If Airbnb can continue to execute as it has to date, we think the firm could achieve the future cash flow expectations implied by a $28 billion valuation.
With the stock trading 33% below its IPO price, and the firm feeling the brunt of the COVID-19 shutdowns across the world, some investors may think there is value in Uber. Think again.
David Trainer joined Morning Trade Live on the TD Ameritrade Network to shine some economic earnings light on stocks reporting EPS over the next couple weeks.
The Risk/Reward of investing in Capital One’s stock looks Very Dangerous to me. There is lots of downside risk given the Misleading Earnings and there is little upside reward given the already-rich expectations embedded in the stock price.
RED FLAGS:
1. Misleading Earnings: COF reported a $399mm increase in GAAP earnings while our model shows economic earnings declined by $1,783mm.
2. The company’s ROIC is in the Bottom Quintile of all the companies we cover.
3. Stock price of $40.69 implies COF must grow its NOPAT at 15% compounded annually for 15 years.
Kyle Guske II, Senior Investment Analyst, MBA
Sam McBride
David Trainer, Founder & CEO