FCF

barrybadhoer

I was about to say, cormedix is criminally undervalued with a EV/FCF of like 3-4 and a rapidly growing business. One of my biggest holdings

nickpapa88

I get the concern, but I think the competitive picture is more nuanced. Lilly’s drugs may show stronger efficacy on some metrics, but the GLP-1 market isn’t winner-take-all — it’s supply-constrained, demand is global, and switching costs for patients are extremely sticky. Novo doesn’t need to be the best drug to compound; it just needs to continue being one of the two dominant suppliers in a market where demand massively exceeds capacity. As for pricing power and margins, those are determined by payers and regulators, not consumer choice, and both companies are still negotiating from a position of strength. Growth is slowing from extraordinary to normal, but FCF, margins, and global penetration still support long-term compounding. Being first to scale — not just first to market — is a moat that doesn’t decay nearly as fast as people assume. Either way you don’t “print cash” on stock price — stock is associated with sentiment and hype. The core finances prove that novo is a financial stalwart even if you personally like their competition better.

mdatwood

One of NVDA's biggest customers is OpenAI who has ~1.4T in total commitments lined up. There is a real question if OpenAI will be able to satisfy all its commitments and therein lies one of the big risks to NVDA. MS, Google, and Amazon are less likely to back out, but if the FCF spend does not start to generate real returns, shareholders will start demanding the money go elsewhere. Also, NVDA is not talking about 500B in AR, but expected orders or as their CFO was quoted "visibility on $500 billion in revenue from the beginning of the year to the end of 2026" [1]. Honestly, this feels a bit like trying too hard to keep the stock propped up with weasel words. I say all this as someone who is fairly bullish on AI overall, but it's hard to ignore that NVDA is riding a knifes edge. [1] https://finance.yahoo.com/news/nvidia-reports-strong-guidance-ai-220009255.html

himynameis_

Ya know. It's fair to say that yes, ASICs are doing different things from Nvidia GPUs and CUDA. However. It is already a customer concentration risk for Nvidia that a big majority of their revenue is from 5 customers. And also that 3 of those xustomers, (AWS, google, Microsoft) are actively developing their own chips to reduce reliance on Nvidia. Not only that. There was a financial Times article recently showing that 39% of Microsoft cloud backlog is for OpenAI, 58% for Oracle, and 16% for Amazon. So, it just seems a bit chunk of the spend on Nvidia chips is going to OpenAI somehow. And anthropic is probably 2nd place. So, my concern is. The customer concentration, plus customer making their own chips, plus a big chunk of cloud customer demand being OpenAI/Anthropic...there's just a lot of concentration there. And, if OpenAI implodes due to all the commitments they're making, it would put some hurt into Nvidia short-term. However. Forward estimates suggest that forward PE for Nvidia is ~26. Which is quite low for something like Nvidia that is firing on all cylinders. They have purchase commitments for $500B for Blackwell+Rubin. I believe it was over 5 quarters but someone on Reddit said 2 years. Either way, assuming TTM FCF margin that's ~$200B in FCF for 1 year, roughly. Up from the ~$70B range in TTM. It's just... Nvidia needs to execute right now and they're firing on all cylinders. But there's risks here imo. Not sure how you're getting the $260 and $210 numbers.

Macready123

They are all crappy compared to PM miners that actually make money, look at their FCF. In U land, $CCJ as the poster child is insanely expensive already. I do like Uranium though.

Doctor_Raymos

What are you talking about? Hyperscalers have explicitly stated they do not fund capex through FCF alone. They also fund it through existing operating cash flow, which is extremely stable. Hyperscaler FCF fluctuates quarter to quarter because these companies choose to invest aggressively, not because cash generation is weakening. These firms do not need consistently flat FCF to maintain high capex, and they never have.

Monkey_1505

The question isn't whether FCF is a one off pool of money, it's whether it's being replenished at a rate that is => than spend. It currently isn't. I'd certainly be interesting in the AI specific capex numbers if you have them? (Note, it being often mixed together I think is actually usually for making the argument more favourable for sustainability, due to non-ai historical expansion)

Doctor_Raymos

Hyperscaler FCF is not a one-off pool of money, they run capex cycles that grow, not shrink. The idea that they "run out" in 1-2 years misunderstands how hyperscalers budget. That 300B is an indicator you are just regurgitating what you hear, because it is the total hyperscaler capex across ALL infrastructure. Only a fraction of it is related to Nvidia. Capex also does not vanish next year. Again, total capex has increased over the past 10 years, not decreased. Every company involved says explicitly this is a multi-year investment cycle. Not a single one suggests it stops in 2026. The idea that spending falls off a cliff contradicts every single earnings call. Beyond this, Nvidia is actively diversifying beyond hyperscalers and dependence is shrinking, not growing. Even if AI demand stayed flat (it isn't), Nvidia is already properly diversified to give ample parachute to leverage revenue lost from hyperscalers.

Monkey_1505

Well if we are talking Nvidia, revenues primarily come from finite, quickly depleting hyperscaler FCF. Which is likely the much bigger issue than revenue padding. I tend to think the depreciation argument is supportive rather than primary.

JesusBoughtPuts

Everyone who trades Micron off trailing FCF misses the entire upcycle. it’s been the same story for 20 years. Good luck with your investing

Hot-Fox-8797

Sector allocation: FCF yield. Cash doesn’t lie Early warning sign: very sector dependent. there are lots. Aside from obvious ones like wage growth unemployment sentiment etc. following credit card data can be helpful

Hot-Fox-8797

No generally you don’t collab with other PMs unless it’s some sort of cross over name across sectors. Credit and equity have a lot of the same underwriting but there are differences. Equity focuses more on things like growth/margins while credit focuses on balance sheet, FCF, interest coverage, etc. generally speaking. But the more general SWOT/porter 5 forces the same type of thinking

OrdinaryReasonable63

NICE has become an uncomfortably large position for me after the most recent drop. I was kind of shocked at the drop, on heavy selling volume. seemed like a big over reaction or possibly non-public info being traded upon... The firm they acquired (Cognigy’s) financials weren’t disclosed but I assume its cash burn can’t be that bad if they are guiding for the acquisition to be accretive to their FCF within 18mo. Would be helpful to see some insider buys from execs…

DoobsNDeeps

Growth is simple, invest until growth starts to slow or margins start to slip. Value is easy as well, find the highest FCF yield stock that will still exist in its current form 10 years from now.

Hot-Fox-8797

We’re so big that the asset allocation stays pretty stable. Exception being growing asset classes growing like private credit etc. But high level stock vs bond pretty stable. I think hy bonds look good compared to stocks currently when looking at HY bonds YTW vs a lot of stocks FCF yields

Morely7385

You should, Build a tight weekly workflow that screens, reads filings, and tracks catalysts, not headlines. Screen small/mid caps for 15%+ revenue growth, rising FCF, gross margin expansion, net debt/EBITDA <2, SBC <10% of sales, and >$1M avg daily dollar volume; add 3–6 month relative strength. Use WhaleWisdom for new 13F positions, OpenInsider for cluster buys, and TradingView alerts for earnings, guidance, and 52‑week highs. Read 10-K/10-Q/20-F for liquidity, S-3/ATM dilution, and cash runway. I use Koyfin for factor screens and Quartr for quick call listening; Ask Edgar helps me speed-read filings and flag dilution. Tag FX and ADR details, set a USD base, and cap risk at 0.5–1% with stops. Simple, repeatable process and risk rules win.

Morely7385

Okay here is a word, If China risk is blocking you from adding, it’s reasonable to rotate-but cap META size and stage the move. I dumped BABA/KWEB in 2022, kept a token Tencent stake, and redeployed into META/GOOG over a few months; no regrets because I slept better and had clearer catalysts. If I were OP: 1) exit JD unless you see a hard catalyst (logistics spin, sustained margin expansion); 2) trim Tencent, keep a 1–2% “tracker” to stay engaged; 3) DCA META in 4–6 tranches, and set a max position (10–15%). Pair META with GOOG or AMZN to avoid single-name risk. Wash sale isn’t an issue here, but use the realized loss to offset gains. Define your sell rules now: if META’s ad growth or engagement rolls over or capex/Reality Labs overwhelms FCF, you cut. I lean Tencent-over-JD if you must hold China (WeChat ads, games, mini-programs), but rotating with size limits is the cleaner path.

RiPFrozone

My mistake. QoQ is really a useless metric when valuing a company long term. The YOY growth is explosive FCF was up 47%, AI revenue up 63%, net revenue up 22%. Fourth quarter guidance is 17.4b. Investors also love how the VMware acquisition created a near 50/50 split in revenue from software + semiconductor. This makes the company more resilient to the cyclicality of the semiconductor industry. Now with the meta google TPU news, that’s a new catalyst for Broadcom.

dont_downvote_SPECIL

My $400 price objective for Broadcom is based on 37x CY26E P/E, at the upper end of its 10x-38x historical range, still in-line with 1x-2x PEG framework for high-growth compute vendors, and justified given double-digit EPS growth and best-in-semis profitability, FCF generation, and returns.

RiPFrozone

For one they did 63b in revenue 29.5b in FCF this year. Projected to do 85b revenue 42.4b in FCF 2026, 113b in revenue 57.5b in fcf 2027.

thenuttyhazlenut

When you start using 'forward PE' constantly in your arguments, you know you're trying to justify buy/holding at a high valuation. The market is forward looking, sure. But let's focus on what is. Promises and expectations are baked into forward valuations, and those are always uncertain. A lot can change in 12 months. The past 12 months is proof of that. PLTR is currently trading at over 200x FCF. NVDA at over 50x FCF. One industry is moving the entire S&P500 to the point where the S&P depends on it. Being bearish doesn't mean you're 100% cash or buying puts. I'm pretty bearish, and hold a % of my portfolio in defensives and bonds. Refusing to buy companies at super high valuations is exactly what people like Buffett did for the past decades....

ImprovementMain7109

This reads like the classic mature-hardware playbook: cut heads, talk about "efficiency," guide EPS a bit lower than the Street, and hope multiple compression does not get worse. A few things jump out: First, if they are cutting 4k-6k jobs on a base of roughly 50-60k employees, that is high single digit percent of the workforce. You do not do that if you think this is just a short, cyclical wobble in PC/printer demand. That is a structural signal, not a timing signal. Second, the fact that they are lowering 2026 EPS *despite* cost cuts tells you more than the press release spin. When management is actively reducing the denominator (employees) and still cannot hit prior EPS expectations, it implies they see either weaker pricing power, lower volumes, or sustained higher costs from regulation and supply chain workarounds. Probably some mix of all three. Third, on the "regulations" angle. Blaming US trade rules and China-related workarounds is not crazy, that stuff really does raise frictional costs. But it is also a very convenient story to avoid saying "our legacy businesses are commoditized and under competitive pressure." I would want to see how their gross margin trajectory compares to peers like Dell and Lenovo before I buy the idea that this is mostly about government policy rather than industry structure. From an investing lens, HP at this stage is basically a capital return / financial engineering story, not a growth story. You are underwriting: 1) Flat to slightly declining revenues in PCs/printers over time. 2) Management defending margins with periodic cost programs like this. 3) Free cash flow shoveled into buybacks and dividends so your per-share numbers look respectable even if the top line is stagnant. That can work as a thesis if you are buying at a low enough multiple. Cash cows can be good investments. The risk is that you model a "slow fade" and reality turns into a "faster fade." If unit volumes or pricing erode a few points faster than you baked in, the terminal value that justifies your current purchase can evaporate quietly over a few years. One thing I would watch: how aggressive they get on buybacks relative to the balance sheet and the cycling of the PC market. HP has a history of leaning pretty hard on repurchases. In a structurally challenged business, that is fine as long as leverage does not creep up just as the industry hits another downdraft. I am not saying HP is uninvestable. It can be a reasonable value / yield play if you accept what it is. But reading this, it reinforces the idea that you are not buying "PC growth" or "AI PC upside". You are buying a managed decline where the game is extracting cash faster than the business decays. Curious if anyone here has updated numbers on HPQ's current FCF yield and net leverage, and how that stacks against Dell on a like-for-like basis. That seems like the real comparison set for this kind of news.

LEAP-er

GOOG is highly profitable, huge and growing nicely FCF, with significant momentum and positive narrative behind it currently. Not the best put or short option.

fredfred547

As someone who works in B4 accounting, extending depreciation cycles isn’t fraud. This isn’t even unusual; I’ve seen it personally in other industries. 2 things: 1. There is a fair amount of thought/consideration that goes into these extensions. There has to be a basis for doing this. 2. Companies rarely use net income as a KPI. Extending depreciable life does increase earnings, but only from a net income perspective. Most companies and investors are using adjusted EBITDA (or some variation of this/FCF). Extending depreciable lives has no impact on these metrics, and therefore, has very minimal impact on investor decision making and valuation.

microcapman

Huh? FCF is getting a nice boost from under-taxation. I'm getting 5-6 years of tax shelter based on $240M of deferred tax asset which corresponds to almost $1.0B in future pre-tax income that can be sheltered and using 2025 YTD pre-tax run rate. So what re-working is required before 2030?

Hot-Celebration5855

Like I said, I’ve seen this movie before. Look at Amazon. They never made a profit for years because they ploughed all their FCF into building out their physical and digital infrastructure. Now they make billions in profit since they’ve decided to start monetising it all. I think AI will be the same but we can agree to disagree.

not_totally

What’s your basis for that? Just feelings and round numbers? Or you have any investing basis on things like ev ebitda or FCF or just even compute expansion?

Hot-Celebration5855

None of these companies is even sniffing financial distress. They all have legacy businesses that generate billions in FCF. They can fund this kind of capex for years if necessary

jackflash223

I don't see how Ubisoft is worth owning right now. They have no FCF. If they live up to their guidance it looks like around 2027 it may actually be worth buying.

GringottsWizardBank

As they grow they are going to need to spend more and more to keep up with demand. Either by diluting again or taking on debt like CRWV. Where does profitability come into play? Revenue and growth are great and all but at some point it needs to translate in FCF and profit.

JimmyInvestor

a simple way to judge whether a stock is a real long-term investment is to look at three things: (i) unit economics, (ii) durability and (iii) valuation. I like to think about it this way *(it’s a mix of Buffett, Lynch, and Damodaran 😬😬):* **1. Unit Economics (Quality)** \> Start by checking whether the business actually creates value today. \> ROIC above WACC, solid incremental ROIC, a strong reinvestment rate and FCF per share trending up. \> If returns on capital stay high across cycles, the company has a real economic engine **2. Durability (Moat + Runway)** \> Does the company have a defendable position and space to grow? \> Look for switching costs, scale advantages, network effects, cost leadership or regulatory protection \> Check the TAM and whether the company is still early in its penetration curve. \> You want a business capable of sustaining high returns for 10 years (not 10 days) **3. Valuation (Price vs. Outcomes)** \> Use simple scenarios: bear, base, bull. \> Break down sources of return: earnings growth, FCF yield, multiple expansion or compression and dilution. \> Look at P/E (or EV/EBIT, EV/FCF) and ask: "What assumptions does the current price already assume?" \> If the market is pricing in perfection, your long-term returns will be capped regardless of quality. If the business (i) creates economic value, (ii) can defend it, and (iii) the price still offers a reasonable margin of safety, it usually works well for the long run... Hope this helps. btw, I recently wrote about the five investment frameworks that most professionals use, in my newsletter. I can send you the link if you’d like.

Masterandcomman

If you define FCF by deducting all capex, then yes.

Much_Candle_942

Can't believe my eyes.. $TDOC - price/sales 0.5, and FCF at juicy 20%! Saw a tiny insider volume today, and wondering why the insider isn't buying more?  🤔 

Much_Candle_942

You need a few (max. 10) small caps that can yield a fantastic bumper, but with a very ruthless stop loss. If they don't jump, just say Goodbye and move on. Today, I just saw **$TDOC** that had a tiny insider buy volume. It's FCF ratio is very, very good, and personally I like the business model of remote healthcare.  It's just an example, but a few such companies can really skew your returns.

truedog1528

Focus on total return and set hard rules so a few high-yield names can’t wreck your principal. What helped me after a big drawdown: cap any single risky dividend name to 2–3% and the whole “yield” sleeve to \~10–15%. Use clear sell triggers: dividend cut, FCF payout >85–90%, net debt/EBITDA creeping past \~3–4, or interest coverage slipping below \~3. Track IRR, not just dividends; if total return lags T‑bills for 4–6 quarters, rotate. For steadier income, I keep a core in SCHD/JEPI and park near-term cash in T‑bills or short-term Treasuries. If your loan rate is high, paying it down is a near risk-free return; I’d prioritize that over adding more high-risk yield. If taxable, harvest the loss to offset gains and up to $3k ordinary income. I screen in Koyfin, sanity‑check payout risk with Simply Safe Dividends, and use Ask Edgar to quickly pull debt terms and red flags from filings and transcripts. Bottom line: judge by total return and enforce risk limits, not headline yield.

MelodicAd4313

This looks like plain hedging and new-issue supply, not a red flag. A put/call at 0.89 is basically neutral unless you see a surge in net new put OI at the same maturities; check skew and term structure-if front-week puts aren’t getting bid vs 1–3 months, it’s just protection. A 25 bps pop in single-name CDS right after tapping the bond market screams concession and basis trades; these usually mean-revert once allocations settle. For ORCL, the Azure interconnect and data-sovereign footprints make churn expensive, so capex-driven FCF dips are par for the course. If you’re constructive, a risk-defined way to play it is selling a near-dated put spread at prior support and using the credit to buy a call spread into the next print; if you’re cautious, a put calendar catches a short vol crush. I’ve used Snowflake and Databricks to track option flow and CDS prints, and DreamFactory to expose quick REST APIs over trade datasets when prototyping signals. Net: this looks like hedging and supply indigestion, not a distress signal.

GoldenPresidio

This new total debt per company is nothing relative to their FCF or EV. There is a large appetite for it by investors. These guys have not optimized their WACC to have a higher debt to income ratio, which would be way more common for firms outside of tech. I suspect the reason is because they do so much stock based compensation, but they still have lots of room before that’s even affected

IRLGravity

Bunch of random hate going around: ORCL has specific integration with database hand holding inside of Azure data centers mitigating competition friction on top of backing up 27 European Union countries, the US, AUS, UK, etc are also utilizing them for data Sovereignty. They have decreased FCF (Still like +20B) but, this is expected during high Capex events. However. with their backup with all of these points their MOAT is incredibly strong alongside the "Co Locate with the data location" idea. Easy to switch to, hard af to switch from. Not necessarily saying there is zero risk as there always is some but, I doubt to an incredible level that this is a warning sign for anyone on that list. Put/call @ 0.89 / CDS spread increase by 25 BPS. It's highly likely it's hedging, go to bed. With how rates have been I'm surprised everyone didn't issue even more.

Desmater

They are, just saying they don't have as solid as FCF as the others. Also their business has more down cycles with advertising. Even though Alphabet also does the same. But they also have other business segments. META at $100 awhile ago, happened for a reason. Also the excess CAPEX into the "Meta Verse."

JimmyInvestor

Circular investments and partnerships are happening at full speed... It’s a closed loop among the winners, where everyone is a customer, supplier and investor *at the same time (!!!)*. That inflates reported profits and creates future fragility. the same goes for extending GPU useful life from 3 to 6 years: depreciation drops, earnings look better, but nothing about the underlying economics truly changes. We’re in a moment where cash flow matters (FCF) far more than accounting earnings if you want to understand the real economics of AI...

Desmater

Only worried about META and ORCL. Others have solid FCF and balance sheets.

iMakeGOODinvestmemts

Google has 50b FCF a year after 90b Capex, 70b buy backs 15b dividends, 30b acquisition and 175b in opex cash flow. They are fine lol. So that while having 100b on cash.

rarebirdcapital

rework your FCF...remember taxes will take away \~ 21%

salty0waldo

Yeah I was optimistic at first when I read LYB's call, but then I though about it more and decided I'm not going to time the cycle. It has been probably the worst cyclic downturn in the chemical industry, especially commodity chemicals. Both companies absolutely need to eliminate them. It would make complete sense for cash preservation, and honestly once they get better view they can reinstitute it albeit at lower payout. I would think for these cyclic companies they should have a conservative dividend and then each quarter have a variable dividend based on previous quarter FCF and outlook. I think FANG does this and it work really well for a capital heavy business.

MutaliskGluon

Their AR increased by 5B+ in a fucking QUARTER. Their inventory has grown 90% YTD, well above sales growth. When AR, INV are growing faster than revenue, and FCF is missing estimates, thats a serious red flag. You can creatively account AR, INV, REV, etc, but you cannot do that to FCF...

Perfect-Obligation60

I dont day trade, I swing trade or go long. I think its fundamentals are solid: 1. EV/EBITDA at ~6.6-7x is lower than peers and much lower than S$P 500. 2. FCF yield of ~8.9% is solid. 3. Oil price is low, and should go up at some point.

ElectricalGene6146

I understand that. I don’t understand how you can attribute the difference in FCF to depreciation when they both use the same accounting standards?

Feudal_Overlord

Nvidia will probably lose a lot of its marketshare in the future. ADM is growing and now Qualcomm making chips. And theres the china risk which could at any moment show up with cheaper ai chips.. I would not bet on nvidia at this point. The current valuation expects nvidia FCF to 20x in the next 10 year or something like that.

2020Macthedog

Not if the bear thesis is also accompanied by specific action. Like I have given? Oh. Wait. The mods DID remove those. This isn't just a little pull back. But you guys just DCA and never make any changes. Isn't the entire point of subreddit to discuss stuff? Like did you know that the natural gap between FCF per share and adjusted earnings per share has significantly widened. Is that DD? Or that the combined total of Capital raised for chips is $288 billion and has been dumped on the market at the same time the Treasury has to issue so many new bonds. Or that the FEDs balance sheet is increasing at a time it should be decreasing? (This one I need to confirm. That kind of DD? Or do you guys poo poo this as alarmist?

cardioking408

They are creating demand. 100% financing the purchasing for OpenAI who is cash strapped and losing $. And let them payback when they have the cash. Similar to Cisco dot com bubble again. 65% of A/R balance is from 4 customers, and less FCF. Just creative accounting by NVDA. Let the AI bubble burst, stop the Trump charades!

PrettyBasedMan

Funnily enough it would probably have been massively value accretive if they took on debt to pay their employee bonuses; dont get me wrong, that sounds ludicrous and is not something I'd have been amused by as a NVIDIA shareholder in say 2019. But even more funnily, that would've destroyed way less value than what they ended up doing. A A prudent reminder to always deduct SBC from FCF to estimate the cash that can be returned to shareholders via dividends/buybacks ***while being actually accretive on a per share basis.***

MutaliskGluon

It's the relationship between revenue, AR, inventory operating income and FCF. It doesn't pass the smell test. Plus all the circular revenue, vendor financing, and hiding the fact they are helping sell to China (while also saying they aren't making a cent from China sales). There's fraud and securities fraud all over the place

Mnshine_1

No gives a shit about price to sales, p/e and FCF

MutaliskGluon

NVDA just had its Cisco moment. A "blowout earnings" on headlines, but tons of shady accounting things under the service, FCF missing estimates, and blatant lies by the CEO on the call and filings. I posted a ton about it last night but no one could see it because it would get downvoted to hidden instantly. The bubble has popped.

_hiddenscout

Volume in general goes down this time of year and we’ll get the tax harvesting moves soon as well.  I find the AI bubble thing interesting, since I think it’s somewhat true. Personally I’m not worried about like hyperscalers or companies with billions of FCF.  I think there is more of a bubble with VC AI backed apps, the nuclear names, quantum, and some of the names financing things. 

6edge9lord

Positive FCF, high asset to debt ratio, 74% gross margins. Reminds of another stock I regret not buying more of, HOOD

CreativeLet5355

So let me get the argument right: NVIDIA is spitting off enormous FCF. It's options are put that cash in investments, use it to acquire, or use it to invest back in the business in the form of R&D/Sales/Marketing/Product OR buying back portions of the business at what it views as favorable prices. It does all of that, including enormous buyback of publicly held stock. In particular, NVIDIA: \- Use stock based comp to attract top talent as it grows and scales \- Buys back publicly owned stock using its FCF at prices it views as favorable along the way \- Issues new stock at higher prices along the way, which the market happily gobbles up. \- Company revenues, ebitda, and valuation go boom And this is being viewed as some sort of negative cycle? I love this concept that companies should just create enormous cash flow and not put some of it into financial management of its cap table/ownership structure in a way it views as favorable. And if they do, OH NO, they really should've done other things with it.

_hiddenscout

I do think they are parts of the AI trade in a bubble, but not all of it. Nuance is something that is lost online a lot and sometimes in investing.  Like I’m not worried about the hyperscalers who have billions in FCF, but see the stuff like growth in nuclear names and quantum as more part of the the bubble of the AI trade. Especially the stuff VC is funding of just a bunch of bad apps. 

MutaliskGluon

Nvda may hit numbers, but their cash generation is shit. Paying vendors, carrying forward revenue, and bloating inventory now too. This can't last, and their FCF is shit compared to headline numbers which is a huge red flag. I wouldn't be surprised to see a red close

Rude_Judgment7928

Spending 2-3years FCF (META cash) additional capital (either balance sheet or new debt) on AI build out is not pennies for these companies.

MutaliskGluon

I mean, these filings are clear fucking proof. Revenue growth is big. FCF down, AP way up, inventory up. Pretty fucking blatant fraud. But as long as people like you exist, it won't crash. Ignorance is bliss.

endwithel

My thesis is that people fear that their SEO business will substrack, while they will need to pay max earn out to Oddsjam previous owners. Thus 80m earn out with substracting SEO business, but right now market cap is so low, like SEO business is 0. I mean bringing in 0 revenue and EBITDA, which is just false. Other big fear could be dilution, since part of earn outs could be financed shares. But this also is not likely, since they have loan facility to cover earn outs + they just did share buy back for 8.23 a share. It would be just stupid to buyback for 8 and dilute for 4, if you have other sources of funds like FCF and loan facility.

BackSpiritual9741

This looks like a leverage time bomb, and the CDS spike is the tell. If OP’s numbers are close, $80B/yr capex vs Oracle’s historical FCF means they’re leaning on debt just as spreads blow out. When CDS doubles, I’ve usually seen management cut capex within 1–2 quarters and push delivery dates; watch for that guide change and any take‑or‑pay GPU contracts that can’t be deferred. Key catalysts: ratings outlook/downgrades, bond spread widening vs MSFT/AMZN, OCI utilization disclosures, and concentration risk in RPO. If OpenAI shifts workloads back to Azure or slows usage, those data centers turn into depreciation anchors. Trade-wise: long-dated put spreads on ORCL into next earnings/rating actions, or pair short ORCL vs long MSFT. If you play the credit angle, track their 2030–2035 bonds for spread blowouts. At my shop we right-sized cloud spend fast; we moved analytics between Snowflake and Databricks, and used DreamFactory to expose legacy SQL Server data as APIs so we could test without overcommitting capacity. Bottom line: the CDS is screaming “funding risk,” so I’m betting on capex cuts and multiple compression.

jrex035

Easy, AMZN had a negative FCF last quarter because its dumping so much money into building out data centers, something GOOGL notably isnt doing. AMZN is also much less recession resilient than GOOGL is.

Prestigious_Meet820

It's a low margin business growing 5-8x a year that is trading at 50x FCF. At some point it will come down a lot more unless you expect permanent multiple expansion.

Wowmuchrya

Turns out a lot of the companies promising infinite amounts of money to other companies do not actually have any of the money. If for some reason Nvidia exposes itself while also claiming to have over 500b in revenue and a ton of FCF the game is over.

CapitalClimate9639

NVDA actually has 60.85 billion in FCF, a 125 percent increase YOY. Their debt is a little over ten billion but has decreased 7 percent YOY. If you're going to try to spread FUD at least get your numbers right.

shasta747

ORCL is shit, fundamental doesn't matter until it does, well it's the only hyper scaler that has negative FCF, that explains the massive pull back. Market is not as regarded as we thought. But 110P is also regarded :))

ApartmentEvery6303

No. They have debt but they have 50m cash and FCF covers the interest. They have 19 months before any debt issues and they are marketing the company for sale. Prior bids at 9/sh and 7/sh. We believe it sells for over 5/sh. They also have zero dilution, zero warrants, zero ELOC, zero ATM. If it gets the volume it needs, this could potentially be a 5x that has next to zero risk

CanYouPleaseChill

FCF - SBC is currently negative. Perhaps instead of spending money like crazy they should return capital instead in the form of a dividend. The "Oh, but they're reinvesting for growth" narrative is never quantified. The longer it takes to see meaningful FCF, the greater it has to be, as future cash flows are discounted.

MutaliskGluon

NVDA will beat and raise. And I say that as the biggest bear here. But everyone knows they will beat and raise on non GAAP because thats the whole point of using non-GAAP lmao. The real test is what FCF looks like, and what revenue recognition, AP, AR and inventory looks like.

microcapman

Could you walk us through your assumptions in your DCF? If DUOL reaches $5B in revenues by 2035, they will likely be doing 35% FCF margins, no change from today, which is very conservative. The current EV is $7.5B. If they are still growing mid-teens at that time, fair value is more like $35B, excluding all the cash generation during the next decade. But that assumes 17% growth for a decade, whereas it's more likely to be frontloaded for the next 3-5 years and come in higher. This also excludes ARPU growth / further monetization. So today's valuation basically gives value for current users only. Seems mispriced.

anon4crypto

PayPal is spending money on AI like crazy! They'll be one of the biggest losers and all their FCF will get absorbed.

MutaliskGluon

Markets peak/bottom before earnings peak/bottom. NVDA needs to beat earnings, also beat guidance, and also show that the FCF math supports it and not just more creative accounting to pump up EPS while having FCF be less than stellar. Spouler: the first two will happen, but the FCF stuff will be shady and will scare thr market

MutaliskGluon

DYODD. But expenses rising faster than revenues, and they guided to that trend not only continuing, but also getting worse. That means operating income growth will slow a lot, and FCF is going to decrease. Tech traded at high multiples because of great margins, good growth, and low capex. Now all those are becoming less true and that means they need to re rate

CanYouPleaseChill

FCF- SBC is what matters and it’s not so hot for Meta.

LarryStink

Credit default swaps for mag7 still rising. MAG7 is undergoing a phase shift from asset-light free cash flow monsters that funneled their retained earnings into endless stock buybacks into asset-heavy machines with agressive amortization schedules and levering up to further fund the AI capex build as runway for self-FCF-funded AI capex buildouts nears its end.  As that levering up occurs for assets with agressive amortization (GPUs), credit spreads and CDS need to rerate to better reflect this change. These aren't the FCF darlings they were 5 years ago. Tldr they getting balls deep in debt to fund their AI buildout and the market doesn’t like it.

GoldenPresidio

That’s revenue Their FCF was 52 B in 2024. The trailing 12 months into q3 2025 is 44.8B so presumably their 2025 FCF will be something like $40B. Their capex spend in 2025 is between 70B-72B and zuck said it’ll be 105B in 2026 So they’re gonna increase capex spend by $35B, when they were already only yielding $40B. Thats $5B left lol wtf. Sure there will be some taxes avoided on that spend so maybe it’s $10B but still to go to from $52B ATO $10? Yeah I’m standing by what I said. He’s killing all their free cash flow with nothing to show for it

MagnesiumKitten

Hey even he projected free cash flow varies one company will have it calculated at 33 cents and other like Allinvestview will say It's -$0.84 cents per share "FCF is a favourite metric for many investors because it strips away a lot of accounting noise and focuses on actual cash generation. Unlike **net income (earnings)**, which can be clouded by non-cash charges and accounting rules, cash flow is harder to fake." "Strong free cash flow means the company is bringing in real money, not just paper profits."

MagnesiumKitten

Hey the Peter Lynch Earnings Line is about $5.30 "A Peter Lynch chart compares a stock's P/E ratio to its earnings growth rate, and for Rolls-Royce, its current price relative to its growth rate suggests it is trading at a premium, a finding corroborated by a high P/S and P/B ratio, even though its P/E is moderate. " like I said before the PSR shows when stocks get toxic "As of 2025-11-15, the Fair Value of Rolls-Royce Holdings PLC (RR.L) is 335.35 GBP. ($4.36 USD) This value is based on the Peter Lynch's Fair Value formula. With the current market price of 1,106 GBP, **the upside of Rolls-Royce Holdings is -69.7%**." so my Lynch Value is $5.30, another has it at about $4.40 for Rolls. Mind you Lynch wouldn't invest in Lockheed Martin either wanting it at $265 over the current price of $465 and Lockheed is like 5x more profitable for the year ahead \- The Lynch value shows a company's potential fair value based on its growth rate and like I said Rolls isn't great at growth Lockheed's growth is good, I give that like a 7 out of ten. /////// Lockheed Martin: Growth Outlook and Valuation The company's fundamentals remain solid, supported by steady defense spending and reliable contract flow: Revenue is expected to grow about 4% annually through 2027. so value investors can look at the median PSR and not like Rolls very much and with growth investors, some will love Rolls-Royce, like you do, and others like the Lynch crowd wouldn't see any opportunities for Rolls or Lockheed in what they seek out Mind you the Lynch chart will overestimate the fast growers and underestimate the the slow-growth stocks But Lynch would give Nvidia $87 as a price he would like not $190, it's twice as expensive as the stuff he likes to hang onto mind you with Peter Lynch's Ideal stocks of about 30 of them, I've owned about 10-15% of them over the past few years It's an interesting metric, but nothing I'm terribly crazy about, but I watch the Lynch values for most anything I follow, just like the PSR and as I've stated in the past year, Rolls Royce has a moderate issue with the PSR in the aerospace sector but it's more of a severe one for the graph of Rolls-Royce but it's not bad enough that it'll tank in the next year, but give it 3 4 5 years, and it might if profitability and growth don't get a kick in the pants. Not everyone looks at growth the same way, but Lynch fits the bill like 10% of the time I wouldn't think it's essential for Rolls, but I think the Projected FCF of 33 cents is more relevant ........ I look at the price to projected free cash flow in one of my valuations of Rolls Royce, by the way for the sector, rolls is lousy but for the stock chart it's mediocre so it's two metrics that knocks the valuation down the PE ratio for the sector and the stock chart would be a thumbs up to the valuation but the Forward PE would be a minus

Masterandcomman

I would be surprised if this was a Buffett pick. Apple made sense because of it's entrenched position, mature product cycles, huge FCF, and commitment to buybacks. Alphabet is slowing, maybe soon even reversing, their net buybacks to fund multi-year growth capital expenditures. That's great if you believe in the vertically integrated AI story, but it's closer to venture capital than the Apple investment. More likely, this reflects more capital given to Combs and Weschler.

ratskin69

"Analyst consensus and discounted cash flow (DCF) analyses generally forecast continued healthy growth in cash flow through to 2029 and beyond" Stop making up numbers. Zodiacs are more accurate than you |**Metric** |**2025 Guidance**|**Mid-Term Target (\~2028)**| |:-|:-|:-| |**Free Cash Flow (FCF)**|£3.0bn – £3.1bn|£4.2bn – £4.5bn| |**Underlying Operating Profit**|£3.1bn – £3.2bn|£3.6bn – £3.9bn|

MitchCurry

On a reverse DCF with a 30% FCF margin (they've reported 31% and 34% the past two years), MELI is priced for 1.5% revenue growth annually over the next 10 years. Drop FCF margin expectation to 25% and it's 4%. Over the past 10 years, their FCF margin is 26%. Even if you drop the expected FCF margin to 20%, it's priced for just 7% revenue growth annually over the next 10 years.

MutaliskGluon

SP PE is high. Its also a load of bullshit as EPS gets pumped with creative accounting. Compare EV to FCF and we are only like 15% below dot com high and that was notorious for being the most overvalued market ever and it aint even close.

_hiddenscout

Totally. Honestly, nothing wrong with that. I invest in some companies just because I think they are cool lol. Like CODA and MIND fit into that bucket. Both actually generated FCF, but still cool. Yeah, when I was doing the drone research stuff, could never find anything that made sense, in terms of what I want to buy. Plus I own a lot of smaller defense names already, so don't want to get too over saturated into one thing. Actually just came across this name, I'm starting to look into: PAHC Sucks because it's been on a solid run, but the valuation isn't too bad: [https://finviz.com/quote.ashx?t=PAHC](https://finviz.com/quote.ashx?t=PAHC)

debatetradernj

Can you explain what the profit and FCF issues that data centers have are?

jrex035

Not just that, look at the FCF too. META should print cash and instead they've been incinerating it for years for minimal gains

MitchCurry

Crocs (CROX) is currently priced as if FCF will shrink 10% annually for the next 10 years.

Voaracious

TMUS is not a growth stock. It's a value stock. The telecom sector is fully mature and dominated by the triarchy TMUS VZ and T.  Whatever growth TMUS had was at the expense of VZ and T. That is not sustainable. VZ just got a new CEO who looks like a market share pugilist. T can shift that way at any time.  So think value metrics. PE debt FCF etcetera. If you're looking at TMUS thinking growth metrics smack yourself in the head and stop it. What do the value metrics say? That TMUS is ok but not as undervalued as T and VZ. 

WickedSensitiveCrew

I went back through the thread content. There’s almost no comment that: - References actual T-Mobile metrics (ARPU, churn, debt, subscriber growth, FCF, spectrum spending, etc.) - Mentions telecom-sector trends (e.g., Verizon/AT&T pricing pressure, network CAPEX cycles) - Discusses macro-level effects (interest rates affecting debt-heavy utilities/telecoms) Basically, the thread lacks any analytical reasoning tied directly to T-Mobile’s business model or valuation. Was just generic advice you can copy and paste into any thread like "buy the rumor sell the news".

TrueCommunication440

Playing devil's advocate here... as soon as someone shoots down your primary metric (profitability not actually going up if you judge by FCF) you jump to a secondary one (revenue) and say it is more important?

thalassamikra

They only have about half of that in FCF. They'll have to borrow the rest. Should be fun.

EffectivePoet4572

FCF is low because they decided to spend it on chips. Their earnings and revenue is doing very well.

atdharris

Tbf their FCF is less than what it was when the stock dropped 70%, but I much prefer capex to go towards AI data centers over reality labs. Their revenue is also growing at 20%+ whereas it was declining in 2022.

atdharris

Yeah I am aware of the FCF and increased capex guide, but I didn't expect a 20% decline as a result of that. Capex increased I believe \~$2B/year

MutaliskGluon

Dont look at E, look at FCF. E is being propped up by BS depreciation (which I have been mentioning for months). FCF is not painting a rosy picture, and Meta guided for even more increasing capex which means FCF is going to be declining. Cash is king

Galactiator

https://preview.redd.it/7ohhxyrt7u0g1.jpeg?width=596&format=pjpg&auto=webp&s=00d0a8bab61d52857a5ac558ad556f8dd1e6fbbc No hiding RTR's been battered by headwinds: COVID fallout, debt overload, and runs a very niche model. And the product requires an intelligent, organized user to extract full value- certainly not for everyone. But cut the sh\*t: This isn't some pump-and-dump scam; there's been a structural reset worth a fresh look after the Oct 2025 recap slashed and extended debt, handed 86% control to PE (APS, STORY3, Nexus who've sunk $240M+ into it), and supercharged AI personalization that's already showing teeth (Q2 subs +13.4% to records, NPS +77% YoY). If you still think this has the same odds as past efforts run by a CEO who just likes pretty dresses, fine, but now there are turnaround pros at the wheel, not just garment enthusiasts. I laid this out upfront: an execution-dependent thesis- not blind hype. If they nail, or market believes in possibility of, subs growth, AI efficiencies, and FCF flips, minority, early entrants bag 4x+ on a squeeze; if not, it tanks. I called out the thin 4.8M float from day one: volatility's baked in, not hidden. And yes, I bought in- the small retail fry that I am - so of course I'm sharing the narrative and rooting for a re-rate. That doesn't make it a pump-and-dump, where insiders juice a turd then dump bags on retail. I'm no insider; who the hell am I dumping on with a 1% float/ .15% total ownership? Lazy jargon from folks too lazy to read a 10-Q. Dismissing this as "pump" because there's a turnaround attempt (factual, post-recap) and a float that could meme on a whisper? That's low-effort analysis- is every distressed play a scam? The game's changed: PE muscle on ops, AI tilting profitability, $300M+ revenue proving demand. If you don't see why that's worth fresh eyes, cool. But I'm cautiously optimistic PE and AI crack this; happy to listen to real counters.

Evolvedyouth

Perfect — here’s a one-page investment memo for PayPal Holdings (NASDAQ: PYPL) as of November 2025, summarizing the company’s latest financials, strategic momentum, valuation view, and key risks. 📄 Investment Memo: PayPal Holdings, Inc. (PYPL) Date: November 2025 Analyst: ChatGPT (GPT-5) Sector: Fintech / Payments Ticker: PYPL | Market Cap: ~$75B Recent Price (Nov 2025): ~$68–70 52-Week Range: ~$50 – $82 🧾 Investment Thesis PayPal is executing a credible turnaround under CEO Alex Chriss, transitioning from stagnation toward profitable, diversified growth. With improving transaction margins, renewed consumer engagement through Venmo, early traction in advertising and AI-driven commerce integrations, and the reinstatement of a dividend, PayPal is re-emerging as a cash-rich fintech with multiple growth levers. Valuation remains compelling relative to peers, suggesting upside potential if management sustains EPS momentum and TPV growth. 💰 Recent Performance (Q3 2025 Highlights) Revenue: $8.42 B (+7% YoY) Non-GAAP EPS: $1.34 (+12% YoY) TPV: $458 B (+8% YoY) Free Cash Flow: $1.7 B Active Accounts: 438 M (+1% YoY) Transaction Margin Dollars: +6% YoY Dividend: Initiated at $0.14 / quarter (first in company history) Buybacks: $1.5 B repurchased Q3 alone Outlook: FY25 non-GAAP EPS $5.35–5.39 (raised). Management emphasizes “quality growth” and cost discipline. 🚀 Key Catalysts & Positives 1. Venmo Monetization: Launch of Venmo Stash cash-back program aims to drive debit card spend and interchange revenue. Venmo card penetration now a key monetization vector. 2. PayPal World / Cross-Border Expansion: New platform linking to India UPI, Mercado Pago, and Tenpay Global opens high-growth remittance and merchant corridors. 3. PayPal Ads: Building first-party data ad network leveraging merchant insights — potentially high-margin incremental revenue. 4. AI & Agentic Commerce Partnerships: Integrations with Google, OpenAI, and Perplexity to enable “smart checkout” and embedded payment flows. 5. Capital Returns: Dividend + accelerated buybacks signal confidence in steady free-cash-flow generation. 6. Crypto & BNPL Product Expansion: Enhanced stablecoin and BNPL infrastructure expand addressable markets beyond traditional checkout. ⚙️ Financial Health Net Cash Position: ~$3 B (cash – debt) Free Cash Flow Yield: ~9–10% Operating Margin: ~23% (non-GAAP) ROE: ~21% No material near-term debt maturities 📊 Valuation Snapshot (as of Nov 2025) Metric PYPL Peers (Avg: V, MA, SQ, ADYEN) Forward P/E ~12× ~21× EV/EBITDA ~9× ~16× FCF Yield ~9–10% ~5% Fair Value Estimate: $85–95 / share (≈25–35% upside) Assumes sustained mid-single-digit revenue growth, stable margins, and continued capital returns. ⚠️ Key Risks User Engagement: Transactions per account still below 2022 levels; weak activity could cap TPV growth. Competitive Pressure: Apple Pay, Block/Square, and traditional card networks compress take-rates. Regulatory Headwinds: BNPL, crypto, and ad data usage may invite scrutiny. Execution Risk: Monetizing Venmo Stash and Ads needs careful rollout and user adoption. Macro Sensitivity: Consumer spending slowdown could hit merchant volumes. 🧩 Bottom Line PayPal is no longer a pure growth story — it’s a cash-flow compounder in transition, trading at value-stock multiples. Early success with Venmo Stash, PayPal Ads, and cross-border expansion shows a path back to mid-teens EPS growth. If execution holds, re-rating toward peers’ multiples appears justified. 📈 Recommendation: Buy / Accumulate Time Horizon: 12–24 months Target Range: $85–95 Would you like me to append a peer-comparison chart (Square, Visa, Mastercard, Adyen) and a DCF-based fair-value model to this memo for deeper valuation detail?

Galactiator

Anecdotally, I know users who love the product. Data: Rev near all time high; subs at all time high. Not a "dying"product. Drag has been ops inefficiencies (high CapEx, logistics bloat) and scale hurdles- not lack of interest. This is why Nexus is a great partner. PE commitment signals belief in the turnaround. The story is about execution on those levers for FCF positivity. May or may not appeal to your risk tolerance. In theory, PE could buyout anytime post-90% ownership. Trading strategy would be enter cheap, feather out on preferred exit levels (moving target), let PE's incentives do the work. If no squeeze by mid-2026, reassess on FCF trajectory. Volatility = opportunity, but patience pays.

InquisitorCOC

Based on WS estimates, they don't believe themselves OpenAI can come up with that kind money For example, they expect hyperscaler capex $381, $471, $543 billion from 2025-2027, which implies only 23.6% and 15.3% growth for the next 2 years But already in this year, the combined TTM operating cash flow of Amazon, Google, Meta, and Microsoft grew 29% over the previous period. In Q3 2025, their OCF growth is definitely accelerating: - Amazon 37% - Google 58% - Microsoft 32% - Meta is the only laggard at 21%, and sees its stock punished Despite their rapid capex increase this year, these 4 still field $205 billion in TTM FCF. If their future capex growth only matches their OCF growth for the past 12 months, then WS estimates are crazily **conservative** It's possible that they **can't spend** as much as they want, because the current bottleneck is in power generation, not GPUs Finally, their capex mostly goes into semiconductors, and Nvidia especially. The money is still out there and investable. Nvidia has already shown great willingness to **reinvest** much of its FCF back into the infrastructure