FCF

LDNBrickTop

Agreed, he’s the time to load up, once it starts running as the FCF story deteriorates in the industry it’ll be a steady graph up

Milswanca69

I believe strongly in PayPal as a value and FCF play. They have a $40 bn market cap, no net debt, and are generating a steady $5bn in free cash flow per year. They’re repurchasing shares at a massive rate ($6bn this year and more into the future) which accelerates the FCF yield. I also view it as a strong acquisition candidate.

FarSolid7870

Trailing earnings alone is not the way to look at SNs valuation. PEG, FCF, Price to sales are better indicators. SN isn’t operating as a mature business yet so operating margins and earnings do not reflect what future cash flow will look like

JabCrossE4E5Quark

Because they have no FCF and are diluting.

Beneficial-Ad-7771

Software premium is gone due to AI productivity. Most of these tickers had moats because it would take too much time and money to build a rival competing product. Today you can build most of these sites and do quickly which is what Anthropic has been doing lately. If companies can now replicate what took years and years to build, the only value these companies have now will be on their ARR and FCF. The product these companies have are basically commodities today.

Commercial_Seat_3704

Borrowing costs will be high for a long time and since these dickhead CEOs are torching their FCF on the AI buildout they are going to have to dilute just like Google did

_hiddenscout

Hyperscalers should. They are spending a ton of money, but they still generate a ton of FCF. I get the idea of them needing/wanting to invest into the future or next big thing, but feels like the speed in which they are doing it is not sustainable. Yeah one of my big things is looking at quick ratio and debt levels before I make any investment. It's hard to go bankrupt when you have no debt or can sustain your debt.

drew-gen-x

Another new ATH for $VXUS (World ex US) this morning. You have to watch where the money is going. Reddit's fave AI cap ex hyperscalers are spending their entire 2026 FCF plus even more debt plus diluting their shares and sending the majority of that cash to Samsung, SK, TSMC, ASML, etc. Add in the USA weaponizing the USD. 1st it was Biden freezing Russian foreign assets held abroad in USD and then DJT w/ his assnine tariffs. Foreign capital is being repatriated from US debt & stocks back into their home foreign economies out of necessity and now these foreign economies are showing massive growth.

IntrepidFile2593

Interesting thesis on the consumer sentiment angle — worth digging into the numbers though. LULU scores 32/100 on our research tool right now, which is deep in “avoid” territory. The issues: EPS is down -9.4% YoY, FCF dropped -41.8%, and the company guided to flat-to-down revenue for the full year. Stock is -31% below its 200-day MA with RSI at 36 — not really showing accumulation yet. Your macro thesis isn’t wrong (upper middle class spending recovery), but the margin pressure may be structural, not just cyclical. Also worth noting there’s a CEO transition underway until September. Could be a value trap at $115 rather than a bounce setup. I’d want to see at least one quarter of margin stabilisation before getting comfortable. Free research here if useful 👇 https://picksmith.co/free-research/2026-06-17-lululemon-athletica.html

rebuildingblocks

I also like COWS - [https://amplifyetfs.com/cows/](https://amplifyetfs.com/cows/) \- for a portion of a long term investment. It's an ETF with a slightly different angle (strategy is focused on high free cash flow (FCF) companies that pay and have historically grown dividends.)

an_PR

Bro you probably bought the bottom on a stock with one of the lowest sentiment. 10 times earnings, lot of FCF going into buyback, a war chest of cash,… If they do a few good things right over the next 12 months, this is 50% higher or more. Just stop thinking about it and reevaluate in a year or two.

BubblyStation30

I think Redditors generally don’t understand what fundamentals means. They think it means the current financial state of a company, what its revenue, earnings, FCF was in the past several quarters. They do not understand that stock prices are more determined by expectations of future free cash flows. If you understand this fact you realize that for firms like SpaceX it’s essentially meaningless to say “the fundamentals don’t make sense for the valuation” because the business is so incredibly dynamic and has such a huge potential window of retaining a competitive moat that it’s essentially impossible to characterize the distribution of possible future free cash flows.

Rav_3d

Fundamentals don't matter to this stock. It trades on hopes and dreams, not EBITA and FCF.

drew-gen-x

Until the AI cap ex hyperscalers stop spending their entire 2026 FCF plus extra debt and keep diluting their stock. none of them are buys IMHO. Buy what they are spending their money on. Look at $SOXX, $CAT, $VXUS (Samsung, SK, TSMC, ASML). I tend to look that all this cash is moving from the USA to Pacific Asia area. Nvidia ain't making any of these chips in the USA. The $SOXX has moved too far too fast so I like $VXUS. Follow the flow of money.

Iron_Yuppie

Yeah, my issue is less “is SpaceX overvalued?” and more “what would even tell us if it was?” If this were anchored to some metric — forward revenue, EV/revenue, EBITDA, FCF, Starlink subs, launch cadence, cost per kg, whatever — then at least you could draw a map. You could say: at this multiple, it needs this much revenue; at that multiple, it needs this much margin. But at $2.5T, it feels like it has moved past any way to say "ok, now it's grown into its valuation". It’s not aerospace, and even if you tried to treat it like AI infrastructure / ElonWS / CoreWeave, the implied scale required is enormous. So then the question becomes: why is $2.5T the right number? Why not $250B? Why not $25T? Once the valuation is detached from measurable business metrics, it becomes almost impossible to reason about the future stock price. I’m not saying the story is wrong - and i believe wholeheartedly in the vision of transforming humanity (with SpaceX)/demolishing telecoms industry (with StarLink)/more competition for Compute (with EWS). I actually buy the “railroads to space” too! I just don’t know how to invest other than "Elon historically makes stocks go up."

Agitated_East4908

(First, I apologize — English is not my native language, so I used translation help for parts of this.). \----------------------------------------------------------------------------------------------------- 1. The Core Fundamentals: Narrative vs. Reality The bear case on Asana for the last two years has been "Generative AI will replace mid-tier project management software," and that thesis pushed short interest to extreme levels. But Q1 FY2027 (quarter ended April 30, 2026, reported May 27–28, 2026) cuts directly against it: \* Revenue beat: $205.1M, up 9.5% YoY — above the high end of management's own guidance ($202.5M–$204.5M). \* EBITDA near breakeven: -$2.35M for the quarter (-1.1% margin), the narrowest loss in the company's history as a public company. \* Record non-GAAP operating margin: Non-GAAP operating income hit $23.6M (11.5% margin) — up from $8.1M (4% margin) in the same quarter last year. Company-confirmed record, +720bps YoY. \* GAAP losses shrinking fast: GAAP operating margin went from -23.4% to -7.4% of revenue YoY. \* Real cash generation: $40.2M in operating cash flow and $34.4M in adjusted free cash flow (17% of revenue) for the quarter. \* NRR (net revenue retention): 96% en base a últimos 4 trimestres; 97% in-quarter, mejorando por 4° trimestre consecutivo. Esto es clave con la narrativa bajista de "AI mata a Asana" se sostiene en que los clientes se van — la métrica de retención muestra lo contrario, una inflexión. \* Clientes "core" (>$5K anual): 26,103. \* AI Studio: clientes que gastan $100K+ casi se duplicaron QoQ (base chica, pero ritmo de adopción rápido). \* P/S aprox 2.2 (versus MNDY 3.10 | TEAM 3.7) \* EV/Sales 2.01 (versus MNDY 2.25 | TEAM 3.6) AI integration, not just AI talk: Asana closed the acquisition of StackAI ($75M upfront cash + equity earn-outs) the same day as earnings — a no-code AI-agent/workflow platform meant to let Asana's agents actually execute work across enterprise systems (ERP, CRM, ITSM), not just plan and track it. This isn't a "dying SaaS name." Margins, cash flow and GAAP losses are all moving in the right direction at the same time revenue is still growing high single digits. \----------------------------------------------------------------------------------------------------- 2. The Share Structure: A Genuinely Illiquid Float This is the part most people screening on Finviz alone will get wrong, because Asana has a dual-class share structure: Class A common stock (ticker ASAN, the only class that trades): 164.36M shares — this is what Finviz shows as "Shs Outstanding," and it's correct for Class A, not for the company as a whole. Class B common stock (10 votes/share, converts 1:1 to Class A, almost entirely insider-held, does not trade): 69.54M shares. Total combined shares outstanding (per the 10-Q for the period ended April 30, 2026): 233.90M — this is the number used for market cap, EPS and the weighted-average-share figures you'll see on Yahoo Finance. Because only Class A trades, the relevant float for squeeze mechanics is the Class A float — and that's exactly what Finviz's short-interest stats are built on: \+ Insider ownership 60.47% Combined Class A + B, dominated by Dustin Moskovitz \+ Institutional ownership 44.84% \+ Public float (Class A) 91.12 M Shares \+ Short Interest 32.15 M Shares \+ Shoar Float 35.32% \+ Days to cover aprox. 5 days So: insiders control \~60% of the company, the free float is \~40% of total shares, and over a third of *that specific Class A float* is sold short. That's the setup — not an error in Finviz's data, just a dual-class structure most retail screeners don't account for. So: insiders control \~60% of the company, the free float is \~40% of total shares, and over a third of that specific Class A float is sold short. That's the setup — not an error in Finviz's data, just a dual-class structure most retail screeners don't account for. Dustin Moskovitz is no longer Asana's CEO. He stepped down in July 2025; Dan Rogers (formerly of ServiceNow) is now CEO, and Moskovitz moved to Board Chair. He's still by far the dominant shareholder — his last Schedule 13D/A (August 2025) showed \~129.8M shares, roughly 58% on an as-converted basis, and he's continued buying on the open market under a 10b5-1 plan since. The 60.47% "insider ownership" figure is mostly him, just not in the CEO seat anymore. Asana has an active buyback program of approximately US$199.4 million (expanded in February 2026) on Class A shares—the only class that can be borrowed. If the company continues to repurchase shares, it mechanically reduces the loanable float, which puts pressure on short sellers over time, regardless of the price. Asana tiene posición de caja neta positiva (157 millones USD) \----------------------------------------------------------------------------------------------------- 3. The Structural Asymmetry (Days to Cover) With average daily volume of 6.70M shares, the short ratio sits at 4.81 days — it would take nearly five full sessions of pure buying volume for current shorts to cover, and that's before accounting for how little of the float is actually liquid given \~60% insider/Class B control. Technically, the stock is base-building: price is above both the 20-day (+1.1%) and 50-day (+11.0%) moving averages, while still well below the 200-day (-28.7%) — consistent with an early-stage recovery off the 52-week low ($5.38), with the stock currently around $7.43 (52-week high $15.71). \----------------------------------------------------------------------------------------------------- Conclusion ASAN's setup: a founder-chairman who still controls roughly 60% of the company, fundamentals (margins, EBITDA, FCF) that directly invalidate the "AI kills Asana" bear case, and a heavily crowded short position concentrated in a structurally thin Class A float. I'm not playing this for a momentum pump — I'm here for the structural turnaround and the mechanical squeeze risk that shows up if/when valuation starts to catch up to the fundamentals. \----------------------------------------------------------------------------------------------------- My Positions 1. Spot: 5% of total portfolio in common shares. 2. Options: LEAPs — $ASAN calls expiring 2028. Disclaimer: Not financial advice. Do your own research.

tradematesHQ

Trademates rates this AVOID and SPECULATIVE. The $7M market cap and negative equity are hard to ignore. They're burning through cash with no path to profitability, and the bear case is bankruptcy or massive dilution within 4 months based on -$23M FCF against $7M cash. The $250M facility sounds great until you realize they might not survive long enough to use it.

Jasonmilo911

For the record, I've been permabullish, and I'm not bearish overall. I also agree that AI development is in its infancy. What I'm saying is, TO ME, the AI capex boom trade is a terrible one going forward. 90% of spending on many of these recent high-flyers is coming from 5/6 companies that have pledged to spend over 700B this year. So far, such spending has been relentless and has created capital structure issues (hundreds of billions of new debt, now equity, and depreciation costs to come) and cratered FCF. All forward assumptions take for granted that such spending from the hyperscalers will be almost a trillion next year, and that it will grow from there in perpetuity. The yield is not yielding, and the math isn't mathing. Can it go on? Yes. Can it go on for many more years? Also yes. Though unless something fundamentally changes, AI in its LLM form is very cool and very useful, but with very bad unit economics. Hyperscalers don't want to be the ones subsidizing it all and stuck paying the price. At some point, spending will be dramatically cut. When that happens, you are going to see a lot of -20% days in a short period of time.

SnooHedgehogs5162

https://preview.redd.it/3dl8zdj5nk7h1.jpeg?width=1024&format=pjpg&auto=webp&s=ec1401630f4d8fd5b2b2d56c1daf367502f8bae6 Aletheia Capital raises its SK Hynix price target to KRW 5.3 million Based on: 10x CY27E FCF 10x P/E This implies 125% upside from the current share price.

TheRedditModsSuck

Look at SPCX revenue (18.67B in 2025), pretend that's free cash flow, assume 30% growth rate over 10 years, do not even discount, add values together... Still doesn't make $2.5T. With these ridiculous assumptions, FCF would only be $250B in the 10th year. All of these ridiculous assumptions and I *still* can't justify the valuation. That's crazy.

BobWileey

The space sector is high beta and they generally trade in a basket. Someone pointed out that institutions probably went long SpaceX at IPO and short other space stocks at that same time. RKLB is a low margin business, and they're FCF negative and remain that way until currently delayed Neutron is running regularly, right? So for like 2 years+? I have to assume the IPO brings exposure to the sector and investments in others in this basket start to see some inflows when people realize SpaceX isn't the only shop in town. Also, I may be short sighted, but I just don't see the launch business being something that generates a ton of money unless you have products you're trying to put in orbit (like BO and SpaceX)

_hiddenscout

It's a smaller company, but ITRN is really cool. They do vehicle locational tracking for like stolen cars, growing a bit more in the US, but mainly ex-us markets. Subscriptions continue to grow, so they have stable FCF growth and the company has no debt. They make so much money that they did a special dividend last quarter and the thing doesn't have expensive fundamentals by any means. I think the yield is 3% on it. It's smaller than a common stock people by for dividends, but the thing has better asset performance than the SPY or QQQ.

_hiddenscout

Still short term, imo. Sometimes stocks just move quickly and go through periods like that. Like some of the names I sold out early, like AMKR, which is a semi packing company, did nothing for years, but now up like 320%. That is 100% narrative driven, but the way I see investing is that you'll hit some home runs, some tripples, etc. However, if you continue to buy things that grow FCF and trade a relatively good fundamentals, it should take time. Even Buffet/Munger saw like BirkB down like 30-50% in multiple times in their lifetimes.

jrex035

I'm holding multiple companies that have huge FCF multiples, have pes in the single to low double digits, and are still growing considerably but aren't seeing meaningful price action because everyone is dumping everything to fomo into anything tangentially AI related, no matter how little revenue let alone profits they generate. Narrative is *way* more important than fundamentals in this market

KeyCommission2

How is that sentiment any different than what was present in every other bubble? Namely "it's going to go up forever". In order to approach justifying current valuations, Google FCF would have to triple. In what world is that reality?

BladeFireQ

Wait why? The have like 100B in FCF every quarter, I expected it from the hypers not from NVDA

ValuEdge

I think the better question is not “will boring companies outperform AI IPOs?” but “what assumptions are already priced into each side?” A boring profitable company can still be a bad investment if the market is already pricing in years of perfect execution. And an AI name can still be interesting if the current price is not assuming impossible growth. The category matters less than the gap between expectations and reality. The checklist I’d use: 1. What revenue / margin / FCF growth is already implied by the current price? 2. What has to go right for that valuation to make sense? 3. What would make the thesis wrong? 4. Is there a margin of safety if the story cools off? 5. Is the company cheap on fundamentals, or just less hyped than the current shiny theme? A lot of investors compare narratives: AI vs boring, growth vs value, IPO vs established. I think the real edge is comparing expectations. The market can be right about the theme and still overpay for the stocks.

Sllyce

Really? I would think near 10% FCF yield is excellent for a mature company , I would love to own that if the revenue stayed like that long term

Jeff__Skilling

Most tickers will probably be traded off of forward FCF than anything....

VitaliiNoskov

The timing on this is interesting. Berkshire sitting on $333B of insurance surplus and FCF just recovered to $25B after a weak 2024. The Abel buy is a signal, but the real question is whether that $8.3B impairment on Kraft Heinz and Occidental was a one-time cleanup or the start of a broader reassessment. What's your take on the operating businesses underneath the investment portfolio? GEICO's premium growth held at 5.3%, BNSF earnings up 8.8% — the core engine is still firing even if the headline earnings got hit by mark-to-market noise. At 15.9x P/E vs sector median of 12.9x, you're paying for quality. The question is whether the conglomerate discount has finally flipped to a premium.

Fun-Inspection-8196

Some of these LLMs are doing griundbreaking stuff....and they are burning through cash at levels not ever seen in human history while the "used cigarette" software companies are still generating FCF. Unless you think the LLMs can keep losing money forever, there will be a rebalancing.

Wide-Contribution-29

I’m buying XLE calls on dips They’re good companies producing a lot of FCF and I’m not concerned about their capex not having returns  People the world over still want the black gold

SWchibullswolverine

wtf are you talking about lol? this takes 2 minutes to look up. Tesla has been profitable for the past 5+ years....$44B in cumulative net-income over that period. if you don't believe in US GAAP then their FCF is $26B over the same time period.

_hiddenscout

Not a chart guy, but can just look at the company fundamentals. [https://stockanalysis.com/stocks/meta/statistics/](https://stockanalysis.com/stocks/meta/statistics/) PEG is 0.84, P/FCF is 30, Forward PE is 17 and ROIC is like 30%. All while the company is growing revenue like over 20% every quarter, with the last quarter growing 33% QoQ. You are buying arguably one of the best companies in the world in terms of financials and it's actually sitting at a place where it's undervalued. The thing going against it is they are burning all their FCF, but they still generate a ton of FCF. Like last year, META made 46.1B in FCF.

Donechrome

SpaceX balance sheet and FCF explain everything I need to understand where it is heading Debt-to-EBIDTA 4.2 negative interest coverage ratio FCF to debt -48%. Awful Retained earnings -40B!!! FCF -20B. with B! If SpaceX were evaluated as a "regular" asset-heavy business like a traditional airline, automaker, industrial manufacturer, or telecom provider—its credit rating would not just be junk; it would be  deep, highly speculative distressed junk. If a credit analyst applied standard quantitative ratios to a regular company showing an accumulated deficit of $41.3 billion, a quarterly net loss of $4.28 billion, and a negative free cash flow of $14 billion, it would score a rating of  CCC+ or CCC from S&P, or  Caa1 from Moody’s.

_hiddenscout

Not even close lol All the hyper scaler names have more of a FCF issue right now. However, they still generate a ton of FCF and it's more of the market being angry at the capex spend. There will be a day where this stops and it will actually benefit these names. Like last year, MSFT generated like $73B in FCF. It's really just a story of their spending and a matter of when it ends. I still think if you are a long term investor, like Amazon, META, and MSFT are some of the best businesses in the world and trading at pretty solid to cheap valuations, just need to wait it out until the party stops for the data center spend.

_hiddenscout

Not really my bag of tea, but man there is some interesting software names out there that seem so cheap. Was looking at RELY this morning: [https://stockanalysis.com/stocks/rely/statistics/](https://stockanalysis.com/stocks/rely/statistics/) PEG is 0.2, P/FCF is 13, Foward PE is 13, ROIC is 31% with a quick ratio of 2.2 Also seeing 3 quarters of growth at like 25%. Pretty wild how cheap some names have become. Will need to dig more into them over the weekend. Here's what they do: >Remitly Global, Inc., a cross-border payment company engages in the provision of digital financial services in the United States, Canada, and internationally. >It offers cross-border remittances and complementary financial services through mobile application and website. Latest Investor Presentation Slides [https://ir.remitly.com/static-files/5e8b2bdb-0614-4b22-946d-76261a0a5e0e](https://ir.remitly.com/static-files/5e8b2bdb-0614-4b22-946d-76261a0a5e0e)

TronoWolf

https://preview.redd.it/lxhf0lhdtv6h1.png?width=434&format=png&auto=webp&s=750b1199ffdd97b5d0a686d9e2e24ec6d250e289 Yup they don't have as much debt to worry about and have all the access to AI benefits. However, I don't like that they had a Net Cash position of 234m in Feb and -1,439m in May, but their debt to FCF is under 1 which is good. It looks like it was mostly investments and have a consistent 10,000m in operating cashflow. They are near the end of their investment cycle it seems as well

renegaderunningdog

At these prices they're gonna take the company private through their FCF.

Agreeable_Fun_1371

The most important metric is REVENUE and FCF you fucking dumbass. Just admit you’re a hater for the love of the game. Active accounts doesnt fucking matter when the accounts spend more and more. Jesus, what a clown

elgrandorado

The money in Tesla is really solid. $5 billion in FCF, similar Net Income figures. TTM revenue growth is 2.25% so not too shabby for a cyclical car company. At the Q1 2026 rev growth I would slap a $150 billion valuation assuming they're able to consistently grow again at a mid teens rate with their 20%+ gross margins. Pretty great for a car company. Oh wait they're valued at $1.25 trillion LMAOOOOO

renegaderunningdog

They have a market cap of 70 something billion if the after hours price holds and they have almost 3 billion in FCF a quarter. It's insane.

hoopaholik91

Because their FCF is negative

Dstein99

Micron’s price relies heavily on gross margins. When I made this comment Micron’s gross margins were 45%, their all time high in a single quarter going back 20 years was 61% in FQ4 2018. In the 2 quarters since they posted 56% and 74%. Micron has great management and they deserve a lot of credit for how they are handling this demand surge. I researched this company in maybe 2023 and I thought at the time this may be the best set of financial statements I have ever seen so I have nothing but respect for their management. My understanding is that they told customers if you want to buy chips you need to agree to lock in the price which could fundamentally change the memory chip industry for the next few years. Customers cant go to Samsung or SK Hynix because they have no inventory either so they are forced to agree if they want chips. I don’t know how long these agreements go out and if they are binding so that is my concern and I would need that answered if I were to invest. The issue I have with the memory industry is reinvesting in the business will eventually bring down prices and reduces their margins so they aren’t as rewarded for investment as companies in other industries would be. They realized quick that they needed to ramp up investment, they went from around $2-$3B of investment per quarter to $5-6B in FQ4 2025. In the last quarter (because annual numbers are already out of date) they earned $12B in operating cash flow, 3x their cash flow from last year. They spent $6B on investments, $1.7B on paying down debt, repurchased $350M shares which is enough to offset their share based compensation, but they have nothing to do with $3.3B in a single quarter other than let it accumulate as cash on the balance sheet. Maybe they use the cash for a special dividend, maybe they let it pile up until the shares fall and they can buyback their stock at a good value, but they’re smart and they have a great problem. From the numbers I see, Micron is expected the have $35B in free cash flow this year, up from $1.6B last year and beating their all time high of $8.3B in 2018. They are expected $89B in FCF in 2027, $101B in 2028, $61B in 2029, and $26B in 2030. I don’t want to be in the game of predicting where free cash flow will be in 5 years because I have no idea. If we get a down cycle where free cash flow goes negative I would love to jump in based on how management handled this massive boom cycle, but this company deserves their success and I am happy when they succeed even though I don’t have any financial gain.

the_mammynun

Not sure why bears act like this is not a company with a $700m run rate and 3 years of positive FCF. It's not some underground scam name pumped by a few redditors, it's the largest cannabis retail chain worldwide (larger than any MSO) and also one of the largest importers in Germany.

Ayye_Human

Walmart has the worst, fakest, shit quality, and not even cheapest products of any of the type of stores. While I would never invest in space x due to actual financials, I equally wouldn’t do so for Walmart. It sounds like you’re looking in all the wrong places and doing research on stuff that won’t make you money in long run. It’s like my friend who told me to try to create an ai program to figure out what trump says and invest in the company’s that will pump from it. Do real research there’s tons of high quality businesses that grow and do bookoo revenue and FCF every quarter that are attractively priced currently. How big is your portfolio? Why hedge? Unless your like 7-8 figures in just invest your money in companies with solid financials and let the weighing machine do Its thing

Kookiano

What's the source for this? I only own Amazon stock and these are different from the latest earnings report end of April, e.g. +$1.2B FCF TTM, positive net cash position...

SuperSultan

If they laid off 20% of their workforce, the company would collapse. You’re acting like it’s not poorly managed enough already. And people care about net earnings and FCF not EBITDA. Since this is a tech company I’d even ignore FCF too. The real number is what you get when you subtract SBC from FCF.

JabCrossE4E5Quark

PE useless when earnings are being propped up with 1 time M2M gains on investments and EPS being juiced by phony depreciation. Whats their FCF to EV multiple? Hint, the stock looks a lot less cheap when you do that

drew-gen-x

Because Amazon, Microsoft, and Google are giving them their entire 2026 FCF : )

SuperSultan

Stock based compensation is the murderer of tech companies nobody acknowledges much less pays attention to. It is one of the few things that let managements effectively lie about their FCF.

infernalr00t

Mag7 are killing their FCF, the FCF and you are still buying meta?.

Agreeable_Fun_1371

Their userbase is increase. Revenue is also increasing. Are you high? FCF, net income, TPV, every metric is increasing.

More_Temporary6697

The thing I’d be most worried about isn’t valuation. It’s whether the market is correctly pricing in the possibility that growth slows before the FCF story fully plays out.

Agreeable_Fun_1371

If they just continue with current FCF and don't grow at all, you're getting 15% return annually

ApathysLastKiss_

Yeah but those companies have money in the bank. Google is a FCF machine

stockerowl

The bear case here is emotionally valid but the actual financials tell a more interesting story. CRM generated \~$13B in free cash flow last year on $38B in revenue — a 34% FCF margin that's genuinely elite among enterprise software peers. The issue isn't cash generation. The real red flags are: (1) \~$4B in annual stock-based compensation quietly diluting shareholders, and (2) declining net revenue retention, meaning *existing* customers are expanding spend less. That's harder to fix than acquiring new logos. The entire Agentforce thesis defines the next 3 years. 150K+ enterprise clients who literally can't leave is an extraordinary distribution advantage for AI agent rollout — *if* adoption materializes. If it doesn't, you're paying \~40x earnings for 8-9% revenue growth with a shrinking expansion signal. We ran a full fundamental breakdown on $CRM at Stockerowl — the DCF implies today's price assumes \~12% annual revenue growth. The installed base moat is real; whether management can monetize it through Agentforce is the only question that matters.

Remarkable_Cat_8696

Oracle's FCF became negative 394M in 2025, and to -23.69B this year. Before its FCF was positive and looked healthy. Its capex has increased a lot in recent years.

_hiddenscout

Part of Apple's story is that they aren't spending tons on AI. That's part of why they are going the reverse of a lot of the names in the space. Seems like investors aren't happy with some of the biggest companies in the world burning all their FCF and now even talking about offering more stock to raise capital.

elgrandorado

Great beat on FCF, burning through $25 billion in one quarter. Cloud revenue picking up at $3.3 billion. They only need to 8x that number to sustain the cash incineration. It would be a shame if they need to go through another hardware CapEx cycle in a couple of years though....

PrimaryResolve641

Oracle free cash flow (FCF) for FY2026 is projected to be negative $23.7 billion, and the company expects to raise approximately $40 billion in FY2027 as well. I thought Oracle had sufficient funds since they raised capital early, but I wonder if sell-side analysts will lower their target prices...

looool_k_libtard

You’re bullish? Mag 7 has run out of FCF and is starting to take on debt again so AI can do a shitty job while stealing your jobs and you’re bullish? We’re about to go into a 50 year depression.

talkthispeyote

what exactly is your catalyst for doubling in price? they can continue to generate FCF but the stock clearly doesnt have anything exciting going for it except pump and dump schemes from a game store.

Prudent-Corgi3793

ORCL better see huge ROI soon. Despite their huge capex, the other hyperscalers still have sound balance sheets (it's normal to have slight net debt position) and manageable cash flows given that this is close to peak capex. ORCL sticks out like a sore thumb here: | Company | Net Cash | FCF (TTM) | |:--|:--|:--| | GOOGL | +$36.36B | +$64.43B | | MSFT | +$21.31B | +$72.92B | | AMZN | (-$66.80B) | (-$2.47B) | | META | (-$5.59B) | +$48.25B | | ORCL | (-$124.30B) | (-$23.69B) |

Prudent-Corgi3793

Jesus Christ, they better see huge ROI soon. Despite their huge capex, the other hyperscalers still have sound balance sheets (it's normal to have slight net debt position) and manageable cash flows given that this is close to peak capex. ORCL sticks out like a sore thumb here: | Company | Net Cash | FCF (TTM) | | GOOGL | +$36.36B | +$64.43B | | MSFT | +$21.31B | +$72.92B | | AMZN | (-$66.80B | (-$2.47B) | | META | (-$5.59B) | +$48.25B | | ORCL | (-$124.30B) | (-$23.69B) |

longGERN

Pretty simple. No FCF projected. Therefore higher risk and discount rate = lower value. Wall street plays with their Willy's and then excel models and see lower number, so click sell

nobertan

I’d say the spaceX explanation is cover for the answer they don’t want to be public saying, US economic policy is backed into a corner with no easy levers to pull. *If the messaging says it’s a one off issue because spaceX is such a great investment the entire market liquidated assets salivating at the opportunity, market confidence will remain high and avoid a full on crash by spooking the market with unpleasant realities. (After all, you need someone to buy if you’re trying to sell)* Inflation is going out of control again, and will have a lagging reaction from the Iran conflict (***still*** unresolved) — it’s going to continue upwards for **many** months ***AFTER*** the conflict is fully resolved. The problem compounds further due to fiscal policy in the US left treasuries unattractive and pushed interest rates up. We can’t really increase them as the cost of maintaining federal debt is exceedingly high, and we’re can’t lower them as no one will buy our debt. That scenario is long term stag-flation and consumer economic recession. In such a scenario, you’d want to raise capital while confidence is high to avoid FCF cratering impact later, and being unable to raise capital thru stock offerings due to much lower valuations. Ie, exactly what is happening. The spaceX IPO messaging makes zero sense for anyone that can do basic math.

Superb_Barnacle_4893

This hyper-bear take is such an entertaining extreme take, let’s break this down rationally. Search still dominates global market share by a massive margin, their AI stack Gemini is scaling into enterprise cloud subscriptions steadily, YouTube ad revenue remains resilient through ad cycles, Android owns most global mobile OS market. Massive cash pile + consistent positive FCF is not a weakness—it’s dry powder for AI CAPEX and share buybacks. A single month’s pullback never rewrites a company’s core moat. I ran a full DCF valuation for GOOG last week mapping AI revenue ramp-ups. DM me if you want to compare model assumptions.

WhereasInside6738

Been watching this trade unwind too - semis getting hammered while software names that got obliterated are starting to show some life. GTM at these levels does look pretty compelling from a pure numbers standpoint, especially with teh debt maturity runway they have That FCF generation capability combined with management's track record of actually returning cash makes this less of a knife catch than most beaten down SaaS names. Just gotta hope they actually execute on debt reduction instead of more dumb buybacks at inflated prices

k3t4mine

Brother the hyperscalers are all going to be FCF negative this year, no matter what rates do. They've given all their cash to semiconductor companies. Buybacks will stop regardless.

Confident-Income

EV/EBITDA ratio is around 7 at current valuations. FCF yield depending on how you forecast is 6-9%. Both metrics are arguably more meaningful than P/E and put the company in value territory. 

Confident-Income

Yeah no one in the industry should be doing buybacks right now except for GTI, which has a clean balance sheet and high FCF.  Not the worst for Trulieve as they also have decent FCF and their debt to cash ratio including UTP is not too bad. But I wonder if this is moreso exit liquidity for insiders. Will see if Trulieve prudently manages the buybacks and get value from them like GTI buying back shares at like $5.80 apiece. 

Jhelliot_62

Their FCF may be ugly this year but you've also got to consider the $450B in backlog.

jrex035

Most energy equities are priced for ~$70 WTI which we haven't seen in 3 months and won't see for years to come. At current prices these companies will have enormous FCF which they'll use for dividends and stock buybacks in addition to paying down debt, which will further improve their profitability. >BTW this includes China which had great demand pre-war and now can stop imports because they literally prepared for this. China cutting imports by ~5m bdp has been one of the most important factors keeping a lid on prices thus far. But it can't last forever either. They're drawing down stockpiles of crude and refined products to the tune of millions of bpd. Sure they have been stockpiles to draw on, but even they can't keep this up for more than a few additional months.

JabCrossE4E5Quark

We are more expensive than dotcom on FCF yield since EPS is being juiced by phony depreciation and round tripping revenues. When you strip out all the bullshit and look at Cash Flow.... its fucking UGLY. And thats without OpenAI, SpaceX, Anthropic included which will just make the valuations look even more batshit insane

ga643953

Nah, SaaS trading at below 10 times P/FCF are not. Meta and MSFT are not. Even the once most overpriced PLTR is now cheaper than SpaceX's market cap. The street really needs to come out and just say they don't care about valuation and fundamentals.

Independent_Rent_315

The bull case is intact. AVGO just printed $15.1B AI semi revenue — crushing its own $10.7B guidance by 41% — with FCF of $10.3B and operating margin of 67.3%, both records. The drop was a guide-miss unwind vs inflated buy-side expectations, not a thesis break. Main real risk is Google ASIC insourcing spreading to other hyperscalers (Macquarie's bear case). But with Meta locked in through 2029, OpenAI and Anthropic in the pipeline, and $100B FY2027 AI revenue target intact — this dip is structural, not cyclical. you can see more fundamental, technical, market sentiment and social to understand what Broadcom does @ ultrastockanalysispro.com/Ultra_Stock_Lists/SP500_Top20/Featured_stock_sp500.html

Independent_Rent_315

The company itself didn't break — the setup did. AVGO printed $15.1B AI semi revenue vs $10.7B guidance, +143% YoY, $10.3B FCF record. Stock dropped 21% because Q3 guide missed inflated buy-side expectations by $1.2B on a $22B base. RSI is now at 26–35 — the same zone that preceded a +100% recovery after the Dec 2025 selloff. This is options pricing reality vs company reality. Full breakdown if you want of all the actual data and market sentiment at ultrastockanalysispro.com/Ultra_Stock_Lists/SP500_Top20/Featured_stock_sp500.html

ShowerFriendly9059

META doesn’t care about their shareholders. 100% of their FCF is going to capex. Hard pass

ryzetard

rational investors selling it off to place the capital somewhere else. shitty sentiment over FCF and spending fears (cuz zuck once lost a bit on metaverse but this time it seems the money was spent in a better way) and rumors of equity raise via offering.

Asleep_Emphasis69

I would take some time to seriously research the financials of big tech. I would start with earnings videos on YT. The fact is these two companies no longer fortress balance sheets due to CAPEX, which means 0 FCF for the next few years most likely. The boomers that are retiring can not tolerate situations where META/MSFT pause buybacks and stop compounding on FCF so they fucking sell dude. They go into dividends with constant cash flows and ride off into the sunset. But you and I are not retiring. We invest through the Capex cycle my man. Our risk is rewarded with future cash flows after the cycle is over in 3,5,10 years….if you didn’t understand any of this then you definitely need to understand the financials first before investing

Dev_Im

Sure, I get your point. But even if hyperscalers reach a limit, spending won't decrease. There are hidden metrics of AI benefits, like optimization. We are speaking about colossal numbers here. This isn't a fixed chain. That's the mistake most analysts make. They think this capex is burned into nothing and moves circularly, and that's wrong. Just look at the massive FCF of Nvidia and some other hardware players. They reinvest this FCF into other companies, expanding the chain and offering each new year better solutions. I'm witnessing this. Two years ago we didn't have neoclouds or liquid refrigeration companies. Today photonics is barely a promise moved on hype, wait two years and tell me. We haven't even seen agentic AI deployment yet, 2026 is a beta phase. We haven't seen yet that agentic AI being deployed into robotics at a larger scale. This is just starting. Most people are unable to see that this is an exponential growth, not a static chain that some analysts can calculate on an Excel page. That's why this past quarter's results, most analysts forecasts, were broken. This is a game to stay invested in long-term, not to try to time the market. We are witnessing the biggest revolution in history.

Dadraik

Bro you wrote the right thesis and bought the wrongest possible expiry. You identified a H2 2026 setup and bought June 18 calls.... nothing happens by June 18. I think the FCF story is actually the most underappreciated thing in large cap right now. $12.5 billion free cash flow on a company that was burning money four years ago. The ad tier is genuinely new money. 250 million monthly active viewers who cost zero incremental content dollars. Every new advertiser flows directly to margin. The content amortization headwind easing in H2 is real and most of the regards in this thread don't know what that means. **Q2 absorbs the heavy spend from H1 production cycles, Q3 and Q4 get cleaner margins as a result.** The comments dunking on you are right about your position... sorry - but they're wrong about the company. Netflix has 325 million paying households, a live sports pipeline that Amazon is still figuring out, and content that't more relevant than its "in vogue" to admit... The bear case you actually needed to address is that the Italian court ruled in April that the unilateral price hike was unlawful and ordered refunds. Germany and Spain running the same case now. Their pricing plan -- Standard at $19.99, Premium at $26.99 -- is under real legal pressure in the EU, and the $12.5B FCF guide assumes those prices hold. If they don't hole, the guide moves. I'd dump what you have now for what you still can get from it, and then sign back up but fix the expiry. Jul 17 captures the July 16 earnings print, which is the first data point that confirms or kills the H2 margin story. I think you found something good. Stop buying options that expire before the thing can happen.

Briack89

Getting this angry over macro history is wild. It doesn't matter if the cash is real if the return on that invested capital is garbage. If tech giants keep pouring mountains of FCF into data centers that don't generate matching profits, Wall Street is going to punish those margins straight to their ass. Take a deep breath. Inhale... exhale... let the anger go. 🧘‍♂️ Maybe go put on a YouTube course for yoga or meditation to calm down

StuartMcNight

It’s not exactly like the DotCom. You didn’t have companies that are almost literally printing money (google, Amazon, meta, etc.) spending huge chunks of their FCF on infrastructure.

karouse

Great move imo. Running DCF on FCF assuming only 10% growth and 20 P/FCF multiples gives more than 20% cagr for the next 5 years, they only pay a max of 6.7% yield on debt. So the shares they bought should deliver massive benefits for shareholders after deducting interest payments. Their revenue growth just re accelerated in recent quarter. I have bought a lot more shares after recent earnings.

Confident-Income

I dont think so. Why hold the dumpster fires LPs when you can get positive FCF comapnies in the world's biggest Cannabis market with still so much untapped potential?  I think a lot of institutional investors will rotate out of the LPs and into the profitable MSOs. Many waiting on the sidelines will also enter now on the US side. 

booobReviewer

Efficient market hypothesis is often misunderstood — it doesn't say prices are always "right" or that bargains don't exist. It says that all available information is already reflected in the price. That still leaves room for behavioral errors, hidden risks, and differences in time horizons. The real challenge for value investing today is structural: passive flows, zero-commission trading, and meme dynamics create persistent pricing noise that Graham didn't have to deal with. That doesn't mean value is dead — it means the edge comes from the non-consensus thesis that most people can't or won't hold through drawdowns. If you found a stock with a 15% FCF yield that a competing thesis hasn't surfaced for, you're still getting the Graham bargain — it just takes longer to play out in a world where algos dominate the daily flow.

Sufficient_Habit5091

If we do, NVDA will at least temporary take a big hit in FCF right? It's smart then he seems to be shoring up the balance sheet at least a bit in preparation. Building up cash as well.

_hiddenscout

He owns a lot of shares. I mean Apple pays Berkshire Hathway like 280M a year because of how many shares they own. Also it shows how much FCF Nvidea generates. It's usually around 96B to 119B. So technically he takes about 1% of all the FCF doing some napkin math.

groceriesN1trip

Looking for a non-AI play with a solid business, low debt, strong FCF, moat… and currently undervalued? ULTA

_hiddenscout

Of course. I’ve owned these names for years. All great companies but definitely check the valuations before buying. All of them have been on solid runs. Just rather hitch my wagon to companies that are less speculative and actually generate FCF.

Beautiful-Low-3932

Green flags: 1. Cash conversion (FCF / EBITDA): if improving/stable cash conversion over multiple years 2. Operating cash flow consistency: OCF and EBITDA gradually converge 3. Less swingy working capital: so looking at inventory, receivables, and prepayments vs revenue -> prepayments/supporting cash flow become more structural 4. Revenue mix: Increase in VAS / recurring share Red flags therefore would be: • persistent gap between earnings growth and cash generation • working capital continuously absorbs cash (inventory + receivables outpacing revenue) • strong volatility in cash flow driven by timing effects •no real improvement in cash predictability over time • VAS doesn‘t scale meaningfully → business remains hardware/project-driven with lower structural quality

Beautiful-Low-3932

On the Gotham report: it definitely raised some serious questions back then (revenue recognition, EBITDA quality, BOE-related structure). Vusion strongly rejected those claims and pointed to audited IFRS accounts and proper consolidation. So far as I know, there hasn’t been any regulatory action or restatement that would confirm the core fraud allegations, This was Vusion’s response: https://www.vusion.com/insights/response-to-the-gotham-city-report/ On the cash flow side, I think the more relevant point today is the quality and volatility of cash generation. 2024 had a very strong free cash flow year, largely helped by working capital (including customer prepayments and timing effects). 2025 is weaker in comparison, and management basically explains it as a normalisation: fewer customer prepayments vs 2024 and higher investment spending. So I’d say the key things to watch going forward are * whether cash conversion stabilises over multiple years * how much FCF is driven by working capital vs underlying operations * whether receivables and inventory are growing in line with revenue

MitchCurry

How is GWRE down on that earnings release? Revenue up 27% y/y, subscription rev up 35%, FCF up 93%. Raised FY guidance by 1.5% despite only having one quarter left in their fiscal year. RPO up 44% y/y. Subscription and support gross margin up 390bps. Their newer applications landed some major wins in Q3. Down 12% AH. Going to have to add to my position tomorrow if this fall holds.

RiPFrozone

When Nvidia makes 213b in FCF this year, its valuation is 24x fcf. It’s a pretty fair valuation. In 2 years it’s projected to make 341b in fcf. That means today’s valuation is 15x FY2028 fcf. That’s incredibly cheap. Yes there are stocks that run up with no semblance of fundamental value, but when you have the Nvidia’s of the world making cash hand over fist selling the picks and shovels it’s not hard to see why they get rerated so aggressively.

_hiddenscout

Anytime man! Yeah I used to own TATT but got out. There's a ton of great names in the space for MRO. It's a great market because covid push out backlogs and there is still supply issues for new planes. That means older planes are flying for longer meaning the space for MRO is huge. AIR is really cool company. P/FCF is really high, but it's because of inventory buildout to keep up with demand. You seem to be more value oriented, you should check out AER. They are boring, but they do leasing and they are basically the big dogs there. Only thing is that they have a ton of debt, because they buy planes, but it's not an issue. They keep buying back shares and the company is pretty cheap.

Select-Leading-4542

First, there was just a classic mix-up with the numbers. The $311 million in FCF wasn't the full year figure, but just the result for a last quarter. If you annualize that run rate, you end up with over $1.2 billion in cash flow. And just like that, the supposedly absurd multiple of over 100 drops down to a totally reasonable 27 to 28. That directly ties into the main conclusion: The stock isn't some deep value bargain, but for a tech company with a gross margin of over 91%, an FCF multiple under 30 is actually incredibly cheap in the current market environment. Wall Street is simply still overlooking how damn fast Reddit is turning into an absolute cash machine thanks to its massive operating leverage. That's really all the magic behind it.

DarkDruid8

Could you walk me through how you ended up with the conclusion that it is not expensive right now? I mean providing more details than just '*improving profitability*'? The market cap right now is 34,3B, which means P/FCF ratio over 100 with that FCF 311M which you mentioned. You mentioned revenue growth 70% (which might or might not be sustainable, 5 years is a long time and only a small fraction of companies can actually grow revenue like that for 5 years) and increasing profitability. I am not sure if I can see that part where '*the market may still be underestimating it*'. What kind of FCF growth do you realistically expect to see over the following 5 years? And what is your expectation on side of dilution? The stock-based compensation reached 343M in 2025, which means that the whole FCF was basically thrown out of the window through that dilution. Do you expect any change on this front? I want to like RDDT, but to me it doesn't seem cheap at all right now. Of course, I might be wrong. When thinking about it, I would even like to be wrong, because I would like to buy it. So, any tip on what makes it cheap would be appreciated 🙂

_hiddenscout

Yep! It’s so silly to me when people are like why are the mag7 not performing as well. It’s like dude, they are spending all that FCF lol.