The hottest Stock Valuation Substack posts right now

And their main takeaways
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Top Finance Topics

AI's Winners, Losers and Wannabes: Valuing the AI Boost at NVIDIA

Musings on Markets • 1179 implied HN points • 23 Jun 23
💼 Business Investing Market Trends Stock Valuation Technology impact Corporate strategy
  1. The semiconductor industry has seen cycles of growth and maturity, with significant changes in who the biggest players are over time. Companies like NVIDIA have found success by targeting profitable niche markets.
  2. AI technology is currently a hot topic, with companies like NVIDIA and Microsoft seen as leaders. However, investors should be careful as many companies may falsely claim to be AI-focused, leading to potential losses if the wrong ones are chosen.
  3. When investing in AI-related companies, it's important to remember that not all will succeed. Past technological changes show that disruptive innovations can create a few big winners but also many failures.

Clouded Judgement 12.13.24 - Beat and No Raise?

Clouded Judgement • 4 implied HN points • 13 Dec 24
💰 Finance Investment Market Analysis Software Stock Valuation Economic Trends
  1. Software companies generally performed as expected, with very little change in earnings estimates for 2024. Most stock prices did not move much either.
  2. Recently, there has been a notable increase in software valuation multiples, driven by stability in the economy and expectations of future AI revenue.
  3. Investors are feeling hopeful about tech investments, as they believe upcoming growth in IT budgets and AI could lead to better earnings next year.

Clouded Judgement 12.20.24 - The Fed Bomb

Clouded Judgement • 3 implied HN points • 20 Dec 24
💰 Finance Monetary Policy Market Trends Economic Indicators Investment Analysis Stock Valuation
  1. The Federal Reserve is expecting fewer interest rate cuts in 2025 than many had hoped. They now see only two cuts instead of three or four.
  2. The Fed raised its inflation projections, indicating that inflation might be a bigger problem than previously thought. This caused a noticeable drop in market values.
  3. Economic growth estimates for 2025 have improved slightly, but the Fed suggests it will be cautious moving forward, making investors nervous.

Cash, Debt and PE Ratios: Cash is an upper and debt is a downer!

Musings on Markets • 0 implied HN points • 03 Jun 15
💰 Finance Investing Debt Management Stock Valuation Corporate Finance Market Analysis
  1. Cash balances can improve a company's price-to-earnings (PE) ratio, making it look more attractive. This is especially true when interest rates are low.
  2. On the other hand, having a lot of debt can lower the PE ratio, making a company seem riskier. So, companies with high debt might not be as appealing despite good earnings.
  3. It's important to consider both cash and debt when evaluating a company's financial health. Just looking at the PE ratio alone can be misleading.

Reacting to Earnings Reports: Let's get real!

Musings on Markets • 0 implied HN points • 08 Aug 14
💰 Finance Investing Market Analysis Earnings Reports Stock Valuation Corporate Finance
  1. Earnings reports can change how people see a company's value and affect its stock price. If a company beats or misses estimates, it can lead to big reactions in the market.
  2. Apple appears to be a mature company with slow growth and declining margins. Despite meeting estimates, its stock often drops after earnings reports, reflecting a stable but unimpressive narrative.
  3. Facebook has been growing rapidly, particularly in mobile advertising, which has shifted its market narrative positively. This might lead Facebook to potentially surpass Google in online advertising in the future.
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Stock market paradigms

America in Crisis • 0 implied HN points • 21 Feb 23
💰 Finance Stock Market Market Analysis Stock Valuation Financial Policy
  1. Stock market valuation tools need to evolve with changing market paradigms, as seen with the shift in P/R values over time
  2. The emergence of new market paradigms, like one that disconnects stock market value from underlying company value, can impact stock market behavior
  3. Historically, stock market paradigms have shifted based on economic cultures and policy changes, influencing investor behavior and market trends

Incremental News, Price and Value: The Twitter Earnings Report & Market Reaction!

Musings on Markets • 0 implied HN points • 11 Feb 14
💰 Finance Investment Market Analysis Economic Trends Stock Valuation Corporate Earnings
  1. Twitter's revenue grew really fast, over 100% in a year, which is great news for the company. This means they are making more money and reaching more people.
  2. Despite the revenue growth, Twitter struggled with user growth and engagement. They had to work harder to attract new users, which can be a concern for the company's future.
  3. The market reacted sharply to Twitter's earnings report, which shows how unpredictable stock prices can be. Sometimes, even small news can lead to big fluctuations in a company's value.

Groupon Gloom: Deal of the day or Death Spiral?

Musings on Markets • 0 implied HN points • 25 Aug 12
💼 Business Investing Market Trends Stock Valuation Corporate strategy Financial Analysis
  1. A big drop in a stock price isn't always a good chance to buy. Sometimes it's just the market reacting to real problems with the company.
  2. Valuations of companies can change a lot over time. If a company's growth potential looks shaky or uncertain, its worth might drop significantly.
  3. For growth companies, it's important they can defend their market share. If they can't, they might struggle to make money and their stock could suffer.

Equity Risk Premiums: An Update

Musings on Markets • 0 implied HN points • 22 Oct 09
💰 Finance Investing Market Analysis Risk management Economic Trends Stock Valuation
  1. Equity risk premiums are important in understanding stock market debates. They help determine if stocks are overpriced or underpriced.
  2. After a major financial crisis, the implied equity risk premium rose significantly, leading to questions about whether this change is permanent or temporary.
  3. Current market conditions are uncertain, and opinions vary on whether stocks will continue to rise or face a correction based on the equity risk premium.

Watch the Gap: Apple's long and twisted pricing journey

Musings on Markets • 0 implied HN points • 29 Apr 14
💼 Business Finance Investing Market Analysis Corporate strategy Stock Valuation
  1. Apple's stock price can differ quite a bit from its actual value, meaning investors might buy or sell based on emotions rather than facts. This gap can last for a long time.
  2. Despite strong sales, news like stock buybacks and dividend increases might not change how much Apple is really worth. Market reactions can sometimes be driven by things with little real value, like stock splits.
  3. Investor feelings and market trends, rather than actual company performance, can really impact stock prices. This makes it tricky for companies to fix any gaps between their stock's price and its true value.

Trillion Dollar Toppers: Market Triggers, Value Drivers and Pricing Catalysts!

Musings on Markets • 0 implied HN points • 10 Sep 18
💰 Finance Investing Market Analysis Stock Valuation Corporate Finance Investment Strategies
  1. Market capitalization milestones, like reaching a trillion dollars, don't change a company's fundamentals, but they can affect investor emotions and behavior. These numbers can create buzz and might influence decisions, even if nothing actually changes in the company.
  2. Investors often react differently to market triggers. Some focus on long-term value based on earnings while others rely on technical indicators. Understanding both perspectives can help investors navigate the market more effectively.
  3. The distinction between value drivers and pricing effects is important. Value is based on a company's fundamentals, while pricing can be influenced by market mood. Recognizing this difference can guide investors in making more informed decisions.

Valeant: Information Vacuums, Management Credibility and Investment Value

Musings on Markets • 0 implied HN points • 20 Apr 16
💰 Finance Investment Market Analysis Corporate Finance Stock Valuation Risk Assessment
  1. Valeant experienced rapid growth by acquiring other companies and raising drug prices, which attracted many investors. However, this model was risky and heavily relied on debt.
  2. The company's troubles began when it faced scrutiny over its pricing strategies and financial practices, leading to a significant drop in stock value. Without financial transparency, investors became concerned about its future.
  3. Valeant's management credibility waned amid delays in financial reports and legal issues, making it clear that the previous business approach could not be sustained. Investors now have to tread carefully, as the company's future is uncertain.