The hottest Valuation Substack posts right now

And their main takeaways
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Earnings, Cash Flows and Free Cash Flows: A Primer

Musings on Markets • 1538 implied HN points • 31 Oct 22
đź’° Finance Valuation
  1. Free cash flow (FCF) is a crucial metric that shows how much cash a company generates after covering its expenses and investments. It's often misused in finance, so it's important to know the real meaning behind it.
  2. When valuing a company, understanding its free cash flow helps in predicting future performance. Different methods are used based on whether you're looking at equity or the whole business.
  3. As companies age, their financial characteristics change. Younger companies usually have negative free cash flows while older, established companies tend to produce positive cash flows and return money to shareholders more consistently.

Good (Bad) Banks, Good (Bad) Investments: An Investing Perspective

Musings on Markets • 819 implied HN points • 07 May 23
đź’° Finance Valuation
  1. Good banks tend to have stickier deposits, which help them maintain stability. Buying a good bank at a high price might actually lead to losses compared to buying a bad one at a low price.
  2. Valuing banks is tricky because their cash flows and risks are different from other businesses. Instead of using traditional methods, one should often use a dividend discount model or a free cash flow to equity model.
  3. The price of a bank's stock can differ significantly from its actual value. Understanding both the intrinsic value and market price is key to making smart investment decisions.

Just one word: Dividends

Lewis Enterprises • 353 implied HN points • 19 Nov 23
đź’° Finance Valuation
  1. Dividends are a natural outcome of business ownership and distinct from share repurchases.
  2. The shift towards buybacks over dividends may have a significant impact in the real economy.
  3. A new paradigm of higher interest rates will prioritize cash returns and challenge the reliance on buybacks for funding consumption.

Clouded Judgement 1.30.26 - Software is Dead...Again!

Clouded Judgement • 15 implied HN points • 30 Jan 26
đź’Ľ Business Valuation
  1. SaaS valuations are at decade lows — the median NTM revenue multiple is about 4.1x and FCF multiples have fallen sharply while growth rates are also weak (median NTM growth ~12%).
  2. Investor confidence in the SaaS business model has been shaken because AI and the much lower marginal cost to build software increase competition, threaten retention, and raise the chance that some companies have little or no terminal value.
  3. Markets will likely only recover if companies show stable retention and resilient cash flows despite AI challengers over multiple quarters, and early reports (e.g., ServiceNow) haven’t yet shown widespread retention declines.
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26 Stocks I'm Watching For 2026: Part 2

QTR’s Fringe Finance • 33 implied HN points • 24 Dec 25
đź’° Finance Valuation
  1. Concentrated thematic bets paid off in 2025 — nuclear names, gold and silver miners, rare-earths, select EMs, and some high‑beta innovation trades drove big outperformance versus the S&P.
  2. Heading into 2026 there are clear systemic risks: a tapped‑out American consumer and rising delinquencies, stretched valuations (especially around AI capex), a weakening passive bid, crypto becoming systemically embedded, and geopolitical/monetary shifts pushing demand for hard assets.
  3. There are two plausible market paths next year: a liquidity‑driven grind higher if policymakers keep backstopping markets, or a more painful deleveraging as real economic strain reasserts itself; positioning favors international/EM discounts and precious metals as hedges while aiming for relative outperformance.

Burry Breaks His Silence

QTR’s Fringe Finance • 43 implied HN points • 08 Dec 25
đź’° Finance Valuation
  1. Michael Burry has spoken publicly about Palantir, Nvidia, and the AI bubble.
  2. If you own Palantir, Nvidia, AI-heavy ETFs, big-cap tech, or broad index funds, you should spend about ten minutes listening to his interview.
  3. His perspective is seen as important for investors in those stocks and for broader market exposure, so it’s worth paying attention.

Nelnet Shows Some Skin

Mindset Value • 393 implied HN points • 09 Mar 23
đź’° Finance Valuation
  1. Nelnet's book value has grown consistently and it has never had a losing year, which is impressive.
  2. Nelnet is undervalued as its book value does not reflect the true value of its businesses and investments.
  3. Nelnet's investments in companies like ALLO, solar energy, and HUDL show potential for significant growth and increased value.

a horror story in four words

Dan Davies - "Back of Mind" • 393 implied HN points • 16 Jun 23
đź’Ľ Business Valuation
  1. The concept of 'change of valuation basis' in business can indicate stress and financial strain
  2. Valuing buildings can vary depending on the purpose, whether it's for selling, lending, or immediate sale
  3. Understanding 'change of valuation basis' sheds light on liquidity, solvency, and the socially constructed nature of financial reality

[2025–2026] Week 9: Warren Buffett: Partnership Years

Behavioral Value Investor • 44 implied HN points • 05 Dec 25
đź’° Finance Valuation
  1. Warren Buffett focused on three investment types during his partnership days, reflecting his diverse strategy. Each investment type had unique traits and risks, which influenced his approach.
  2. Buffett's strategy evolved from his early days to later years, showcasing adaptability in his methods and insights gained over time. He learned to balance risk and opportunity while managing his portfolio.
  3. The seminar encourages participants to engage with each other, highlighting the importance of community learning and sharing different perspectives on investing.

Liquidity, Not Logic: QTR And Epoch Times Talk Markets

QTR’s Fringe Finance • 21 implied HN points • 09 Jan 26
đź’° Finance Valuation
  1. Stocks are driven more by liquidity and expectations of policy support than by the current health of the real economy, so bad economic news can sometimes lift markets even as it masks growing strain and creates moral hazard that shifts costs into inflation and weaker purchasing power.
  2. Market valuations look high by almost every historical measure, leaving little margin for error, so investors should be realistic about what they’re paying for and the future growth those prices assume.
  3. Speculation is concentrated in areas like crypto and parts of AI where downside can be sudden, and individual investors should read 10‑Ks, compare peers, understand debt and cash flow, and beware passive flows and index concentration.

Tesla in 2023: A Return to Reality, The Beginning of the End or Time to Buy

Musings on Markets • 839 implied HN points • 26 Jan 23
đź’Ľ Business Valuation
  1. Tesla has grown rapidly, becoming a significant player in the auto industry, especially in electric vehicles. Its revenue jumped from $117 million in 2010 to $31.5 billion in 2020, showing strong growth potential.
  2. The company's success is closely tied to its founder, Elon Musk, whose vision drives Tesla forward. However, his dominant presence raises questions about the company's future if he steps back.
  3. The business landscape is changing, and even a successful company like Tesla must face traditional rules of business, like the need for investment and risk management, which is becoming more evident as competition increases.

The Red Flags Multiply For Tether

QTR’s Fringe Finance • 34 implied HN points • 15 Dec 25
đź”® Crypto Valuation
  1. The company is planning a huge stock sale that could imply a $500 billion valuation, making it one of the most valuable private firms.
  2. Management intervened to stop insiders selling shares at a steep discount that would have implied about a $280 billion valuation, which suggests liquidity issues and that market prices may differ from headline valuations.
  3. Refusing a full independent audit while actively managing share sales and public narrative is a major transparency red flag and increases skepticism about the company’s true financial health.

What Did Buffett See in AAPL in 2016? Coca-Cola

Value Investing Substack • 353 implied HN points • 11 Jun 23
đź’° Finance Valuation
  1. In 2016, Apple stock was undervalued with a low P/E ratio, making it an attractive investment opportunity.
  2. Apple's brand strength and ability to create standardized products quickly were key factors that Buffett saw in the stock.
  3. Buffett's investment strategy in Apple was similar to his approach with Coca-Cola, focusing on consistent returns and solid fundamentals.

New Jersey Goes Rogue

Mindset Value • 353 implied HN points • 05 Oct 23
đź’° Finance Valuation
  1. New Jersey has limited licenses for cannabis companies, leading to high prices and lower quality products.
  2. Grown Rogue is entering New Jersey with their high-quality, low-cost cannabis, potentially disrupting the market.
  3. Grown Rogue's operational excellence and efficiency position them as a valuable investment opportunity in the cannabis industry.

Networked Conviction 002

Investing 101 • 9 implied HN points • 24 Jan 26
đź’° Finance Valuation
  1. India’s tech scene is following a path similar to China’s around 2010, which suggests a big multi-year opportunity as local companies scale and markets mature.
  2. The idea that "software always wins" is overextended—software valuations and expectations are cooling, so investors should be more selective and update their outlooks.
  3. A rapid, raw approach to sharing investment ideas helps surface connections between theses and exposes where real conviction (or doubt) lies.

How to Judge if a Stock is Overvalued or Undervalued

Shivansh • 79 implied HN points • 23 Apr 24
đź’° Finance Valuation
  1. Stock valuation involves analyzing metrics like Price-to-Earnings (P/E) ratio, comparing with others in the sector to identify overvalued stocks.
  2. Price-to-Book Value ratio is crucial for asset-heavy sectors like Adani Ports to make informed investment decisions.
  3. Understanding stock valuation methods can help investors save and grow their money effectively.

OpenAI: Altman Returns

Don't Worry About the Vase • 1388 implied HN points • 30 Nov 23
đź’Ľ Business Valuation
  1. The new board at OpenAI is officially back to its previous state.
  2. An investigation and the actions of the new board will gradually reveal the future of OpenAI.
  3. Having a strong board that can hold the CEO accountable is crucial for organizations like OpenAI.

Financing the AI Boom 2

Net Interest • 14 implied HN points • 09 Jan 26
đź’° Finance Valuation
  1. Data centers are critical for AI and demand sites built for extreme power and cooling, with strong leasing demand and low customer churn.
  2. Building and running these centers is capital intensive, so companies use asset-backed bonds, large loans, and equity to raise billions and boost valuations.
  3. Investors can gain broad, leveraged exposure to the AI infrastructure boom by buying private equity owners of data centers instead of individual operators, letting them scale using other people’s money.

Two Of My Favorite Investments: Chris DeMuth

QTR’s Fringe Finance • 14 implied HN points • 15 Jan 26
đź’° Finance Valuation
  1. Ask “what would this look like if it were easy?” to reframe problems and find elegant, high-leverage solutions instead of forcing effort and complexity.
  2. Look for smaller competitors with close comparables that show a clear path to closing the market-cap gap with larger incumbents; those situations can produce big, relatively straightforward gains.
  3. Using comps to visualize an easy outcome helps identify investments where scaling feels likely and the upside is easy to justify.

PacBio @ JPM

ASeq Newsletter • 14 implied HN points • 13 Jan 26
đź’° Finance Valuation
  1. Revenue grew only modestly (about 4%), totaling roughly $154M in 2024.
  2. They are burning around $110M a year and have about $280M in cash, giving just over two years of runway.
  3. Becoming profitable by 2027 looks unlikely without further cost cuts, and that target was not addressed in the presentation.

Sizing The Category Prize

Category Pirates • 255 implied HN points • 24 Apr 23
đź’Ľ Business Valuation
  1. When exploring a new category, focus on its potential future size, not just its past or present size.
  2. Conducting a 'Size of Prize' analysis is crucial for understanding market potential and driving growth.
  3. Running this analysis adds credibility, clarity, conviction, and accelerates outcomes, leading to increased market cap growth.

One Microcap Stock I Own

QTR’s Fringe Finance • 16 implied HN points • 05 Jan 26
đź’° Finance Valuation
  1. A small energy infrastructure company is increasing its exposure to data center construction, which could diversify its revenue and boost growth.
  2. Its operations are accelerating in the Middle East and across the EMEA region, indicating geographic expansion and momentum.
  3. The business trades at roughly a 10x run‑rate P/E and has a solid balance sheet, suggesting an attractive valuation with manageable financial risk.

Finance 101 for Crypto Degens, Part 1

DeFi Education • 1159 implied HN points • 17 May 22
đź’° Finance Valuation
  1. The time value of money means that money now is worth more than money in the future because you can invest it and earn a return. This idea explains why banks charge interest on loans.
  2. Understanding capital structure is important. It distinguishes between the types of capital a company uses, like debt (bonds, loans) and equity (ownership shares), and how these affect the company's value and risk.
  3. Discounted cash flow analysis helps evaluate the value of a business by looking at its expected future cash flows. This method shows how much future money is worth today, factoring in investment risks.

A lot of times you just need more bidders

Something to Consider • 19 implied HN points • 14 Jul 24
đź’Ľ Business Valuation
  1. Having more bidders in an auction often leads to better outcomes. More bidders means a higher chance that someone will value the item enough to buy it.
  2. In auctions, it's usually better to have more bidders than to have perfect control over the auction. More bidders can drive up the price and lead to better allocation of goods.
  3. Collusion is less likely to happen when there are many bidders competing against each other. More competition means it's harder for bidders to secretly agree on lower prices.

Understanding Valuation Methods

DeFi Education • 1978 implied HN points • 30 Jun 21
đź”® Crypto Valuation
  1. Having users is really important for a project's value. A company that has a lot of users is usually seen as more successful, even if it's not making money yet.
  2. Sales and profits are not the same thing. Just because a company makes a lot of sales doesn't mean it's actually earning money after paying all its costs.
  3. Quick valuation methods, like comparing sales and earnings, can help you understand a project’s worth. However, you should also consider user growth and how the project makes money.

How Do Investors Protect Themselves from Downrounds Through Weighted Average Anti-Dilution Protection? | Paul Graham's Article & More

Venture Curator • 239 implied HN points • 24 Jul 23
đź’° Finance Valuation
  1. Investors use Anti-Dilution Protection to safeguard against down-round situations, like Stripe's valuation decrease from $90 billion to $50 billion.
  2. There are two types of Anti-Dilution Protection: Full Ratchet and Weighted Average, each impacting investor ownership differently.
  3. Weighted Average Anti-Dilution Protection involves calculating new share conversion prices to adjust ownership percentages after a down round, ensuring fair investor protection.

Thinking about Writing Down your Investment?

SaaS Engineering • 137 implied HN points • 07 Jan 24
đź’° Finance Valuation
  1. Understanding the difference between preferred and common stock is crucial for calculating holding values.
  2. Writing down investments only makes sense if a company's value decreases below the size of its liquidation preference relative to the investment.
  3. High valuations may not always benefit investors due to misaligned incentives, especially in scenarios where the company's valuation is higher than its true worth.

What is Your Life Worth?

Economic Forces • 9 implied HN points • 22 Jan 26
đź’Ľ Business Valuation
  1. People reveal how much they value life through choices like buying insurance, spending on health, and taking risky jobs, and economists use those choices to compute a "statistical value of life" (e.g., via wage premia).
  2. Empirical estimates place the statistical value of life in the millions of dollars and show it rising over time; as incomes and life expectancy rise, people tend to demand and pay more for safety.
  3. Price theory lets us put dollar values on non-market goods, so up-to-date value-of-life estimates are essential for sensible policy and cost–benefit decisions about safety and regulation.

Facebook (Meta) Lesson 2: Accounting Inconsistencies and Consequences

Musings on Markets • 619 implied HN points • 10 Nov 22
đź’Ľ Business Valuation
  1. Accounting mistakes can misclassify expenses, affecting a company's reported profits and overall valuation. When money is wrongly categorized, it can look like a company is performing worse than it actually is.
  2. Correctly categorizing expenses like R&D can show a company’s true financial health. For example, treating R&D as a capital expense can increase reported profits and the value of the company.
  3. Understanding these accounting practices is important for investors. If investors misjudge a company due to these accounting errors, it may lead to undervaluation, making the company look cheaper than it really is.

January 2023 Space Stock Review

Case Closed • 196 implied HN points • 22 Feb 23
đź’° Finance Valuation
  1. Legacy space companies outperformed space SPACs in 2022
  2. In 2023, focus on analyzing legacy space companies due to heightened interest in 'dual-use' investing
  3. New year brings updated analysis tools, including a broader set of space companies in the valuation comp sheet

Facebook (Meta) Lesson 3: Tell me a story!

Musings on Markets • 539 implied HN points • 18 Nov 22
đź’Ľ Business Valuation
  1. A good business valuation combines numbers with a compelling story. The story helps make sense of the numbers and gives them context.
  2. Storytelling is important for investors because it makes a business memorable and helps communicate its potential. However, numbers are crucial to maintain credibility and accountability.
  3. As market conditions change, so must a business's story. Companies like Facebook need to adapt their narratives to remain relevant and regain investor trust.

The Billionaire Tax Trick Fueling Record-High Sports Valuations

Huddle Up • 71 implied HN points • 06 Aug 25
🎾 Sports Valuation
  1. WNBA team valuations increased significantly, even though the league lost money last season. This shows the market interest in women's sports is growing.
  2. Powerful team owners took action to protect their investments after policies impacted sports valuations negatively. Their influence helps shape the financial landscape of sports teams.
  3. Tax laws and political decisions can have a big effect on how much sports teams are worth. Changes in these laws can lead to record-high valuations.

[2025–2026] Week 6: Benjamin Graham’s Security Analysis, Part 6

Behavioral Value Investor • 29 implied HN points • 07 Nov 25
đź’° Finance Valuation
  1. When analyzing a company's finances, it's important to look at more than just the income statement. You should consider the balance sheet and cash flow statements to get a fuller picture of the company's health.
  2. Benjamin Graham warns that income statements can be misleading due to factors like one-time costs or accounting tricks used by management. It’s essential to adjust your views based on these potential issues.
  3. Graham emphasizes the importance of management when looking at companies trading below their liquidation value. Good management can make a big difference in whether these investments are truly worthwhile.

Dissent and Debate: The Pushback on my Tesla Valuation

Musings on Markets • 379 implied HN points • 03 Feb 23
đź’° Finance Valuation
  1. There are strong opinions on both sides regarding Tesla's future value. Some believe it's undervalued, while others think it's overvalued, showing how divided people are about the company's potential.
  2. Revenue growth estimates are tricky; as companies get bigger, it's harder to keep high growth rates. The idea is that Tesla will reach a certain revenue and then grow slowly, like many large companies.
  3. Cost of capital is an important factor in valuing a company. For Tesla, using a realistic cost of capital helps in understanding its financial potential, even if different viewpoints exist on what that number should be.

AAVE Part 2 - Valuation Methodology and Q&A Is Open!

DeFi Education • 1278 implied HN points • 19 Jul 21
đź”® Crypto Valuation
  1. AAVE earns most of its money by charging interest on loans, much like a traditional bank. This means that understanding interest rates is key to their success.
  2. Valuing AAVE involves analyzing its potential for growth and how well it can generate income in the future. This is important for investors to know before putting money in.
  3. There is an opportunity for discussion and questions about AAVE's valuation, indicating that community engagement is encouraged. People are invited to join in and share their thoughts.

July 2023 Space Stock Review

Case Closed • 157 implied HN points • 15 Aug 23
đź’° Finance Valuation
  1. July saw growth stocks leading in market performance
  2. Rocket Lab's valuation is rising due to its reliable launch business and growth potential
  3. ViaSat faced challenges with a satellite malfunction impacting its revenue