Rocket Lab Corp. (NASDAQ:RKLB) shares extended their post-earnings decline into Friday, even after topping expectations on both revenue and earnings, as two analysts pointed to the same strong results but drew sharply different conclusions about the stock's near-term trajectory.Rocket Lab stock is among today’s weakest performers. Why is RKLB stock dropping?Both Citizens JMP Securities and Cantor Fitzgerald cited revenue beats and growing backlogs; their outlooks diverged: Citizens flagged execution and val ...

Each week we run a DCF (Discounted Cash Flow) model on a company from our watchlist. This week’s pick: Chevron Corporation (CVX).ProfileChevron is a globally integrated energy company spanning upstream oil and gas exploration, production, refining, chemicals, LNG infrastructure, and emerging lower-carbon energy investments. Its revenue base is primarily commodity-driven, with upstream earnings leveraged to crude oil and natural gas prices while downstream refining and chemicals provide partial cyclical bala ...

Core Viewpoint - Analyzing the valuation of CF Industries using a Discounted Cash Flow (DCF) framework is challenging due to the dependency of cash flows on various factors [1] Group 1 - CF Industries' cash flow forecasts are essential for a DCF model, indicating the complexity in valuation analysis [1]

Core Viewpoint - Tesla, Inc. is evaluated through a DCF model, revealing a significant gap between its current market price and intrinsic value, indicating potential overvaluation based on conservative cash flow assumptions [1][6]. Company Profile - Tesla operates as a vertically integrated company in electric vehicles, energy storage, and clean technology, with revenue streams from vehicle sales, regulatory credits, energy solutions, and software upgrades [2]. - The company’s asset base includes manufacturing scale, proprietary battery technology, AI-driven autonomy, and a robust charging infrastructure [3]. DCF Analysis - Key inputs for the DCF model include a discount rate of 10%, a terminal growth rate of 3%, and a WACC of 10% [4]. - Forecasted free cash flows (FCFs) from 2025 to 2029 are projected to grow from $6.5 billion to $10.5 billion, with a total present value of FCFs calculated at $31.5 billion [4]. - The terminal value, calculated using a perpetuity growth model, is estimated at $154.5 billion, leading to a present value of the terminal value of $95.9 billion [4]. Enterprise Value Calculation - The enterprise value of Tesla is determined to be $127.4 billion, factoring in the present value of FCFs and terminal value [5]. - With a net cash position of approximately $29.4 billion, the equity value is calculated at $156.8 billion, resulting in an intrinsic value per share of approximately $42 [5]. Conclusion - The DCF value of Tesla is around $42, while the current market price is approximately $411, indicating a margin of safety of about -90% [5]. - Tesla is recognized for its strategic ambitions in transportation and energy, leveraging its technological leadership and strong balance sheet to support future growth initiatives [5][6]. - However, the current market valuation suggests that it is heavily reliant on future execution and potential growth in autonomy and energy infrastructure rather than current cash flow fundamentals [6].

REA Group Ltd - REA Group is a Melbourne-based real estate advertising company, primarily known for its realestate.com.au platform, and is majority-owned by News Corp [2] - The company operates property websites in around 10 countries, with the Australian website receiving over 55 million visits monthly, and Australian operations account for the majority of its revenue [3] - REA generates revenue through property listings for sale or rent and has a smaller financial services arm offering mortgage broking [3] - Competitive advantages include network effects and economies of scale, with REA having greater market power compared to its main competitor, Domain [4] - The current price-to-sales ratio for REA shares is 13.24x, lower than its 5-year average of 17.41x, indicating potential undervaluation or increased sales [8] Zip Co Ltd - Zip Co is a financial technology company specializing in buy-now-pay-later (BNPL) services, allowing customers to make purchases and pay in interest-free installments [5] - The company operates globally, partnering with over 79,300 retailers and serving more than 6 million customers, and expanded into the US market by acquiring Quadpay in September 2020 [6] - The current price-to-sales ratio for Zip shares is 3.48x, which is lower than its 5-year average of 5.81x, suggesting potential undervaluation [9]

Core Thesis - PayPal Holdings, Inc. is viewed as a compelling investment opportunity due to its strategic pivot under CEO Alex Chriss and significant market mispricing relative to intrinsic value, currently trading at a 29% discount to its DCF-based fair value [2] Growth Initiatives - Key growth initiatives include Fastlane by PayPal for one-click guest checkout, unbranded processing via Braintree for high-volume clients, monetization of Venmo through various integrations, and expansion into small and medium businesses with PayPal Open [3] - The DCF model assumes conservative explicit growth of 6–4% over ten years, with PayPal having never experienced revenue decline in the past decade [3] Financial Projections - Long-term growth is projected at 2.6%, with a WACC of 9.4%, a 10x EBITDA exit multiple, a 21% tax rate, and reinvestment based on a 1.1 Sales-to-Capital ratio [4] - The bull case emphasizes strong free cash flow, self-correcting valuation, underappreciated margin recovery, and improved user experience from platform simplification [4] Market Positioning - Despite slower growth, the market has over-discounted risk, creating a favorable entry point for investors [5] - PayPal's combination of discounted valuation, strategic initiatives, and resilient financial profile supports maintaining a modest position of 2–3% of a diversified portfolio [5] Historical Context - The stock price has depreciated by approximately 18.45% since previous coverage due to market concerns over slower margin expansion, but the current analysis emphasizes DCF-based upside and the importance of buybacks and margin normalization [6]

Micron Technology, Inc. ( MU ) is one of the hottest securities in the current AI explosive market (Figure 1). AI data centers are consuming so much memory that it has created supply chain constraints and, asInvesting in high-growth opportunities across industries, employing a value investing approach that prioritizes robust business models and strategic foresight. Focusing on companies with the potential to profoundly influence the global landscape in the years aheadI primarily employ the discounted cash f ...

Company Overview - James Hardie Industries is a building solutions company and the world's largest producer of fibre cement and gypsum products, operating across North America, Europe, Australia, and New Zealand with over 5,200 employees [1] - CSL is a global biotechnology company focused on creating and delivering life-saving medicines, with three main divisions: CSL Behring, CSL Seqirus, and CSL Vifor [3][4] Financial Performance - The share price of James Hardie Industries (ASX:JHX) has decreased by approximately 35.0% since the start of 2025, while CSL's share price is 5.7% above its 52-week low [1] - James Hardie Industries currently has a price-sales ratio of 3.20x, lower than its 5-year average of 4.14x, indicating that shares are trading below historical averages despite revenue growth over the last three years [7] - CSL has a trailing dividend yield of around 2.23%, which is higher than its 5-year average of 1.50%, reflecting the company's stability and ability to pay out income [8] Product Characteristics - The main selling point of fibre cement for buildings includes its non-combustibility, resistance to water and termite damage, durability, and low maintenance requirements [2] Investment Appeal - James Hardie Industries is viewed as a growth company, while CSL is considered a 'blue chip' company, making both attractive options for investors seeking exposure to their respective sectors [6][5]

Each week we run a DCF (Discounted Cash Flow) model on a company from our watchlist. This week’s pick: Taiwan Semiconductor Manufacturing Company Limited (TSM)ProfileTaiwan Semiconductor Manufacturing Company Limited (TSMC) is the world’s leading dedicated semiconductor foundry, manufacturing advanced logic chips used across data centers, AI accelerators, smartphones, PCs, automobiles, and industrial electronics. The company’s process leadership, scale advantages, customer diversity, and technological roadm ...

Company Overview - Reece Limited has been operating in Australia for over 100 years and is the largest plumbing and bathroom supplies business in the country [1] - HUB24, founded in 2007, has become a significant player in the wealth management sector, providing software and platform solutions for financial advice, superannuation, and investment management [3] Product and Service Diversification - Reece has diversified its offerings beyond plumbing to include services and products in irrigation, pools, civil construction, and HVAC systems [2] - HUB24's core products include the HUB24 platform, Class, and myprosperity, which enhance financial advisory services and client experience [4] Financial Performance - Reece Limited's share price has decreased by approximately 35.8% since the start of 2025, while HUB24's share price is 101.5% above its 52-week low [1] - Reece shares currently have a dividend yield of around 1.76%, higher than its 5-year average of 1.06%, indicating potential growth in dividends [7] - HUB24's share price trades at a price-sales ratio of 24.54x, significantly above its 5-year average of 13.32x, suggesting it may be overvalued [8] Competitive Advantage - HUB24 has been recognized for its high-quality service, being named the Overall Best Platform in the Adviser Ratings Financial Advice Landscape Report for 2024 [5]