Invite ye felawes and frendes desirous in gold to enter the gates of Shrewd'm, for they will thanke ye later.
- Manlobbi
Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
No. of Recommendations: 4
MSFT currently trading at a PE around 24 is starting to look attractive. Hasn't been this cheap on a valuation basis for about a decade. As a Berkshire shareholder, I wouldn't mind seeing them take a stake if the stock keeps falling.
jg
No. of Recommendations: 7
Here is what I posted back in February
https://www.shrewdm.com/MB?pid=694490510This time next year, MSFT will likely have TTM EPS of around $18/ share. The lowest multiple it has had on that number in the past 7 years is 26x , which would imply a price of $468. the average multiple has been around 32x which would imply a price of $576. A trend line multiple of 29x would imply a price of $522.I have a boat load of MSFT and think its a good valuation right now...
tecmo
...
No. of Recommendations: 1
“I have a boat load of MSFT and think its a good valuation right now...”
Agree, I’ve only got a pontoon boat load of MSFT but I did add recently as well.
As Aswath D. has recently said, NVDA is priced for near perfection but I’m biased, it’s exceeded expectations, dominant brand, they seem a couple moves ahead of competitors, growth is still there and I’ll admit, I’m a big fan of Jensen’s intellect, vision and leadership.
No. of Recommendations: 2
I have a boat load of MSFT and think its a good valuation right now...
That's thinking like a professional. MSFT's valuation is almost all-time historically low, as pointed out by the video/podcast The Compound and Friends March 20th. Worth a listen. A short term capex dump of all of their cash flow for 1 year into AI infrastructure is a significant factor in this crash. They make the case that MSFT's economics haven't changed THAT much; Copilot may be behind the curve a bit but they will leverage it "soon". Buy when there's blood in the streets and all that.
FC
No. of Recommendations: 9
Some inside baseball:
Github is a major asset, and it is failing to even meet "2 nines" of availability - mean the site is up < 99% of the time. This is considered extremely poor.
Azure has been capacity constrained in key regions. This is supposedly related to the Github availability issues.
They had to post a Windows insiders blog post addressing the very poor quality of Windows 11 in the last week.
The Apple Neo is expected to eat into their consumer laptop market.
I've been wrong about MSFT before and they are cheap. But they have real operational issues.
No. of Recommendations: 8
As Aswath D. has recently said, NVDA is priced for near perfection FWIW, I just did a little post on that subject, a possible way to guess whether the current price is a reasonable one.
https://www.shrewdm.com/MB?pid=675563133My tentative conclusion is that the current valuation doesn't actually look too bad. Their growth can slow gradually to a crawl and you'd still do fine, as long as profits don't actually go into decline. So it's primarily a matter of whether you believe profits will fall materially.
My biggest concern is that their profit margins are sufficiently obscene that their very very rich clients have a huge motivation to roll their own. That would take a lot of time and money, but doesn't seem impossible.
Jim
No. of Recommendations: 2
Another perspective: Apart from Apple, Google and Nvidia all Mag 7 very clearly crossed their 200 SMA downwards, with those 3 "just" not yet having done the same.
The End of the hype?
Said, doomsday prophet and longterm short (2028 puts) all of them.
No. of Recommendations: 11
My biggest concern is that their profit margins are sufficiently obscene that their very very rich clients have a huge motivation to roll their own. That would take a lot of time and money, but doesn't seem impossible.Already happening; and its taking lots of capital but Google is making in roads with its TPU chips.
https://news.ycombinator.com/item?id=46069048Quote:
Google's real moat isn't the TPU silicon itself—it's not about cooling, individual performance, or hyper-specialization—but rather the massive parallel scale enabled by their OCS interconnects.
To quote The Next Platform: "An Ironwood cluster linked with Google’s absolutely unique optical circuit switch interconnect can bring to bear 9,216 Ironwood TPUs with a combined 1.77 PB of HBM memory... This makes a rackscale Nvidia system based on 144 “Blackwell” GPU chiplets with an aggregate of 20.7 TB of HBM memory look like a joke."
Nvidia may have the superior architecture at the single-chip level, but for large-scale distributed training (and inference) they currently have nothing that rivals Google's optical switching scalability.
tecmo
...
No. of Recommendations: 2
The Apple Neo is expected to eat into their consumer laptop market.
Planning to get one. The Mac laptop I've been using for travel is dying and the Neo looks like just the thing to replace it.
No. of Recommendations: 2
Planning to get one. The Mac laptop I've been using for travel is dying and the Neo looks like just the thing to replace it.
I bought a Neo and liked it so much that I immediately ordered another one for my lovely wife, of course hers is pink ;-)
No. of Recommendations: 1
Traditional discounted valuation methodologies are frequently compromised by the inherent subjectivity of their underlying assumptions. To mitigate this volatility, I have engineered a framework that bypasses speculative projections entirely.
This model is particularly effective for evaluating securities characterized by stable earnings and low volatility, where historical fundamentals provide a more reliable anchor for value.
The methodology determines intrinsic value at discrete historical coordinates without the influence of look-ahead bias. By strictly utilizing point-in-time data, the model reconstructs a valuation history as it would have appeared to an investor at each specific interval, ensuring that past assessments are not distorted by future knowledge.
The following illustrates the model’s output for Microsoft Corp. (MSFT) from a period exceeding twelve months ago.
https://quantasticworld.substack.com/p/the-art-of-...
No. of Recommendations: 8
Traditional discounted valuation methodologies are frequently compromised by the inherent subjectivity of their underlying assumptions. To mitigate this volatility, I have engineered a framework that bypasses speculative projections entirely.
Amen to the DCF issue.
I too created my own framework, but I admit it's painfully simple.
What multiple are you paying for the "pretty darned sure" average real EPS in the interval 5-10 years from now? That's it. Works for dead end cash cows, ordinary firms, and profitless startups, companies with ongoing dilution or ongoing buybacks, whatever. There are quite a few subtleties built into it, but using it is simple: at a multiple under 12 on that figure, you'll do OK. At under 10, you'll do well.
If you can't come up with a good estimate of the "pretty darned sure" average real EPS in the interval 5-10 years from now, don't buy the stock.
Jim
No. of Recommendations: 5
What multiple are you paying for the "pretty darned sure" average real EPS in the interval 5-10 years from now?
I am considering creating a system by which I don’t try to estimate much of anything at all.
I have spent almost my entire investing career watching the high-fliers and (so called) Rule Breakers soar without me being attached (one or two exceptions), and as I gaze back I wonder why?
Here’s a list of companies I didn’t buy because they seemed just far too expensive, and forever:
Amazon, Apple, Microsoft, Yahoo!, Tesla, Nvdia, Qualcom, Dell, Netflix, Google, and lots of others.
Two that I did, more as a small flyer than anything, were AOL and Facebook. (I put in a bid for Google’s Dutch auction but the price flew by so fast I never got close.) AOL was a fluke; I worked next to a pod of originals in the Chicago Tribune Tower who got me interested; Facebook was an addiction for Mrs. Goofy so I bought as it cratered after the IPO.
Anyway, looking longingly at the tremendous gains by some of those in the “never bought” pile I wonder if I would have the constitution to ask for a “do over” and be able to handle it. I don’t think so, but my saliva glands activate whenever I see the prices and gains of those listed in the winner’s pile.
I figured the Falling Knives troop would give me some objective reality on how many of those wunderkind companies also go the other way.
Still…. (Salivating)….
No. of Recommendations: 3
Amazon, Apple, Microsoft, Yahoo!, Tesla, Nvdia, Qualcom, Dell, Netflix, Google, and lots of others.
...
Anyway, looking longingly at the tremendous gains by some of those in the “never bought” pile I wonder if I would have the constitution to ask for a “do over” and be able to handle it.
Sounds familiar - which is why I have a theory about the underlying psychological flaw: Thinking too much? Or rather: Refusing to be "part of the crowd/herd"? Being a skeptic, always doubting where the masses are going? Which also would explain being attracted by the Falling Knifes board (contrarian thinking).
Naturally resulting in missing out where momentum is King, where the recipe is to join the crowd FAR longer than feeling comfortable with, because as we know the best part is the really "crazy" one before the end.
IF that´s ones character it comes down to: Outsized investment returns --- or accepting ones flaws and feeling comfortable? As my aversion to losing money is greater than my greed for me it´s an easy decision :)
No. of Recommendations: 0
On this point, i've spent quite a bit of time watching Druckenmiller interviews and it seems most of his success comes from riding waves of mommentum and it often comes from gut feel.
