FCF

RichieFromCuba

Gracias!🙏 🙏 En el análisis incluyo una tabla comparativa de valoración (P/E, EV/EBITDA, FCF Yield) frente a Carrier y Trane en la sección de valoración. Si te refieres a algo más amplio con márgenes operativos y ROIC lado a lado, es una buena idea que tendré en cuenta. Normalmente consulto ese tipo de comparativas en herramientas como InvestingPro o alguna que otra páginas de este tipo.

c-u-in-da-ballpit

| Metric | NXT | NEE | |---|---|---| | Revenue Growth | 20–40%+ YoY | ~6–11% YoY | | Free Cash Flow | Positive, ~$620M FCF | Structurally negative (CapEx) | | EPS Growth | ~59% 5-yr CAGR | ~8–9% annually | | Debt Load | Near zero ($0 LT debt) | $95.6B, growing | | EPS Beat Rate (3yr) | ~100% — avg surprise 20–89% | ~75% — avg surprise 3–9% | | Stock Return | ~350% since Feb 2023 IPO | ~24% total over 5 years |

redpillsbluepills

Why would anyone invest in IRDM when it has $1.8 billion of debt on its balance sheet against only $97 million of cash and $300 million of FCF? YoY revenue growth went from 17.34% in 2022 to 4.93% in 2025 and has been trending downwards each year in-between. What’s stopping L3Harris or Northrop from buying its L-band spectrum (arguably IRDM’s most valuable asset) and locking up government connectivity?

_hiddenscout

Happened before the war. Hyper scales/Mag7 lost favor of investors because of the amount of FCF going into data center spend. With software stuff, same thing happened with the fear of software companies losing moats and multiple compression because of AI.

MitchCurry

What's your math that gets it to $1,000/sh? I see a company trading at a premium to it's 3Y historical averages of 60% for P/S, 180% (!) for P/GP and P/FCF, and 20% EV/EBITDA. Seems pricey to me, not discounted, especially when you consider they're only 6% of their ATH.

CriticalAnybody6686

I would argue and say that it’s just the nature of the economy taking a dip. Eventually the war will end, and inflation rates will start to drop off. Sounds stupid, but take for example companies like NVDA, SOFI, MU, hell any mag 7 stock is getting shafted right now. Despite the fact that cap ex is increasing and FCF is following the same trend. Yet despite this, these “pillars of the economy” are getting merced. Once the war ends, oil prices stabilize, and maybe impossible Mango shuts ups… everything will spike hard. The fundamentals for many of these companies are so solid, it’s just market sentiment. But hey, I need to get back to the fries

Lookingud

for every $5 increase "from $60" in a year average is 300M FCF. I OWN ALOT

Agitated_Patience_75

what do you mean why is it relevant? it's one of the biggest lessons learned for the cruise industry, it taught them to not get caught again with their pants down (in their case pants down means having too much debt and not enough FCF). RCL wasn't in as much trouble as its competitors and its balance sheet was more solid than a lot of these other cruise companies. They're fine and their management is solid. Now with the war situation and the oil prices: if i were them i would have price locked fuel contracts for at least 1 year so that fuel price swings don't affect me as much. I'm pretty sure they did that, if i, an anon account on the internet thought about it, they did too. And they have the negotiation power and leverage to do it. As for the war...it's disrupting a lot of countries around the world, it's in everyone's best interest to finish as fast as possible. Give it a month or two, my 2 cents is that it's over before the summer starts and things go back to normal. And when that happens nothing will happen in the stock market, except a small bump and then back to slowly crashing. It's been doing that since before the war started. Just my opinions, personally I'm long RCL at any price below $270 (pretty sure i sold them to OP). Currently I'm short puts hoping i get assigned, getting paid while i wait. But otherwise I'm 6figs all cash, not buying anything else in this environment. Just nibbling

Personal_Repair_3579

Interesting post - I actually ran AAPL through a tool I use to check fundamentals and it mostly backs up your read, but with a few wrinkles worth mentioning. The moat is genuinely ridiculous. Like, top percentile vs peers on basically every dimension - margins, capital efficiency, pricing power. This isn't a company that's about to fall apart, and the market clearly knows that. But here's the thing that caught my eye: free cash flow is actually down \~9% year-over-year, and Apple is returning more cash to shareholders than it's actually generating. Over 100% of FCF going out the door in buybacks and dividends. Not a disaster at their scale, but it does explain why the market isn't exactly frothing at the mouth. Over the last three years, growth has slowed pretty meaningfully while the balance sheet has gotten safer. Apple has basically been optimizing for stability. Great company to own, maybe not the most exciting near-term story. So yeah, "Apple is probably fine but not about to rip" feels about right to me too. The longer-term stuff - foldable, deeper AI integration, whatever comes next - is what would actually change that. Until then it's kind of just... a really excellent, slightly mature business sitting at a full valuation.

DJ_Mimosa

Earnings. They've been blowout after blowout for a few quarters here. So increasing earnings and a 6% correction (so far) has compressed multiples on SPY decently, and really compressed forward PE. The market is still astonishingly over-valued by FCF and PE metrics, but by forward PE it's actually starting to look not too shabby. Shiller PE is a bit scary, but also looks behind, not forward: [https://www.multpl.com/shiller-pe](https://www.multpl.com/shiller-pe) Trailing PE is approaching the upper band of it's average interval, still very hot: [https://en.macromicro.me/series/20052/sp500-forward-pe-ratio](https://en.macromicro.me/series/20052/sp500-forward-pe-ratio) Forward PE: Actually starting to look inviting, approaching lows not seem since the Liberation Day nonsense.

Icy-Sheepherder-7595

Maybe a year ago. You're kind of late. CAPEX is high FCF low. Not at all like how it was before where they were the only Mag7 not burning cash but now they're spending to catch up.

Full_Cash6140

Well they could issue bonds. Is there no FCF?

MutaliskGluon

More like why is a company with deteriorating performance and ugly YoY numbers trading at 2 billion PE and 4 trillion EV to FCF

Comfortable_Oil6642

Care to name some for a company which is moving from a cap ex intensive phase to having fully function FCF generating data centres?

Hamzehaq7

yelp’s definitely got some solid fundamentals, but man, that Google dominance is a real killer. like, how do they expect to compete with 73% market share? the valuation looks tempting at those PE and P/FCF numbers, but it's kind of a gamble with the fake reviews and ad softness. tbh, the growth from AI tools sounds promising, but I’d wanna see more concrete results before jumping in. what do you think the timeline is for those acquisitions to pay off?

A55BAG

NVDA putting 50% FCF into buybacks. Michel Burry maybe should close his short...

Independent-Cress382

Let's take a look at this LanzaTech stock. Implemented a 1-for-100 RS to stay compliant with Nasdaq. TTM Net Income Common Holders is -$75 million. FCF has been deeply negative for it's entire existence. End Cash Position has been steadily declining. Already I wouldn't touch this with a 12-foot pole. You literally acknowledge in your post that the core business is cash burning and not worth much. For this play to work, there has to be no bankruptcy and no serious dilution. These guys are burning cash like a biotech company, where do you think they are gonna get cash? A lot of today's price action seems based around the low float. Another risk factor. Asset sales take time, doesn't happen overnight. Asymmetry requires downside to be limited. There is way too much risk here. This is a lotto ticket not an asymmetric bet. Just because your loss is capped at what you paid doesn't mean it's asymmetric.

the_mammynun

HITI earnings today after market. We're hoping for C$170m revenue and positive net income. $5m+ FCF would be ideal however due to higher capex relating to Remexian I'm not counting on it.  It's exciting. Hopefully those who missed out on CWEB will come to see that HITI is in a strong position to benefit from the executive order as it pertains to CBD. They offer some of the highest quality products at the best prices.

gamblingPharmaStocks

> Do you think all the users paying more and more money are just going to be like nah, this isnt actually for me anymore? Not the users, but their shareholders. Hyperscalers are not making anywhere close to 1T in FCF, so this has to come from debt, and they con only shove so much of it into SPVs off their balance sheet before people start worrying. Unless they start making money out of AI, of course, but this has yet to happen. Beside this, while I think that > demand for AI will vanish overnight I think NVDA growth can slow down also for other reasons, like competition from AMD, TPUs, Trainium, Cerebras... NVDA had a monopoly because if you were developing software, it was not worth it to make your own chips. The hardware costs were much lower than salaries. If instead hardware is the bulk of your costs, and you a trillion dollar company, you are quite happy to make your own chip. The only thing holding these competitors back is that NVDA has preordered most of TSMC's capacity for the coming two years. However now we see orders overflowing into Samsung and Intel. Lack of backlog was the main thing holding them back from doing their CapEx and bringing up capacity... As a final point, I don't trust NVDA's numbers anyway. NVDA, under Huang, was ruled guilty of prebooking revenue during the dotcom bubble, in order to meet guidance and mislead investors. I see no reason why they wouldn't do it again.

DocInABox33

That’s an impossible objective bc related to the last question, what is the book value of SaaS, how can you measure an overreaction? It really is difficult because there’s no objective data points to analyze. At least with companies with hard assets or even looking at just cash balance, you have a basis for accurate valuation (bc cash’s value doesn’t fluctuate and hard assets can be priced in real time). You’ll need to monitor a trend in FCF and even then what’s not an arbitrary timeframe? 2 quarters? 2 years? You’ll only know if it’s an overreaction vs accurate commoditized risk after it’s already occurred. Probably for you the best way to answer the question is look at the first principle: CRM SaaS and AI capability. Do a mock case study; use AI in such a way that mimics what CRM does. Then you need to ask 4 questions: 1) Does AI effectively, accurately, and consistently perform the same as Salesforce? 2) How easy/time consuming is it to use AI or set it up to act like Salesforce? 3) What is the real cost (tokens consumed, employee time used to engage, etc.) to use AI and compare to Salesforce price? 4) At what point would I use Salesforce over AI; if it were priced the same? lower? if AI companies increase their prices? It’s all speculation but you’ll be far closer to having a reasonable answer to your question than most people who are using AI news headlines, which in my opinion, are overstating the effect of AI. Not in terms of application, but more so people just are too lazy or don’t want to learn how to use the tools. Far easier to hire someone else and complain to or blame them when things go wrong. How can you blame computer code? People are significantly mispricing the ability to hold a human accountable when things go wrong.

Routine_Gazelle_3522

Salesforce’s value isn’t actually its software. It’s the data it has collected. It has a database with more business data than maybe only three other companies in the world. AI has the potential to unlock any unrealized value in that data. The quality of its software going forward will be secondary to its ability to be a business matchmaker and intelligence provider (it’s gonna steal a lot of consulting business). The potential is huge. That said, I haven’t bought any of it because I think it’s a poorly run business. 1) Benioff is a piece of shit. Other than his donations to children’s hospitals, he’s a fake MF. 2) their questionable M&A choices of the past have only been made worse by their seeming inability to integrate them and monetize them. 3) they not only have high SBC, but high operating costs for a software company, 4) this choice to use debt to do share repurchase is stupid. If a company doesn’t have the FCF or Cash to buy back shares, it simply shouldn’t. It’s another example of bad management.

Routine_Gazelle_3522

Salesforce’s value isn’t actually its software. It’s the data it has. It has a database with more business data than maybe only three other companies in the world. AI has the potential to unlock any unrealized value in that data. The quality of its software going forward will be secondary to its ability to be a business matchmaker and intelligence provider (it’s gonna steal a lot of consulting business). The potential is huge. That said, I haven’t bought any of it because I think it’s a poorly run business. 1) Benioff is a piece of shit. Other than his donations to children’s hospitals, he’s a fake MF. 2) their questionable M&A choices of the past have only been made worse by their seeming inability to integrate them and monetize them. 3) they not only have high SBC, but high operating costs for a software company, 4) this choice to use debt to do share repurchase is stupid. If a company doesn’t have the FCF or Cash to buy back shares, it simply shouldn’t. It’s another example of bad management.

DocInABox33

You are missing the fact that the market is future/forward looking. It’s the same reason why any company that reports great earnings (i.e. beats EPS/Rev/Margins etc which are related to the same valuation metrics you focused on) gets hit when forward guidance is bad. Your valuation is based on TODAY’s FCF; but the market is saying they don’t want to pay for TODAY’s FCF they want to pay for 2027,28,29 etc FCF. What changed is CRM has always been a premium product that defended its pricing power, but the market is factoring in the fact that AI is going to commoditize their service. The other companies you mentioned may be due to more growth/retail sentiment or some AI news driven speculation who knows. But CRM’s valuation has always been a dominant staple in pricing power that’s going to swing in the other direction… a commodity, at least that’s what the market believes. Since it’s a technology company that’s sells a service, it difficult to use traditional Buffet valuation metrics bc they have no hard assets. In other words, what’s the true book value of a SaaS company?

LumpaLard

There is very little detailed analysis on the LPSN sub. It's either dead or the minute someone applies any analysis, it is shut down or the person banned. Lol. Discord from Tradespotting is also low on analysis - I only look at the free side and I noted he was quite tetchy with some people after recent earnings call saying he always said manage risk responsibly. It's no Carvana which I think Tradespotting once said LPSN had potential to be, it doesn't have squeeze potential. I don't want to be all negative: They’ve clearly found some operating leverage: adjusted EBITDA $10.8m on $59m revenue (~18% margin) is a legit short‑term improvement. Syntrix and Google Marketplace gives an angle for news‑driven pops if they announce more proof‑points (new big logos, usage spikes, ARR milestones). Balance sheet is still alive - net loss narrowed from -$134m to -$67m for 2025; debt is painful but they bought time, which keeps the equity as a viable trading instrument. But: Structural top‑line decline is explicitly guided to continue; they are not even pretending to re‑accelerate in 2026. NRR below 80% with falling RPO - this is not a compounding SaaS engine, it’s slow erosion. FCF still negative, cash trending down; any macro or execution wobble re‑opens the “more dilution / more refi” scenario. Management is framing 2025 as “defining” and “inflection,” but the numbers don’t support a true growth inflection - that disconnect is a tell to me. As you can gather: I enjoy picking at the scabs of my failed investments 😅 Godspeed whatever you decide, friend

Beneficial-Ad-7771

Planet is pre GAAP profitable so PE is useless and so is FCF. The valuation IS the P/S re-rating from SaaS to defense infrastructure. And I already mentioned I used Claude to help me put everything together.

petohauki

Since direct links to full models aren't allowed here by Automod, for anyone wanting to dig into the exact FCF calculations or dynamic leverage breakdown, the full formatted report is linked in my Reddit profile.

the_mammynun

Like I said, VFF is an efficient operator, so is LOVE. They are the exceptions not the rule when talking about growers. HITI generated $12m cad FCF in the entire year, but they reinvest a lot in working capital. They opened 27 new stores organically and bought a German distributor this year.  All I'm saying is long term HITI has more stable growth avenues. VFF will always be a grower and that makes them sensative to commoditization risk as global supply opens further. HITI will be there to manage distribution and sales no matter who is supplying the market.

TerribleEngineer

It was close to bankruptcy in 2024. It's not a good comparison. Its still a $360M marketcap company making $130M+ in FCF

bartturner

How do they turn it around? The current trend is declining sales, declining revenue, declining FCF, declining profits. They started their robot taxi deployment coming up on a year in June and have a single unsupervised car running. https://robotaxitracker.com/?provider=tesla

TrailerParkBuddha

So I asked my AI assistant (Gemini 3 Flash Pro) about this as I've recently started to pivot to O&G due to the Iran affair, and SM passes the three different sets of metrics to scout and evaluate longs, even the criteria set not intended for O&G. A couple things I want to add to your post that you may find interesting. First, you mentioned them paying down debt. This is what Gemini had to say about their current debt structure: "​4. Conservative Financing (Rule: Debt-to-Equity < 0.8) ​Data: Current Debt-to-Equity is 0.48. ​Note: Total Debt ~$2.7B vs. Total Equity ~$4.8B. ​Verdict: STRONG PASS. Management is aggressively deleveraging. They are allocating 80% of free cash flow to debt reduction following their recent acquisitions. ​5. Free Cash Flow & Share Buybacks ​Criteria: Positive FCF and reducing share count. ​Data: * 2025 FCF: $620M (Record high). ​Buybacks: A new $500M repurchase program was just authorized; they plan to use 20% of FCF for buybacks initially. ​Verdict: PASS. They are generating significant "owner earnings" and beginning to return that cash to you." It also goes on to mention the absurdly low P/E. When I asked it about entry points and dates+strikes for calls, it threw in these juicy tidbits at the end as supplementary note: ​Audit Summary & Strategy Note "​Price Gap Check: $SM is currently ~21% below its 52-week high ($32.26). This is lower than your usual 40-60% requirement for tech/crypto, but energy stocks rarely drop 60% without a total market collapse. ​Correlation: $SM has a low correlation to $SPY (0.14), meaning it moves independently of the broader market—perfect for your goal of finding positions that don't move sympathetically with your other tech/crypto holdings." So not only does it have room to run, it can and will run in the face of the market shitting the bed. I am buying ITM calls and leaps tomorrow.

Riskismyapellido

**Rubrik (NYSE: RBRK)** reported strong Q4 and full‑year fiscal 2026 results, driven by subscription growth and improved cash generation. **Q4 subscription ARR grew 34% YoY to $1.46B** and Q4 revenue rose 46% YoY to $377.7M. Fiscal 2026 subscription revenue was $1.26B (+53% YoY) and GAAP gross margin improved to 80.1%. The company finished FY26 with $1.68B in cash and short‑term investments, operating cash flow of $282.9M, and free cash flow of $237.8M, and provided FY27 ARR, revenue, margin and FCF guidance.

Jeff__Skilling

> how about any of these companies start by making an actually good product for once that delivers their core promise and value to the user? I mean.......couldn't you just settle for "good financial performance, at bargain basement prices"? Their market cap as of yesterday's close is $2.80 x 112.738mm = $315.68mm FY 25A Adj EBITDA = $313.63mm (99.4% of their total market cap) FY 25A FCF = $238.68mm (75.6% of their total market cap) Would think generating 75% of your equity value in 12 month's worth of organic free cash flow would be, ya know, a good thing...

Jeff__Skilling

lol, yesterday. That was the first time I'd ever taken a look at Bumble's historical financials.....and was having a hard time connecting the dots between OPs "Short Bumble" thesis. I'm just gonna paste that comment below..... ------------------------------------------------------------- >Look at FCF. This "dead horse" is a money printer that's 3X cheaper than PayPal Holy shitfuck dude, you **were not** kidding * Q3'25 YTD OCF of ~$190mm * Annualized, OCF comes out to ~$255mm * Q3'25 YTD FCF of ~$182mm * Annualized, FCF comes out to ~$243mm * Current market cap is **~$750mm** ***For every dollar you spend on buying Bumbles shares, the company generates $0.33 in FCF, which is patently fucking absurd.*** What the fuck is management doing? Imagine they're trading so shittily due to the pretty high (for a tech company) leverage, so why not just start hammering down that debt balance? Might be super onerous private credit with nasty call premiums attached? Have these guys been diluting the shit out of common as of late? Having a hard time wrapping my head around their valuation (leverage aside) given their ability to generate OCF over the last 9 months -- anybody have a guess? Also, OP, I gotta say, for opening a thread on shorting Bumble....how tf are you not asking any of these same questions? And just polling this sub on, well, seems like "vibes" I guess? Without ever checking historical financials or filings?

jrex035

Zomg gotta buy Oracle their FCF is only -25b, what a steal!

LongLonMan

It’s 100% for capex, what else would they raise the money for? It’s a high FCF business so it doesn’t need working capital?

Dstein99

The issue isn’t that there isn’t profit, the issue is that people were paying too much for that profit. Take Cisco for example which peaked at a market cap of almost $600B in 2020 while they produced $4.6B of Free Cash Flow. Free Cash Flow only dropped around 15% to $4B from 2000-2002. It took Cisco 25 years to recover to $80/share (which doesn’t include dividends or share buybacks), and in that time the company went from earning $4.6B to earning $13.2B. Cisco in 2000 was a good company, they tripled profit in 25 years, but the issue is they were not worth 150x P/FCF. This is the lesson of the dot com bubble, great companies will emerge from AI, but they are not a buy at any price. You can look at the opportunity AI companies have, but make sure you pay a fair price.

Algo_Mas

Just repackage these negative FCF products into a CLO and sell it off to the pension funds seeking yield bc they are underfunded anyway. Then boom you are golden! Rinse n repeat until the tax payers pick up the bill!

Jeff__Skilling

>Look at FCF. This "dead horse" is a money printer that's 3X cheaper than PayPal Holy shitfuck dude, you **were not** kidding * Q3'25 YTD OCF of ~$190mm * Annualized, OCF comes out to ~$255mm * Q3'25 YTD FCF of ~$182mm * Annualized, FCF comes out to ~$243mm For every dollar you spend on buying Bumbles shares, the company generates $0.33 in FCF, which is patently fucking absurd. What the fuck is management doing? Imagine they're trading so shittily due to the pretty high (for a tech company) leverage, so why not just start hammering down that debt balance? Might be super onerous private credit with nasty call premiums attached? Have these guys been diluting the shit out of common as of late? Having a hard time wrapping my head around their valuation (leverage aside) given their ability to generate OCF over the last 9 months -- anybody have a guess? Also, OP, I gotta say, for opening a thread on shorting Bumble....how tf are you not asking any of these same questions? And just polling this sub on, well, seems like "vibes" I guess? Without ever checking historical financials or filings? * Current market cap is ~$750mm

Much_Candle_942

* Look at FCF. This "dead horse" is a money printer that's 3X cheaper than PayPal  * Call me a conspiracy nutcase, but dating apps will be #1 targets for AI hyper scalers, because the level of personal info, pictures, chats is beyond wildest dreams.  * Not to mention, these apps are targets for bots. And to counteract, the apps have tonnes of verification methods like payment methods, and soon to be a reality - biometrics based logins, which big tech will drool over. * It just jumped 20% on ER 

6_2Crew09

STUB (StubHub) — The Most Hated IPO on the Market Is Also One of the Most Mispriced. Here's the Real DD. **TL;DR:** StubHub controls 50% of the North American secondary ticketing market, generates real free cash flow, cut $900M in debt in its first year as a public company, and trades at a 68% discount to its IPO price because of three temporary, mechanical problems, none of which have anything to do with the actual business. The World Cup is 90 days away. I think this is a legitimate multi-bagger from here. # First: Why Does Everyone Hate This Stock Right Now? Let me steel-man the bear case, because it's real and you deserve to understand it before I make the bull case. **Strike 1: The Q4 Earnings Miss (March 4, 2026)** StubHub reported Q4 EPS of -$1.56 vs. an estimate of -$0.01. That's a catastrophic miss on paper. Revenue came in at $449M, down 16% year-over-year, versus an estimate of $485M. The stock got absolutely torched — down 13% in a single session. **Strike 2: The Lockup Expiration (March 6–16, 2026)** The 180-day IPO lockup expired this week. Every insider, early investor, and employee who has been sitting on paper gains (or losses) since the September 2025 IPO can now sell freely. Lockup expirations are mechanical selling pressure — it has nothing to do with whether the company is good. It's just supply flooding the market. **Strike 3: Macro Chaos** Iran war. Oil spike to $120. Stagflation fears. The worst two-day hedge fund deleveraging in years hit the tape the same week as the lockup. Growth stocks got indiscriminately dumped. STUB, a small-cap growth name, got caught in the blast radius. **Three things hitting simultaneously equals max pain. And max pain creates max opportunity.** # Now Let Me Tell You What The Bears Are Getting Wrong # The EPS "Miss" Is Almost Entirely Accounting Noise The -$1.56 EPS that everyone is screaming about? **$1.40 of that was a one-time, non-cash, IPO-related stock compensation charge.** It's a required GAAP accounting entry that happens to virtually every company when it goes public. It does not represent cash leaving the business. It will not recur. Strip that out and look at what the business actually produced: * **Free Cash Flow: $158.2M** for the full year 2025 * **Operating Cash Flow: $192.6M** * **Adjusted EBITDA: $232M** (13% margin) * **Gross Margins: 82%** This company is **not** bleeding cash. This is a company that went public, took a mandatory accounting charge, and is being punished for it as if the building is on fire. The building is not on fire. # The Balance Sheet Story Is Actually Impressive In its *first year as a public company*, StubHub: * Repaid **\~$900 million in debt** * Cut net leverage from **6.7x to 4.5x** * Ended the year with **\~$1.2B in cash** * Now has a current ratio of 1.16 meaning it can cover all short-term liabilities That's not the balance sheet of a company in distress. That's the balance sheet of a company that used its IPO proceeds exactly as promised and is aggressively cleaning up its capital structure. # The Market Position Is a Legitimate Moat StubHub has been doing this for 26 years. Stubhub is anything but a startup. * **\~50% North American secondary ticketing market share** in a duopoly with Ticketmaster * Operates in **200+ countries and territories** * Supports **30+ languages**, payments in **45+ currencies** * Brand trust and liquidity that took decades to build Network effects in marketplaces are real and durable. The more buyers on the platform, the more sellers come. The more sellers, the better the prices for buyers. This flywheel has been spinning for over two decades. That doesn't disappear because of one bad earnings quarter. # The Revenue Decline Is Explained By One Name: Taylor Swift Q4 2024 was an *anomaly;* one of the most extraordinary quarters in live events history. The Taylor Swift Eras Tour finale drove a generational spike in secondary ticket volume. Comparing Q4 2025 to Q4 2024 is like comparing a normal Christmas to the Christmas after Ticketmaster crashed and everyone panic-bought. Exclude the Taylor Swift comp effect and Q4 GMS actually **grew \~6% year-over-year.** The underlying business is growing. The headlines are lying to you. # The Forward Case: Why 2026 Is Different Management guided 2026: * **GMS: $9.9–10.1 billion** (\~9% growth) * **Adjusted EBITDA: $400–420 million.** That's **70–80% growth** in EBITDA year-over-year Even the bears acknowledge the 2026 guidance "may finally be achievable" (JPMorgan's words, not mine). The question is whether the market will wait for the proof. Here's why I think it will: # Catalyst #1: The Lockup Selling Ends ~March 16 This is the most important near-term catalyst and the most misunderstood. The selling pressure hammering STUB right now is mechanical. When the lockup window closes, that forced supply dries up. Stocks that have been beaten down by lockup selling historically stabilize and recover once the window passes, assuming the underlying business is intact. The business here is intact. # Catalyst #2: The World Cup The FIFA World Cup 2026 kicks off in June hosted in the United States, Canada, and Mexico for the first time in history. This is a **HUGE** event for StubHub. This is one of the single largest live event ticket markets on the planet, happening *in StubHub's home territory*, with StubHub holding a dominant position as the go-to secondary ticket marketplace. Management has specifically called this out as a major 2026 driver. The summer concert season is also described as "firming up significantly" according to JPMorgan's most recent note. The company's core engine, live event secondary ticketing, is about to get a jet fuel injection. # Catalyst #3: All-In Pricing Headwinds Resolve by May One of the reasons for the revenue pressure in late 2025 was the transition to "all-in pricing" (showing fees upfront rather than at checkout). This created short-term conversion friction. Management has flagged this headwind resolves by **May 2026,** just before the World Cup begins. Not a coincidence. # Catalyst #4: Direct Issuance: The Long Game This is where the real upside lives and where the market has the least patience. StubHub is building out direct issuance capabilities — selling originally-issued tickets (primary market) directly for venues and artists, not just resale. If this works, it doesn't just expand their TAM. It **quadruples it.** The bears say the timeline has slipped. That's fair. But the CEO just said on the Q4 call that AI is now enabling them to build capabilities on the supply side that would have been "difficult to deliver even a year ago." This is a longer-duration thesis, but it's not dead. It's actually accelerating in the background while everyone stares at the quarterly miss. # The Valuation Math At $7.54/share (today's price), here's what you're buying: |Metric|Value| |:-|:-| || |Market Cap|\~$2.6B| |2026 Guided EBITDA|$400–420M| |EV/EBITDA (2026)|\~11x| |Free Cash Flow (2025)|$158M| |FCF Yield|\~6%| |North American market share|\~50%| |52-week high|$27.89| |Discount to IPO price|\~68%| For context: Ticketmaster's parent Live Nation trades at 20–25x EBITDA. StubHub, the *only* company that competes with Ticketmaster at scale, is at 11x. Even if you haircut the 2026 guidance by 20% to be conservative, this stock is cheap. A DCF model based on projected free cash flow growth through 2035 puts intrinsic value around **$93/share.** I'm not asking you to believe that. I'm just pointing out the gap between where it trades and what a reasonable long-term valuation looks like. **Analyst consensus (12 analysts, per Investing.com): $12.83 average price target — 46% upside from here. Not a single analyst has a sell rating.** # What Could Go Wrong (Be Honest With Yourself) This is real DD, so here are the actual risks: * **Lockup selling continues longer or heavier than expected** \- there may be a second wave through March 16 * **World Cup disappoints** \- low scoring games, low US engagement, or a macro recession dampens ticket demand * **Direct Issuance continues to underdeliver** \- the strategy has already slipped once * **Regulatory overhang** \- there are ongoing concerns about ticketing regulations that could affect secondary market dynamics * **Stagflation/recession** \- live events are discretionary spending; a deep recession hurts the whole sector * **Altman Z-Score is in distress territory** \- this is a real flag, even if I believe the FCF offsets it Eyes open. This isn't a risk-free trade. It's a mispriced asset with real catalysts and real risks. # The Bottom Line StubHub is a 26-year-old category leader with 50% market share, positive free cash flow, a rapidly deleveraging balance sheet, and three specific temporary headwinds; a non-cash accounting charge, a mechanical lockup expiration, and macro chaos, that have combined to create a 68% discount to its IPO price and an 11x EBITDA multiple that makes no sense for a dominant marketplace business. The World Cup starts in 90 days. The lockup selling ends next week. The all-in pricing headwind resolves in May. And not a single analyst on Wall Street has a sell rating. I'm not saying this goes to the moon tomorrow. I'm saying the market is pricing in permanent impairment for a company experiencing temporary pain, and that gap between price and value is where money gets made. **Positions: Long 2,100 shares, 10x $15C 5/15/26** Do your own DD. Don't take my word for it. Read the 8-K. Listen to the earnings call. But don't let the noise fool you into thinking this company is broken. This is a play to get to the moon.

petohauki

How do you suggest I "verify" this? It's all public data. FCF-yield has been historically the best indicator of price increase in stock market. There has been studies made about it, one big one being by Anna Yartseva in 2025.

petohauki

What makes it not good? FCF is 74mil They have almost 300mil in cash Market cap is around 800mil EV is around 500mil FCF-yield is around 14% FCF is increasing FCF-yield is about 3x bigger than it should be. Those are facts and not some oppinions.

petohauki

Are you sure you are looking at the right stock? (NRO.PA) The have 282 million in cash and FCF of 74 million. FCF-yield is around 14% (FCF/EV) and if you check their previous financial report from january, that FCF will probably be over 80 million now

MutaliskGluon

So oracle made 3.6B in earnings this quarter. Lets say the next 12 months will be 20B in earnings. How in the everloving fuck are they going to spend 50B on CapEx, and also spend another 5.5B this year on dividend payments. And I am looking at EPS here, where their FCF is likely significantly lower, but im not gonna look at the filing just headline numbers. Like seriously, just think about it. The company is committing to spending 3x their profit this year on CapEx and divvies. How in the fuck is that sustainable? (its not)

Cozyteammate

- Great Thesis - Strong tailwind - Accelerating TAM - Future is guaranteed But prices at these level are simply still priced in for those scenario, even with -25% discount in each names. Only RBRK has a compelling risk adjusted return right now (using P/FCF/FCF growth), other are still priced to perfection with very little margin of safety.

Impressive-Bee-5183

Solid fundamental breakdown. If you're considering a position, worth thinking about how to express this through options since the setup has some interesting characteristics: **Why DOCU might be a good options play right now:** Down 77% over 5 years but fundamentally stable (positive FCF, NRR > 100%, growing revenue). That's the kind of name where IV can be elevated relative to the actual risk of further collapse - the market prices in "tech stock that already crashed" fear even though the business is generating cash. **A few ways to play the thesis with options:** **If you're bullish but cautious (your "medium conviction"):** * **Sell cash-secured puts** at a strike you'd happily own it. You either get paid to wait or buy at a discount. Given your bear case concerns about commoditization, getting paid premium while the thesis plays out is better than buying shares outright. * **Bull put spread** if you want defined risk. Collect premium, cap your downside, and you profit as long as DOCU doesn't drop below your short strike. **If you want asymmetric upside on the IAM thesis:** * **LEAPS calls** (0.70+ delta, 1-2 years out) give you time for the Anthropic/IAM catalyst to play out without the full capital commitment of shares. Your bear case ("medium risk") is exactly why LEAPS make sense - defined risk while the thesis develops. **What I'd check before entering any of these:** * Is IV elevated vs DOCU's own history? If IV rank is high, selling premium (CSPs, put spreads) is the better play. If IV rank is low, buying premium (LEAPS) is cheaper. * What's the sentiment skew? If options flow is heavily bearish, selling puts into that is risky even if fundamentals look fine. * Any earnings/events within your DTE window? I built a tool that checks this stuff across \~4,000 tickers daily - would tell you whether DOCU currently favors buyers or sellers based on IV, sentiment, liquidity, and timing. Free to use, called Options Pilot. Might help you decide *how* to structure the trade, not just *whether* to take it. Your bear case about commoditization is real though. If you go the CSP route, pick a strike where you'd genuinely be happy owning DOCU even if the IAM thesis doesn't pan out. The worst outcome is being assigned into a stock you don't believe in anymore.

MutaliskGluon

Job market is still shit. Big tech is still burning through their cash reserves to buy chips thay arent even plugged in y et. Valuations are still super high, and even higher when you use FCF and not manipulated EPS. Makes sense for things to go green /s

Derpy_Mc_Burpy

Problem is that the estimated FCF they'll get from doing so is 8 to 10 billion. And their TTM FCF is -13B. So they're still negative

Just-Drop-2011

I agree and in Terms of FCF they were cheaper then on PE

Derpy_Mc_Burpy

I'm with you on orcl dumping but to play devils advocate, is it possible for oracle to post positive results on FCF now that expansion hasn't gone through and they had layoffs? Also there was that debt refinancing but I'm not sure when that was supposed to take effect. Will that be at this earnings? I'm not too educated on orcl so could you clarify that

Upbeat-Bookkeeper-17

On the cash: It doesnt just sit idle. First 4 years, 100% of FCF sweeps to kill the senior debt. After that, the cash is earmarked to self-fund a massive terminal expansion in yrs 11/12 without taking on new debt. The rest just juices the final debt-free exit valuation. On oversight: Local mgmt stays in place for day to day operations. the GP and the anchor LP are literally the exact same family office. Theyre putting up almost all the equity themselves. Their capital is locked in the exact same 12-yr black box. On location: Cant name the exact country for obvious reasons, its not Middle East and prim export hub for regional copper & grain.

RiPFrozone

Company IR, Edgar for full reports. On your phone use Quartr app, it gives you all the company filings, presentations, earnings calls, and some quick ratios for you to look at + expectations of revenue and FCF growth 2 years out. Stay up to date on press releases for whatever company you hold or are researching. Books: Intelligent Investor, Little book of Valuation, One Up Wall St Insights: Barrons Streetwise (general industry news and insights), Bloomberg TV (general market news), Memos from Howard Marks (investor insight), CNBC (free market news website) (Annualized) 10 year return is: 15.5% 5 year return is: 15.56% 3 year return is 27.11% I became confident in my skills about 7 years ago and entered the industry 2 years ago, yes we have more tools at our disposal, however an individual investor can do the same analysis if they know what to look for. A lot of my coworkers are traders rather than fundamental investors, don’t look at charts understand the industry and pick what you believe to be winner. That’s usually high ROIC, compounding FCF, and defensible MOATs for continued profitability. Finally, learn what you are good at analyzing, you don’t need to be an expert in every industry, just focus on the ones you have the best knowledge in. Analyzing a bank stock vs a tech stock are two different things. Don’t buy oil without understanding the effects of commodity prices to their underlying business, etc. Stay away from hype unless you have an edge the market is overlooking. Finally, learn risk management. A portfolio generates alpha by properly managing risk.

SnooBooks4305

I bought due to EV/FCF 15 and revenue growth at 23%. Selling at rebound to 100-115 (depending on new developements, earnings) I'd keep for longer (140+) but the SBC is so bad actual valuation multiple is masked and probably should be EV/FCF 25+ (if they paid more normal salaries). This is not a shareholder friendly company, so I only see it as a swing trade.

Portfoliana

not sure i agree that msft's AI moat is about distribution rather than models. thats the pitch, but copilot adoption has been pretty underwhelming relative to what they forecasted. most of my contacts at mid-size companies are still in 'pilot phase' 18 months later. at $30/seat/month the ROI math just doesnt close for most teams when the actual productivity gains are marginal. the 54% of OCF going to capex is the real number here tho. bought a small position at 385 back in january, sold half somwhere around 408 because i couldnt get comfortable with FCF compression lasting another 2-3 years. if azure AI growth stays above 35% yoy ill rebuy but right now the stock is priced like monetization is already proven

vansterdam_city

My issue with TEAM is that their SBC eats up their entire FCF so it's not even a profitable business on any dimension and the growth is slowing. I actually think their products are sticky and I don't believe in the sell off. I was eyeing selling some puts the day it was at 70 but then I took a deeper look at financials and I just can't see a floor here on any foundational basis. Contrast to something like PYPL which is also in a mad selloff but actually makes net income and you can calculate a reasonable clearing price based on comparable PEs of "slow bleed" dying cash cows like comcast.

ThisKarmaLimitSucks

This. I am a massive AI skeptic, but the businesses in Big Tech that are paying for that AI buildout are so fucking solid. They have revenues in the hundreds of billions with 30% type margins, and they're dumping all their FCF into chatbots because they don't know where else to put it.

_hiddenscout

Anyone here follow BR? Really interesting company that has sold off as part of the SaaS fears. Revenue growth is pretty slow, but FCF looks really healthy. Valuation isn't bad as well [https://finviz.com/quote.ashx?t=BR&p=d](https://finviz.com/quote.ashx?t=BR&p=d) Didn't know much abut the company, but seems like they are viewed as like the plumbing of the financial world, so not sure how overblown the saas fears are here. Seems interesting to say the least.

backto001

its facing resistance at 13, if it breaks this then next resistance is at 15. I honestly think this is a deep value stock. If this pipeline decision goes in their favor (which i think likely it will given Fed court is republican and want to drill baby drill) then based on their FCF we are looking at instant 20-24$ Huge institutional money riding on this as well. Over 70% stock held by institutions. as always DOD (Y)

Specific-Ad-6687

PYPL is an entrenched business with crazy FCF.  Even if they actually lose revenue somewhat over the next 10 years, with the crazy buybacks they will grow at a pretty great rate. 

_hiddenscout

If you are looking like true, EXLS still remains a really great company at a cheap price. For more GARPy levels, I think TOST is great. Trailing numbers are high, but PEG is responsible because they are actually profitable now and growing FCF. Last two quarters FCF growth was 32% and 57%. Insider ownership is like 18% and basically like no debt, technically 20M.

_hiddenscout

I do. That's where LLM's usually help of recent. Basically my process is to screen, so I use the PEG P/FCF, but also look at things like quick ratio, revenue growth, eps growth and ROIC. I like to look at these things because I think they are part of what make a great company. That's the beauty of investing, you can define what characteristics you want when looking. So screener cuts down my list to like 100 -150 companies to research. Basically from there, you pick a company to research. I then like to look at overall sales growth and then start looking at earnings presentations and reading earnings transcripts. I like to look at the last two. I then like to get a DCF value to get an idea of what my margin of safety is with a bear, base, and bull case. I do a bit more, but that's like the jumping off point of how I start research. I'm a GARPy investor, growth at responsible price, which means i'm for companies that are under to fairly valued with good growth.

Past_Paint_225

Look at Chegg's and Duolingo's Revenue, FCF and Net Income charts side by side. The market may be doom and gloom, but that really isn't showing in their earnings statements.

_hiddenscout

So like BSX [https://finviz.com/quote.ashx?t=BSX&p=d](https://finviz.com/quote.ashx?t=BSX&p=d) [https://stockanalysis.com/stocks/bsx/statistics/](https://stockanalysis.com/stocks/bsx/statistics/) PEG is under 2 and P/FCF is under 30 with a forward PE of like 18. You can argue that BSX gets a little premium since it's a great company. I like to check both stock analysis and finviz, since numbers can be different, but both are showing the PEG under 2 and P/FCF under 30. I'd argue that puts in a fair to good price for a great company. It's not like crazy under valued, but if you are looking for a long time hold and think the news around the slowdown being a bit overblown, I think it's a solid buy around here. These would be for long term holds, with going back to the idea that Buffet said, "It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.”

_hiddenscout

For me, I like to look at PEG and P/FCF as main metrics. Try to buy when PEG is under 2 and P/FCF is under 25-30 range.

_hiddenscout

I really don’t follow those names. I went with MANH because of how sticky the product is. Also elite ROIC, no debt abs solid FCF. They have a lumpy story now, but I have faith in the company long term. They are working on bringing more clients to cloud and doing trials around their agentic AI with a 2B backlog. BSY just super niche civic engineering software. They took on debt to acquire a few names and have been paying it down. Good margins and FCF growth. It plays well with my infrastructure names and theme. Their iTwin and regulatory needs make them a sticky product. Just more my style I guess. I like finding the under the radar names compare to stuff like CRM. Plus I know these names aren’t going to be replaced by vibe coding. Like it takes years to love away from either MAHN or BSY. Love finding niche. Niche is a really underrated moat.

_hiddenscout

That's the trailing PE. If you look at the forward it's much lower at 22. PEG is also at 1.09, so they are still seeing high EPS growth rates and the P/FCF is 25 which isn't the cheapest, but nothing too crazy. While trailing PE is high, you can look at the historical average of what people pay for the company, it's much cheaper.

salty0waldo

The valuation definitely got reset, so not a terrible price here. The other issue I think is the increase in CAPEX through debt that will eat into FCF.

_hiddenscout

Not sure who that is, but will look into it. Yeah, it's one of the SaaS names where I'm calling my shot and buying. FCF growth is great, you have a sticky product that is niche around infrastructure spend. It layers nicely into what I own and offers some diversification. Also bought MANH the other day. I feel early on the name, but feel comfortable holding long term at these levels.

_hiddenscout

Yeah these hyper growth names always throw me off. I always like to do a DCF just to get an idea and they trade at pretty crazy levels of P/FCF, which makes sense in terms of where the company is at in the growth cycle. Just always have a hard time with these type of names.

_hiddenscout

Yeah, it's a lot of factors. Also these hyper growth companies are really hard for me to even try to wrap a valuation around them. Plus stuff like DCF don't really make sense, so it's hard for me to figure out what makes the most sense for an entry. I also like to look at P/FCF which is pretty wild for CRDO at 143 lol

No-Doctor9742

DNUT shorts looking to regain control - not sure how theyr going to hold it down though now that they have religion and are trading at 5x FCF …

mewalkyne

You should be looking at gross margin, not FCF margin. Paying tons of execs huge salaries is in fact part of their profit model.

_hiddenscout

Yeah, that's the thing. It's always been expensive, but it's a high quality company. Zero debt, good FCF and margins, and really high ROIC. They are kind of going through a transition of moving clients over to the cloud. They hired like 100 new employees to help launch their agentic AI stuff for warehouses. Like they are doing it with Eton now and another place. I think the CEO stepped down, some light guidance and the SaaS stuff really clobbered the stock. However, they are really sticky company and if you are looking long term, the valuation isn't the cheapest, but it's really cheap compared to historical valuations. Seems like a company that will benefit from AI and the market really sold it off.

iwasshotbyatigeronce

They are all spending too much FCF. That stuff freaks big investors out, it's super risky, but if it pays off these companies could somehow triple. Tech has entered the Hail Mary phase.

GladCheetah6048

It been compounding its net income and FCF by a lot for the last 5 years. It's highly profitable now at a PE ratio of 12.

GladCheetah6048

Do it this weekend then man. Duolingo has 350m FCF trailing 12 months. That could all be yours by Monday next week. Go ahead.

GladCheetah6048

The only problem with this is they're profitable and their FCF and net income compounds every year for the last 5 years, by a lot

Whole_Day9866

Ah makes sense, hadn't thought about the regulations. Guess the FCF margin is basically just by design.

cuzimabrownie

I think shorting it at $500 made sense. Now that it’s down 80% and $100 per share you don’t have much shorting left. Cash on hand is > 1 billion and positive FCF for a company worth $4 bil, near impossible to go bankrupt

theJimmybob

$ROKU another baby thrown out with the bath water. $14 bil market cap with $1.9 bil in cash, no debt, throwing off $484 mil in cash a year now - they expect $1 bil FCF by 2028 $400 mil buyback program - bought back $150 mil in stock last Q Everyone forgets $AMZN partnership $ROKU is the $RDDT of streaming... [https://x.com/OMillionaires/status/2028140803521122543?s=20](https://x.com/OMillionaires/status/2028140803521122543?s=20)

NegativeAlphaLLC

It’s not tourism or cancelled flights, it’s the coming spike in jet fuel prices. If the Red Sea shipping lanes and the Strait of Hormuz become uninsurable you will likely see JBLU come close to insolvent and FCF for the other airlines go to almost 0. Time will tell but I don’t think airlines are investable rn.

k3t4mine

Where are you getting these numbers from? TTM FCF? If so, that's not really relevant, at all. Take Meta for example, they have an estimated 2026 Cash Flow from Operations (CFO) of 130B. They guided for 135B in CapEx at the high end of the range. If they end up hitting the high end and coming in line on CFO, they'd have negative free cash flow. 130-135 = -5. Amazon is even worse. 179B estimated 2026 CFO and a CapEx guide of 200B, so it's firmly cash flow negative. Google and Microsoft have bigger cushions (10-30B), but these megacap tech stocks clearly aren't the asset light cash flow machines they were like just a year ago. This is why they're all funding a substantial amount in the debt market. Considering every single issuance has been oversubscribed, saying the "funding is running dry" is an insane overstatement, but the spreads on these bonds are widening a little bit. Market is clearly a little nervous that their CFO won't grow fast enough to match their CapEx. They aren't defaulting anytime soon, for sure, but anyone claiming we're "early" in the cycle is fucked in the head, because META and AMZN mechanically can't raise CapEx faster than their cash flow grows. If they do, they have to fund it entirely with debt. MSFT and GOOG aren't far behind. The second they start to slow the growth in their Capex, the whole "NVDA is still a growth company" narrative dies immediately.

elgrandorado

I'm confused about this. They're growing all their metrics (Rev, FCF, earnings, paid subs, etc.) but they're going to decline? We've had Google Translate for a long ass time now, and even easier ways to translate languages, yet their business has continued to grow sequentially. I'm confused. LLMs have been out for years now and their company has continued to grow unimpeded. Are you saying that in the next couple years we'll have chip implants that will directly translate everything in your brain immediately and perfectly to speak with everyone in any language in the world? Because that's the only scenario where people will stop trying to learn languages. I'm confused as to how little research you've done into this company and the habits of language learners. I'm confused as to why you even bothered making such a bad take. I

Newflyer3

RDDT down 40% YTD essentially earning 90% gross margin, 3.2M capex spend which probably replaces some chairs and a microwave at their office, and FCF for days to buy back shares also getting punished lol

Dependent_Try_7199

I had a closer look on the numbers. I think the market is overreacting. The company is much more focused on improving the experience - which would create more loyal customer base - rather than short-term FCF and revenue growth at the expense of user experience. With current share price of $98-ish the market cap is $4.5bn - and the company authorized up to $400m share buyback. That's almost 10% of the current market cap - which has very much been unnoticed by the media (e.g. no mentioning in the Bloomberg article). I don't think they will be disrupted by AI anytime soon - they are actually very good at integrating AI in their product. With a P/E of 12-13, the stock looks to be on the cheap side, taking into consideration that the revenue guidance for 2026 is 15-18%

Dependent_Try_7199

I had a closer look on the numbers. I think the market is overreacting. The company is much more focused on improving the experience - which would create more loyal customer base - rather than short-term FCF and revenue growth at the expense of user experience. With current share price of $98-ish the market cap is $4.5bn - and the company authorized up to $400m share buyback. That's almost 10% of the current market cap - which has very much been unnoticed by the media (e.g. no mentioning in the Bloomberg article). I don't think they will be disrupted by AI anytime soon - they are actually very good at integrating AI in their product. With a P/E of 12-13, the stock looks to be on the cheap side, taking into consideration that the revenue guidance for 2026 is 15-18%

Key-Plant-6672

Both are highly successful, FCF machine enterprises 🤣

MutaliskGluon

Because you are looking at non GAAP earnings. Look at cash flow. Their spending on CapEx + Buyback commitments are greater than their cash + projected FCF this year. The market doesnt like that. They want their companies to earn money, not burn cash. Not to mention META is fraudulently depreciating their GPUs, which is making their EPS seem higher than it actually is.

rockets_go_boom

I don't think anyone disagrees that data center revenues will eventually slow down, but pricing that in as a near term certainty is insane while ignoring all the other positives. Nearly all the largest companies decided this expense is so crucial that they will dump their entire FCF into it, and we think that spending is just going to disappear in a year or two? This is oversimplified math but they have a backlog of over $500B and growing, which is more than 2x ttm revenue and still larger than their projected revenue next year. The money from data centers alone is going to be flowing in for at least another couple years. My disagreement is that you can't just say a specific PE is unreasonable if there is actually profits being generated to justify it. I agree long term they will have to diversify income streams, but it's not like they're unaware of this, failing to do this already, or that this will be an issue in the next year or two. None of this factors in NVDA itself growing. They're being valued like a data center provider like Oracle. I'm more interested in NVDA because of future exploration into things like AI hardware integration in self driving. There's room for further growth.

Smooth-Sentence5606

You’re highly misinformed. That is only one portion of their business. They also own Venmo and Braintree. And they actually have the largest customer base out of all payment providers. Not to mention their pristine balance sheet and monster FCF.

Meetdreys

Post-deal, the new Paramount-Skydance will inherit WBD’s ~$33B debt + the fresh $57B+ from the bid, so yeah, interest payments alone could eat billions yearly. Cash flow’s already thin from linear TV decline, and adding that $2.8B Netflix payout (licensing/settlement stuff) is a straight gut punch basically 15-20% of current market cap gone in one check. Budget restrictions are real: they’ll likely have to cut corners on big swings like the Harry Potter series (which needs massive VFX/marketing spend) or delay stuff to protect the balance sheet. Netflix, meanwhile, prints cash (~$7-8B FCF projected) and could’ve thrown real money at those IPs without blinking. It’s a classic “win the battle, lose the war” vibe Skydance gets the keys to the kingdom, but the kingdom might be crumbling under debt. Antitrust might slow it anyway, but if it closes, quality could take a noticeable hit for years.

Feeling_Ad_6671

Their FCF looks good

Portfoliana

bought at $85 in december thinking the turnaround under chriss was finally getting traction. down about 20% now and this drop today is rough but tbh the takeover rumor never made sense anyway. stripe doesnt need paypal's legacy checkout baggage the real question is whether paypal can grow venmo into something that actaully monetizes. $68 is like 11x forward earnings for a company doing $5B+ in FCF, thats insanely cheap if they can even get back to mid single digit growth. im holding but not adding until i see a quarter where unbranded checkout stops shrinking

elgrandorado

I unwinded the last of my ASML position because of this. We're definitely in the throes of the AI CapEx supercycle, but the moment one of the hyperscalers flinches, the ride down will be gnarly. It could be two years from now, but the time to buy into the shovels was 2-4 years ago. I'm debating on GOOG. They've proven their ability to reinvest in the business and continually fend off competitors, but I don't like to see FCF multiples compress like this to starve out AI labs.

xyztome

I've said it once, I'll say it again until I'm vindicated in 6 months time. AI is NOT the enemy of SAAS. It's Jerome Powell. We've never seen rates at this level for this long. It is absolutely choking the jobs market. Why do you think companies are focusing on FCF and revenue instead of growth? You've got this generational productivity booster in AI and hiring is at all time lows because with AI, it's easier to maintain with less. Who tf is SAAS supposed to sell to? Even still, I'm looking at these earnings and seeing >20% growth YOY. It's not as high as when rates were sub 1%, but it's still pretty strong. Once the new Fed steps in, SAAS will be back with a vengeance.

jrex035

Again, all of this is based on other trillion dollar companies dumping all of their FCF into building out data centers indefinitely, despite growing opposition to building them, rising costs, delays in connecting them to the grid, and of course a currently non existent ROI for this literally unprecedented infrastructure spending. It's not sustainable at face value and when the most valuable company in the world is in full blown speculation territory, that's bad news for everybody. It's genuinely funny thay you think a forward pe of 24 for a $5T company is reasonable.

Icy_Letterhead4893

Numbers are clean but read the capital allocation. £7-9bn buyback on \~£3.6bn annual FCF means 70-80% of cash goes back to shareholders. Capex was £257m. They're pricing in a world where the transformation is done and the cycle doesn't turn. That's not strength... that's a confidence bet with a thin cushion. Net cash £1.9bn won't absorb much if flying hours flatten.

FishWings1337

Three rounds of layoffs in three years (18% → 6% → 12%) while simultaneously doubling production. Revenue is growing but they burned $3.8B in FCF last year on $1.35B revenue. That's not a path to profitability, that's a cash bonfire. $4.6B liquidity with \~$1B/quarter burn rate = 4-5 quarters of runway. No permanent CEO for a year. Stock at record lows. Polymarket pricing about 44% chance of bankruptcy before 2027. The tech is legitimately best-in-class but at some point Saudi PIF has to ask whether they're funding an EV company or a very expensive jobs program. What's the realistic path to positive gross margins here?

Separate_Anxiety3347

At that valuation, buybacks can be rational if management sees durable FCF and limited higher-ROIC alternatives. I’d check whether repurchases were mostly anti-dilution vs true share-count reduction, and whether leverage stayed controlled. If AI pressure is more cyclical than structural for their moat products, this could look like good capital allocation in hindsight.

Separate_Anxiety3347

Target-price gaps can be misleading because analyst targets often lag fast sentiment shifts. Market may be discounting slower billings growth, tougher comps, and compression in premium SaaS multiples. I’d compare ZS/CRWD/PANW on NRR trend, large-deal velocity, operating-margin expansion, and valuation on EV/FCF, not just narrative. Could be undervalued, but only if growth durability plus margins re-accelerate.