He responds:
“I asked the comp committee of the board not to give me any comp. My view was I was a founder. I already owned a significant amount of the company, and I just didn’t feel good about taking more. I felt I had plenty of incentive. I owned more than 10% of the company, and earlier — before it was diluted by various things — more than 20% of the company. I just felt how could I possibly need more incentive?”
Jeff continues:
“Most founders own big chunks of the company. They’re more like owner-operators. The way they increase their wealth is not by getting more equity. They just want to make the equity they have more valuable. And so I just would have felt icky about it. And I’m actually very proud of that decision.”
Jeff is especially proud of how much wealth he’s created for other people:
“Somebody needs to make a list where they rank people by how much wealth they’ve created for other people — instead of the Forbes list where it ranks you by your own wealth. Amazon’s market cap is $2.3 trillion today. I own about $200 billion-ish of it. So if you take $2.3 trillion and subtract out the piece I kept for myself, then I’ve created something like $2.1 trillion of wealth for other people. That should put me pretty high on some kind of list. And that’s a better list — how much wealth have you created for other people?”
Video source: @nytimesevents (2024)
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Dimitry Nakhla | Babylon Capital®
Updated CAGR Est after $GOOG +14% rally📈
2024E: $7.98 (37.5% YoY) *FY Dec
2025E: $8.95 (12.2% YoY)
2026E: $10.19 (13.9% YoY)
2027E: $11.78 (15.5% YoY)
$GOOG has an excellent track record of meeting analyst estimates ~2 years out, but let’s assume $GOOG ends 2027 with $11.78 in EPS & see its CAGR potential assuming different multiples
24x P/E: $282.72💵 … ~13.0% CAGR
23x P/E: $270.94💵 … ~11.4% CAGR
22x P/E: $259.16💵 … ~9.8% CAGR
21x P/E: $247.38💵 … ~8.2% CAGR
20x P/E: $235.60💵 … ~6.5% CAGR
$GOOG still has attractive return potential IF it can maintain a >23x multiple (below its 5-year & 10-year average & not unreasonable considering recent growth catalysts)"
A quality valuation analysis on $GOOG 🧘🏽♂️
•NTM P/E Ratio: 20.07x
•10-Year Mean: 23.62x
•NTM FCF Yield: 4.36%
•10-Year Mean: 4.18%
As you can see, $GOOG appears to be trading below fair value
Going forward, investors can receive ~18% MORE in earnings per share & ~4% MORE in FCF per share 🧠***
Before we get into valuation, let’s take a look at why $GOOG is a great business
BALANCE SHEET✅
•Cash & Short-Term Inv: $93.23B
•Long-Term Debt: $10.88B
$GOOG has a strong balance sheet, an AA+ S&P Credit Rating & 370x FFO Interest Coverage
RETURN ON CAPITAL✅
•2019: 16.4%
•2020: 16.2%
•2021: 27.6%
•2022: 26.1%
•2023: 28.1%
•LTM: 31.7%
RETURN ON EQUITY✅
•2019: 18.1%
•2020: 19.0%
•2021: 32.1%
•2022: 23.6%
•2023: 27.4%
•LTM: 32.1%
$GOOG has strong return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2018: $136.82B
•2023: $307.39
•CAGR: 17.57%
FREE CASH FLOW✅
•2018: $22.83B
•2023: $69.50B
•CAGR: 24.93%
NORMALIZED EPS✅
•2018: $2.19
•2023: $5.80
•CAGR: 21.50%
SHARE BUYBACKS✅
•2018 Shares Outstanding: 14.07B
•LTM Shares Outstanding: 12.51B
By reducing its shares outstanding ~11%, $GOOG increased its EPS by ~12.3% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 58.1%
•LTM Operating Margins: 32.1%
•LTM Net Income Margins: 27.7%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~18% MORE in EPS & ~4% MORE in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $GOOG has to grow earnings at a 10.04% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be more than the (10.04%) required growth rate:
2024E: $7.98 (37.5% YoY) *FY Dec
2025E: $8.95 (12.2% YoY)
2026E: $10.16 (13.5% YoY)
2027E: $11.78 (15.9% YoY)
$GOOG has an excellent track record of meeting analyst estimates ~2 years out, but let’s assume $GOOG ends 2027 with $11.78 in EPS & see its CAGR potential assuming different multiples
23x P/E: $270.94💵 … ~16.7% CAGR
22x P/E: $259.16💵 … ~15.0% CAGR
21x P/E: $247.38💵 … ~13.3% CAGR
20x P/E: $235.60💵 … ~11.5% CAGR
19x P/E: $223.82💵 … ~9.7% CAGR
As you can see, $GOOG appears to have attractive return potential IF we assume >20 earnings (a multiple below its 5-year & 10-year mean)
At >22x earnings, $GOOG has aggressive CAGR potential & it’s not unreasonable for the business to even trade for ~22x (given its growth rate, moat, balance sheet, & exemplary capital allocation)
Those buying today have a decent margin of safety given
In $GOOG latest report we saw a strong re-acceleration in cloud growth ☁️ & margins continue to expand
Today at $173💵 $GOOG appears to be a strong consideration for investment
#stocks #investing $GOOGL
___
𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️: 𝐓𝐡𝐢𝐬 𝐢𝐬 𝐍𝐎𝐓 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐀𝐝𝐯𝐢𝐜𝐞. 𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐚𝐯𝐞 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐭𝐰𝐞𝐞𝐭.
[...]
Updated CAGR Est after $GOOG +14% rally📈
2024E: $7.98 (37.5% YoY) *FY Dec
2025E: $8.95 (12.2% YoY)
2026E: $10.19 (13.9% YoY)
2027E: $11.78 (15.5% YoY)
$GOOG has an excellent track record of meeting analyst estimates ~2 years out, but let’s assume $GOOG ends 2027 with $11.78 in EPS & see its CAGR potential assuming different multiples
24x P/E: $282.72💵 … ~13.0% CAGR
23x P/E: $270.94💵 … ~11.4% CAGR
22x P/E: $259.16💵 … ~9.8% CAGR
21x P/E: $247.38💵 … ~8.2% CAGR
20x P/E: $235.60💵 … ~6.5% CAGR
$GOOG still has attractive return potential IF it can maintain a >23x multiple (below its 5-year & 10-year average & not unreasonable considering recent growth catalysts)"
A quality valuation analysis on $GOOG 🧘🏽♂️
•NTM P/E Ratio: 20.07x
•10-Year Mean: 23.62x
•NTM FCF Yield: 4.36%
•10-Year Mean: 4.18%
As you can see, $GOOG appears to be trading below fair value
Going forward, investors can receive ~18% MORE in earnings per share & ~4% MORE in FCF per share 🧠***
Before we get into valuation, let’s take a look at why $GOOG is a great business
BALANCE SHEET✅
•Cash & Short-Term Inv: $93.23B
•Long-Term Debt: $10.88B
$GOOG has a strong balance sheet, an AA+ S&P Credit Rating & 370x FFO Interest Coverage
RETURN ON CAPITAL✅
•2019: 16.4%
•2020: 16.2%
•2021: 27.6%
•2022: 26.1%
•2023: 28.1%
•LTM: 31.7%
RETURN ON EQUITY✅
•2019: 18.1%
•2020: 19.0%
•2021: 32.1%
•2022: 23.6%
•2023: 27.4%
•LTM: 32.1%
$GOOG has strong return metrics, highlighting the financial efficiency of the business
REVENUES✅
•2018: $136.82B
•2023: $307.39
•CAGR: 17.57%
FREE CASH FLOW✅
•2018: $22.83B
•2023: $69.50B
•CAGR: 24.93%
NORMALIZED EPS✅
•2018: $2.19
•2023: $5.80
•CAGR: 21.50%
SHARE BUYBACKS✅
•2018 Shares Outstanding: 14.07B
•LTM Shares Outstanding: 12.51B
By reducing its shares outstanding ~11%, $GOOG increased its EPS by ~12.3% (assuming 0 growth)
MARGINS✅
•LTM Gross Margins: 58.1%
•LTM Operating Margins: 32.1%
•LTM Net Income Margins: 27.7%
***NOW TO VALUATION 🧠
As stated above, investors can expect to receive ~18% MORE in EPS & ~4% MORE in FCF per share
Using Benjamin Graham’s 2G rule of thumb, $GOOG has to grow earnings at a 10.04% CAGR over the next several years to justify its valuation
Today, analysts anticipate 2025 - 2027 EPS growth over the next few years to be more than the (10.04%) required growth rate:
2024E: $7.98 (37.5% YoY) *FY Dec
2025E: $8.95 (12.2% YoY)
2026E: $10.16 (13.5% YoY)
2027E: $11.78 (15.9% YoY)
$GOOG has an excellent track record of meeting analyst estimates ~2 years out, but let’s assume $GOOG ends 2027 with $11.78 in EPS & see its CAGR potential assuming different multiples
23x P/E: $270.94💵 … ~16.7% CAGR
22x P/E: $259.16💵 … ~15.0% CAGR
21x P/E: $247.38💵 … ~13.3% CAGR
20x P/E: $235.60💵 … ~11.5% CAGR
19x P/E: $223.82💵 … ~9.7% CAGR
As you can see, $GOOG appears to have attractive return potential IF we assume >20 earnings (a multiple below its 5-year & 10-year mean)
At >22x earnings, $GOOG has aggressive CAGR potential & it’s not unreasonable for the business to even trade for ~22x (given its growth rate, moat, balance sheet, & exemplary capital allocation)
Those buying today have a decent margin of safety given
In $GOOG latest report we saw a strong re-acceleration in cloud growth ☁️ & margins continue to expand
Today at $173💵 $GOOG appears to be a strong consideration for investment
#stocks #investing $GOOGL
___
𝐃𝐈𝐒𝐂𝐋𝐎𝐒𝐔𝐑𝐄‼️: 𝐓𝐡𝐢𝐬 𝐢𝐬 𝐍𝐎𝐓 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐀𝐝𝐯𝐢𝐜𝐞. 𝐁𝐚𝐛𝐲𝐥𝐨𝐧 𝐂𝐚𝐩𝐢𝐭𝐚𝐥® 𝐚𝐧𝐝 𝐢𝐭𝐬 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐚𝐭𝐢𝐯𝐞𝐬 𝐦𝐚𝐲 𝐡𝐚𝐯𝐞 𝐩𝐨𝐬𝐢𝐭𝐢𝐨𝐧𝐬 𝐢𝐧 𝐭𝐡𝐞 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐢𝐞𝐬 𝐝𝐢𝐬𝐜𝐮𝐬𝐬𝐞𝐝 𝐢𝐧 𝐭𝐡𝐢𝐬 𝐭𝐰𝐞𝐞𝐭.
[...]
Offshore
Dimitry Nakhla | Babylon Capital® Updated CAGR Est after $GOOG +14% rally📈 2024E: $7.98 (37.5% YoY) *FY Dec 2025E: $8.95 (12.2% YoY) 2026E: $10.19 (13.9% YoY) 2027E: $11.78 (15.5% YoY) $GOOG has an excellent track record of meeting analyst estimates ~2…
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®
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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®
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Stock Analysis Compilation
Montaka on Alphabet $GOOGL US
Thesis: Alphabet’s dominance in Search is not weakening but strengthening, as AI enhances Google’s core business and widens its competitive moat.
(Extract from their article) https://t.co/5Z3n6igSaq
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Montaka on Alphabet $GOOGL US
Thesis: Alphabet’s dominance in Search is not weakening but strengthening, as AI enhances Google’s core business and widens its competitive moat.
(Extract from their article) https://t.co/5Z3n6igSaq
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Stock Analysis Compilation
Hedge funds' best ideas #23 is in your inbox 🔥
(link below)
Includes links to the Q3 letters from Artisan Partners / Bronte Capital / Distillate Capital / Edgepoint / Fairlight Capital / FPA / Heartland Advisors / Hotchkis & Wiley / Lindsell Train / Liontrust / Loomis Sayles / Macquarie / Madison Funds / Mar Vista / Montaka / Silver Ring VP / SouthernSun
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Hedge funds' best ideas #23 is in your inbox 🔥
(link below)
Includes links to the Q3 letters from Artisan Partners / Bronte Capital / Distillate Capital / Edgepoint / Fairlight Capital / FPA / Heartland Advisors / Hotchkis & Wiley / Lindsell Train / Liontrust / Loomis Sayles / Macquarie / Madison Funds / Mar Vista / Montaka / Silver Ring VP / SouthernSun
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Quiver Quantitative
The spending bill released last night would include a raise for members of Congress.
Members are currently paid $174K/year.
Members made an average of $366K in the stock market last year, per our estimates.
This number is skewed by some outliers: https://t.co/d29OTDVGDk
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The spending bill released last night would include a raise for members of Congress.
Members are currently paid $174K/year.
Members made an average of $366K in the stock market last year, per our estimates.
This number is skewed by some outliers: https://t.co/d29OTDVGDk
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Stock Analysis Compilation
Pernas Research on BGSF Inc $BGSF US
Thesis: BGSF, trading at depressed levels, offers a compelling speculative opportunity with strong insider buying and significant upside potential.
(Extract from their Stock Sonar report) https://t.co/wipD39btUh
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Pernas Research on BGSF Inc $BGSF US
Thesis: BGSF, trading at depressed levels, offers a compelling speculative opportunity with strong insider buying and significant upside potential.
(Extract from their Stock Sonar report) https://t.co/wipD39btUh
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Investing visuals
While $AMD operates in the shadow of $NVDA, its data center revenue growth over the past four years has been impressive. https://t.co/Odq6HWuBxL
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While $AMD operates in the shadow of $NVDA, its data center revenue growth over the past four years has been impressive. https://t.co/Odq6HWuBxL
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Quiver Quantitative
Senator John Boozman has disclosed a purchase of an Asia (excluding Japan) ETF, $AAXJ.
First time we've ever seen a politician buy this ETF.
Largest holdings include:
- TSM
- Tencent
- Samsung
- Alibaba https://t.co/QCbbxaIBA3
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Senator John Boozman has disclosed a purchase of an Asia (excluding Japan) ETF, $AAXJ.
First time we've ever seen a politician buy this ETF.
Largest holdings include:
- TSM
- Tencent
- Samsung
- Alibaba https://t.co/QCbbxaIBA3
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