Value in 60 Seconds: Most news is noise - 12 May 2023

8 Aug 2023 · 1 min

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Most daily news is noise for investors. Only information that changes a company's economics or market expectations matters. Stories hyping Sweetgreen as the next Subway or claiming Netflix would destroy Disney were overblown, not grounded in fundamentals.

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Most news is noise. We don't pay attention to a lot of it unless we think it's something that's going to meaningfully affect the underlying operations economics of the business, or if it's affecting expectations. There's a ton of narrative around zombie stocks out there, positive narrative like, oh, Sweetgreen's going to be the next, I don't know, Subway. I don't think they even say that, but that's what's implied by the stock price. They say other crazy things. And they said a lot of crazy things about how Netflix was going to destroy Disney. Most of that's noise. We like to focus on understanding the expectations baked into stock prices and operate from there.