Earnings Watch Party: Alphabet, Merck, PepsiCo, Amgen, Pfizer, and Spotify

Welcome everybody. Let's get going. I think we've got the majority of folks here and we got to start on time to make sure the folks that got here on time get what they deserve, which is to not have to wait. So let's jump right into it. Today we're going to be covering 6 stocks' earnings reactions. As you guys know, New Constructs thinks about earnings reactions a little bit differently. Than other folks. My experience on Wall Street has led me to believe that, look, these quarterly meetings and reports, these are commercials to sell stock, and they're not really even allowed to give out any good information. So without further ado, uh, let's take a look at, uh, the 6 stocks we're talking about today. I created a portfolio on the website to, uh, highlight these 6. Uh, let's take them in order of market cap. I just sorted by market cap. We'll start with Google. Told you guys we give you our rating. Google here is a classic good company, bad stock. It has been on our focus list for a while. It was a great pick, but it got up there in expensiveness or valuation. And so we said we decided we're going to take a little risk off the table there. But it's, you know, it's like one of the most profitable, best businesses probably in the history of the world. We all know the story. They, you know, they really invented search and a way to monetize that and very, very technologically driven. Great high returns on capital. You know, they're one of the FAANG stocks or Mag Seven. You know, they're all they're great. They're great. So what happened? Stocks not done so well the last couple days. They didn't hit their numbers, and there's concern about you know the amount of money it's going to take to keep up with AI. And I and I think you know when when we're looking at the rating here, you know just to be perfectly candid with you, of course, is you know look. Good news is priced in here. This is something that's priced for perfection, especially when you see this market implied growth appreciation period, more than 100 years. That's a big red flag. That's basically showing that when we put in consensus estimates, we can't get our DCF model to generate a value even assuming 100 years of profit growth. So what I mean by that, if we were to open a model— we had all these models open a minute ago. Here we go. Alphabet. If we open our model for Alphabet, and let's see what I have in here for an optimistic scenario. What you see here are implied values per share. This is how we get to the, the rating for growth appreciation period. And, and so what, what this shows you is what the company has to do to justify the price. And when we're looking out over long periods of time, what we see is, you know, the exact performance requirements for, for Google to justify the price. And this is based on consensus. This is the neutral line. You can see we're not getting too much above, you know, $190 or $200, you know, almost close to $190, $190 a share here in this optimistic scenario where we've got a faster growth rate, higher profitability. We can get to the model can produce a value equal to the current stock price in 15 years. Keep in mind, this is not a prediction model. Like the first thing I always say to my analysts is, hey, would you rather be a fortune teller or a critic of a fortune teller? And new constructs valuation is all about being a critic, not having to be a fortune teller. As I joke all the time on CNBC or with Chuck Jaffe, my crystal ball's in the shop. I don't want to be in the position of having to make predictions. So what do I do? I understand the prediction baked into the current stock price. And that's what this model does. And then of course you can build around that to look at expectations that are higher or lower and see whether or not you believe them. So if, you know, for example, you believe that, you know, lower— if you want to think about a shorter amount of time for profit growth, you're looking at a reason, you know, meaningfully lower price for the stock. So this is all just another way of explaining that we think Google is really pretty fully priced here, uh, and you're going to see the stock get punished pretty severely whenever it doesn't meet what the already very high expectations are. I think going forward, AI spend is going to, you know, it's going to be a real thing. You know, I think that the idea that, uh, I think was sort of the prevailing narrative in the marketplace around our Mag 7 and our tech companies is they kind of had the market cornered. They weren't going to see a lot of competition. And DeepSeek, I think, blows that up. There's going to be plenty of competition. It's going to cost them a lot. I think we're going to see returns on capital go down. And we're going to see free cash flow go down. So you can see returns on capital over time here, been pretty steady. And by the way, this is a pretty stellar high return on capital. That's, that's a good number. In fact, I can show you, we have our database as the return on capital for pretty much all companies and all major publicly traded companies in the US, actively traded. So if we were to sort by return on invested capital, see where Google ranks, 6th, you know, 15th in the, in the S&P. So that's a pretty good number. Pretty good number. 45.7. It's a good number. And then I wanted to show you free cash flow because free cash flow for these guys has really been impressive. I mean, 13, 14 billion, 32 billion, 49 billion, 27 billion, 54 billion in the trailing 12 months, 34 billion. It's been a cash flow generating machine. And I think that that's probably going to be coming to an end here in the near term. So I think there's going to be Risk reward here isn't so great, and I think we've sort of seen this coming as we saw the valuation really just creeping up, creeping up. And I think a lot of this is just people piling in, right? They're piling in on the safe names. We may not be as interested as a market in general in the original meme stocks like GameStop and and AMC and others, which were just complete jokes. I think investors have wisened up and said, "You know what? If I'm going to just pile into a stock, might as well pile into one that's got cash flow as opposed to a." Non-existent business model, for for example. So that's that's where we are on Google. Again, type in here on the chat or the Q&A, and I will get back to you. Next, in terms of market cap, Merck neutral rating. And here we're seeing a little bit more of a mixed bag. Not such a great company, and you know valuation not so bad. Neutral rating like Google. And, and so, you know, this is, you know, middle of the road. Neutral-rated stocks always aren't usually as fun to talk about and to cover. But, you know, the news is on one of the biggest pharmaceutical companies in the world, I think, is, is important. So I think they did pretty well on the quarterly numbers, but they got crushed because on the margin they're not so sure about some of these drugs that they want to be selling. I think there was bad news on this. Yeah, this HPV vaccine. So look, you know, with the pharmaceutical company, the good news is that they've got amazing business models. They're super profitable. If we go in here and we look at Merck, we're not seeing technology type of returns on capital or economic earnings, but we're seeing decent returns on capital. And it's the teens. It's dropped off here recently. You know, we got a nice little bump from COVID I'm sure that helped everybody. But it's definitely— it's dropped off. It's on the way back, it appears. I imagine free cash flow here is pretty good as well. Yeah, pretty consistent free cash flow. Again, not like a Google— market cap's a lot smaller— but you got a, you know, decent amount of free cash flow. You got $22 billion here in 2022 and a fair amount here recently. They have to spend a lot of money to create these drugs. They don't come free, which is part of why the patent laws And the FDA stuff is also important. And, and so, you know, look, there are a lot of controversial discussions we can have around the pharmaceutical companies. I think we've probably all heard about or read about how they have a lot of influence on the FDA, and a lot of these studies, double-blind tests and things, aren't always as authentic as they ought to be. But these are great businesses. And I think one of the things about Merck that we've always liked that's made it made us sort of, if we're gonna look at a pharmaceutical company, Merck and Pfizer, same thing, it's about distribution. So they don't necessarily have to invest a ton to create new drugs because they can buy those drugs from a biotech, a smaller biotech, and they can monetize the heck out of it through their distribution. Sort of like Budweiser buying up craft brews, you know, which, you know, huge value creation, right? Budweiser doesn't really have the R&D. They don't really have the sort of culture to be creating, you know, new stuff. They, they got so much distribution. Well, they can buy the— they can buy that innovation from someone else. Merck can do that, and they can, and they can get a good value for that because they can monetize what that biotech company has created with, you know, an amazing distribution platform. So a couple questions back on, on Google here. Should we, you know, what's, what's the recommendation? Well, first of all, full disclosure, you know, we are not advisors. We do not make recommendations. We provide research. But if we're looking back at Google here, you know, look, this still looks like an expensive stock. We took it off our focus list a while ago and we've not considered putting it back on. Look, cash flows are great. You know, look at the credit rating. I mean, amazing credit rating, right? I mean, it's a great cash flow business, but I think that they are facing more competition than ever, not to mention the regulatory heat. That doesn't help either. So I think Google's business model's best days are probably behind it. Sad to say, but look, tech is the most disruptive sector. This is part of why we've been sort of banging the table around these overpriced tech stocks. Tech is synonymous with disruption. So to believe that these stocks were appropriately priced to have monopolistic profits and market share for perpetuity, we thought was, was naive. And we're seeing that unwind. And I think we're going to continue to see that in the not too— in the near future and going forward. So that's our take on Merck. Let's take a look at Pepsi. How did Pepsi do? Focusing more on healthy stocks, a revenue miss, and a soft outlook. So what did that mean for the stock the last couple days? So yeah, big down day yesterday. People didn't like that. You know, look, it's a very competitive business. I mean, we're going to take a look here at Pepsi. We're going to see returns on capital. That's pretty good for a consumer Consumer goods company. We've still not gotten their 2024 10-K. We're expecting that any day now. Just got suspended today. That means it should be in here. It was expected yesterday, so it's a little bit late. Not a red flag, nothing like what we've seen with other red flags like we saw with Supermicro. But we're going to be getting new data here any minute, and that's post the earnings conference call. But a neutral rating based on what we do have here. You see a lot of green but some yellow. So mediocre business, uh, mediocre valuation, mediocre stock. Let's take a look here. Uh, look, it's been, you know, it's super competitive. So, you know, we surprised to see that the outlook is softer. Um, revenue is, is, is is always going to be a challenge, as they are always— revenue growth is because the market's pretty saturated with Pepsi and, and, and chips and stuff like that. So they've got to look to new categories. And, you know, I think maybe we can think about Pepsi in a way that's not dissimilar to Budweiser and Pfizer and Merck, and that they don't necessarily have to have the best innovation or R&D in the world for creating new healthy stocks. They can monetize someone else who's created it by buying it and pushing it through their distribution, which is huge. I've said for a long time, one of Coca-Cola's biggest advantages, and if you read the stories and the history about Coca-Cola, it was distribution and merchandising. And Pepsi does an amazing job of that as well. So economic earnings pretty steady, return on capital pretty steady here, which is nice. Margins down, back up a bit. Capital turns doing well. Free cash flow Pretty darn steady too. $6 billion minus $1 billion plus $9 billion plus $6 billion plus $8 billion and like a $7.5 billion. So that's looking pretty good. You know, this is, this is, you know, not this, but this is not a great, not a sexy story because, you know, we got a neutral rating here. I don't have a lot of strong feelings about Pepsi here except to say that the business model is decent. They're facing more headwinds. Valuation doesn't look cheap. You know, neutral rating means we wouldn't be that interested, um, in allocating or putting this on our focus list or anything like that. Wouldn't make our most attractive stocks list. So sort of a middle-of-the-road stock. One thing that might be interesting here to see, what's the beat here? That means that our earnings distortion is probably showing that core earnings are better than accounting earnings, which is always a good thing. If we wanted to see why that is We always, by the way, we like stocks. In fact, we've got an index with Bloomberg called the New Constructs Core Earnings Leaders Index that is based on owning the companies that have the best core earnings power. But let's go into take a look at one of our institutional features and see our earnings distortion items. And so what we're finding here is that there are some unusual charges buried in cost of sales and SG&A related to productivity plans. So you've got a restructuring productivity plan. They've been going for a while. I mean, that's— it's always kind of not a great thing when, you know, a company's doing a restructuring. It's like, well, we need to manufacture earnings growth by cutting costs because we're not going to get it by growing the business as much, which makes sense in such a mature industry. But here's where you see exactly where those numbers are hitting the bottom line. And you don't know about these expenses if you— unless you go through the footnotes, right? This is a summary of our 2019 productivity plan. These are the charges that are buried in these items. So you're not going to see productivity plan on the income statement. It's very short, short and simple income statement. You've got to go through the footnotes. That's something that New Constructs does that's better than anybody else. So that does not necessarily mean that Pepsi's a buy. It meant that we expected them to beat, and they did. So, but it didn't help the stock because the outlook was bad. So, you know, you got to weigh all these things. It's a very multifaceted thing. Again, not a really sexy stock here, nothing really that exciting. All right, let's go to what's up next on our list here. Amgen, a lot of pharmaceuticals here reporting recently. Strong miss, but we like this. It's on our focus list, and the business has not done as well as we'd expected when we first put on the focus list. You'll see that there are stocks sometimes that are on our focus list that don't get— always get an attractive or very attractive rating. Uh, we're in it for the long term. When we put Amgen on there, I know that it was a very attractive, or I think attractive rating. But businesses go through cycles. And if we see that this business has got a good competitive advantage and we think that the valuation is appropriate and the, and we think the business is going to continue to be strong and survive headwinds, we'll put it on the focus list and we'll keep it there if we believe in it. But you can see here, rating doesn't look great right now. Returns on invested capital been dropping. And let's see what free cash flow looks like. Free cash flow has been strong. Bad year in 2023. That looks like a big number, probably related to an acquisition. So let's see what's in the news on Amgen. So let's see here. Up big today and the last 2 days. This is a, you know, kind of a typical focusless kind of stock where, you know, even some bad news means the stock still goes up because the, you know, the core strength we saw in the business is still shining through, and that means the valuation, you know, remains relatively light. So let's see here. Let's take a look at our model for Amgen. Let's do some reverse DCF here. Let me open this model. Alphabet, PepsiCo, Merck, Nvidia, Quantum. Let me open the model. Take a look. If we run the model, this one And see what kind of assumptions we got to put in here to justify the current stock price. Because it's, you know, interesting story for a lot of these pharmaceuticals are getting, getting hit pretty hard when they miss. These guys have them, or even though they beat, these guys have a miss and, you know, the stock's up. So I think that what's that showing is that people are seeing through what might be some difficulty in the business model now. And this company doing well, especially since they've got one of the key— one of the big obesity drugs out there. All right, so Amgen, do you have any scenarios here? No, we're going to have to create one. So here's what the default forecast is showing. They've got to grow revenues at 3.6% compounded annually for 19 years and maintain an 8.8% return on capital versus cost of capital spread to justify the current price. Here you can see the implied values for the scenario over a 100-year timeframe. The dot marks where the model— the year in which the model generates a value closest to but still less than the current stock price. So why don't we take a look here and see if we want to maybe change some of those forecasts around? What would we do here? So margins have been a lot lower. Wow. Been a lot higher. So maybe in our, in our neutral scenario here, we can even call it optimistic. Why don't we assume that margins get back up to 35%? We'll leave everything else the same. Save that off. I'm getting questions about a lot of other stocks. We did— we've done a couple of other earnings replays. So for earnings that happened last week, I'm going to put into the chat here access to The earnings call replays from last week, so you can see those. Meta was included in one of those, so that was a question from somebody specifically. Sorry for the delay there. All right, so let's take a look at how what this forecast, what this optimistic scenario does for Amgen. So when we see, when we put that higher margin in, not a lot higher and not as high as it's been, you can see that moves the number of years of growth down quite a bit. So for example, if you wanted to say, all right, well, if I think they're going to do that margin and I'm good with 19 years because look, this is a big moat, a strong moat for this business, and I think they can grow profits for 19 years. And now you're looking at, at a, you know, your target price could potentially be $322 here. I hope that makes sense, right? This is if we're looking at the optimistic scenario and we go out to 19 years. Sorry, that's $317. Same number of years as the Forecast 1 or default scenario. If we've got 20 years, 20 years, you're looking at implied value of $326. So that's, that's just a way you can, you can show how exactly this model works and how we get to this value in our market implied growth appreciation period analysis. So I, my, my takeaway on this for Amgen would be like, you know, this is why it's still on our focus list, because there's potentially good strong upside performance if margins get anywhere close back up to this, you know, the, the, you know, the mid-40s or even 40. I bet you're going to see a really, a really— the stock gets— looks pretty inexpensive real fast. We're going to see a really short gap. Save that off. And then we'll, we'll be able to look at another scenario. Really quickly and easily. You know, I'm getting some questions about Palantir and and Snap. We might think we might have some time to take a look into those because those are sort of some interesting stocks that we've talked about in the past. In fact, while we're waiting for this, why don't we pop over to the ratings page and we'll take a look at this has been good company, bad stock, super expensive stock in general. We should run a model on this one when we show you the expectations baked into this stock price. Your stomach might turn because Palantir is crazy expensive. A lot of good, good news pumped into there. So let's take a look at Amgen. We put in the 40% margins. You see they look very little time. They can justify the price with 6% growth, you know, less than what they've done even in the last year in a short amount of time. So now if you go with this scenario, you go out 19 years, your implied price is $381. So this is a great way for those of you that care about fundamentals at all to really specifically quantify what it means with your target price, right? EBITDA multiples, price-to-earnings multiples, whatever multiple you want to use, those are sort of like guesses, right? They're shortcuts to valuation. We don't believe in shortcuts at New Constructs. We've done the hard work to get to the truth behind the numbers, and to build a model helps you specifically quantify what your target price implies. And I think that's really important, especially for those of you supervisors of analysts, portfolio managers. You got a team you want, you want to understand where your analyst comes up with a target price. Make them show you this model. Make them show you the assumptions. You can see right here, here's the forecast page. Here are the assumptions that go into what it is we're assuming. And if we go to the DCF page, right, this is, you know, this is the scenario for the optimistic assumptions that you put in, goes through everything, shows the free cash flow. Present value free cash flow, present value terminal value. By the way, it's a no-growth terminal value, which is why we have multiple forecast horizons. We do all the work to get the implied values. Then we just look up where the model generates a value that's closest to but still less than the stock price. That's the market implied growth appreciation period. But you can see we're modeling out for 100 years, not because we're predicting the future for 100 years. We are not. We're just making sure that we cast our web Or I'm sorry, our net far enough to capture market expectations. Now with, with Amgen here, we don't have to go out that far because it's not so expensive. But for a lot of companies, you'd be surprised how much we have to go out that far for. All right, let's get back to business here. We are running a little bit short on time here. We got a couple more stocks to cover. Pfizer. All right, unattractive, suspended, expected to beat, uh, big acquisition, not such a good business right now. I'm guessing that if we looked here, you know, yeah, it was doing great during COVID Yes. But after COVID, not so much. It's a competitive business. As we said before, you know, look, everyone's trying to come up with new drugs. Pfizer's big. I can, you know, it's going to be hard for them to grow. Economic earnings have gone negative. We don't like that, even though accounting earnings are staying positive. Bad sign. And you can see here, you know, this is really, they sort of diverge here. Surprised this is not getting a, a worse rating because you've got negative economic earnings and positive accounting earnings, and it looks like those are rising and these are falling. So interesting there, right? Very low return on invested capital. Free cash flow is bad. Bad big acquisition. That's what's causing that. Valuation looks cheap. So here's a situation where, you know, looking at the model, we might be surprised here. Again, this is a strong sign. We've actually had a special— we did a special promo last year where we looked at companies that might not have a good rating, overall rating, but had a good market implied growth appreciation rating. And this was a really strong signal on its own. Now we paired it with another signal before we, we put it in the bundle, but you get the idea. So let's see here, where's Pfizer? Let's see if we did a scenario here on Pfizer. Let's see here. So, all right, the neutral— let's go with neutral here. So positive 7 Let's just go with 0.1, 0.4. This is consensus going out. Margin came way down. So that default is pretty high. Let's say margins. See what this looks like. Save that off. See how it goes. Price to economic book value looks pretty good. Return on capital margins kind of, you can see up and down. Free cash flow, negative $15 billion, positive $26 billion, positive $33 billion. When things are good, COVID, you know, they made a lot of money, but you can see big negative drawdowns here on the free cash flow here. I think they're trying to buy more drugs to put through the pipeline, and that means, you know, returns on capital are going to suffer. So when we're thinking about our reverse DCF on Pfizer, you know, that's going to be kind of tough. For them to see returns on capital get much better, you can see returns on capital now negative. All these scenarios have showed them less than one year. So I messed up. I needed to make this more conservative, not the other way around. So if we're going to neutral, let's go in and say what happens if we assume margins stay super low? That's the way to do this. So we're going to put in 2020, 2020, 2020, super low worst case scenario. See how that goes. Another question here about the behavioral phenomenon that we're seeing with a lot of stocks, you know, report good numbers, go down, report bad numbers, go up. We are certainly in a market where we're seeing a lot of noise, there's no question. And that noise is manifest, uh, no better than stocks like Tesla, where we're getting a huge amount of, you know, upward movement even though the stock's missing, and we're seeing everything on the competitive advantage side really going down. And, and people get annoyed with me talking about Tesla, but I think it's just a great example of a meme stock and where people are really crowding into certain stocks because they're popular, not based on fundamentals. And I think it's important to know that as much as we see a lot of false narratives spread throughout the country in different places, I know a lot of these folk, you know, a lot of them come from all over the world or whatever. You know, one of the weaknesses of the United States is our greatest strength, and that's free speech, which means anybody can come in and say anything, which means people can make up false narratives. And I think if you're going to, like, you know, really try to hurt us, You know, you want to divide our country and you want to undermine our capital markets. And undermining our capital markets means not allocating capital efficiently or putting too much capital in stocks that don't do well or aren't good companies. And I think that's what's happening sometimes. All right. Let's go back to check out our Pfizer model. It is ready to look at here. So when we knock the margins all the way down to the worst ever, you see here now it takes us 20, 29 years based on consensus numbers to get to the stock price. So if we believe that the stock's gonna, you know, if the margin's gonna get anywhere close to where they were before, this still is still a cheap stock. Still a cheap stock, which is what you see when you look at the market implied growth appreciation period. Alrighty. Let's finish up here on Spot. We're here at 30 minutes. I wanna try to keep these things short and sweet. So Spot, another good example. Good company, bad stock. Really high expectations here. How do these guys do? Stock went up, right? Good subscriber growth, beat the numbers. Look, it's a really profitable business. I had to do a double take when I first saw this 344% return on capital. Why? They got no balance sheet, right? That's also their biggest risk. No balance sheet is one of their biggest financial benefits, but it's also one of their biggest strategic risks. They don't own anything. So when margins get this good, What do you think the owners of this music are going to want to do? They're going to get paid more money. And so these guys are perpetually squeezed. This has been our thesis for Spotify ever since the beginning. We don't think profits this high are sustainable. We don't think profits this high are sustainable. Return on capital, look, it used to be terrible and it's really just skyrocketed here recently. We'll see here when we break down returns on capital into the 2 key drivers. You can see margins were really kind of hovering around zero. Skyrocketed here recently. Capital turns doing extremely well also. So the question is, are these margins sustainable? I would say no. I would say no, they're not sustainable because the owners of the music are going to say, why is this person who's renting my music making more money than me? I need some of that back. So I think Spotify's margins are really boxed in, almost like a utility company. Right? You know, they got to balance what they charge people between what's going to actually keep them happy. And they, you know, and they really, they don't own, they don't own the underlying product. Really, utility company is not a great example, except that there, there's a cap, I think, on how much of a margin they can charge. This might be fun to do a reverse DCF here real fast. Spotify. Yeah, you can see like we've got some jacked up numbers in here. you know, super steep on my neutral, and it still can't get to more than $300. Let's see what— let's see what we got for optimistic. Okay, so optimistic scenario. Oh my gosh, we can't even get there with the optimistic scenario. All right, let's, let's, let's play the game here. Let's go in and see how optimistic we need to be. So the optimistic scenario's got 25% growth in revenue going out for 20 years, and that's still not getting us to where we need to be. The last fiscal year margin is negative. I told you, just barely got positive. Let's take a look here on what the margin is at the TTM. TTM margin is 5.5%. So let's, let's put We'll leave the cash tax rate. We're going to go zero. Leave this at zero. Assume they maintain this really high margin, 5.5%. And then let's, let's go see what kind of revenue growth. So 25% didn't do it. Let's try, let's try 15 in the first year, 30, 30, 30. Save that off. So this is a great way to use this model, right? Like if I'm bullish on Spotify, what do I need to believe is going to have to happen? And we've done this. We've done some great case studies, which you can see on our site. I'll share some other case studies we've done here recently that I think are super, super helpful for doing this kind of work on individual stocks where we do work just like this on things like quantum stocks. Here's some case studies on reverse DCF. I hear that model runs pretty quickly. What does optimistic look like? 15 years. So they've got to grow revenue at close to 30% or 27.5% compounded annually for 15 years while seeing the return on capital improve from negative 23 to positive 1,500%. We want to look at like, how high is that? I think we rank the S&P by return on capital. Here in this, in this, this dataset I pulled together from our system, the highest company's at 415. I can tell you that no company in the last 5 years has been over 600%. Fortinet made it over 500, but it only lasted for a little while. So I think it's pretty fair to say that Spotify is pretty expensive here. If we want to look at sort of implied revenue, we're getting up to $560 billion. Let's see, where would that rank in the S&P 500? In terms of revenue, total revenue, largest to smallest. So they'd be up there, they'd be bigger than Apple and just behind the biggest retail businesses in the world, Walmart and Amazon. That's what the stock price is implying they're going to get to while also seeing return on invested capital skyrocket. There you go. Around zero all the way up to The average over the timeframe is $15.80, but the total that it gets to is $2,400. So I'd, again, I'd say that's pretty expensive. If we want to look at the free cash flow for Spotify, again, skyrocket, $30 billion. You know, that's on the, you know, level of these big companies we talked about. So yeah, I think this is a really tough business to want to buy at this stage. I think somebody mentioned, you know, would you buy the labels instead? I, you know, I don't, I don't know. I look at the, I would have to look up the, open up the models, look at the labels. But I think it's fair to say all the good news here is pricing to Spotify. What about original content? I said, well, that'll be expensive. I think it'd be really expensive. And that means returns on capital are going to suffer. So, right, if you're going to have that kind of market share and that kind of growth, you know, you're going to have to come up with a lot of great new content. You're going to have to do it at an extremely profitable level. It's going to be hard to believe that the labels and the owners of the music are going to let you do that. You want to create original content, it's expensive. They paid Joe Rogan a lot of money. He did them a lot of good, but that's expensive, uh, and that's going to go on the balance sheet. That's going to hurt your return on capital. So what this optimistic analysis scenario shows you for Spotify is whatever they're saying in the earnings— good news, rah rah rah, stock goes up— nothing about the long-term implications. That we show you here, which is oh my gosh! A super profitable history or future is priced in here. Amazing growth, amazing profitability, as if they have no competition, and new content is going to just grow on trees for free. That's why you know this is a stock that we have warned people about for a long time, and is on our focus list short. We think when when when the narrative unravels. When people start caring more about allocating capital intelligently and not just chasing stocks, when people feel the risk of chasing stocks has just gotten to be too much and they care about fundamentals, this is one of those big ones that's going to fall and it's going to fall big. Okay. Thanks everybody for being here today. That's all I got. I did want to share that we have another training coming up tomorrow and Friday, not a training, but other earnings releases. If you registered for this one, you're already registered for that one. We also have a big training coming up on February 20th where we're going to be talking about our most attractive and most dangerous stocks. That's going to be a, a great session where we will go in a lot of detail and answer a lot of questions. I will share the link to that in the chat. And if you have any questions otherwise, feel free to email me support@newconstructs.com. Our website here, www.newconstructs.com, if you want to have access. I got some people asking about what kind of products we have. You check it all out here. Professional, institutional, quants, model portfolios. If you want, you know, our deep value picks, this would be our most attractive stocks model portfolio. That would be where we scan the entire market and find the stocks that we think are the most attractive. We also protect people on the downside with the most dangerous. There's some dividend yield stocks, bond portfolios as well, and our exec comp as well. Anyway, no more questions. We will sign off. Thank you very much for being with us today, and I look forward to seeing you tomorrow when we do the next one of these. Bye.