After the past few weeks, the market finally cooled as both the S&P 500 and Dow are headed towards a down week. That doesn’t mean there aren’t still some absurdly expensive stocks out there. Did you know that, at $315/share, Tesla’s (TSLA) stock price implies margins will rise and revenues will be $1.7 trillion by 2035? That’s more than the entire eclectic vehicle market, which is expected to be ~$1.5 trillion in 2035. Spotify’s (SPOT) stock is similarly overvalued. Nvidia (NVDA) is priced for revenues to be over $6 trillion by 2040, that’s more than the expected annual GDP of Japan, the 3rd largest GDP in the world behind only China and the USA.

No wonder the IPO market looks to be opening back up. I’m sure Wall Street is rushing to sell as much stock as it can in this overheated market. The higher the price, the more money raised, the more fees, often tens of millions of dollars per IPO, to them. And, then, they leave investors hold the all the risk with overpriced IPOs in their portfolios.  

Klarna filed confidentially for its IPO. We’ll be on the lookout for the S-1, so we can get coverage of the stock as soon as possible and give clients a read on whether the IPO is a sound investment. Note that all of our IPO research is free. Check out the archives here – we’ve made some great calls on IPOs, including leading the charge to get the original WeWork (WE) IPO cancelled.

It’s not all fun and games for Wall Street. Super Micro Computer (SMCI) is staring down the risk of being delisted from the Nasdaq, while General Motors (GM) just cut around 1,000 jobs in an effort to trim down its costs.

Don’t get caught in the hype, trust in the truth. We work extremely hard to collect proven-superior data that generates novel alpha and gives investors an edge. For example, since November 1, we’ve leveraged our Robo-Analyst AI to parse 2,078 10-Qs and 10-Ks and update our stock ratings and models with the latest quality financial data.

Now, to this week’s published research.

This week’s Long Idea features a company that stands at the top of the financial industry. Yet, its current stock price implies the market expects the company’s profits to never grow from current levels.

On the flip side, our Danger Zone pick is a company that garnered investor’s attention over the last few years yet it remains unprofitable. We don’t believe this company can reverse years of unprofitability and become the best in its industry as its stock price implies.

On the Model Portfolio front, we published the latest Exec Comp Aligned with ROIC Model Portfolio, and featured a stock in our Dividend Growth Stocks Model Portfolio. We also published our Model Portfolio performance for the first three quarters of the year.

Links to all our newly published research are below along with a preview for next week’s research.  

We hope you have a great weekend.

Long Idea: Strength in (Record Profit) Numbers

Members can read the latest Long Idea report.

Danger Zone: Uphill Battle Getting Steeper

Members can read the latest Danger Zone report.

Model Portfolio Performance Through 3Q24

Exec Comp Aligned with ROIC Model Portfolio Update for November

Featured Stock in our Dividend Growth Stocks Model Portfolio

Danger Zone Podcast: 11/4/24: Why This Consumer Goods Retailer is Back in the Danger Zone

Upcoming Research

Coverage Updates

  • 2,078: 10-Qs parsed since Nov 1.
  • 27: 10-Ks parsed since Nov 1.
  • 147 stocks, ETFs & mutual funds added to our coverage universe over the last 3 months.