From Growth To Value

The new Potential Multibaggers article on $MELI Deep insights on the company, a quality score and valuation.

Incumbents are often wrong about trends. Just 2 examples: "What the hell is cloud computing? I mean, it’s really just complete gibberish.” ~ Larry Ellison, founder of $ORCL, 2008 "I think there is a world market for maybe five computers." Thomas Watson, chair of $IBM, 1943

$MELI trades at an EV/Gross Profit of just 6.18, the lowest in at least a decade, probably longer. What's your excuse for not buying the stock now? 🤔

@moatpatrol_ It's a very useful metric for growth stocks and much better than FCF, which can be manipulated. If $MELI stops investing, FCF would skyrocket, but it would be a huge red flag. Having said that, it looks cheap no matter how you look at it.

@FromValue EV/Gross Profit is not a useful metric. Excludes everything investors care about: operating expenses, capex, debt expense, working capital, etc. Much better to use a metric like EV/FCF to show how much cash a company is actually generating

@VictheDope It's not a KPI. It's a valuation method and it's used for growth companies. Seriously...

@FromValue Never heard of that KPI. I guess you can always find a metric that looks good to you.

@stknbd_thomas The kind of things you only hear when a stock is cheap. 😁 Do you realize that $MELI has been successful for 26 years? Why would that change that now? The risk in Argentina is lower than it was for a very long time.

@FromValue Valuation compression alone doesn't make a buy case. Argentina and Brazil carry genuine operational risk. What's the fundamental catalyst for rerating?

@BjornGunnarsso7 I don't give a 💩 about the next 6 - 12 months 🤷‍♂️

@FromValue Better use for cash in other stocks next 6-12 months, just like 3 years ago

$MELI's flywheel

You can read the article here: potentialmultibaggers.com/p/mercado-libr…

The new Potential Multibaggers article on $MELI Deep insights on the company, a quality score and valuation.

@kyr_dreamer Pre-revenue is also in the image (first stage)

@FromValue Solid framework. Curious how this works for pre-revenue AI startups. DCF seems impossible when burn rate is the main metric.

This is how I value stocks. No matter how you do them, valuations are tricky and subjective. As long as you know that, it's not a problem. Be wary of false precision, as valuations are always just estimates. That doesn't mean these guesses can't be helpful. How do you value?

@ventureeat Thank you, and yes, correct!

@FromValue Love this framework! Valuation is more art than science. In VC, I see too many founders fixate on DCF when it's just not applicable pre-revenue. 📉

.@PimVerlaan en @Miloubrand komen volgende week naar @VlFedBeleggers happening. Ben jij ook fan van hun podcast "Jong Beleggen" ? Schrijf dan nu in want de tickets raken stilaan op !

Just looking at the stock price is not investing.😏

Wake up, honey! The new Overview Of The Week is out! 🥳🎉 This week: The best memes How the Nasdaq wants to bend the rules for SpaceX A story of two brothers (for if you feel stupid sometimes). Much more.

You can read the article here. As usual, a generous free part! Enjoy it and have a great week! potentialmultibaggers.com/p/this-may-hel…

@nikoliasgoninus @SleepwellCap Oh, that's what you mean. Yellow Beauty 🥰

@FromValue @SleepwellCap I named mine Diana☺️

what’s a material thing between $1000-$5000 that you’ve bought that actually changed your life? mine is the Eames lounge chair, no questions.

@LanceRoberts Just remember... that you will never be able to time the 10 worst days. You won't probably be able to time 3 correctly and you will miss most best days as well.

Just remember...it is FAR BETTER to MISS the 10-WORST DAYS in the market than worrying about the 10-BEST DAYS.