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Disney stock has had a rough few years. Covid did a lot of damage to their park business, and they are in a lot of debt from their acquisition of Fox. Covid came at the worst time for them as their park business was definitely needed to help pay for all their debt. Disney is currently down 6% over the last 5 years and almost 37% year to date. Disney was recently in the news after they announced that Bob Iger would once again be returning as CEO of the company replacing Bob Chapek.
Many people are very happy to see Chapek go and Iger replace him. While I am definitely not saying that Chapek did a fantastic job as CEO, I do think he took the job at literally the worst possible time. I personally feel like he is being blamed for a lot of problems that there just wasn’t any good answers to. Disney’s parks shutting down was unavoidable. Theaters closing was not his fault. The debt that Disney has was not created by Chapek. Again, I am not saying that Chapek was a good CEO, but I do think he is being blamed for more things than he deserves. That said, I do like Bob Iger as CEO, and with him in charge once again, let’s take a look at Disney’ stock.
First, Disney is trading at a price/earnings ratio of 56.57. While that might seem very high, I will mention that Disney is very much still recovering from COVID. They are also investing a lot of money into their streaming platform Disney+ right now also. I expect Disney to increase their earnings over the next few years. They currently have a market cap of $176 billion, which I do think makes them undervalued. Disney does not currently offer a dividend. Under Iger, I do think that Disney will likely reinstate its dividend though.
I am personally very bullish on Disney+. I think that Disney is in a very strong position for streaming by owning ESPN+, Hulu, and Disney+. While Disney+ is currently not profitable, I think that it will provide a lot of revenue for them over the next several years and will eventually be a profitable entity of theirs.
I do think that this stock could be a buy. I think it’s undervalued right now, and I think the company does have a lot to be excited about. I would like for them to reinstate their dividend, and I am slightly worried about their debt.
It’ll be very interesting to see how the company performs with Bob Iger back as CEO.
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The Intelligent Investor by Benjamin Graham is one of the most popular books out there to help one invest. It’s a book recommended by Warren Buffett who was taught by Graham in college. If one wants to invest in stocks, it is a book that should definitely be considered. In the book, there is a character called Mr. Market, and in this article, I want to analyze that character.
Mr. Market represents the stock market as a whole. When I buy a share of Blackrock, what I bought is a piece of the business. I now own part of the company Blackrock. That business has revenue and some of that gets turned into profit which goes to the owners of the business. Now, think of the market as a person. That person, Mr. Market, comes up to you every single day and throws out a price to buy your part of the business. Going back to Blackrock as an example, let’s say that someone owns one share of Blackrock. Mr. Market is currently offering to buy their piece of the business for $741.72. One might look at that and think that that’s a crazy offer as they believe their part of the business is worth more than that and decide not to sell or maybe they will believe their piece of the business is not worth that at all and decide to sell.
Mr. Market should be looked at as a tool. When one owns a piece of a business, that business has value. Mr. Market will often try to buy that value at prices that are way below the actual value. That’s when the intelligent investor ignores Mr. Market. Mr. Market will also try to buy that value for way more than the value one owns is actually worth and that is when one should take advantage and sell to Mr. Market.
In summary, when one buys a stock they are buying a piece of the business. One should look at the market itself as not the decision maker on the price of value but as a person offering to buy one’s part of a business at various different prices. One should take advantage when the market gives them a price above their value, but should not listen when the market gives them a price below their value. One should not see the market as the decision maker on what their business is worth but as a possible opportunity.
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Paramount Global is a company that I have been planning to do a write-up on every since I first wrote my piece on Warner Brothers Discovery. Several people told me that they consider the stock to be the better buy in the streaming markets. The stock has definitely gotten itself a strong base of supporters, and in this article, I will be looking at the stock to see if it is one that I should purchase.
Paramount Global trades at a $10.77 billion dollar valuation. They are a media and entertainment company formed by the merger of Viacom and CBS. They own CBS, BET, Comedy Central, MTV, Paramount Pictures, Paramount Plus, Pluto TV, Showtime Network, Smithsonian Channel, and Nickelodeon. This exposes them to traditional distributions as well as streaming services. The stock is down 45.83% year to date and is down 71.46% over the last 5 years.
Warren Buffett’s Berkshire Hathaway is the largest shareholder of the company with 78,421,645 shares, which is currently worth $1,279,668,759.
The company is in a lot of debt. As of August 4, 2022, they had a total debt of $15.81 billion dollars. $15.77 billion of that is long-term debt (more than one year from becoming due) while $37 million of that is current debt (due within one year). Last quarter, Paramount Global had a debt/equity ratio of .68.
One of the big opportunities with Paramount Global is streaming. Paramount Global reported last quarter that they have 67 million people subscribed to their streaming services, with 46 million of that being subscribers to Paramount Plus. They reported earnings from streaming at $863 million last quarter, which is a large increase.
The company currently has a price-to earnings ratio of 3.71. They also offer a really nice dividend yield of 6.17% which is a nice incentive to hold shares.
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Funko stock crashed 59.38% today November 4, 2022. As a shareholder of Funko, I find this rather unfortunate. 2022 has been a major down year for the stock market as a whole, but Funko stock had seemed to be the exception. Funko had been performing really well. A green stock in a sea of red. Sadly, that has changed.
The reason the stock fell so much is because of a pretty bad earnings report. This is not a market that is forgiving of a bad earnings report. Funko reported a profit for the quarter at $9.63 million or 19 cents a share. Compare that to last year at this time where they were at 28 cents a share. Funko did beat expectations on revenue though as they brought in $365.6 million dollars.
What worries me the most, however, is that Funko lowered their annual sales forecast for the year to $1.29-$1.33 billion. Funko has already brought in slightly less than a billion dollars this year which means they are only expecting to make $300-$340 million in revenue for quarter 4 of 2022. They believe they will bring in less money during the holiday season? I find this pretty worrisome.
Funko now has a market cap of $370.98 million which gives them a p/e ratio of just 7.20. I think that this is a major overreaction. I think Funko should be valued much higher than $370.98 million. I do understand the drop in stock price due to a terrible earnings call but almost a 60% drop seems a little much in my opinion.
I did not sell my Funko shares. I am, however, waiting to buy more. I predict they will fall more after their next earnings call considering the fact that they decreased their forecast. After that, I will consider buying more.
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2022 has not seen many IPOs (initial public offerings). With this being a down year for the market as a whole, many companies do not want to go public with this current market. Mobileye Global Inc., however, has gone public today. They went public at $21 a share and have so far increased by 33.61%. The company is now trading at around $28 a share.
Mobileye is owned by Intel. They’re planning to keep 50% of Mobileye shares over the long run, but they currently still own 95% of the company. This means that Intel will still be able to sell 45% of their Mobileye shares. Mobileye is a company that is focused on making autonomous driving technology and advanced driver-assistance systems. They are located in Jerusalem, Israel.
With today’s increase in value, Mobileye now has a market cap of $23.12 billion. They are not a profitable company, and they actually lost $75 million on $1.39 billion in revenue for the 12 months ending Dec. 25, 2021. While I am very interested in their technology, this is a pretty hefty premium but that’s to be expected for this kind of company. That said, Mobileye’s year over year growth has been slowing. Here is a chart detailing that:
While I do like the idea behind Mobileye, the valuation they are trading at is a little concerning to me. If the stock falls after their IPO day, I could see myself buying some shares at a much cheaper valuation. I’m excited to see how this stock performs over the next few years.
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BlackRock is the largest asset manager in existence. It has 9.5 trillion dollars in assets under
management. Compare that to Vanguard who is in second place with 8 trillion dollars in assets.
One can easily see that BlackRock is a very dominant player. With the market in a downturn this
year, BlackRock stock has taken a fall. Their stock is down 34.77% this year as their holdings
have taken a dive. I’m already a shareholder of BlackRock, but this market is making the idea of
purchasing more BlackRock shares very appealing.
The main reason I want to buy BlackRock shares is their valuation. BlackRock is currently trading
at a market cap of 90.05 billion dollars. This gives the company a p/e ratio of 16.45. While that’s
definitely not a very high p/e ratio, it’s worth noting here that I believe their p/e ratio is a little
misleading. The reason I say this is because their earnings are currently being affected by the
market downturn. Their assets are being valued less than before, so they are making less money
overall for managing that money. Because I believe that this downturn is temporary, I believe
that they are actually undervalued. When the overall market goes up, that benefits BlackRock.
Since I am bullish on the actual market itself, I don’t see any way to not be also bullish on
BlackRock. I believe that buying this stock at its current valuation is a really good deal long term.
Another reason that I am bullish on BlackRock is their continuance of getting more money to
manage. The markets have been terrible lately, yet BlackRock received $247.6 billion in net
inflows this year. That’s very impressive in my opinion. I think BlackRock will continue to build
its number of assets under management.
They also offer a really nice dividend of 3.27%. I think this dividend is a great way to receive
passive income. Companies that offer a strong dividend while growing their valuations are great
buys, and I believe that BlackRock fits this description.
I am definitely going to be buying more BlackRock shares.
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Fundrise, which is known as a platform to easily invest in real estate, has decided to revolutionize the venture capital (VC) world. There are many venture capitalist funds out there. They seek to invest in startups that they believe will in the future either get acquired or go public on the stock market. By getting into companies at much smaller valuations, VC funds are able to get a very nice return. Sounds like a great way to invest right? Well, most people cannot do this. Many VC funds only allow accredited investors to invest with them. To be an accredited investor, one must have a net worth of $1 million or make $200,000 dollars a year.
Many people view this as a problem. They feel as though the average person should be able to participate in this kind of investing as well. I have thought about this as well. I have been a big proponent of crowdfunding because this allows the average person to invest in startups. This sentiment is also shared by Fundrise.
Fundrise is launching a fund called the “Fundrise Innovation Fund”. The fund will be investing in early stage startups that they believe will go public one day. This fund will be open to everybody to participate in. I think that that is amazing because it gives the average person access to startups.
In many ways, the fund will be very similar to a VC fund, but it is also different in a very important way which is fees. VC funds normally operate on a 2 and 20 fee structure. This means that the VC fund receives 2% of the initial investment as a management fee then also receives 20% of the carry. With Fundrise’s Innovation Fund, they will receive a 1.85% annual fee and that’s it.
My hope is that these moves inspire more funds to do the same. If their fund goes well, I hope more funds will also allow the average investor to invest with them, and I also hope that this inspires lower management fees as well.
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The Charles Schwab Corporation provides wealth management, securities brokerage, banking, asset management, and financial advisory services. As of May 31, 2022, they had $7.3 trillion under management. It is one of the leading ways that people use to invest with 34 million active brokerage accounts. They also have 1.7 million banking accounts attached. They are a huge player in the financial services market.
The company is currently valued at $130.86 billion. They are also trading at a p/e ratio of 22.62 at time of writing. In 2021, the company brought in $18.52 billion in revenue and profited $5.86 billion. Compare that to 2020 where they brought in $11.69 billion and profited $3.3 billion. The year before that they brought in $10.72 billion and profited $3.7 billion.
The stock does offer a dividend yield of 1.28% which comes out to 88 cents a share. Over the last three years Charles Schwab has grown its earnings per share by 4.7% a year. This is good for shareholders of the company.
One thing that has helped Charles Schwab with their growth is the acquisition of TD Ameritrade in 2020. Acquiring TD Ameritrade gave the company around 12 million client accounts, $1.3 trillion in client assets, and around 5 billion dollars in annual revenues. This allowed Charles Schwab to scale beyond its organic growth.
Because the stock is already trading at 22.62 times earnings, we currently give the stock a rating of HOLD.
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Shark Tank star Kevin O'Leary recently stated that Lamar Advertising Company stock was a buy. After hearing that, I began to research the company to see if that was a stock that I should add to my portfolio, and in this article, I will be discussing my findings.
First, I want to discuss what Lamar Advertising even is. They are one of the largest outdoor advertising companies in the world. While they do a various kinds of outdoor advertisements, they are mostly known for their billboards. They also own the largest network of digital billboards with 3,800 displays. Lamar is a dominant player in the billboard advertisement world.
When Kevin O'Leary was talking about the company, he mentioned that they have had a rough year so far. They are down 30.93% since January 1, 2022. When seeing a downward spiral like this, I am always curious to then see how much they are currently trading above earnings. At time of writing, Lamar Advertising has a p/e ratio of 18.62. With their p/e ratio in mind, let's see how fast they are growing. From June 30, 2021 - June 30, 2022, Lamar Technologies increased their revenue by 19.02%. From 2020 - 2021, they had a revenue increase of almost 14%, and the year before that, they had a revenue decrease of around 10.54%.
One thing that I really like about this stock is their dividend. They offer a dividend yield of 5.64%. That's a very high dividend. Normally, I consider a high dividend to be a bad thing. Most of the time a company offers a really high dividend is because their stock is not doing well and they want to keep their investors around. They also raise dividends when the company isn't really growing at all, and they want to keep their investors happy. I believe Lamar Advertising could still have some growth left. I especially see this with digital billboard potential. When I see a business that I believe still has some growth left to do and offers a nice dividend, then I view it as a positive for the stock.
I personally believe that Lamar Advertising is pretty fairly valued. It's a stock that I would feel pretty confident over the long run that I would not lose money holding it. While I never tell anyone if they should or should not buy a stock, I could definitely see myself owning this stock in the future.
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Elon Musk's Twitter Purchase Offer is Back On
Amazon is Paying 1 Billion Dollars a Year for Thursday Night Football
The Future of Ark Innovations ETF Under Cathie Wood Looks Scary
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When Elon Musk first went back on his deal with Twitter to buy the company, I stated that Elon Musk would have a tough time in court if Twitter tried to force him to buy them. Twitter basically was in a position where it held all the cards. They had a signed contract from Musk stating he would buy them. They also had the fact that Elon waved his right to do due diligence on the company. Then, when they did pursue legal matters, they were able to get a fast scheduled court date that benefitted them as well. I personally did not see anyway they could possible lose in court.
It seems like Elon Musk agrees because he will once again be buying Twitter at the agreed upon 44 billion dollar valuation. While 44 billion dollars seemed like a pretty ok price for Twitter when he first announced he wanted to buy it, the stock had fallen by quite a bit after he tried to back out of the purchase. On September 1st, 2022, Twitter had a market cap of 29.34 billion dollars. Now, after the news that Elon Musk is back in on the Twitter deal, Twitter is back to a market cap of around 38 billion dollars.
One thing that has yet to be seen is if Twitter is going to drop their lawsuit on Elon Musk. I don't think that they should just yet. I think they should keep their court date set until they know for sure that Elon is not going to just back out again once the suit is dropped. The court the trial is going to be held at is a big advantage for Twitter, and it is important for them not to give up that advantage until they know for sure.
I'm not surprised that Elon is back in on the Twitter deal. I couldn't see Twitter losing their lawsuit. It seemed like he was going to try and prove fraud on Twitter's part, but it does not seem like he was able to do this. His whole argument was that Twitter had more bots on the platform than they disclosed. It's worth mentioning here that he gave up his right to do due diligence on the company, but he was stating that while Twitter claimed 5% of its users were bots, he thought it was closer to 20%. He had 5 tests ran to try to prove his claim. One test also arrived at 5% for total number of bots. One test showed closer to 10%, and the other three have yet to reveal their findings. I imagine that their findings were not good if Elon is now wanting to buy Twitter again.
It'll be interesting to see what happens now.
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Amazon is Paying 1 Billion Dollars for Thursday Night Football
The future of Ark Innovations ETF Under Cathie Wood is Scary
The Market's Dying. Is It Time to Hold Cash?