@breadcrumbsre True but DGEO eps revisions and org growth is bad… needs to improve for stock to work… not only AI related
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Compounders
758 posts
Compounders
@compunders35
Student of great business models that are misunderstood and neglected by the market. No investment advice, views are my own.
Katılım Mayıs 2015
499 Takip Edilen163 Takipçiler
something i keep thinking is how much of selloff in boring stuff like diageo is driven by fundamentals vs flows. during dotcom mania stock bottomed literally when nasdaq peaked - March 2000
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@zephyr_z9 Well deserved shout out to @MaiusPartners. Very much like his Research. If possible, would very much appreciate more insights on the bear points - esp Arashi and CCT
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@MaiusPartners Ok thanks but what about Arashi and CCT risks? Very material for NAV… governance solution only temoprary
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maiuspartners.com/p/back-to-the-… Would you ever invest in a Chinese AI Company?
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@cannibalstocks Also revisions were massive… eps almost -50% since mid 2024
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The Peer Multiple Massacre
Screenshot this. Tape it to your monitor.
MercadoLibre. Latin America super app. 45 times earnings. $MELI
Sea Limited. Southeast Asia super app. 35 times earnings. $SE
Adyen. European payments machine. Around 30 times earnings. $adyey
Kaspi. Higher margins. Higher ROE than all of them. Stronger moat than all of them.
The dot at the end of the URL is the only reason you can still buy this at 7 times earnings. $KSPI @MohnishPabrai
cannibalstocks.com/p/while-everyo…
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@cannibalstocks Not sure 7x is right but much more country risk vs Adyen
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@ContrarianCurse Why IDM‘s?… competition is for losers…
Just buy aixa, same view, better LT expression
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What are some of the longest running downcycles in the markets today? (Something thats confused with structural decline but its cyclical and will rebound at some point)
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@Investmentideen @rja907 But SGN is also lower quality revs… 50% project based with tenders
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@compunders35 @rja907 Yes. Poland is one of the fastest growing in terms of IT spend. TSS/SGN owns almost the all Poland leads within CSI. Best pick long term imo
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@evrgn11112231 @BirchCourtCap Why is that? A fungible commodity?
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@BirchCourtCap I would reframe it as “compute will probably be really valuable not matter what” and “but I hope Meta can be the one to earn the full application layer return on top of it”.
And the stock is priced for neither.
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Think folks are arguing past each other here.
The bulls like the backup plan for compute.
Everyone agrees that if the backup plan is being used, the original plan must not be going so well.
The alternative isn’t magically switching timelines to the good state of the world, the alternative is a company that doesn’t have a backup plan ex-ante; i.e. doesn’t have a backstop on asset value.
TrumpGrift Capital🇺🇦@Crussian17
Renting compute for $meta means they failed in their ai plans and is bearish not bullish since it would be a last resort. Ppl mentioning this as a positive are out of their mind
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@Investmentideen @rja907 Thanks Paul, is the growth runway of SGN so much better vs TOI?
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@rja907 SGN is the best pick here. Why would you Huy the tanker if you can buy the speedboat? Cheapest of the 4 companies mentioned and fastest growing.
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@PythiaR Yeah almost as good as tobacco… litigation and user churn risk without pricing duration 🔥😂
Def need a new creative name as they pivot to AI hardware
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TOBACCO THESIS VALIDATED $META TO ZEROOO
zerohedge@zerohedge
META: first drop in Daily Active People in Years
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@JerryCap If $CSU just had these high-quality sftw assets… bruh
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'We see large-language models (LLMs) and Al-based coding tools and their derivations as powerful but largely commoditized, price competitive, with low switching costs, making them an important source of value enhancement for high-quality incumbent software and information services businesses at a manageable cost."
GIF
Stock Analysis Compilation@StockCompil
Akre Capital on the threat of AI to their software holdings, specifically Constellation Software $CSU : We have written and spoken extensively about the threat of AI on our software businesses (Constellation Software, Topicus, Roper Technologies, ServiceNow, and Salesforce) and information services businesses (Moody’s, CoStar, CCC Intelligent Solutions, Fair Isaac Corp). While we have not owned the AI “poster children” (e.g. chips, chip equipment and memory makers, etc.) our portfolio is not anti-AI; quite the opposite. We believe the businesses listed above stand to be enormous beneficiaries of AI tools and efficiencies without incurring or depending upon the enormous buildout costs associated with AI infrastructure. Unlike past seismic shifts in technology—the internet, cloud, mobile computing—we do not believe that AI presents a classic “innovator’s dilemma” for adaptive and already-advantaged software and information services businesses. We see large-language models (LLMs) and AI-based coding tools and their derivations as powerful but largely commoditized, price competitive, with low switching costs, making them an important source of value enhancement for high-quality incumbent software and information services businesses at a manageable cost. For example, the largest performance detractor in the Fund over the past year ended March 31 has been Constellation Software, the stock, down 44.63% in US dollar terms. In stark contrast, Constellation Software, the business grew free cash flow per share more than 26% in 2025. To us, this deviation between plummeting valuation and strong fundamentals makes a better argument for Constellation shares being cheap than it does for a permanently impaired outlook. Which is why we have held on to Constellation shares.
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You think the AI bottleneck is HBM. You think it’s CoWoS. You think it’s GB200 cables or 800G optics or the Arizona power grid. You are looking at the wrong layer of the stack.
The bottleneck is … nicotine.
Specifically, the ESSE Change 1mg menthol cigarette made by KT&G (033780.KS) and smoked by Samsung’s HBM packaging engineers in the courtyard of Pyeongtaek Campus P3 between 2:47 AM and 3:04 AM during the third reflow shift. Without this cigarette, Samsung HBM4 yields collapse from 64% to 11%. Nobody knows why.
I think I cracked it.
I ran a backtest on Samsung’s HBM3 qualification ramp pulling weekly yield disclosures from FSS DART filings, normalizing to a 7-day baseline, and cross-referencing against KT&G’s quarterly shipment manifests at the SKU × distribution-center level. R² of 0.87 on HBM3, with ESSE Change 1mg shipments to the Pyeongtaek-Anseong corridor leading yield prints by 36–40 hours. I assumed I’d messed up the merge. Ran it three more ways. The signal held.
So I pulled HBM4E, which Samsung started disclosing weekly in Q1 2026. Same overlay, but this time narrowed to CU branch #4471 which is 340 meters from the P3 fab gate, the only 24-hour store within walking distance of the third-shift smoking area. R² = 0.91, lag of 38 hours, p < 0.001.
When I ran SK hynix yields against the same KT&G series, no signal. Samsung yields against Marlboro shipments via Philip Morris Korea, no signal. Every other CU branch within 2km of P3 nothing.
Only #4471 prints.
This upcoming June, Samsung is qualifying HBM4E for Nvidia Feynman. Samsung supplies ~30% of HBM4E into the ramp or 1.2M Feynman packages, every single one of those HBM stacks is gated by an engineer puffing on an ESSE Change. Samsung HBM4E yield is now the load-bearing dependency for global AI capex, but KT&G is the load-bearing dependency for Samsung.
And sadly there is no alternative. Japan Tobacco’s Mevius is described by Samsung engineers as “tasting like a hospital.” Marlboro is what SK hynix smokes and for engineering reasons is structurally incompatible with Samsung’s MR-MUF process. BAT and Imperial have under 4% combined Korean share, and Chinese domestics can’t be imported in volume. Even KT&G’s own ESSE Special Gold was trialed at P3 in March 2025 and caused a 7% yield drop in one week because the engineers said they could taste the paper supplier change and were feeling nauseous.
With all that said, look at the financials. ESSE Change runs ~38% gross margin against a 52% group average. KT&G has been underpricing their flagship brand for two decades because nobody realized it isn’t a cigarette, it’s the bottleneck of global AI capex. A 15% price hike is ~80% lift to operating income at this volume, lifting group EBITDA margin from 28% to 34%. On ₩6.1T of revenue, that’s ₩370B of incremental operating profit against a ₩9.8T market cap resulting in a 12% earnings beat from one SKU repricing.
And the best part? The engineers literally cannot decline, because there is no substitute. I bet on two hikes in eighteen months which gets you 25% EPS growth without selling a single additional pack. This is what the sell-side is going to figure out in Q3, and it’s why the multiple goes from 9× to 22× before consensus catches up to the revisions.
No amount of Arizona engineers chewing 30mg mint Zyns replaces this.
KT&G has a lockdown on the engineers who make the world’s HBM. They can name their price.
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@JerryCap @NotMarkLeonard So you are pitching the bull case for $ADYEN?
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"When a vertical market software provider embeds payment processing natively into its platform, the switching costs multiply exponentially. If a customer wants to rip out a $CSU software product, they aren't just changing their user interface or data storage- they are fundamentally disrupting their own accounts receivable, merchant underwriting, and daily cash reconciliation."
L@zeroxpectation
CSIPay is live for all $CSU firms! Great move! 1 integration 1 platform: full control over processing, onboarding, compliance & payouts No to generic processors; Yes to purpose-built infrastructure, improving visibility & alignment—shifting payments from dependency to ownership
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@BucknSF Cuz most of relevant AI products have just or are about to be launched
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the stock down 20% on a meh quarter prob a bit much, but if you believe the AI ACV number you should be asking why they aren't guiding to acceleration.
Kaushik@WisemanCap
$NOW Q1'26: Noisy quarter clouds fine results. PT Raised to $226 at Bernstein
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@Brian_Stoffel_ Technical discussion but what matters is OPM
Beat in Q1 and no diltution FY
Reminds me of the $GOOG search discussion
$NOW seems to be fine
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Consider the margin compression.
Right now, 50% of new revenue is NON-SEAT BASED
Great, right?
Except, cost of good sold grew 44% while revenue grew 22%
Subs gross margins contracted 360 basis point y-o-y
Brian Stoffel@Brian_Stoffel_
Why is $NOW down so much? Organic cRPO is de-celerating to 18% in Q2. As @buccocapital has said: accelerate or die
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@PythiaR Technical discussion but what matters is OPM
Beat in Q1 and no diltution FY
Reminds me of the $GOOG search discussion $NOW seems to be fine
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As persnickety as it is this is the issue. $NOW is an interesting one to watch becuase they were early on the transition to more consumption based business with NowAssist, but you're seeing the problem everyone is going to have with the transition: it's margin dilutive.
Which means you need to cut fat below the GM line if you're a SaaS company.
Yes they can all do this, but it's not necessarily going to be linear/matched timewise with the revenue transition.
Which makes the whole space a hard long.
I don't think anyone seriously is debating whether SoR's are going to be around. But there is still SO much debate about what the economics of that "around" look like, and I dunno why you want to be a hero and dive into a debate that isn't going to be resolved for a while?
Brian Stoffel@Brian_Stoffel_
Consider the margin compression. Right now, 50% of new revenue is NON-SEAT BASED Great, right? Except, cost of good sold grew 44% while revenue grew 22% Subs gross margins contracted 360 basis point y-o-y
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Who are your favorite saas companies to benefit from agent usage?
Have to imagine it’s the usage-based models that have most juice to squeeze. If we see that + RIFs could see higher rule of 40s here across SaaS cohort
SuspendedCap@ContrarianCurse
The agents still need tools
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@TheLAPurchaser Wow… -11%? Whos still selling at 18x PE? Now cheaper before the entire run up
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First blush — $BSX CHAMPION
Good enough for guidelines and to drive incremental adoption, but not a V-like take-off.
It’s not a bad result, but I wouldn’t characterize it as a home run the bulls would have liked to see.
A lower stroke rate in the LAAC arm would have made for a cleaner result for the financial community. Bleeding was fuego tho.
Will take some time and debate for the dust to settle.
FestivusCap@LongVollllll
@TheLAPurchaser thoughts?
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@leevalueroach Org growth has come down to 6%… not too long ago was rather mid-teens
What should a mature software biz with 2% „AI revs“ trade on?
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I don’t know anything about Salesforce $CRM. But the stock price has gotten hammered. The multiple is cheap. People are panicking like idiots. And the company is raising cheap debt to buy back stock. I’d say this thing is a buy and management is nutting up to buy back in size.
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