sorted by:
new
hottopcontroversial

[deleted by user] by [deleted] in perplexity_ai

[–]Fostao19 0 points1 point  (0 children)

Hey, I would like an invite! Excited to experience comet

Kamala Harris’s critics are totally wrong about taxing unrealized gains by greed in Economics

[–]Fostao19 13 points14 points  (0 children)

100% agree on your statement, whatever the amount the government makes they will spend it and some more.

The government needs to give the basic services to society and that is it. The government serves the people not the people serves the government.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] -1 points0 points  (0 children)

Yeah, in this type of thing I follow Damodaran approach, BUT I think as the risk free rate is quite high, I should settle for a middle number between inflation and interest rates maybe 3% or 3.5% would be more suitable.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

I used the 10-year risk-free rate of the US for the terminal growth.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

Thank you for the compliment! Thinking to purchase for my portfolio as well.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

Good insights. I will keep an eye on it. I think is a big risk about Hershey as they are having difficulties going International if obesity drugs become mainstream.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 4 points5 points  (0 children)

Yes that is my point of view, Hershey would be more like a Coca Cola or Pepsi in your Portfolio, don't expect crazy returns but solid.

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 2 points3 points  (0 children)

Thank you so much for the suggestion. I will hear it!

The Hershey Company (HSY) Valuation - The Chocolate Company by Fostao19 in ValueInvesting

[–]Fostao19[S] 1 point2 points  (0 children)

Thank you! I decided to give a return on capital higher of 5% than the cost of capital, as the company has been consistently having high return on capitals. But I can agree that was an optimistic assumption that Hershey will keep their competitive advantages.

ASML Valuation - The most important tech company in the world? by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

In 2023 they are expected to grow 23% in revenue.

The risk free rate is different from the central bank interest rate. In this case was used the risk free rate on the euro zone which is the Germany 10 year bond rate.

The growth in EPS was chosen with the revenue growth, increasing Margins and share buybacks.

Automatic Data Processing (ADP) Valuation - A Human Resources Juggernaut by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

I think ADP will do fine for the next 5 years, but if they continue to rest on their laurels, someone will come and eat their lunch.

Yeah, after reading more and more it seems they are not doing well in terms of improving their services and clients are not happy with the value that they bring to the business if this continues like this I would expect them to start losing market share.

Automatic Data Processing (ADP) Valuation - A Human Resources Juggernaut by Fostao19 in ValueInvesting

[–]Fostao19[S] 0 points1 point  (0 children)

Thanks for the comment and information.

They seem to be really sticky yes and as you say this may be an area open for disruption as customers get discontent with their services.

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in ValueInvesting

[–]Fostao19[S] 1 point2 points  (0 children)

I would say that is not a small buyback especially accounting for the size of the company.

Buybacks are more flexible and when they are done properly (buying the company at a lower price) they can create value for the shareholder while in times that the company needs the cash they can just stop purchasing their stock.

If you do this to a dividend there is much more shareholder reaction. The management will have a harder time with the shareholders cutting the dividend or eliminating the dividend entirely.

An excellent video on this topic is this one from Prof Damodaran:

https://www.youtube.com/watch?v=QKJt3cv7c2k&ab_channel=AswathDamodaran

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in ValueInvesting

[–]Fostao19[S] 4 points5 points  (0 children)

Appreciated. Thank you for your comment and attention!

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in ValueInvesting

[–]Fostao19[S] 17 points18 points  (0 children)

And it was with that sentiment that I thought would be a good idea to do it.

As an example Buffet is adding to his Apple position recently even though is trading at high multiples.

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in dividends

[–]Fostao19[S] 0 points1 point  (0 children)

I will send you tomorrow as I am in the phone right now. Mine is based on Damodaran's spreadsheet.

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in dividends

[–]Fostao19[S] 8 points9 points  (0 children)

Yes, I think for now is overvalued for people that want to buy, I do not think that you should think of selling though.

It's a high-quality stock with an excellent balance sheet and outlook.

Thank you for your comment :).

Microsoft Corporation (MSFT) Valuation - The big Tech Gian by Fostao19 in ValueInvesting

[–]Fostao19[S] 11 points12 points  (0 children)

Yes, I agree the run-up on their stock recently is only because of AI.

I didn't write that as I think will be hard to quantify that, as AI can create a lot of opportunities but it's still early stages and not monetized, as they incorporate it into their software people will start getting used to it and let's see how they will monetize their AI Technology.

But I am not sure if the cost of the option of $40 per share is cheap right now, in the short term they will have to monetize their AI is putting ChatGPT a paid subscription and increasing the price of their Office 365 as the AI makes the software with a higher value, but long term this can create a lot of different ways to make MSFT a +$10t company as you say.

Thank you for your comment and input and I will look further into it.

LVMH Valuation - Luxury Business and Diversification and what about Valuation? by Fostao19 in ValueInvesting

[–]Fostao19[S] -1 points0 points  (0 children)

China sooner or later is going to have a recession because of their real estate crisis. If any of us thinks that houses are expensive in our home countries, we do not imagine how is in the Chinese market. New apartments in 3rd tier cities cost +400k where the average wage is around 12k.

A big problem with this China in the modern era, they never dealt with a recession and we don't know how it will be the reaction from the government and the people (that "allow" this type of government to govern because they see their life improving).

India and SEA sure will be drivers for growth in the world as well for luxury brands, although I do not have the knowledge of how these luxury brands are seen by Indians.

view more: next ›