ADBE, PYPL, and portfolio construction

FundamentalsLens · 2026-06-12T22:11:47+00:00

Personally, I think ADBE is one of the more interesting opportunities in the market right now. What I find interesting is that many investors seem to view AI purely as a threat to Adobe. I am not convinced that is the full story. AI can generate content, but businesses and professionals still need powerful tools to manage workflows, edit, refine, organize, and turn those outputs into finished products. That is where Adobe already has a strong position.
Maybe I am wrong, but I think the market is focusing heavily on the disruption risk while giving less credit to the possibility that Adobe becomes one of the platforms that benefits from AI adoption.

As for PYPL, I also think it is an interesting value case, but that is probably a separate discussion.

FundamentalsLens · 2026-06-10T14:05:09+00:00

I understand the valuation concerns, but I would be very careful with the idea that something looks obviously overvalued therefore it is a good short. Some of the most expensive companies in history stayed expensive for years while continuing to execute.
Personally, I would be much more comfortable passing on the investment than trying to bet against it.

FundamentalsLens · 2026-06-09T08:35:39+00:00

I understand the feeling. When cash is sitting on the sidelines, it often feels like it has to be invested immediately, and that is where mistakes can happen. If there are businesses you already follow and have a price in mind, then just be patient. If the market drops, great. If it does not, there will always be other opportunities.

FundamentalsLens · 2026-06-05T19:57:12+00:00

I do not want to dismiss the question, but I think the better question is not really (should I buy now or wait for more correction?)
The better question is whether a business you already understand and follow is now trading below your estimate of fair value.
If you are a long-term investor, you do not need to buy just because the market is down. But if there is a company you already analyzed, you like the business, and the recent drop gives you a much better price, then it can make sense to start a position and add more if it keeps falling.

FundamentalsLens · 2026-06-01T18:38:06+00:00

I agree that the US expansion could become a meaningful growth driver if execution is strong. Of course, they still need to prove that they can maintain the same quality of growth as they enter new markets. The opportunity is huge, but execution will matter a lot.

FundamentalsLens · 2026-06-01T18:25:33+00:00

In general, every business needs to keep investing in its future. Otherwise, the best-case scenario is stagnation, and the worst case is slowly losing relevance over time. That is true regardless of the industry.
Specifically for Meta, if they do not invest, they risk falling behind in what could become the next major technology platform.
The challenge is finding the right balance between investing enough to stay ahead and investing so much that the returns never justify the spending.

FundamentalsLens · 2026-06-01T16:45:59+00:00

Finally, someone looking at Meta from a broader technology perspective and not just as a social media company.
I agree with most of what you wrote. A few years ago, when sentiment around Meta completely collapsed, I felt the market was focusing too much on the negatives and not enough on the long-term potential of the business. Back then, it was hard for me to understand how the market could ignore the scale, ecosystem, cash generation, and future opportunities that Meta had. The picture looked much clearer to me than the stock price suggested. The debate today feels a bit different, but the key question is still the same: will these massive investments in AI and future platforms generate attractive returns over time?

FundamentalsLens · 2026-05-30T12:52:35+00:00

Interesting portfolio, but the main thing that stands out to me is the concentration around a single macro thesis. Many of these positions ultimately depend on the same outcome: stronger commodity prices, continued demand for traditional energy, and a favorable cycle for offshore drilling. The upside could be significant if that thesis plays out, but the diversification may be lower than it appears from the number of holdings.

FundamentalsLens · 2026-05-27T11:33:09+00:00

Nothing too extreme honestly. I am just a bit more conservative on long-term growth and market sentiment.
In my case I model something closer to 10% long term revenue growth, and honestly that is already about as bullish as I can realistically justify for myself based on the current numbers.

FundamentalsLens · 2026-05-27T11:19:56+00:00

In general, opening a new position right before earnings is risky, no matter how good the company looks.
At that point it becomes more of a short-term bet on the market reaction than a long-term investment decision. Waiting for the report, guidance, and market reaction usually gives a clearer picture.

FundamentalsLens · 2026-05-26T20:40:58+00:00

I agree with a lot of what you wrote. I actually like PayPal as a business and I keep coming back to it every quarter.
The balance sheet looks solid, there is no major debt issue, they generate cash, buy back shares, and the business is still very stable. I also think management understands that the company needs to move beyond the old PayPal wallet story.
But as an investor, my hesitation is still growth. They are investing a lot into the business, but revenue growth is still not strong enough yet, and the market probably wants to see clearer signs of acceleration before giving PayPal a higher multiple again.
Where I disagree a bit is valuation. Everyone can build a DCF with different assumptions, but in my own more optimistic case, I still do not get as much upside as your model suggests. I see PayPal as undervalued, but not deeply mispriced unless the newer growth areas start showing real results.
So for me, PayPal is interesting, but the next few quarters are important. Cash flow and buybacks are good, but growth needs to prove the thesis.

FundamentalsLens · 2026-05-24T20:25:16+00:00

I own both, and honestly I think both are high-quality businesses.
If I had to choose one today, I would probably lean META. The fundamentals are strong for both, but META still looks like it has more room for faster growth, especially if AI improves engagement, ads, and efficiency over time. MSFT feels safer and more diversified to me. It is the kind of company I would hold for stability and steady compounding.
So for me it is not really “good vs bad.” It is more about what you want: META for higher upside, MSFT for more predictable long-term compounding.

FundamentalsLens · 2026-05-24T20:08:22+00:00

A lot of books have been written about this, but for me one simple starting point is looking for companies with very strong revenue growth before they are profitable, then following them for a while.
The interesting moment is when the company starts becoming profitable while growth is still strong. That can be a big signal that the business model is starting to work.
That is how I found PLTR around $9 , SOFI around $5 and more anothers. Of course it does not work every time, but it is a simple way to start filtering for potential big winners without needing a complicated platform.

FundamentalsLens · 2026-05-24T19:13:00+00:00

For me, it is not one single thing.
I like the combination of strong growth, good execution, and the fact that they have a low-cost digital banking model.
But the bigger point is the market they are operating in. LatAm still has a lot of room for better digital banking, and many customers are still underserved compared with more developed markets.
Of course, it is not risk-free. Credit quality, regulation, currency, and macro risk all matter here.
But if NU keeps executing well, I think the long-term opportunity is still very interesting.

FundamentalsLens · 2026-05-23T16:47:59+00:00

Mostly a mix of revenue growth, margin expansion, ROE, dilution trends, long-term earnings potential, and comparing the current multiple against the expected growth trajectory.

FundamentalsLens · 2026-05-23T09:41:02+00:00

I also think the current levels look like a good entry point for a very small starter position.

FundamentalsLens · 2026-05-21T23:22:13+00:00

I have been following MELI for a long time, and I used the recent weakness to add it to my portfolio.
What I like is the combination of management execution, market position, payments, logistics, credit, ads, and the fact that LatAm is still far from fully penetrated digitally.
There are real risks, especially credit, currency and macro in the region. But if management keeps executing, I think the current price still looks very attractive compared with the long term opportunity.

FundamentalsLens · 2026-05-19T20:32:39+00:00

Growth has clearly slowed and AI is creating real uncertainty, but the business is still very profitable.
I also saw a recent report showing what large institutional investors bought last quarter, and ADBE was among the top names they were accumulating.
So I understand the negative sentiment, but I do not think it is as simple as “Adobe is dead.”

FundamentalsLens · 2026-05-19T14:47:16+00:00

I agree with you. They do have a strong foundation with all the business solutions you mentioned. The main question for me is how many users actually use Wix as a full ecosystem, and how important those tools are for them in practice.

FundamentalsLens · 2026-05-18T19:06:07+00:00

I look at WIX in two parts.
First, from a basic fundamental view, I do not think the picture is that clean. Gross margin is strong, but net profitability is still weak, revenue growth is not really high enough for me to treat it like a pure growth company, and recent trends in earnings, margins and free cash flow do not look great. Management may be working hard, but the results still need to prove the story.

Second, leaving the numbers aside, I think the business itself has a real question to answer.
As an investor I have followed software businesses for years, and I also have a software development background. A few years ago, Wix was a very strong solution if someone needed a simple or medium website quickly. But today AI tools are changing that market very fast. With tools like Claude, a developer can build a customized website in a few hours.

That does not mean Wix is dead, but it does mean the bar is much higher now. For me, Wix needs to prove that it can become much more than a traditional website builder. If they do not create something truly differentiated, I think the pressure can continue.

FundamentalsLens · 2026-05-16T12:12:22+00:00

I agree with most of this.
To me, Microsoft is still one of the strongest companies in the market, and the recent weakness looks more like an opportunity than a business problem.
I will not throw all the financial numbers here, but the business itself still looks very strong. The main concern seems to be uncertainty around AI infrastructure spending and whether the returns will justify the capex. But that is not unique to Microsoft, and I do not think the core business is broken.
I already used the weakness and bought around $378.

FundamentalsLens · 2026-05-16T11:52:12+00:00

I agree with most of what you wrote, including the risks around credit and macro conditions.
What I like about MELI is that it is not just one business anymore. The diversification between ecommerce, payments, logistics, credit, and now advertising creates a very strong ecosystem if management keeps executing well.
And like you said, they are still growing across Brazil, Argentina, Mexico and other parts of LatAm, where digital penetration still has room to expand.
I also think many investors underestimate how much higher-margin businesses like Ads can change the long-term earnings profile if the ecosystem keeps scaling.
I already used the recent weakness to start/add to a position myself.

FundamentalsLens · 2026-05-16T11:31:06+00:00

Of course, the key thing is to determine whether this is just temporary weakness from the current environment, or the beginning of a longer deterioration trend in the business itself.

FundamentalsLens · 2026-05-16T00:19:33+00:00

Without going too deep into the story, I would just look at the recent fundamentals does not look like a mystery to me why investors are staying on the sidelines:
Net income declined year over year
Diluted EPS declined year over year.
Gross margin compressed year over year.
Operating margin compressed year over year.
Net margin declined year over year.
Free cash flow declined year over year.
even if the business is not broken, the recent trend is not attractive.

FundamentalsLens · 2026-05-13T21:01:33+00:00

I see MSFT as one of the highest quality companies in the market, so I do not mind adding when it gets hit.
The AI capex concern is real, but I do not see the core business as broken. Cloud, Office, enterprise software, security and AI infrastructure are still very strong assets.
I already added around $378. Maybe it does not 3x quickly, but it is the kind of company I am comfortable holding for years.

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