Watch our Earnings Recap for Broadcom, JD.com, Kroger, BJ’s, The Gap, Macy’s, Venture Global & more

I believe we got 10 or so stocks here to go over. Why don't we mix it up a little bit today and go with the stocks that are moving the most? So let's, let's jump in here with Gap. What is, what does New Constructs have to say about Gap? Neutral rating. You know, the ROIC is kind of low, I would think, for retail company. You know, that's, that's about right. You're not going to expect a lot there, but It's good to see economic earnings that are positive and on the rise, a strong free cash flow yield. And this is a pretty low price-to-economic book value for a market-implied GAAP that is 50 years. So that's interesting. That's interesting. I'm guessing that maybe margins are probably coming up a bit and we're not giving them all the credit for that margin improvement at this time. You see return on capital pretty strongly improving here. A lot of that's probably driven by margins, and we're going to look at a, probably an average around this last whole period. So our margin is probably a little bit lower, which means it's going to take a little bit longer to generate the cash flows embedded in the stock price because it would be— that cash flow would be generated at a somewhat lower margin over time. Free cash flow yield, good and steady. These guys have been good free cash flow. Good, good company. Good boys here making good cash flow. And then economic book value been pretty volatile with the no PAT margin. We can see here though that economic book value is on a pretty strong rise. The stock's been, I guess, you know, those who follow it really flat for a while. But today, big day. Big day up 3% for GAT. That's a big. I'm sorry, up 17%. That's a big number for Gap. I mean, we're up, we got $19.48 and we're up to $22. So that's a, that's a big number. It seems it must have beat, outperformed its EPS surges by 10.2%. I think they gave some good guidance around tariffs, which was counter to what we saw from a lot of the other retailers who are down still. And, and that's interesting because Gap's been kind of a struggling company. So I think the takeaway for Gap here for you all is Neutral rating, but if you feel like they're you know the business is going to continue to improve, then this would be something worth taking a closer look at. This would be worth something taking a closer look at. Not the best financials, but a pretty cheap stock. Pretty cheap stock. Nothing too funny going on, and hidden items here pretty small going down, not up. Earnings distortion. Getting better. We don't like to see accounting earnings crossing over core earnings because that hadn't happened before, so that's not great. But it's a pretty small amount. We don't have a big— we don't have a strong miss rating here. So I'd say for, for Gap, we're doing pretty well. All right, what's our other big mover today? Broadcom. Ah, this is one of my— it's gonna be one of my favorites. We're going to get a little bit deeper into Broadcom because I've seen— we've seen this stock jumping up like crazy on the heels of Nvidia doing so well. And it's like, oh my gosh, we made, you know, so much money went into Nvidia that it was like, we need to put some money into something else. And I think Broadcom was the beneficiary of that. I don't know that its valuation needed to go up as much as the stock price has gone up here recently, but I believe that Broadcom beat the numbers and the AI trade isn't dead. I mean, this is sort of one bright spot in the market for those of you that are the MOMO types and looking for this kind of big momentum that we've seen happening to continue. This is not a very good business. Like, the difference between Broadcom and Nvidia is, you know, these are both bright green. So it's a Nvidia, good business, bad stock. Broadcom, mediocre business, bad stock, which means extra bad stock. 8% return on capital because these guys have a really bad history of write-downs. I believe this is the company I've been thinking— I'm thinking of. Yeah, you see accumulated write-downs. They've done a lot of acquisitions. It's $1.2 billion. Not a big amount in terms of total adjusted capital. So maybe I'm not thinking about the same company. I know the old Broadcom had a lot of bad acquisitions over time, but this is a, this is a capital, a more capital-intensive business than Nvidia, whose returns are much higher. Let's see here. Economic earnings down. We got the 10-K, so that was a big drop. I don't know, you know, whatever they beat, it was probably a lower number. And those of you who've been on this call with me before, you know how Wall Street plays the game with their numbers, with the stocks they like. they have lower estimates, so it's easier to beat. Stocks they don't like, they have higher estimates, and they use a different model for coming up with target prices. So earnings estimates from Wall Street are a game, they're a trick. I would not pay attention to them. Yeah, return on capital coming, coming down a bunch here. Margins down, capital turns down, free cash flow. Yeah, big acquisition here recently. That's not helping returns on capital at all. Okay. Yeah, here we go. Yeah, that's, this is 70. Yeah, they had a huge acquisition. So this is, this, this TTM and 2024 are the same because we just got the annual report. So I missed this before where we've got 7, you know, from $73 billion to $166 billion in total assets. Invested capital goes from $53.6 billion to $143 billion. So an even bigger jump there. So it looks like they, they put some of this hot money to work and made a big acquisition. Yeah, VMware. That was a super expensive stock that we watched for a long time. Thanks, Neil. That was the acquisition they did. And yeah, so I bet they overpaid for an already expensive stock, and that's just going to crush your return on capital, crush your cash flows. It's just not a good sign. You want your— the agents of your capital. You know, we're the owners of the capital as investors, right? We are owners of capital. And managers are our agents. They're taking this capital and they're supposed to do good by that. That's the purpose of the capital markets. That's the fundamental idea behind a democratic capitalist system is that we want that capital to go its highest and best use, just like we want the best ideas to rise to the top. That's part of why we have freedom because if we don't have freedom and we don't let the market, we don't let the group do its own best work, then it's effectively centralized. If it's not decentralized, it's centralized. There's no way to do it. Either you have censorship or you have no censorship. There's no partial censorship, because at any point in time, if you're putting somebody in charge of censoring or determining where capital allocation goes, you are ruining the ability for society to determine its highest and best use. And that just comes down to one person or some group of people, and that's That's not healthy. And the part of the reason the United States is where it is today in terms of being the global economic superpower is because our capital markets are better. So let's take a look at Broadcom. I think we looked at this before because it was so expensive. So I got a couple scenarios already put in here for what's required to justify the current stock price. Now we see returns on capital really haven't been that great anyway. If we go back here we saw it got crushed down to 8%, but return on capital before this, you know, it was only 24-28%. Nvidia's return on capital is 211%, right? So it's, it's a lower quality business even before the acquisition. So let's go. We got a couple scenarios here. If we assume 21% compounded annual growth in revenue for 12 years and an improvement of the return on capital versus cost of capital spread from -3 to positive 34, That will justify about $180 a share. On the other hand, if we think about a slightly lower growth rate and lower level of profitability, it takes 60 years to justify the current stock price. So it's just, you know, that's the way it is, right? If you're going to grow fast at higher margins and get more higher return on capital, you're going to generate free cash flow faster. That means you're going to achieve the cash flow growth expectations embedded in the stock price more quickly. Growing faster, go— you're going to go make that money faster. And so that's why we got a lower slope and it takes longer. Steeper slope, it happens faster. So let's take a look at what the implied revenues are here. Wow. All right, so we can see hockey stick for that optimistic scenario. That puts us at $502.4 If we want to look at total revenue and sort the S&P 500 by largest to smallest, you can see the biggest right now, Walmart, $674 billion. And these guys are expected to be $502.4 billion. Where would that rank in the S&P 500? This is data that I pulled back on February. We could update it any time, but I think it's close enough, right? So they'd be number 3 in the S&P 500. Okay. What would the NOPAT be? It'd be $150.2 billion. Let's see the NOPAT rank. Shoot. NOPAT, $150.2 billion. So that puts us, that would be way bigger than any company in the S&P 500 right now. Wow. A lot bigger, like 50% bigger. That's impressive. Return on invested capital. Would be up at 80%, and that would rank not quite as high. That would rank, yeah, top 9. So I think the takeaway here is that Broadcom is quite expensive. You can see Return on Capital's kind of had a bumpy road. They've never been that good, but this is like rocket ship, no pad, hockey stick, right? We're at around $10 billion in OPAT and we're going to go to $150 billion. That's a pretty good growth rate. And revenue, hockey stick to $502.4 billion. So I think this means that it's pretty clear that this is a really expensive stock. We would recommend you stay away. This is— this, I do not consider this a good investment. I think expectations are super high. And keep in mind, To own the stock at this level, and let's let's make a quick note here. The stock's at 179. We're looking at 179. Okay. So well, let's see. The stock is actually at 193. Sorry, it's at 193. We're looking at implications at 180. So it's already gone up a lot. And what you need to understand is that in order to own the stock at 193, and we can look at the implications for 193. Just just point just the point is to be significantly higher than what it is now, right? To own the stock from a fundamental perspective, from a truth perspective, from a non-FOMO narrative, whatever crazy driven, you need to believe that the company's future financial performance is going to be materially greater than what is already baked in. That's what justifies owning a stock. You got to be materially greater than what is already baked in. You got to expect the company to do materially better than what is already baked in. Otherwise, there's no reason to own the stock. The market's got the valuation right. Mr. Market's got the prediction right. So that's what we're dealing with here when we say bad company, good stock, or bad company, bad stock. That's kind of what we mean. Or good company, bad stock. Expectations are super high here, super high. Incredible growth rate implied here for profits. We would, we would recommend you go someplace else to find a good stock. Okay, Macy's. It's like Macy's had a good, good, good quarter revamping stores, closing others. You know, this is smart. You know, we love it when we see capital consolidation, when companies go in and say, let's clean up the Let's shut down the bad stores and reallocate resources to the good stores. That needs to happen because oftentimes when businesses are doing really well, look, they're trying to grow as fast as possible and investors are pushing them to grow as fast as possible. You got a good thing, you got a good thing. Let's make the most of a good thing as soon as and as fast as we can. Problem is that oftentimes you end up overdoing it. You overbuild and you end up having a lot of stores that eventually don't do that well. Sometimes you have stores too close to each other. I know we often wonder about that with Starbucks, right? There's a Starbucks everywhere. There's a Walgreens everywhere. They probably need to have some attrition. So interesting. Forecasts 2025 sales and profits below estimates on inflation, tariff uncertainty. Interesting. They expect sales to drop again this year. But see, stock's down net over the last couple days. So what we're seeing today is a bit of a bounce back, kind of flat on the month. Really downed down over the last five days. Today's kind of a bounce back. I guess it's kind of a bounce back for the market in general, at least a small bit. But yeah, I think it's fair to say that Macy's having a big day. What does our system say about Macy's? Well, I was expecting a strong beat. It's super cheap. So this is a great example of where they came out with a with a miss. Uh, or bad expectations for the future, but the stock price is implying worse. You've got a price-to-economic book value here of 0.5. That means the stock price is implying a permanent 50% decline in profits. And I think Macy's came out and said, yeah, it wasn't so great, but it's not going to be 50%, maybe 5 or 10, right? So the stock's got room to come back, which is why we saw the decline followed by a pretty pretty quick bounce back. That's the beauty of our system, is that, you know, when you get into stocks that are super cheap, right, they've got a lot less downside. They got a lot less downside risk because the valuation is already so pessimistic. The implications of the current stock price already so pessimistic. So yeah, what's going on with the business here? Imagine returns on capital, economic earnings kind of leveling out. Bad time during COVID came back a little bit. Nothing special here. Same with, you know, return on capital looks exactly the same. Margins. Wow. Everything kind of looks exactly the same. But, you know, this is a great kind of example here of where, you know, yeah, the business is in decline. Is it in a 50% decline? No, no. And so the stock price is cheap. Right. Bad company. Oops. This is bad company, good stock. Right. I don't— you probably never heard anyone say that before, but it's possible you can have a bad business. But if the stock price is implying the business is going to be significantly worse, materially worse than what you think it's going to be, well, then it can still be a good stock. And here you see you've got decent free cash flow. a stock price that implies a permanent 50% decline in profits. And look, this is— you don't need any growth. You don't need any growth appreciation period if the stock price is implying a permanent 50% decline. Anybody have any questions about what I'm talking about when I go through the valuation stuff? Because I've done it so many times and I sometimes may go fast, but I want to make sure people understand this because I think this is incredibly insightful stuff. If you care about fundamentals, this is the truth. This is what's going on. This is, this is what the stock price implies. This is why fundamentals are helpful, because you have a real footing in strong math, reliable foundation. And I think that that's a good way to go. What do we got free cash flow-wise? Pretty good. Been negative here, but pretty positive here. So yeah, you know, this is gonna probably, you know, they're closing down stores, so they're hopefully maybe raising some cash as they As they consolidate and get smarter about where they're allocating. But overall, pretty strong free cash flow here. Way more free cash flow, positive free cash flow than we've seen negative. So this has been a net free cash flow positive business. That's why you're getting that 2-year average free cash flow yield of 4, 5.4%. Not bad. Not bad at all. I would also highly recommend that if you have not been a part of our community before, You would join that. We've got some great conversations about forecasting, forecast metrics, how we do that. I wanted a lot of detail here. Almost should go through this for the for today, but just explaining how our model works, right? When I'm talking to you about AVGO, you you need to know like well what are the inputs? How do we come up with these inputs? How do we come up with a default scenario? How do we come up with a Default scenario for revenue growth. How do we come up with a default scenario for the pretax profit margin, for cash tax rate? I explain all that in the community. I'm not going to do that today because it would take a long time, but I will sum it up to say that our default forecasts are based on consensus estimates for revenue. And then for everything else, we're looking to do a conservative extrapolation of what the company's done in the past. We're not trying to predict anything crazy. We want to just extrapolate so that we can more easily and quickly and clearly delineate those stocks that are expecting or implying a significant improvement or significant decline from the existing. That's the idea. That's where we find the abnormalities. That's how we shine a light in the dark corners. It's looking at the fat tails, not looking at what's under So that's what we think about Macy's. Macy's, bad company, good stock. All right, we got a lot through to— like to get through here. Should probably get going a little bit faster. Any questions, let me know as always. Let's see, Kroger. Yeah, this has been, man, so it's up pretty strongly here past 2 days, 1 day. Mixed quarter and soft guidance, the stock rises anyway. What does New Constructs have to say about Kroger? Attractive stock. Decent company, cheap stock. So what happened? Does it really matter what happened in earnings? Let me say, let me tell you, like, I still to this day, I remember when I first started to understand the earnings game on Wall Street and, and I thought, okay, so everybody's obsessing every quarter about a penny here, a penny there. I mean, at most a nickel here, a nickel there. And as if that, that penny or nickel is consequential to the body, the future body of cash flows that have to be generated to justify the price. It's silly. It's silly. We're, you know, you know, we were just talking about companies meeting or beating or missing. And then we go through, you know, AVGO here and we look at, you know, the huge amount, huge amount of future cash flows required to justify the price. And we're going to get excited about a penny, a nickel. Come on. Like, what are we doing here? It's going backwards. It's so misleading, and it's purposely misleading because if Wall Street can get you to focus on that, you know, they can get you to not focus on the bigger question, which is how much future cash flows are baked into the stock price. So Kroger's looking pretty cheap here. Yeah, I know that they had this merger go down, and there's been some questions about the CEO. I think there's even some articles written about that, about that by our buddy Matt Levine. And so, yeah, you know, Kroger is such a big sprawling company. And, you know, I actually worked at Kroger. It was my first job out of college. I was in the management training program. It was an excellent education. Took me about a year to realize it was not gonna be the career path long term for me that I wanted because their promotion cycles are really slow. But I would tell you, I would not be worried about a CEO. I mean, I think when I was there, they had a different CEO and things changed there at the top. That's a big, that's a really big organization. CEO's not going to make a big difference, good or bad, unless it's really drastic on one way or the other. So yeah, Kroger. Yeah, it is. It's been in the focus list for a while. We like the stock and, you know, we love it. And I think it's a tribute to the system when stock's getting an attractive rating and it goes up even if its earnings aren't great. Foot Locker. I wanted to hit on some retail stocks today because I just think retail is interesting. So what had happened to Foot Locker? The best of the year. The price is fair value weight. Stocks recently looks like Foot Locker beat up a lot here recently. We predicted that strong beat. Good for us. That's great. Not such a good company stock. I don't know. This is interesting. So price to economic book value of -3.4 with a less than 1 growth appreciation period. Both economic earnings and accounting earnings are negative. What's going on here? I'm guessing we got a bunch of debt. Yeah, big debt number, $3.8 billion on market cap of $1.7 billion. So that means even though they got a positive NOPAT, right, you got a negative net income but a positive NOPAT. So that's interesting, folks, right? They got a lot of non-operating expenses dragging down net income, invested capital. You got quite a bit of write-offs. They've not done a great job. Got a bunch of off-balance sheet debt, $1.8 billion in off-balance sheet debt. That probably contributes a lot to the debt here. That adds another, yeah, it's almost half of what they're reporting their debt to be. A good bit less than half, more like a third of what their debt is, is off balance sheet or misrepresented. But still, you got a pretty decent amount of capital. You got $1.4 billion in write-offs that we had to add back. So the NOPAT's positive, but the economic book value is negative. See returns on capital, NOPAT margin's kind of trending down here. Free cash flow. Okay. Not too bad. Not great. Got a decent yield. 4.5, 4.7. I don't know what book value's on the slide here. Interesting. Wow. Really high. $180, $65. On the decline here though, as of late. So I would, yeah, you know, I think it's tough to be in one of these retail businesses. So I'm, you know, I'm, I'm not inclined to look to make a bullish case here for Foot Locker. But yeah, you've got a lot of debt. But if the margins revert back, which is our model, our, our reverse DCF model is going to probably looking at average margins over this time frame. So our forecasted margin is going to be more like up here. And I'm guessing if you assume margins get back that high again, you're talking about, you know, you're talking about a profitable business real fast. It's a very margin-sensitive business. Small changes in the margin will have a big impact on stock price. So you believe they're going to make a comeback, more power to you. All right, we got next here BJ's Wholesale Club. Looks like they had a pretty good earnings release too. Looking good, they're up 13.4% over the last couple of days. That's impressive. So it went from unattractive To neutral. Let's see, when do we get the last filing? We're getting a filing any day now here. Okay, so that'll be interesting. A lot of this might change. Lower market expectations seems like the opposite for an upgrade because the stock's been going up. What's going on there? I wonder if the forecast was changed or something. So BJ's, you know, not a great company, not a great stock. This is one of those I kind of wouldn't mess with it. I don't see a lot of action here. I don't see something that's saying A lot of overpriced, a lot of expensiveness, or a lot of cheapness. Just kind of there in the middle, which is not very interesting. Wouldn't play around with that very much if I were you. Venture Global up 1.8% or 1.9%. Okay, so it looks like it's been up and down. Ooh, okay. Whoa. Okay. Over the last couple of days, it's down 39%. Interesting. Class action suit seeking recovery. Duck all their losses. Getting sued, not, not, not a good thing here. What are we showing about Venture Global in our system? Okay, we're gonna get a new 10-K. We just got this thing, just kind of went public pretty recently, just added to coverage and it's already blown up. That's not great. I think this Venture Global is a big natural gas pipeline. Yeah, we were looking at this. Oh, interesting. I remember when it first was coming out, got a— we had in our meeting, the— our analyst was telling us about how expensive this IPO was going to be. It was going to be like one of the biggest IPOs ever, and they brought it way down, which is good, but it appears it's still quite expensive. Let's see, let's dig a little deeper. You don't have a lot of data here. So economic earnings appear to be positive and rising, but we don't have a lot here. 89, 108. When I just got one period really, because we have— oh, that's the big thing I forgot to mention. They don't— they haven't given us a 20— any 2024 data. So the last data we have is 2023. We almost didn't cover it, but we're like, you know what, we're going to go with what we got. It's all anyone else has. So let's figure out what we want to do here. I see we got some good information. Yes, recent IPO management guided down 50%, and the stock price is implying another 40% decline. So maybe, maybe it's cheap now. We're pretty bullish on the energy sectors, you all know. It's not much fun when you don't have a lot of data. Free cash flow negative. Yeah, so we got that. Priced economic book value. So the stock price plummeted. Wow. So before that, expensive. What a, what a huge change, man. What a huge change. What a huge change. Economic book value is around $16 a share. The stock is now at $9. You know, if, if, if, if it had more history and I was able to— if I was an energy sector analyst, by the way, the energy sector is one of our Top-rated sectors has been. See, this changes every day. Yeah, very attractive still. But yeah, if I if I knew this sector well and I thought these guys are going to be able to be a great coin concern, I think I'd be looking at at getting into the stock because it's likely that it's going to not not you know it's got it down fifty percent now it's down now the stock price implies another forty percent. I just don't think we're going to see. that much permanent value destruction for energy companies. There's going to be some reshuffling of the, of the global landscape here, but I think, I think ultimately it's going to be more beneficial to the US producers than not. Yeah, great comment here from Curtis. A 50% guide down on EBITDA 2 months after an IPO, unheard of. You know, you all have listened to us for a while, you know how we think about IPOs. I mean, so many of these are ripoffs. That's why we cover them, because they're like crazy expensive stocks half the time. We've been really negative on most IPOs. That's why we want to cover it. You know, we were the ones out there who were first to call out WeWork. I take credit for— a lot of credit for WeWork getting canned altogether. And one of the big changes we saw after the WeWork IPO was that the amount of time between filing their S-1 and going public was dramatically reduced. When we got the S-1 for WeWork, we were able to publish a report, and it was months before they actually went public. And so our research got to make a lot of rounds. We were on Forbes calling it the most ridiculous IPO of 2019, and we were right. And that made the rounds. And that's— I think that's probably part of why we saw the decline or the end of that IPO didn't happen. And now, you know how much time we get between the filing of the S-1 and the IPO actually happening? It's like 2 weeks. As opposed to 3 to 4 months. Right. And sometimes, like, they do these fake filings where they file an S-1, but they don't put any financial information in there. It's like, what? So I don't, you know, I think Wall Street wasn't happy with what we were doing. They, you know, if there's one way to give us less influence, like a lot less time for our message to get out there. So yeah, as much as this is a tragedy for IPO investors, and don't get me wrong, this is a tragedy. Curtis is right. Like, to, to guide down less than 2 months, like all of a sudden you don't, you, your bit, your, your opinion of your business changes that much. Yeah, I get it. There's a lot going on with Trump and everything, but I still think long term, you know, this is going to be more good for the U.S. than bad. But yeah, pretty nutty. Pretty nutty. Pretty nutty. All right, who's next? National Beverage Corp. Fizz. What's going on here with the earnings? Anybody know what happened here? Looks like his stocks Up more than it's down. Some looks like a little bit of confusion from yesterday to today. It started so some noise in the stock, but not a lot of overall movement. We got a question here. Isn't it possible there's some short covering today given the market turnaround? It could be. It could be technically driven. Absolutely, Frank. Like. You know, there are a lot of short-term currents in the market pushing it one way or the other, driven by a lot of different things. And so yeah, it could be, could be, could be. What does, what does the model say about Biz? We're getting a new queue any, any minute now. Could have come in earlier today. Who knows? But we've got great, great company, bad stock. We were forecasting a miss, which I kind of— what I'm seeing here looks like that happened. So I would say that, that yeah, this would be one to avoid. You know, there's not a lot of— not a big moat around a business like this. Soda is a tough business about distribution and branding, and that's where size matters. And that's kind of why Coca-Cola and Pepsi do— are the kind of the the 300-pound gorillas. You gotta have something special to like catch on, make your LaCroix or Shasta more popular. And you gotta take share against people that can spend heavily to retain share. So yeah, I'm not seeing a lot to like here. Return on capital pretty high and flat, you know, good. You know, that's good. That's good stuff. Good stuff. Like I said, good company, bad stock. What do we got next here? Cracker Barrel. You know, we really wanted to put this on the focus list at one point. We had a lot of conversations and we couldn't do it. Couldn't do it. Just couldn't really see the growth long term. Small stuff. Uh, we're about to get a new 10-K here. Mediocre business, bad stock, expensive. There's— yeah, it's always been a little bit too expensive for us and we just don't see it. I mean, fast casual, great. But yeah, it just, it's not, it's not attracting a lot of new trendy crowd. I mean, Cracker Barrel, I think you've got your staple people who like it and who will go there and will always go there, but I don't know how much they're growing or gonna grow. And I think it's the high margin stuff that they have you walk in and walk through to get in and out of the, the, the restaurant. That's great. But like nobody's like pulling off the interstate to go to Cracker Barrel. Especially when you got this Chuck, the Chuck E.'s, what's it called? The new beaver place that's so popular. Buc-ee's. Buc-ee's. Yes. Like people love that place. It's great. It's big and huge and nice. They did, they did raise the prices too much on the brisket, so I'm not doing that anymore. I did love that. I was like, I love it. Like, like being able to stop at a place and like they've got like meat. It's great. 'Cause I don't want to eat a bunch of that packaged stuff. And it's a good store. They got all kinds of stuff. People love it. I don't mean like, I remember I first heard about it from my kids. They were on a wrestling road trip. They're like, oh, we stopped at Buc-ee's, Dad. I was like, okay, and that's a big deal for what reason? Anyway, people love it. They got a lot of cool stuff there. I actually bought some char— we, I stopped there on a, on a, on my, on a drive to a big wrestling tournament, picked up some charcoal. It's great. You know, it was really cheap. I'm like, shoot, I'll, I'll take this. Anyway, besides that, they definitely have much better selections on food. If you like roasted nuts and all that, they got great, like beef jerky. They got tons of that, which is great. And everything else, everything else. It's a big, huge, beautiful store, and they got tons of gas station things. And, you know, I think it's pretty cool. I'm on the road, like, I wanna, I wanna get in and out as fast as possible. So it's not always my favorite, but still cool. But I don't think Cracker Barrel is gonna compete well against Buc-ee's in general. You know, it's a, it's a mediocre experience. I think it's pretty inexpensive. It's got its shtick, but its shtick is is not going to do anything close to helping the business grow like what's baked into the stock price. So avoid this one. All right, our least— well, our worst moving stock of the day, JD.com. Okay, so over the last couple days, doing just fine. So this is kind of just noise, but a net move, they topped revenue estimates on robust demand and government stimulus. Waivers despite China e-commerce giant posting best sales growth since 2022. Why they rallied on Wednesday. So, you know, we've, we've been burned by some Chinese stocks at New Constructs. Uh, there was a time we were covering some of these a few years ago, too many of them, and they all looked really good. What's going on here? Turns out they all had fake account— fake auditors. And so we're, we're skeptical. The more research I do sort of on, you know, where China sees itself in the global landscape, it makes me concerned that putting money into those businesses, if it suits China, it's probably going to be China that makes sure they get those profits as opposed to US investors. So trade these carefully. Trade these carefully. Strong economics. Look, if you know you're chosen to be one of the companies that does well in China, you should have strong economics. Of course, we should be getting a new filing any day now. I should have gotten it yesterday. So, but any day now. But yeah, strong economics, market implied growth appreciation period is really long. I'm guessing that's because you've got the margin going up. Yes, you have return on capital. So our margin, our NOPAT margin is going to be a little bit more of like a weighted average of the last 3 years. So it's going to be through this. So we're probably like right around in here. And, and that, that small drop in margin, it's indicative of like, okay, well, if that's happening, well, now it becomes an expensive stock. And that's what you see with a lot of kind of retail-type businesses. Small changes in margins have huge impact on valuation. So you really need to focus on that, which is, you know, which is part of why you hear Wall Street talk about that a lot— margins and earnings and things like that. And that is important, and oftentimes it can be very impactful to the valuation. It's also important to be packaged with sense of growth and duration, right? The, the 3 key drivers of value, right? How fast is the business going to grow? How profitable is it going to be? And for how long can it sustain profitable growth? Those are the 3 things you need to understand to quantify the expectations baked into a stock price. It's free cash flow been pretty negative, more negative than positive on balance, I would say. Because these 2 years get canceled out by these 2 years and this is bigger than this. So yeah, it's zero free cash flow overall during its time. Capital turns headed down, margins headed up. Yeah, I'd be careful with anything in China. I think, I think things are going to get more tense. I think, yeah, I think it's likely that the United States is going to have to take a little bit more Of a sober view of China and how we work with and compete with them in the future. Okay, all right. We are about to be done here. So if you've got any requests, you better get them in here fast. I think I got one that I'm gonna go into here. And Carter's. Oh, this is a this is a baby company. This was on our. On our focus list at one point. It was a long idea and it did awesome. This baby gear company, like a Toys R Us kind of, but more for like baby gear. But this looks cheap, man. This is something to be considered. It's in our safest dividend yield model portfolio. 0.5 price to economic book value. Markit Children's Apparel. And DL's saying it's online and brick and mortar. We like that. We've been a big fan of that. We think the omnichannel is the right way to go. They— if you're smart, it works out well together. Amazon moved to that. That's why they bought Whole Foods, right? Williams-Sonoma crushes it on that. And so yeah, this is your bonus today, folks. I would tell you this would be something we should consider for our focus list. And this is like a really, really cheap, like 18% free cash flow yield, 0.5 price to economic book value, online and brick and mortar omnichannel. Thank our friend DL for pulling this out here for us. I like this stock. Internal capital, good and steady. Look again, you're not going to expect something out of the park here. You want steady. Steady is good. This is probably just some noise here. Went down, went back up because people couldn't shop that much. Economic book values come down, but it stayed, you know, it's holding steady, but the price is way down. This is a great example, I think, of a market where, you know, we're going to go throw good money after bad with Broadcom because it's popular. And yet a stock like Carter's, you know, is not getting any love. So, all right, well, thanks very much for being with me today. Uh, great. Again, this is our last session for this quarter. Next quarter, I think we're going to do a lot more of these for clients only. They won't be free for everybody. We'll do a couple free ones, but if you're gonna— if you really like this and you're going to want to join us every time, it's a good idea to sign up and get access. I hope you enjoyed the demonstration of our institutional tools, our professional tools, and the insights. And it's been a good series. Yeah, thanks. Thanks, DL. I've enjoyed doing it. I'm looking forward to doing it more in the future. I got somebody raising their hand. You need to put it in the chat, Richard, if you want to say if you have a question or something. But oh, thank you, Richard. Yeah, this has been fun. I look forward to being with you next quarter. I hope you have a great weekend.