Watch our Earnings Recap on CrowdStrike, AutoZone, Ross Stores, Best Buy, Uber and More

All righty, let's get it going. So we're talking about 1, 2, 3, 4, 5, 6, 7, 8, 9— 3, 6, 9 stocks today and Friday, our last 2 earnings watch calls for this first quarter earnings season, or I should say really fourth quarter of last year's earnings season. Next season, next set of earnings I won't be doing as many free calls. Most of the calls are going to be for clients only. We are giving you access to a lot of data and you get to see our full institutional suite of products. So it's a very rich call in terms of the offering. So let's, let's go with the biggest stocks first. We'll go in, in descending order by market cap. So CrowdStrike, what do I think about this company? You know, I'd love to say good company, bad stock, but I'm seeing bad company, bad stock. I think this is a cybersecurity, very popular business, but unfortunately, man, it just, it does not look very good as a business. The accounting earnings spiking up and looking better than economic earnings. I'm surprised. Wow. That almost should get, I'm surprised it doesn't get our misleading trend because this right here, positive and rising and negative and falling. It's pretty bad. Very bad. See, getting better return on invested capital. I guess that's part of the problem is the return on invested capital is going up. So typically we'll give them a little bit of a break on that. You can see 0.1 to 1.7. So even if economic earnings are negative and declining and these are positive, we see a positive return on invested capital, then we will, we'll hold off on giving them the worst misleading trend here. You know, it's the way it goes with us. We don't put labels on Anything unless we're really, really sure about it. For example, when we talk about hidden items in our core earnings and in our notepad and our invested capital, that means it is not mentioned anywhere on the balance sheet and is not contained in something that could ambiguously mention it. For example, when there are things like other income and other expense, if unusual items are buried in there, we don't call it hidden because we think other is potentially unusual. And so therefore we don't call that hidden. If it's in cost of goods sold and it's a write-down, that we would call hidden. We're really careful about how we classify things. We don't need to embellish. We don't need to hyperbolize because the data is that good. So here we go. Bad return on capital, still very low. We saw that it's up a little bit. You can see the valuation is really through the roof here at 40.7 price to economic book value. Greater than 100 years market implied growth appreciation period. I'm going to open the model. We'll get into some more detail on this, but we can see margins getting a little bit better slowly. Capital turns in a decline. Free cash flow has been pretty consistently negative except for one year. You got a good number here in 2002. And I'm going to see our price to economic book value. Economic book value has been really close. Well, it's been negative, quite negative, and it's popped up. I'm sorry, economic book value. Sorry. Negative, negative, negative. It's popped up to 6, maybe 10 bucks a share. That's a far cry from the 390. That's why we've got a 40x ratio of the stock price to the no growth value of the business. So what you're seeing in the difference between these 2 lines is the amount of future growth or risk, I would say, in the stock. Right. And that risk is going up. The blue line is the bird in the hand. These are the cash flows the company's already generated. The stock price and the difference between the blue line and the red line are the stock— are the cash flows that the stock price expects the company to generate, but it is not yet generated, also known as the PVGO or present value growth opportunities. Let's have some fun here. Let's open the model and see what kind of forecasts are required to get this company to a measure that makes sense. All right. So let's go. This is the fiscal year value. Let's see how margins have gone up here in the trailing 12 months. So just 0.6%. All right. So it's going to be tough to put a margin up here more than 5%. I guess they could get a lot better. Let's see what happens with just some jacked up revenue growth. And we'll do another scenario with a higher margin. Save that off. The idea here with CrowdStrike is to get a sense of what kind of forecast you got to put in to make this market implied growth appreciation period be less than 100 years. Our market implied growth appreciation periods— we had some great conversations in our online community about forecasting and DCFs recently. If you're not a member of that community, I highly recommend you join there. I will put a free invite into The chat here. We had some great conversations about how this works and forecasting. And look, it's important to understand we're not trying to predict the future exactly. That's not our job. We don't even have to. What a model like our reverse DCF allows us to do is to create scenarios that help us understand the implications on the value of the stock of different revenue growth and margin scenarios. Revenue growth, let's go optimistic. Let's see what this looks like first. So neutral scenario. Wow. Still takes more than 100 years of growth. We can't get to much above $270 a share even in this, in this neutral scenario with 50%. So let's go 50, 50, 50, 20, 20, 20. And then let's say margins go 5, 10, 12. Let's keep it at 12. 12 is a good number. It's a very healthy business. I don't think that cybersecurity business is going to be able to have Facebook or even Google-type margins or Apple-type margins. So I think this is a very optimistic scenario. Point saying before is, is that, look, these, these ratios and these signals are great. And look, our value add at New Constructs is that we give you really simple distilled down Information, right? The amount of analysis distilled down in just these two things is huge. First of all, we got to get the existing cash flows right. Then we got to do the math right to get to economic book value. Then for market implied growth appreciation period, we got to build one of these models, which I can tell you very few people in the world know how to build, and we built them with scale. Okay, so in that optimistic scenario, it's the blue line. We're still not getting anywhere close, even with this much higher margin. So let's go let's go fifty. As far out as these guys, 50% for 10 years, and these margins going up to 12%. Let's maybe jack this up to 10 here also. And so this exercise, I think, is extremely interesting where we're putting in different forecasts. I'm fascinated because the fact that we got to keep putting the numbers in higher in order to arrive at a value close to the current stock price. Is information in and of itself, and the fact that this can do this, this model can do these kinds of calculations that fast is amazing. Okay, here we go. Twelve years. So when the margins are twelve percent, you got fifty percent revenue growth for ten years. Drops down a little bit. You know, you're going to get a little bit. You know, and I think honestly, probably the right way to think about this would probably be to drop this down to twenty, something like that. But regardless, let's just go with what we got here with the optimistic. And the neutrals. Just an interesting scenario here. You can see what it takes. And, and of course, if they can continue to grow super high at that super high margin, you know, you're talking about a $700 stock price, right? But that, that's going to take a lot. So what is— let's take a look at what this means in terms of implied revenue. So that means that the market believes CrowdStrike's revenue is going to get to $254 billion. You all know that I love to pull up my model or stats on the S&P 500. I pulled this data a while ago, and it probably has changed quite a bit because we've analyzed around 3,000 Ks and Qs in the last couple of weeks. But $254 billion would put them in the top 15, top 13 in the S&P 500, which is a big number. $254 billion. Yeah. So what, what does that mean for their NOPAT? They'd be at $22.5 billion in NOPAT. Let's see where that would rank CrowdStrike in the S&P 500. $22.5 billion, that would put them at 12th in the S&P 500. And then what kind of return on invested capital are they going to be achieving at this point in time as well? 1,265. I can tell you that's the highest in the S&P. There's nobody in the S&P over 500 right now with return on capital. So I think this is why we would say this is an unattractive stock, and this is why you're getting 2 reds here. You've got a stock price that has incredible expectations for future cash flows. Please keep in mind that the model is telling us in this situation What the company has to do to justify the current stock price, right? So if you believe in that, then you believe the stock's fairly valued. You should sell. You should sell if you believe that this is what the company's going to do. If you believe it's going to do dramatically worse than that, you might consider shorting. But you don't buy it at this level. You've got to buy it at something below this, well below this, if you believe the company can grow revenue at 44.5% compounded annually for 12 years while maintaining a 440% return on invested capital versus cost of capital spread. That's the average spread over the time period. We know that means that they get to about 1,200% return on invested capital in 12 years. If you— the only reason to own the stock at $390 is if you believe the company is going to do materially better than these 3 stats. You could say, okay, well, I think return on capital versus cost of capital spread will stay the same, but they're going to grow it. 55% for 12 years. Or you can say they're going to maintain this performance for more than 12 years. And our DCF review model allows you to see exactly what that would imply. So if you think they can go farther out, here's the 12-year number, right? There's the— sorry, here's 12 years. This is the 44.5%, the 44.9%. If we continue going out based on this forecast, let's say we want to go To 20 years. Well, now you can justify $584. That's a 31.3% compounded annual growth in revenue, an average economic earnings margin of over 1,000%. Your return on capital gets to 2,000%. Your revenue gets to $706 billion, which would be, you know, double, I believe, the highest Wow, $706 billion. Yeah, that would put them at bigger than Amazon and Walmart at $673 billion. So they'd be like bigger than, bigger than those companies. That seems, you know, even, even more pretty unrealistic while also having again a 1,000% return on capital. So, um, yeah, are we surprised to see the stock Getting pummeled in this market. No, I think we are in the middle of a lot of changes in this country, and I think one of those changes is going to be a more rational market, a lot less gambling and speculating as we've seen. I think people are wiser now. Like in the beginning, you know, I think the original meme stocks were complete jokes. It was like Hertz; they're going to go bankrupt. So there's a short squeeze opportunity. It was really just a way for the individual investor to try to stick it to the man. Unfortunately, the man made money, and we all know who the man is. The man is Wall Street. Wall Street made money coming and going either way. And then people got smarter, like, we can pile into good companies that may not be good stocks, but at least it's not going to go to zero. And so, I think other stocks became meme stocks. You know, even Berkshire Hathaway was taking a big run there. Oracle taking a big run, just got really expensive. The Mag 7, Nvidia, those became meme stocks. And by meme stock, the New Constructs definition of meme stock Is stocks that trade completely disconnected to their fundamentals. There's a lot of those. I think the era of the meme stock is going to be is over. I think people are starting to figure out the game is rigged. No matter how you try to meme it or meme-ify it or play it, Roaring Kitty can't help you. Roaring Kitty is not a good source of information. And CrowdStrike, you know, that's that to me is you know what's what we got here. I mean, this is this is it's not quite a meme stock, but it is really expensive. It's really expensive. I think there's some that are worse. There's zombie stocks out there, really expensive, really overvalued. And that's what's going to happen when you don't, you don't do as well as Wall Street expects. They hit their numbers, but they have a bad outlook. You know, it's like Nvidia's come down a lot because that's a stock that I call the meme stock. The revenue implications when it was up above where it is now, when it got up to its height, was like it's going to be as big as Japan. And so that was nutty. CrowdStrike, very expensive. Anything but the best of best earnings report is going to send this stock down, and it should go down anyway, right? There's nothing good enough that management is going to be willing to say to justify this valuation, my friends, right? That's another thing that I think is really important to understand, like earnings calls are commercials to sell stock. It's a waste of time. And no one's really talking about the real numbers. The real numbers that I'm showing on this page, real numbers that I show you on this page. No one's talking about the expectations required to justify the stock price. You know why? Because if they did, they couldn't. So they want to keep you focused on an earnings per share number and talk about whether it meets or misses by a penny or a nickel. And it's completely inconsequential. to the underlying cash flows and the valuation of the business. But that's what they want to focus you on, because if they can get you to focus on that, they can sell you all kinds of junk at an outrageously overpriced number. And so that's, that's the game, my friends. That's the game. That's what we're trying to help you avoid. All right, we spent a lot of time on CrowdStrike. I always go too far in on the first one. I cannot help myself. CrowdStrike, I knew, was going to be a good one to, to break down in terms of the reverse DCF. I've been looking at a lot of these over the years. You know, I kind of, I can see, I can see the really bad ones. I know which ones that are going to be fun. And usually I'll have an optimistic scenario already in there, but it was good to go through the process of creating an optimistic scenario so you can see how we see things in New Constructs. We've done hundreds of thousands or tens of thousands of these forecasts over the years. And we've been through this process, and that's part of why, like, a penny here, a nickel there, a dime there, an earnings per share. for this period is completely irrelevant to the cash flow lifecycle required to justify the price. But again, that's what they want you to focus on. AutoZone, one of our focus list stocks. We've loved it. It's been a great performer. Seen a downturn here in economic earnings. Not too bad here, but accounting earnings went up higher. So this was one of our original golden stocks where economic earnings are greater than accounting earnings. And we pointed this out a long time ago, and it's been a super outperformer for us. But it's gotten expensive. It's got a high return on capital. And this is a time when we as a team go in and we look and we say, you know what, is it time to sell this? And we look at what our other options are. And this would be something we would have a healthy discussion around. How was the earnings report? Not sure. Stock has done well. Here recently. Yeah, and you know, this is going to be— look, in a world where you got a bunch of junk stocks out there, there's still a good business, still a great business. Argus is concerned about tariffs. I, I, you know, I think that's a bad call. I think tariffs are going to do more damage potentially to new cars than used cars. Now, I think Trump did give an exception, which I expected, for the big automakers. I don't think he wants these tariffs to hurt US companies In fact, I think it's the opposite. So really, I think tariffs are going to hurt the original, the OEMs, the original car manufacturers, make people want to keep their current car for longer, which is going to be more bullish than anything else for a firm like AutoZone. I think that's the main thing. And I think that's the same thing in terms of like lack of supply. It's hard to get new cars these days. I mean, it's harder. I would say, you know, we did an earnings call, I think maybe last week, and we talked about Advance Auto Parts and we said how it was a very similar business. To AutoZone, not as good, which is why we liked AutoZone better than Advanced Auto Parts. You can see performance difference quite a bit here. AutoZone up, Advanced Auto Parts down. This was a great call, great stock for our focus lists, and I think they had a decent report. Nothing blazing the headlines, so up a little bit because it's super high quality stock. Super high quality. Ross Stores, good company. Not such a good stock, right? High, good quality of earnings, decent free cash flow yield, and getting expensive here. Getting expensive. What happened with Ross Stores? Did we get any good info after earnings for March 4th? News: annual sales, profit below estimates on weaker demand. Interesting. Stock is flat over the last 5 days. Down 6% in the last month, down 10% in the last 6 months. So things weren't as bad as expected, I think you might say. And so today you're seeing a pretty good pop on, I think, on a day when the overall market is pretty flat. So this is up more than the market. Interesting. Yeah, high-quality business. I think people are going to start caring a whole lot more about high-quality businesses. I think New Constructs Research is growing nothing but more and more valuable by the day. Right. What else we got on the list? On holding, these are the fancy cloud shoes that everybody wears. Maybe somebody can help me out here in the chat. Is that what— is that what we're thinking about here? Good company, bad stock. 7.9, 100 years, profitable business, good returns on capital. Everybody likes it. Everybody wears these fancy expensive shoes. I don't think— I don't think we're seeing a lot. to like about this. Again, got to be a good company and a good stock. You know, it's— if the valuation already implies outrageous cash flow growth, as we talked about with CrowdStrike, then, you know, you're in too far. Look at Nvidia, still down more. You know, we called the top of this for this one around $120, $126 a share, and I wrote a deep piece on how that valuation at that time was still crazy. So Nvidia is going to go a lot farther before I think it finally settles down. So on stock, sprints higher on earnings, faces tariff questions. So the earnings were good. Home run, 20%, 27% constant currency growth. Looks like they're doing well. We had a beat for the earnings. It looks like that came true. We are expecting a new filing any day now, so this could change, but this won't change much. It's going to be— it's going to remain an expensive stock. I think all the good news is priced in here. All right, we got a few votes for stocks. I'm running to the end here, so get them in now. Get your questions in here now. Is Fram here today? That was who asked the great questions in our community about the reverse DCF. It was good to have a deep dive on, you know, what, what drives those models and, and how we think about forecasts. Because every one of these companies— let's go to Best Buy. Every one of these models has to have some set of forecasts in there. And so people often ask me, well, how do you make sure you get that right? I don't have to get it right. The market has to get the forecast right. I just have to figure out whether or not I agree with what the market has embedded in the stock price. And embedded, I mean, the future cash flows reflected in the stock price. So, you know, we can do the exercise like what we did with CrowdStrike, where we put in different numbers to get a sense of what it's going to take. But for our default scenario, what makes the most sense is to extrapolate what's happened in the past. We'll take consensus numbers for revenue growth, top-line revenue. We'll take consensus numbers. We only get those for 2 to 3 years, folks. You only get— there's consensus only for a couple of years of data. Despite the fact that we know that the stock market is looking out way beyond that. The market's looking out way beyond a couple of years. Nobody wants to talk about years after. Oh, I can't forecast that far. Of course not. No, you're not supposed to. You're supposed to understand what the market's implied forecast is. That's what New Constructs does. It's just the honest way to do things. And it's a lot— it's honestly, it's a lot easier if you build the right model and you have the right expectations. Wall Street wants to shroud valuation. Companies want to shroud valuation in mystery, obfuscation, smoke mirrors. So you don't know how expensive something is. So you're buying it based on the narrative because they can make up a narrative. And that's what they do, what they do all the time. So Best Buy, this was a focus list stock. We did really, really well on it. It got expensive. We got out. We kind of thought also that maybe its competitive advantage had run its course. We really liked when, you know, everything kind of went online all of a sudden. And the stock got really beat up because like, oh, electronic stores are going to go the way of sporting goods stores. There's just like no reason. Go to electronic store. Well, that's not true because there's a lot of complex electronic equipment. And so Best Buy really leaned into doing the one thing that they could do that Amazon couldn't, and that was give you advice in the store about what to buy and what pixels and LED versus projection versus all these things that you guys probably know more about than I do. And, and I thought that was a great model. It was working and it worked for a while and it's great. But then you know what? Target's doing that. Walmart's doing that. So It's not, you know, the moat got narrow pretty quickly. And so still looks pretty good. You know, you'll see here, you know, get a little lesson on how our rating system works, right? When I designed this, I'm like, well, you know, if I'm just light green all the way across, that's not special. You know, to qualify for attractive and very attractive, you got to be special. And this is pretty good all the way across. I need to see at least one really good. In order to pop you up to all the way attractive. That's the way this works. You know, keep in mind, Wall Street's got like 90-plus percent of stocks are buy or hold. Right at New Constructs, only 14% of stocks get a buy rating. And less than I think 5% get a very attractive rating. Right? We're really selective. You need to be selective. There's not that many good stocks in the marketplace. Wall Street wants you to believe they're all good because they want you to buy them all so they can sell you more and more and more. Buy, buy, buy, more, more, more. That's what it's about. That's, that's a clear and obvious untruth. And I— our system speaks for itself and its truthfulness. It's just that you see the numbers, what qualifies, what doesn't qualify. You got to be high-quality earnings and cheap valuation. This makes intuitive sense. I think, I think Americans agree and understand that. That this is the way to understand businesses. I need it to be profitable and I need it to be cheap. And if you can't find anything like that, then maybe you don't do— don't buy anything. But there's no reason to buy unprofitable and expensive. No reason to buy unprofitable and cheap if you can get profitable and cheap. You go for the best. Why not? And I think Wall Street's really good at disguising what's the best because they want to keep selling you a bunch of junk. All right, let's look at a utility company. Very unattractive rating. So this one surprised me. And, you know, we spent a lot of time talking about utilities lately, in particular the cost of equity— or I'm sorry, not the cost of equity, the cost of debt, cost of capital. And I really pushed for changing our models to put in a discount on the cost of debt because as a utility, you're a regulated entity. if you are losing too much money, you just raise prices. It's a benefit, right? You have a way of getting around a bad business model because you're a regulated utility. And so I thought that meant the risk of default at a utility company is super low. So we did a bunch of analysis and we looked around and yes, risk of default for utility companies is lower than other companies, but it's not Impossible. It happens. And then we did some analysis on what our internal cost of debt calculation was based on our system and how that compared to their actual reported cost of debt. And they were really similar. It's like, okay, we shouldn't change anything. So yeah, regulated entities, I think that they have been bid up for a long time, people chasing dividends. And what I say to people all the time is like, look, it's great to get 6.5% a year, but if the stock drops by 20%, you're you're still not going to do so well. So this is expensive, an expensive stock, poor economics, bad cash flow. Yeah, we, we wouldn't, we wouldn't be into this. We would look for something else with a much better data set. Yeah, this is not good. Look at that difference. Accounting earnings, economic earnings, return on capital popping up a little bit. That's why this does not get the worst rating. Wow. Why? It's why it doesn't get the misleading trend rating. It is a misleading trend, but return on capital still coming up a little bit. So we're like, eh, we won't call it the worst on that one. Margins popping around, free cash flow, some big negatives here. I think— I'm guessing they've done some big acquisitions. So yeah, utilities, not sexy. And not not good risk reward. Ingram Micro. So this is a this is a good middle ground company. This is a bad sign: weak internal controls. You guys have heard me say that that's a that's like a really bad thing. Weak internal controls. That means the auditor saying, "Oh, I don't want to invest in this." I'm sorry. The auditor saying, "We're not sure that our audit results and the financial statements we're giving you are reliable because we don't trust the numbers the company gave us." Audit companies don't go in and count every piece of inventory in every warehouse. They can't. They don't go back and recalculate all the work and the— and done by the internal accounting teams for the entire year. They can't do that. That would be too expensive. It'd be like duplicating everything the company's doing. At some point, there's got to be some trust that the company's going to give you the data that is required to truly assess the financials of the business. We need trust in our society. We can't have everybody doing everything all the time, right? And so what the auditor's saying here is that we don't have full trust. It's a bad sign. So this is kind of a poor business, decent stock. It's cheaper. So let's take a look here. It's up about a percent, flat over the, over the last several days, up over the last one month, down a lot. I'm guessing people aren't happy with the acquisitions. It's just not good for the business. And then we were just talking about Ingram Micro. Okay, looks like they probably had a miss, down 13%. We didn't predict a miss there. The earnings distortion looked like not bad. Not a lot of history here. You can see accounting earnings came down to core earnings. Core earnings are actually a little bit higher. than accounting earnings. But yeah, it looks like they had a significant miss today, down 13% last couple days, most of that coming yesterday to today. Okay, interesting. We got Box. Whoa, Box has been in the danger zone a lot. Super expensive valuation. I think a really narrow moat, man. I mean, look, When somebody's giving away a free version of what you provide, whether it's Google Cloud or Apple iCloud, that's a bad business, man. And Google and Apple are embedded in the workflow. So this like exterior file storage, whatever, I know some people use it. I just think the moat here is really narrow and this is way too expensive. I get it. The business looks great. 52% return on capital. That's impressive. Keeps getting better. Is there something I'm missing here? Right? Is there something about Box? That means we should think about it as a better business. We— what do we call this? We wrote some reports on Box. Focus List Shorts Poised to Pay Off. Boxed Out. Let's see, how's it been since the IPO? Box down a fair amount. Probably didn't do that great in earnings, but strong Q4 bookings and AI expansion margin outlook prompts analyst adjustments. Yeah, so the stock is down. Let's see. So look, it's doing better than IPO. That's really, that's, I gotta say, I'm surprised. $22 a share and now it's at $33. So it's not outperforming the S&P 500 by any means, but it's done pretty well. Done pretty well. Last 5 years has done better than the S&P since inception. Clearly not from here. But yeah, yeah, Box does, you know, it keeps Ticking along, but this is one of those companies I think it's going to have its comeuppance. It's going to come down and trade probably. You know, look, let's what's long-term growth for these guys look like? Not a lot, right? I mean, again, people use Google, Apple. They've got these applications. The economic book value is barely above zero. It's trading, you know, at a big multiple of that. What should the stock be? I don't know. Four or five bucks, maybe. That's still pricing in quite a bit of growth. That's would be a 2 or 3x price to economic book value. You know, I think that's, I think that's what you're looking at here for a stock like Box. Again, I, you know, someone chime in here if you disagree in terms of the moat. Like, I just don't see file storage as really much of a moat. So I think this is one, despite initial rating, I think you'd want to avoid this for sure. All right, we're close to the end of the list here. AMR, Alpha Metallurgical Resources. All right, this is a focus list stock. We love this sister company. It's been a long time. Focus List stock, super performer for us. For those that don't know, metallurgical coal is very different from thermal coal. Thermal coal's, well, you know, what, what, what is— gets kind of the bad rap. That's the coal that people use to create electricity and to heat, create heat. That coal is bad coal. Metallurgical coal, on the other hand, is cleaner, and it actually is used to make steel. And that's where these guys are really in play here, is that these— it's about the growth in infrastructure. And by the way, all the infrastructure out there needs a lot of steel. I mean, it's not just windmills and solar panels, but buildings, bridges, etc. I think that's going to be part of what we sort of do as reinvesting in America. And so anyway, it's, it's a cyclical business, but again, super cheap. That's pricing in a permanent 30% decline in profits. We like that. That's a nice margin of safety. You know, if we were to go in and build a model for these guys, it'd be the opposite of what we experienced with OnCloud. We go back and say, okay, you know, what are the different— what's the company done in the past? And I've already actually, I've already got a pessimistic scenario in here, really pessimistic scenario. Even with this really pessimistic scenario, The stock looks cheap, right? So the margin drops to 4%, lower than it's ever been. They're growing at consensus rates. It gets higher. Let's just keep it at 4%. Let's see if it gets more than 4%. Yes, we like those steel stocks too, Stephen. You bet. Are you asking for us to take a look at those? Pessimistic, right? So yeah, you know, anytime that margin gets above 4%, you're basically looking at at all upside. So that's kind of what that shows. You can see we put 4%. As soon as that thing went up past that, you're getting a much higher stock price. So that is a super margin-sensitive business, and that's going to, a lot of times, going to depend on the price of the metallurgical coal. But as long as we're out there building, and, you know, I think we're going to be building more data warehouses and power grid stuff, like this is just, steel is a big part of what we do and We're excited about that part of the world. And let's see. Okay, we finished up our list here. Let's talk about a couple requests. Welltower, one of the first ones to come in, hybrid REIT. So this is a business that we, we have a— sometimes have a hard time getting our head around the financials because you've got part of the business as a financing business and part of the business is actually industrial or like a building and hard asset business. And when trying to distinguish the debt for the businesses, the companies don't always give us enough information to know how much of that debt is related to the operations of the financial business, in which case it's an operational expense, or the financing of the hard asset business, in which case it's just a financing expense. And because we like to distinguish between those expenses, because one's operating and one's financing, we can't get that information. It's hard for us to Look at that to get a good, a good call what's going on. Not a huge thing that just blows up our model, but you can see here for Welltower, I guess the stock's been performing well. I don't know how long that will last. Maybe there's a flight to just hard asset businesses in general. All right, let's see here. Cass Information Systems. High return on capital. Yeah, attractive rating. You know, the, the no growth value, right? Does the stock trades at a price equal to this economic book value? That's why the ratio is 1.0. So you don't need any future profit growth. So yes, looks interesting. Cass Information Systems. I think this has come up on some of our screens. Oh yes, this is one of those few companies where economic earnings are greater than accounting earnings, and it gets an attractive or better rating. So this would be potentially one of the golden stocks. If you don't know what a gold stock is, you should go to our website and, and look that up and watch this webinar because this is really about the best way to understand how to find the best stocks in the market. We did a special offer promotion on the golden stocks, just ended last week. If you missed it, I'm really sorry, but these are sort of the best of the best stock picks. And, and it's, it's, it's really, it's research that we've just uncovered. And we did a similar package of stocks back in September and crushed it, super outperforming the S&P 500. Some stocks up 50, 60, 70%. So pay attention to this. This, this, if this deal comes around again, you're going to want to get in. All right, who else we got? Let's look at Uber. Last one. Last, last stock for the second to last earnings watch party that's going to be completely free and let everybody see all the good stuff. So Uber, it's become a good company to my surprise. I didn't think they'd ever really be profitable, but they jacked up prices for a while. I don't know how that's going to hurt them long term. I think it's going to hurt them with growth, but its stock's always been way overpriced. That's why we left it on the shortlist. Like, you know, even though these— we've seen significant improvement in the business, it's not nearly as good as the accounting shows. Look at the economic earnings. This is what you want in a superior measure of profits, right? Up, down, up, down, whatever, right? That's accounting earnings. This is noise, noise, noise. What's truth? Slow and steady. Now, how much has it improved? Not a lot. It did go from negative $3.86 to a positive $4.58. That's pretty darn good. That's surprising. I'm sorry, positive 8 cents. Sorry, negative $2.93, positive 8 cents. So barely, barely return on capital. Just, you know, it's coming up, right? You know, and a lot of, a lot of cheering for this stock was when they decided not to pay executives based on adjusted EBITDA anymore. I was hoping that the rest of the world would wake up to that, but they effectively meet admitted that that was a completely bogus metric for running the business, and it got better right away. But here's return on capital, huge improvement. How sustainable that is, I do not know. I think taxi services have been, and bus services have been largely regulated city-provided services for a long time because you can't make money in them. Can't make money. I don't think you can make a lot of money long term. Black car service, yes. Is it scalable? I don't think so. And I don't think that the moat around this business is that big either. And yeah, adding Uber Eats, that's an even worse business. A lot of the ancillary businesses they brought on, even worse. Not a big fan. I'm, I'm less of a fan of food delivery than I even am of taxi services. I just don't think there's a lot of money. Like, yeah, I mean, there's a few cities where taxis do well. Most places not so much. Free cash flow has been good. I'm impressed. That's surprising. Dropped off a lot here in the last fiscal year. I would think that would, that would continue to be the case. But I bet if we ran a DCF model on this and we look at the expectations embedded in the stock price in terms of growth and margins, we would see that they'd have to maintain these margins, if not higher, and grow quite a bit for a long time. I don't think autonomous rides are going to make a difference. Everyone's going to have an autonomous vehicle. Uber doesn't have that. They don't own that technology. They sold it off a while ago. Correct me if I'm wrong. So what— how's Uber going to make more money off an autonomous vehicle? Why won't the people who, who have the autonomy, whether it's the software or the vehicle itself, what— why don't they make the money? What do they need Uber for? It's going to lower the labor cost, but what does the autonomy guys charge? And then every other taxi service can also use autonomous vehicles, so everybody's Costs come down, which means prices come down, which means margins stay the same. It's a race to, you know, the thing about an undifferentiated business is that it's a race to zero with margins. No one can charge a premium versus another guy because they can just go to the next firm. Who does this on their phone? You look up, you know, you need a ride somewhere, you look it up on Uber, you immediately go and look it up on Lyft, whichever one's cheapest, go. From other cities that have other rideshare programs, same thing. Don't forget trains, subways. Those are getting better. Those are great alternatives, probably way better. You don't have to deal with traffic. So yeah, I don't think autonomous rides or autonomous vehicles is gonna have a lick of difference on the width of the moat around these businesses unless they own that technology themselves, and they do not. I think it just makes it more and more regulated. It's like, all right, it's just, you got a robot driving you around. Like, who's profiting from that? Where's the margin? Where's the differentiation? It's in the car, possibly, right? And so that means the people who make those cars, autonomous vehicles, they're the ones that would deserve the margin, right? For example, you know, if you've got the different— the difference between riding in an autonomously driven Bentley versus, you know, a Google Waymo car, you know, the Google Waymo cars are kind of ugly, got the cameras all over the place. Would you pay more to ride in the Bentley? Yeah. Who should earn— who should get that profit? Uber? No. Whoever made the Bentley that can be driven autonomously, they get that excess profit. So that's what I think about that. Okay, everybody, thanks so much for being with me today. We've got one more of these on Friday. It's the last one of the season, and then we'll start it up next earnings season. I'll probably be doing just as many of these calls, but they will be for clients only. We'll do a few free ones, but not as many. Thanks for being with me, and I look forward to seeing you next time. Bye.