AkhenOsiris
RT @FundaBottom: $APP: Northbeam updated on the latestweek. AppLovin started ramping up - exactly what I said two weeks ago. Advertisers would ramp up at month-end after going through two optimization weeks. https://t.co/ykRXLKyV6E

$APP: Northbeam’s Axon data doesn’t look good today. We should keep a positive outlook—AppLovin’s ecommerce mix is rising gradually, not overnight. Ecommerce advertisers typically need about two weeks to optimize campaigns. We’re also not in the true peak season yet. Most Asian ecommerce advertisers just got back from vacation.
The real ramp should come at the end of the month, not right now.
But everyone’s obsessing over the Northbeam data, which makes me uncomfortable. Last week, when Northbeam didn’t release data, a bunch of people even emailed asking why there was no update. - FundaAI
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App Economy Insights
$INTC Intel Q3 FY25:

• Revenue +3% Y/Y to $13.7B ($0.6B beat).
• Non-GAAP EPS $0.23 ($0.22 beat).
• Intel received $5.2B from the Altera transaction and stake sale of Mobileye.

Q4 FY25 Guidance:
• Revenue ~$13.3B ($0.1B miss).
• Non-GAAP EPS $0.08 (in-line). https://t.co/USYeaLJtOz
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App Economy Insights
$GOOG Google Cloud and Anthropic officially announce their cloud partnership.

• Over 1GW of compute capacity in 2026.
• Anthropic gets up to 1M of Google’s TPUs, worth tens of billions of dollars. https://t.co/oP1wTnZzZx
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Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: The TransDigm acquisition checklist $TDG

1. Proprietary?
2. Aerospace?
3. Sole source?
4. Significant aftermarket?

If yes…

Does it meet management’s 20% IRR threshold over a 5 year period? https://t.co/iGgN1ldv6V
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AkhenOsiris
$AMZN $GOOGL

"We remain committed to our partnership with Amazon, our primary training partner and cloud provider, and continue to work with the company on Project Rainier, a massive compute cluster with hundreds of thousands of AI chips across multiple U.S. data centers."

https://t.co/PDuS5Cb7Tq

$AMZN $GOOGL

We all remember last year November when the AWS/Anthropic relationship deepened.

"Anthropic is now naming AWS its primary training partner, in addition to continuing to be its primary cloud provider, and will use AWS Trainium and Inferentia chips to train and deploy its future foundation models. Both companies will continue to work closely to keep advancing Trainium's hardware and software capabilities."

Is whatever Anthropic spending on GCP smaller than what they will spend on AWS? That would be the logical conclusion with AWS being the primary cloud/training provider. With Project Rainier ramping, the Anthropic spend on AWS increasing this year (some numbers from Ed Zitron yesterday) and SemiAnalysis and other sell-side predicting Claude AI related inflection (recently leaked Anthropic growth aspirations for 2026 are strong), it follows AWS will be enjoying the fruits as well here.

https://t.co/mAjvJRPWvu - AkhenOsiris
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Capital Employed
We meant sub $2 billion.

Feck this X bullsheet platform.

Our regular quarterly post... 👇

What stock are you most bullish on sub $2 million?

(Please do re-tweet this so we can get as many ideas as possible. Thanks 🙏). - Capital Employed
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Dimitry Nakhla | Babylon Capital®
RT @DimitryNakhla: Nick Sleep is one of the greatest investors, generating 20.8% CAGR from 2001 to 2013 📈

Nick ran a concentrated fund, with $AMZN & $COST stock each accounting for >20% of the Nomad Partnership at various points 💸

Here’s the secret to his incredible track record 🧵 https://t.co/9mDupZqv57
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Dimitry Nakhla | Babylon Capital®
5 High-Quality Stocks With Good CAGR Potential Assuming Reasonable Multiples 💵

📦 Amazon $AMZN
•2028E EPS: $11.01
•Multiple: 29x
•CAGR: +12%

💰 S&P Global $SPGI
•2028E EPS: $24.41
•Multiple: 28x
•CAGR: +13%

🏦 Fair Isaac $FICO
•2028E EPS: $63.60
•Multiple: 36x
•CAGR: +13%

✈️ Booking Holdings $BKNG
•2028E EPS: $344.04
•Multiple: 23x
•CAGR: +15%

🫱🏼‍🫲🏻 MercadoLibre $MELI
•2028E EPS: $123.53
•Multiple: 30x
•CAGR: +18%
_______

*Estimates can change
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ToffCap
I wanted to publish a larger update note, but I ended up writing about a French micro-cap, 🇫🇷 HighCo $HCO.

This one has been on the screen for a looong time, but only recently made the cut:

- A sleepy French promo outfit finally finding its way up operationally.
- The domestic engine (France) is back to double-digit growth.
- Two pretty nice bolt-ons, tipping the business toward scalable, recurring business.
- Guidance is actually going up!
- c. 5x forward ebitda, dd fcf yield and >6% dividend yield for a business that’s starting to look like a platform, not an agency.

Let me know what you think @ToffCap (no paywall) 👇
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Dimitry Nakhla | Babylon Capital®
A quality valuation analysis on $APP 🧘🏽‍♂️

•NTM P/E Ratio: 42x
•YTD-Mean: 44x

•NTM FCF Yield: 2.3%
•YTD-Mean: 2.5%

As you can see, $APP appears to be trading near fair value

Going forward, investors can receive about the same in earnings per share & FCF per share 🧠***

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

BALANCE SHEET✅
•Cash & Short-Term Inv: $1.19B
•Long-Term Debt: $3.51B

$APP has a good balance sheet, a BBB S&P Credit Rating, & 11x FFO Interest Coverage

RETURN ON CAPITAL🆗➡️✅
•2021: 3.0%
•2022: (0.4%)
•2023: 14.6%
•2024: 38.9%
•LTM: 62.5%

RETURN ON EQUITY🆗➡️✅
•2021: 3.6%
•2022: (9.5%)
•2023: 22.6%
•2024: 124.7%
•LTM: 253.8%

$APP has strong returns on capital, highlighting the financial efficiency of the business

REVENUES✅
•2021: $2.79B
•2024: $4.71B
•CAGR: 19.07%

FREE CASH FLOW✅
•2021: $360.46M
•2024: $2.09B
•CAGR: 79.77%

NORMALIZED EPS✅
•2021: $1.39
•2024: $5.69
•CAGR: 59.96%

SHARE BUYBACKS❌
•2021 Shares Outstanding: 342.76M
•LTM Shares Outstanding: 345.41M

MARGINS✅
•LTM Gross Margins: 78.6%
•LTM Operating Margins: 51.0%
•LTM Net Income Margins: 43.8%

***NOW TO VALUATION 🧠

As stated above, investors can expect to receive about the same in EPS & FCF per share

Using Benjamin Graham’s 2G rule of thumb, $APP has to grow earnings at a 21% CAGR over the next several years to justify its valuation

Today, analysts anticipate 2026 - 2028 EPS growth over the next few years to be just greater than the (21%) required growth rate:

2025E: $9.26 (62% YoY) *FY Dec

2026E: $14.06 (52% YoY)
2027E: $18.32 (30% YoY)
2028E: $25.39 (38% YoY)

$APP has a good track record of meeting analyst estimates ~2 years out, but let’s assume $APP ends 2028 with $25.39 in EPS & see its CAGR potential assuming different multiples

40x P/E: $1015💵 … ~18.6% CAGR

38x P/E: $964💵 … ~16.7% CAGR

36x P/E: $914💵 … ~14.7% CAGR

34x P/E: $863💵 … ~12.7% CAGR

32x P/E: $812💵 … ~10.6% CAGR

As you can see, $APP appears to have attractive return potential if we assume >36x earnings multiple (allowing for ~15% multiple compression)

Growing its monetization of gaming, user acquisition & subscription business, $APP potential catalysts include broadening of its software platform beyond mobile games into enterprise marketing automation, and leveraging its data-rich advertising stack for AI-driven optimization — both of which could unlock multiple years of EPS expansion

Despite its potential and AXON rollout, $APP is not for the faint-hearted, as its extreme volatility can test even the most resolute shareholders’ conviction in the business

Additionally, $APP also comes with a high-level of uncertainty

$APP is a good business & appears to be a fair consideration for today at $589💵
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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 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.
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