AkhenOsiris
Zuck toying with the street now, pushing the expense envelope to see if market gives him a pass.

META PLANS MAJOR INVESTMENT INTO AI-POWERED HUMANOID ROBOTS. - FinancialJuice
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AkhenOsiris
Markets are broken, took TSM a whole 3-4 mins to react to this.

Did all you whiny alpha whores take advantage?

🔴 TSMC CONSIDERS OPERATING US INTEL FACTORIES AFTER TRUMP REQUEST. - FinancialJuice
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⁠Stock Analysis Compilation
Baron Health Care Fund on Natera, Inc. $NTRA US

Thesis: Natera, Inc. is a diagnostics company focused on women’s health and oncology, offering a promising blood-based DNA test called Signatera that detects residual cancer DNA to inform treatment decisions and monitor recurrence, showing strong growth potential in a $20 billion market.

(Extract from their Q4 letter)
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⁠Quiver Quantitative
Another multimillion view post with wildly inaccurate net worth numbers.

There is no need to rely on made up numbers to show that many politicians are making millions in the stock market.

You can see live net worth estimates for members of Congress on Quiver.

Congresswoman Jasmine Crockett has a reported net worth of $9 million despite being paid $174,000/year.

Jasmine Crockett owns
$2M townhouse in Dallas
$1.5M loft in Austin, Texas
$1.5M lakefront cabin in Galveston, Texas.

Crockett’s net worth grew substantially last year during the 2024 election.

Do you think members of Congress use their positions to self enrich themselves? - DOGE NEWS- Department of Government Efficiency
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⁠Dimitry Nakhla | Babylon Capital®
“Having a margin of safety is like an insurance policy that helps prevent us from overpaying— it mitigates the damage caused by over optimistic estimates.”

— Pat Dorsey 🗣️

Ensuring you have a margin of safety when investing leads to:

Heads I win; Tails I win, but not as much.
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⁠Quiver Quantitative
BREAKING: Warren Buffett just filed a portfolio update.

He opened a new position in Constellation Brands, $STZ.

Full holdings up on Quiver. https://t.co/ZX7NCZSiVN
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⁠Dimitry Nakhla | Babylon Capital®
Dev Kantesaria | VFCM 13F Q4 24’

$FICO $SPGI $MA $MCO $V $INTU $ASML $EFX $MSCI
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The CRAZY thing:

I pitched $MSCI to Dev on April 23, 2024 when it traded for $444 (many of you may remember that analysis) 🌐

Would’ve been great to see Dev pick it up at historic levels then https://t.co/V2CUhqcxI6

A sober valuation analysis on $MSCI 🧘🏽‍♂️

•NTM P/E Ratio: 29.33x
•10-Year Mean: 34.93x

•NTM FCF Yield: 3.64%
•10-Year Mean: 3.37%

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

Going forward, investors can receive ~19% MORE in earnings per share & ~9% MORE in FCF per share 🧠***

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

BALANCE SHEET🆗
•Cash & Short-Term Inv: $519.31M
•Long-Term Debt: $4.50B

$MSCI has an ok balance sheet, a BBB- S&P Credit Rating, & 6.80x FFO Interest Coverate

RETURN ON CAPITAL✅
•2019: 23.4%
•2020: 28.6%
•2021: 26.5%
•2022: 33.0%
•2023: 35.2%

RETURN ON EQUITY🆗
•2019: (463.5%)
•2020: (231.5%)
•2021: (239.3%)
•2022: (148.6%)
•2023: (131.4%)

*ROE negative due to heavy use of debt

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

REVENUES✅
•2013: $913.36M
•2023: $2,528.92M
•CAGR: 10.72%

FREE CASH FLOW✅
•2013: $280.93M
•2023: $1,213.27M
•CAGR: 15.75%

NORMALIZED EPS✅
•2013: $2.16
•2023: $13.52
•CAGR: 20.13%

SHARE BUYBACKS✅
•2013 Shares Outstanding: 121.07M
•LTM Shares Outstanding: 79.60M

By reducing its shares outstanding 34.2%, $MSCI increased its EPS by 51.9% (assuming 0 growth)

MARGINS✅
•LTM Gross Margins: 82.2%
•LTM Operating Margins: 53.9%
•LTM Net Income Margins: 44.6%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive ~19% MORE in EPS & ~9% MORE in FCF per share

Using Benjamin Graham’s 2G rule of thumb, $MSCI has to grow earnings at an 14.67% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2024 - 2026 EPS growth over the next few years to be less than the (14.67%) required growth rate:

2024E: $14.84 (9.8% YoY) *FY Dec
2025E: $17.07 (15.0% YoY)
2026E: $19.39 (13.6% YoY)

$MSCI has a great track record of meeting analyst estimates ~2 years out, but let’s assume $MSCI ends 2026 with $19.39 in EPS & see its CAGR potential assuming different multiples

32x P/E: $620.48💵 … ~14.6% CAGR

31x P/E: $601.09💵 … ~13.2% CAGR

30x P/E: $581.70💵 … ~11.9% CAGR

29x P/E: $562.31💵 … ~10.5% CAGR

28x P/E: $542.92💵 … ~9.1% CAGR

As you can see, $MSCI appears to have double-digit return potential if we assume >29x earnings, a level of fundamental support (first green line in P/E chart) & a level below its 10-year average multiple of 34.93x

Given its wide moat, exemplary capital allocation, & linearity in its EPS & FCF, I believe 29x is fair for $MSCI & leaves us with some margin of safety

Today at $446💵 my research leads me to believe that $MSCI is a worthwhile consideration for investment

Knowing that $MSCI could trade down a bit more (closer to 25x as you’ll see in second green line in P/E chart) I would piece into the position

In other words, if I wanted to allocate 5% to $MSCI, I’d likely look to initiate a 3% - 3.5% allocation & leave room to add more & make it 5% if we see $MSCI trade between $380💵 - $400💵

#stocks #investing
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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 𝐩𝐮𝐫𝐩𝐨𝐬[...]

𝐞𝐬 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