Watch Our Earnings Recap on Shopify, Conoco Philips, Coinbase, and Get Our Top Stocks for 2025

Welcome everybody. Thanks for being with us today. We are excited to get started. We've got a double feature, earnings watch and our regular monthly webinar. So we're looking forward to a lot of action. I see that we got some people been here for a while. One guy said he actually logged in an hour ago just to make sure he got a good seat. Get it. That's the smart thing to do. These, these meetings are jam-packed with good information. With that, I'm going to turn it over to Kyle. He's going to do an intro. I'm going to do an earnings watch, and then Kyle's going to take you down the home stretch with our plan for 2025.

Thanks, David. I want to start it out with a quote from one of our recent articles here. In this environment, it's important to protect yourself, and the best defenses always have great offenses. We're talking Stocks to avoid and stocks to buy. We're not just going to warn you of the dangers, but also let you know how to find good stocks in this market as well. With that said, jump ahead here. This is the monthly podcast, calling this one Navigating 1Q25 Earnings Season. So as David mentioned, a bit of our monthly podcast and earnings watch parties. Put up the disclosures and disclaimers here. The main thing is we are not giving advice, we are publishing research, but we'll kick it off quickly. The agenda today. Got all the replays and slides from this will be in our community. The next monthly podcast, this specific one will be June 13th, but we got a ton of research since we last talked on this podcast. I know David's been doing a bunch of earnings watches where he's talked with a lot of other people as well, but this specific podcast, the monthly one last month, since then we've had new stock picks, 2 new long ideas, some new danger zones, updates on both long ideas and danger zones as well. We've closed a few positions, we put out a ton of sector and style ETF and mutual fund research every quarter, we put out our sector and style ratings, we do a deep dive on each of the individual sectors and styles, and then look at how to find and avoid the best and worst sector style ETFs and mutual funds. So a ton of info in those reports. Again, deep dives on each individual sector, each individual style, and then overall ETFs and mutual funds to Ones to find attractive and ones to avoid. Done a bunch of live sessions. As you mentioned, Earnings Watch, this will be our 7th one this quarter. And we did a bunch last quarter as well, bringing you sort of real-time earnings analysis. Did a lot of performance reporting since we last talked and some focus list performance. Long-short outperformed, model portfolios outperformed in 1Q25, and the Very Attractive Stocks Index outperformed in 1Q25 as well. And round it off with a lot of model portfolio updates. We're updating these monthly, most of them, and we're also giving out free stock picks for each of them. Usually one a week, we'll give out a free stock pick from one of the model portfolios that we've recently published. So those are all on the website. Great insight into our research, how we're looking at stocks, both on the good and bad side. But with that, we'll kick this earnings watch party off right now. We'll throw it over to David and we'll jump into What stocks we're looking at.

We've got an interesting list today. We got 6 stocks. As you guys know, we're, we're showing off our institutional platform here. Most of this is the same as the professional. There's just a few additional features which we're probably not going to use at all today. But this is the, the, the site that people, the professional and institutional users, have access to. Everything's suspended. Why? Well, because we're getting in tons of Qs and Ks right now. I mean, probably getting in, I don't know, 500 today, 300 or 400 yesterday, you know, so 1,000 in the last week or more, and probably another couple thousand before we're all done. Anyway, lots of ratings changes. I think we're going to have at least on average 800 upgrades every quarter. Is that right, Kyle? Or is that 800 ratings changes in general?

Ratings changes, not necessarily upgrades.

Okay. 800, or about a fourth of all the companies we cover, one in every 4 is going to get a new rating because of a K or Q that comes through. So the data matters. We're doing, we're doing the work. All right. So let's take a quick look at price movement. Here's what we're looking at today. So I think we saw Shopify has had a bad report. So they're down a fair amount. Cloudflare is having a good day. Having a good year. Start with Cloudflare. I think these guys, they've got a big contract, a good win. So the business looks like it's doing well. That's the Wall Street spin. What does New Constructs say? Let's take a good look at this. It's a very unattractive stock. Okay. We don't have that many very unattractive. We don't have that many very attractive. It's difficult to get this kind of a score. And what you're seeing here is a business that's looking pretty rough, my friends. Expectations are super high. So just for a second, put down the quality of earnings so you can say it's a growing business. The amount of growth required to justify the stock price is pretty much off the charts here. These guys have to have a significant turnaround. In fact, I'm going to go off script here, Kyle. Said I wouldn't do this, but I think we need to take a look at just what kind of a turnaround in profits is implied by Cloudflare. We'll come back to this in a minute, but what you see here in this, in this Orange and red, and particularly the red. The amount of growth required to justify the stock price at consensus rates more than 100 years. This particular criterion in our overall rating system, market implied growth appreciation period, price implied growth appreciation period, or the duration of profit growth baked into the stock price. This is our most important metric. This is the metric sometimes that matters. Sometimes as much or more than the overall rating we've seen. Overall rating is the most important for sure, but this is the one that stirs the drink, so to speak, if we want to isolate one that is reflective of stock price. So when we see this red here, we know that's a bad thing. And then let's go in here. Let's put a forecast in for Cloudflare. All right, so we've got— wow, we've already got 16%, 20% for a long period of time. Let's assume margins get quite a bit better. So they've been highly negative. Let's say they make it up to 4, 6, 8, 10%. Give them credit for being up there with other strong software companies. We'll keep their tax rate low. Their capital requirement will remain really low. And we'll see if we assume tremendous margin improvement in what is a very competitive business, increasingly commoditized business, It's been highly unprofitable up to this point. Assume it gets to a maturity state of profitability, like a high-level profitability, 10%. We still can't justify over about $12 a share. By the way, this is a discounted cash flow modeling system that looks at the implied values based on that new neutral scenario we just created. So let's come back in here and we'll make an optimistic scenario. And let's assume that our margins go 5, 10, 15. See how much that has an impact on the valuation of the stock. All right, here we go. Let's look at optimistic. Wow, we can't even with 15%. So I think you guys get the point here. This is enormous amount of, of really strong revenue growth and margins. Let's, let's say if we're going to go a little bit higher, let's say, let's say 30, 30, 30, 30, 2020, '15 in terms of revenue growth at the same time. So we're going to put in really good margins. We're going to put in really high revenue growth and see if that can get the model to generate a price that approaches the current stock price. And this is a really, I think, beautiful exercise for anybody investing in any kind of stock to understand what the fundamentals have to be. Let's go back and check out our optimistic scenario.

Wow.

Okay, we still can't get there. I give up. Now let's look at— if we want to look at the optimistic scenario here in terms of revenue, look, look what we're talking about. Revenue is going from zero to— what is this? This would be $500 billion in the optimistic scenario. Let's, let's just make these both optimistic. So you just see one line here. Same is true for NOPAT. We don't have a lot of history. That's just the history, right? That's negative. Boom! Talk about a hockey stick. Isn't that cool how we can do that now, Kyle? So that's a historical NOPAT. That's what they got to do, and it's got to go for a long period of time. So I think really interesting perspective here in terms of what is baked into the stock price. That's why we're saying, hey, this is unattractive. And I'll be honest with you, what they did in this quarter, what they're going to do this year, what they're going to do next year It doesn't matter. It's a drop in the bucket compared to what's going to happen in the future. Wall Street doesn't want you to talk about that. They don't want you to know about that. They don't want you to think about that. Because if you do, there's no way you would ever stomach owning a stock like Cloudflare. All right, let's talk about ConocoPhillips. Completely different situation here in terms of profitability and cash flow over time. They're having a bad patch. It's going to be a tough time for oil companies here. in the last year. And I think we're probably closer to the end of it than we are the beginning. But look, this is why Warren Buffett is the greatest investor of all time. He's owned stocks like this. These energy stocks are— it's the one thing we know is growing no matter what. Maybe not always as fast, but as long as the population is growing, as long as standards of living are improving, energy demand is going up. And these guys are in the business of energy. And look, they're all in the business of different kinds of energy. Just because they've been fossil fuel doesn't mean they will always be. They're moving into natural gas, liquefied natural gas, other green energy. They've got the distribution, they've got the expertise. They know what to do when it comes to energy. So if we're taking a quick look here at Conoco, see last 5 days, not so good. Year to date, it's been tough. It's been tough. It's been tough for oil companies. Guess what? Great stocks go through tough times. How'd they do here? So the stock is pretty good, pretty good return. But we see that it's been pretty volatile. I think had a really good day yesterday, but not enough to offset what's happening today. Let's see the overall market. What, how's that doing today? Overall markets, I guess, is down a little bit today.

Down a little bit. Yeah. Yeah.

Turning. So ConocoPhillips, you know, a good day yesterday, but guess what? Oh, we forgot about that. And you know what? You should forget about that quarterly earnings number because it has about as much relevance to the overall valuation as the stock price reflects, which is, oh, yesterday was great, but guess what? We're still net down.

Right?

That's what I would tell you about about about Conoco. And yeah, it's a neutral rating. So I'm not I'm not getting on my soapbox here and saying that this is like a super great stock to jump into right now. We would we would rather attractive rated stocks, and we've got plenty of those attractive rated energy stocks. We've got plenty of those. And this is this situation is sort of a great example of how it's hard to find good stocks. And how our system, because we're looking at 3,200, 3,300 of the U.S. stocks and we're comparing all of them apples to apples with the best models and data in the world, it's how we find good stocks. Because we can look in every corner, we can shine a light in every dark corner, we can go in and say, oh, you know what, we like energy. Energy is great. Warren Buffett likes energy. A lot of people like energy. These are the best energy stocks. That's why we earn number one rankings for stock picking. That's why our Indices with Bloomberg outperform. There'll be more on that from Kyle later in terms of how to find good stocks. It's a big part of what we're going to do today is not just show you what we think about these earnings. And, you know, we talk about the stocks to avoid. We're going to show you how to find the right kind of stocks in today's market. Ricardo, leave it.

Just did a quick screen. We've got 50 very attractive or attractive energy stocks in the system.

A lot. Some of those are better than others. That's what our focus list is for. We like to go in, we'll pick some stocks like, oh, it's got a very attractive rating. It's got a super high dividend, got super low expectations for future cash flows. But there's no such thing as a no-brainer in anything in life, except sometimes in love when you really meet somebody amazing. That's a no-brainer. That's a beautiful thing. It happens rarely. In the stock market, you got to do diligence. It takes brains to be good in the stock market, no matter what Roaring Kitty or Reddit or Wall Street would like you to believe. They want you to just dump your brain out and trust them. We don't want you to do that, New Constructs. I want you to put your brain on full speed to understand everything we're giving you, because if you do that, you'll realize why our research is the best in the world. And you won't go to those other firms. Otherwise, you trust people to do your thinking for you. You put your life in their hands. You give up the ability to discern, and you end up getting swindled most of the time. People who really want to empower you are going to want you to bring your brain to the situation. They're going to want to have A fulfilling, balanced relationship—not one where I just do all the work and you just have to trust me blindly like a robot. No, dig in, enjoy. Bacardo Libre—you know—I like these these businesses most of the time, most tech. But you know, good company, bad stock. All right. So what's happened here? Still up today, up a lot yesterday. Latin American beats estimates in the first quarter as Argentinian business booms. Yeah. Argentina is where they've got that new president who's so good, right? He's crushing it.

I know they've got a new president.

Yeah. Yeah. That's the guy. Somebody jump into the chat if I'm wrong. The guy that all the conservatives— it's good to be bullish on Argentina in general. I would tell you that I think that the market has priced that in. And that's exactly what we're seeing in our valuation here, my friends. Great profitability, but super expensive valuation. 700, you know, it's the market's applying the profits are going to improve 790%. This is not as drastic a turnaround as Cloudflare because Cloudflare has got to go from highly negative. Look at this, negative, negative, negative, negative, getting worse negative to super positive. Look, this is not as bad a business as Mercado as Cloudflare. Because it's doing great, but the value— all the good stuff is priced in. That's the takeaway, folks. So it really doesn't matter. I'm glad to see the stock price do well. People were rallying in the short term here, but it's already super expensive. Shopify focus list short. This has been something we've written around, written about quite a bit. We have believed this stock to be a bad one for, for a long time, and I think our performance has been overall I think pretty good here, especially versus the IPO. Kyle, maybe you can chime in on that in a second here. But you got another great— another good example. Good company, bad stock. Good company, bad stock. What's happened here recently for Shopify? Yeah, I think Shopify had a—

Yeah, we first put Shopify in the danger zone back in 2020, and it has basically traded flat since then. The market's up 69%.

Okay. So as a short call, good call, but it's still super expensive. So they had a good quarter, but I think they, they lowered guidance. And that's what you're seeing with this strong miss here. Right. When the earnings distortion score is flashing red, we can't tell you exactly when for sure they're going to miss, but it's going to probably happen sooner rather than later. But look, the reality is they were able to put sock away some money in the cookie jar to make earnings look better than they really are. And companies can do that for a long time. WorldCom, Enron, Valeant, they can kind of— you can cook the books for a while. The longer they cook it, typically, the bigger they fall. The point is exactly timing when they're going to reconcile is tough to do. But you can trust from Harvard Business School, MIT Sloan, and the Bloomberg indices based on our data. There's 3 of them, the Very Attractive Stocks Index, the Core Earnings Weighted S&P 500, and the Core Earnings Leader Index, you can see there's alpha in this data. And a big part of it is core earnings and whether or not companies are giving you the right numbers. So for example, what we're seeing here with Shopify, you see a big increase in net income but not core earnings. Notice how this core earnings number removes all the noise. That's why it's so good, folks. This is unusual gains, unusual losses, unusual gains, probably some unusual losses coming. That's the way it goes. But we think there's going to be a miss because we don't think that this increase in net income is going to be sustainable over core earnings because core earnings is a superior number. All right, let's talk Coinbase. Coinbase, should we call it Bitcoin Base? Should we just call it Bitcoin Junior? This is effectively going to trade on Bitcoin, and Bitcoin has been on a run, and you're seeing This business has gotten a lot better. I mean, yeah, don't get me wrong, this is, this is really improved. I think at one point in time, it's been around for a while now, but it was a pretty low return on capital business for a while. It's been, it's been out this long, Kyle. It's hard to believe. Remember we did a, yeah, did an IPO piece on Coinbase, didn't we? Is that, is that long ago?

Yep.

Yeah. So we warned about it then and it came out at $350. So it's down significantly from where it was. We've been right, but it's been a lot. So that's ups and downs, friends, ups and downs. That's what happens with these speculative momentum-driven stocks is you're going to see good and bad. And we're in a speculative bubble here now. We're, you know, we had some bad times and we are back on the good times for sure. Coinbase down a good bit today, down the last 5 days. It's— I think they had a decent quarter, but They are warning of lower guidance, even as Bitcoin surges back above $100,000. They missed on revenue, I guess, and they said they had a bad quarter and bad guidance. Not surprised, honestly. When you see stocks expensive like this and you see strong miss, something's going to have to— something's going to break. But yeah, we recorded this. We, we, we had a nice projection here on having a miss. Again, this is typically not sustainable. It's been pretty correlated here in the past, not too far off. But so this is a pretty big gap in terms of, in terms of reported earnings being above core earnings. So yeah, we, I'm glad we called that, called that miss. And yeah, expensive stock. I kind of don't even care about, you know, what the earnings are on this. I think earnings, earnings calls are, are commercials to sell stock more than anything else. And so When you have a tool like ours, you don't have to, to be in the day-to-day, in the fray. Look, that's where Wall Street wants you. They want you all caught up, you know, just like social media wants you just scrolling down and looking at reels over and over, right? I mean, because then you're not really doing anything else but giving them your attention, which they in turn will monetize. They'll sell that attention to advertisers. Wall Street wants your attention on the titillating short-term stuff so you don't pay attention to the big picture stuff. Like this. This is what Cloudflare's got to do, not just for 5 years, 10 years, 25 years, or 50 years. It's got to do it for 100. That's what we saw when we put in this forecast, that optimistic forecast, super high margins, super high growth rate, and we can only get to around $35, $36 a share. Unbelievable. I got— I mean, I can't— we're not even a third. So let's see how— let's see how ridiculous we can get here. Let's go up to Facebook-level margins. I'm jumping around here. And then let's go 50%, 50%, 30%, 20%. See how that does. We'll come back to this in a minute. In the meantime, I'll keep knocking out a few more of these. So Coinbase, that's the takeaway. Expensive stock. Whatever this earnings, you know, earnings calls aren't completely useless. Like, it's good to have an update on the business. You know, it's good to hear how things are going. We don't want them to not talk to us for 100 years. That's not what I'm trying to say. What I'm trying to say is that don't become overly dependent or focused on these super short-term numbers that are dropping the bucket to the overall big picture of what the cash flows have to be. And New Contracts, I believe, is the first to bring this to you at scale. We do this work, we show you, and we've got some cool stuff coming out. We got some new slides and analysis that Kyle's just recently put together that's super cool that will demonstrate, like, how ridiculous the analyst estimates are, how ridiculously low, how small a piece of the overall pie of future profits that analyst estimates represent. And it's pretty cool. I got a funny question here. What is the most overvalued stock? Robert, great, good question. It's hard to say. It kind of depends because you can do it in 2 different perspectives. You can have overvalued in terms of what the future cash flows are just compared to what the existing cash flows are. What's the biggest delta? Which company's got to change the most? You can look at it from that way. You can also just look in general at how big the future cash flow requirements are. Company like Cloudflare, that's a huge delta between what they got to do and what they've currently done. A company like Amazon, look at how big those future cash flows have to be. It's just kind of enormous. And we did some cool stuff on that. You can look it up. I think the article's called The market believes— Mr. Market thinks Amazon will rule the world. And we look at the implied revenue of their stock prices. I think that maybe it's fallen since then because maybe people read the article, but the implied revenue was like some huge number. We did the same thing for Nvidia. I think they had revenue, their peak, that implied they're going to be bigger than Japan. And that would assume Japan's GDP grew at 4% over the same timeframe, and it hasn't grown at that level. But that's expensive. All right, let's knock out Kaview here. Another neutral stock. This one, you know, decent economics and then not as expensive. We, we covered this on the IPO. I think it was one of the few IPOs that came out that didn't look like just an awful, terrible situation.

Yep.

Yeah, profitable company, expensive stock. So at least they were profitable. A lot of these IPOs we're covering— CoreWeave was one. I think it looked terrible coming out. And it was still super expensive. So Kenview has been reasonable. How did they do? Doing all right. I think they had a pretty good— a lot of noise here. Oh, that's the last 5 days. And that's not really saying— so I'm guessing Kenview did pretty well. They're up today, up the last 5 days. That's better than— that's better than what the market's doing today. So they must have had a good report. That's great. But, you know, look, neutral-rated stocks, it's kind of meh. Not so good, not so bad. Let's take a quick look at what our updated forecast— wow, 50% revenue growth, Facebook margins, and you're still only looking at $75. That's expensive, folks. So is it the most expensive stock we cover? It's up there. It's up there. All right, I'm going to take a couple requests real fast before I jump off here. Do you have a sense of, of what's most been What's been requested the most, or we have a bunch of ties?

It looks like a bunch of singles. So if we just want to start with the first one, FNF.

Let me see. We added Fidelity National Financial, neutral rating. So I would suggest very attractive rating stocks. Those tend to outperform. As we can see, this Bloomberg index that Kyle's going to go into more detail, very attractive stocks tend to outperform. So that's a good one. That's the way to go. Fidelity National Financial, decent economics, kind of cheap, not that cheap, neutral. I'll do one more, Kyle, before I jump off here.

Okay. Next one was IBM.

IBM. People always love to talk about IBM. You don't get fired if you hire IBM. It's— I remember hearing that as a kid growing up. That was like a, like just kind of a constant saying. So IBM, you know, it's— people are like waiting for the comeback for IBM. We just got a new Q. So you're seeing the latest rating here. By the way, if you're a client, you'll get alerts that give you this kind of detail like every day, like what's going on. Professional clients will get all the details. If you're a Stock Tracker 50, you'll get an alert. You'll know that something changed. We can't give you all those details. Professional clients get that. But yeah, you know, look, IBM, it looks like all the good news is priced in, folks. Very much priced in. So not a lot of good stuff to stay there. Credit rating okay, uh, but the stock's expensive. People are giving IBM credit for the turnaround. I'm going to pass this over to Kyle.

All right, thank you, David. I'll take it from here.

Good to see you guys. Have a great weekend.

All right, let me share my screen here. I'll do a few more requests here on the earnings watch, and then we'll jump into a little bit of some more slides that we've got prepared for you guys. The next ticker we saw in that chat was Nokia. And okay, this one is greens all the way across. We've got very attractive quality of earnings, ROIC, and a very attractive valuation, which is why you see here that the stock is in the Most Attractive Stocks model portfolio. David's always mentioning, you know, we're looking for very attractive stocks when we can find them. Nokia would qualify as that. You can look at sort of the trend in earnings, you know, a little bit of improvement here recently. We see a lot of improvement in ROIC, up from about 8% To around 16%, so doubling since 2020. Big improvement in margins recently, so looking good for Nokia. Take a few more. Looks like Ambev. Abev. Let's see what we've got here. Attractive. So here we've got you know pending suspended rating. We are getting there. Six K in, and that means we would have gotten it today or last night. We're parsing it right now. Generally, we turn those around within one day, so you should see an updated rating. You know tomorrow. Would be general timeline there. But attractive rating, you know, quality of earnings, not quite as high as we just saw with Nokia. But the valuation, you've got expectations for profits to permanently decline. That 0.9 basically, you know, means profits will decline by 10%. And we saw with Cloudflare that market implied gap was over 50. Here we've got less than 1. So they've got to do consensus growth for less than 1 year to justify that current price. So we've got a cheap stock and decent earnings with positive economic earnings. So that's why you get that attractive rating, not quite to the very attractive level, but still better than some of those other companies we saw. If we look at trends here a little bit, drop in ROIC in that 2024 period, which is probably why you see, you know, 3rd quintile, potentially back when it was in the 12%, it might have been, you know, 2nd quintile, but Overall, you know, decent earnings and an undervalued stock price. Let's see what we've got here. Got 2 more and then I will jump into the rest of the presentation. MongoDB, suspended rating with a required cash assumption. You've got very unattractive. So the opposite end of what we're just looking at. Poor earnings, you know, false positive, bottom quintile, negative 20% ROIC, and expensive stock price. That market implied gap over 100 years again. And so you've got a scenario where, you know, ROIC, a little bit of improvement in fiscal 2024, but it was still negative 11%, and back down to negative 20% in fiscal 2025. So scenario where margins improving, but still very negative, you know, great, it's gone from negative 35% to negative 11%, but still those negative numbers lead to negative ROIC. Negative economic earnings, and helps get that very unattractive rating. Last one we'll do here, MRVL, Marvell Technology, unattractive. So I think this might have been the first— IBM might have been unattractive— say the first unattractive, but got neutral rating here, bottom quintile, 0% ROIC. The valuation is expensive by some metrics, you know, neutral by the others. But overall, this is looking like an expensive stock based on quality of earnings there. When you've got 0% ROIC and a market implied growth appreciation rate of greater than 100, there's a big turnaround already priced into the company. As David mentioned with what's the most overvalued stock, the delta here would be pretty large. You've got 0% and they've got to grow at consensus for over 100 years. So if we were to increase, grow above consensus, increase margins, that's going to increase that ROIC. So the turnaround baked into the stock price is pretty large. As we can see, the stock's come down pretty significantly since, you know, December, January, you know, cut in half and still looks pretty expensive. Got a situation where maybe don't catch, you know, the falling knife here as it looks still pretty expensive. But with tech companies, you know, high growth companies, I'm not sure growth rates here, but a lot of times the tech companies, we do see higher valuations than others. You've got revenues, they slowed down pretty significantly after big jump in 2021 and 2022, and then actually falling 2024 over 2023. So, you know, flattening of growth while the valuation still looks very expensive. So with that said, that'll kind of end the earnings watch portion of this. We'll jump back into our monthly podcast. Let me switch over here. into our sort of game plan for 2025. We talked about, you know, looking for very attractive stocks, avoiding the very unattractive stocks, and sort of, you know, the plan for 2025 and how to make money in any market. We'll run through some slides here. But we've seen a few consistent themes, you know, recent months, you know, obviously since April with the Liberation Day announcements, but tariffs are bad. The markets haven't liked tariffs. Every time we see new tariffs get announced, Market seems to fall. Anytime there's hope of tariffs being improved or lessened, markets seem to rise. No one knows for sure how bad they're going to get. We can speculate, we can guess, we can try to figure out, you know, what does 100% mean? What does 10% mean? What is 50%? But right now, it's all uncertain. You know, we're in, we're in a pause on a lot of those tariffs, creates uncertainty. But that uncertainty does create opportunities. We've seen a lot of very attractive stocks we've given out in different stock bundles this year do really well. Some stock bundles last year do well. But uncertainty creates that opportunity to find those hidden gems that maybe they're down for the year, but profits still look great. Or maybe they're less exposed to some of those tariffs than other companies. But the valuation doesn't project that. A lot of times, it's hard to find these stocks because as we've said many times, Wall Street and media wants you to believe you can trust their certainty. They come out with their new ratings, you know, new buy rating on XYZ. And they name these 5 different bullet points. But all of it, a lot of it can be speculation. Like it could be, yeah, it's gonna be great if those 5 things happen. Our system allows you to kind of model, well, what if those 5 things don't happen, then what does the stock price look like? And that's what we're doing. You know, when media is fanning the flames of panic, we're finding the best stocks in the market, we want to bring the best quality stock picks, high quality, rooted in fundamental analysis. And That begs the question, how does our research find great stocks? Answer seems simple, but diligence is the answer. And we've done the work to get our proprietary data from insights from the thousands of pages of SEC filings. You know, our system, like David mentioned, we're looking at— I think I just looked at the numbers— we had over 200 filings, I think Tuesday this week, 200 filings Wednesday this week. We've already done 100+ today, updating our models. You know, we're getting all the 10-Qs, some 10-Ks, you know, depending on calendar year, but mostly 10-Qs right now. We're updating our models, we're reading the footnotes, we're reading the MD&A and getting that data so that we can get a better measure of earnings to drive the ratings that you see in our— what we're just looking at in those earnings watches. We uncover critical data that is often, put in quotes, legally buried in the footnotes. There's data that companies just don't want to put at the surface because it helps create, you know, better adjusted numbers, better GAAP numbers. Obviously, you know, we've talked many times, the GAAP isn't the end-all be-all. There's a lot of loopholes in it. We've got 30+ different adjustments we make to get the true earnings and get a real read on fundamentals and profitability, and then use that in our DCF for the valuation. Our process has been vetted and validated by MIT Sloan, Harvard Business School, Ernst Young, published a paper in the Journal of Financial Economics about our process, about what we're doing to get the best quality of earnings and stock ratings. And so all of that sounds great, but it does beg another question. You know, our stock ratings are different, but how do we know they're better? David mentioned the very attractive stocks outperform, and we do have proof of that in our— the indices managed by Bloomberg right now. We've got a very attractive stocks index. It contains only stocks rated very attractive. And so far in 1Q25, beat the S&P 500 by, you know, 9%. So we see outperformance in the short term, and we've got outperformance in the long term as well. Over the past 5 years, that index has beat the S&P by 76%. So you've got a scenario where picking very attractive stocks, and that's all this index does, is a winning strategy. And that's because we've got the data, the underlying data, the fundamentals, the valuation analysis to get that very attractive rating. I think we've looked, you know, less than I think 13% get attractive and very attractive, and 3 or 4%, I think, get very attractive ratings. So it's an exclusive group of high-quality companies. The other indices we like to talk about is the Core Earnings Weighted S&P 500 Index. It takes the S&P 500 and it just weights it based on core earnings, core earnings instead of market cap. So we let the S&P basically pick the companies, you know, it's the S&P 500, and say, hey, we don't just need to buy the biggest company, let's buy the ones with the most profits, you know, the highest core earnings. Short term, that one outperformed by 1%. So not as strong as the Very Attractive, but still outperformed in 1Q25. And then over the past 5 years, it has beat the S&P by 32%. So again, situation where better data leads to better ratings and has led to outperformance, generating alpha in a market that is hard to do. You know, picking stocks is not easy. So if you've got systems that you can follow that have produced outperformance, that's why we've got our model portfolios and very attractive stocks, most attractive stocks like that, to give all investors a chance to outperform. What's the alternative? You know, we, we like to talk about what we've got going on. But what else could you find out there? And we often like to point to Wall Street. Wall Street tells you to buy everything. This was from, you know, percentage of stocks rated as attractive or better, you know, 57% of stocks are buy ratings according to Wall Street. You can say over half the companies in the entire market probably are not buys at all times. Like we said, I said a moment ago, 13% of our stocks get attractive or very attractive buy ratings, you know, call it buy ratings, but attractive or very attractive ratings, much more selective. You know, it's, you've got to really be not just a good company, but also a good stock. And we talk a lot about great companies, bad stocks, bad companies, undervalued stocks, maybe they're not good, but at least cheap stocks to get that attractive and very attractive rating. It's got to be a good strong company, strong cash flows, and cheap valuation. And so the Wall Street buy ratings as an alternative, not a great idea. We like to say, you know, trusting Wall Street is like trusting tobacco companies who said cigarettes are not harmful or addictive. Wall Street wants people to buy more stocks. They make more money when you buy, whether you're buying good or bad, just buying makes them money. And so we like to take a different approach, you know, fundamentals-based approach. Go back here to find the right stocks. How we find good stocks. is using our rating system. You know, we use the first and best AI for investing. We call it the RoboAnalyst technology. It is used to get the data, build the models, and reveal the truth about earnings and valuation. You saw our examples of exactly how we use it at the top of this presentation. But this is what underlies the entire system, is the RoboAnalyst takes in the filings, we get human analysts to verify it. And it— you know, we've run over 500,000+ filings through the system. to figure out where the data is buried, where to best find it, how to quickly find it, and build the best models in the market. So we say, you know, RoboAnalyst ratings visualized. Red is good. I think green is— or red is bad. Green is good. But we can look at quality of earnings and valuation in a quick, easy-to-use format. AI has the ability to comb through thousands of government filings with precision. I mentioned there that green means good, red means bad, and all 5 metrics play a role in the stock and the rating of the stock. And we talk about each of those individual metrics there, you know, quality of earnings, economic versus reported ROIC, and evaluation, free cash flow yield, market applied growth appreciation period, and price to economic book value. Those all play an average in the overall rating because one metric can be great. If the rest of them aren't, it doesn't mean you're going to have a good company and a good stock. So we've got a litany of metrics that go into that so that we can really measure the true economics of the business. And risk reward. Like, it's all about, you know, finding quality risk reward. It is the only stock rating system with an official US patent behind it, and we're proud of that. We've got the backing there, and we've got some options for you guys today. It's got 2 options to figure out how to find the best picks. First, we do free trainings like this. You've got upcoming trainings we want to make you aware of. Tuesday, May 14th is the Unmasking Q1 '25 Earnings: Cutting Through the Tariff-Twisted Projections. We're emailing out signups for that right now. That is where David mentioned we've got some really interesting charts and graphs about projected earnings versus what our model shows. We'll be showcasing that in this training event, talking about, again, tariffs, earnings, how to game plan it, and kind of what to expect moving forward. On Tuesday, May 20th, we have our Let's Talk Long Ideas with Pro and higher members. David jumps in with our Pro and institutional members. They bounce ideas around, take requests, go into more deep dives. We'll do a lot of the work that we did on Cloudflare here today in that session with our pro and institutional members to really deep dive on earnings and our numbers and the valuation and what it implies for kind of the future cash flows, what the stocks look like, but more in-depth than we went even today. And then the second option, we do have a special bundle going right now. We want to tell you guys about is the tariff-proof stocks. We think right now is a stock picker's market. We're trying to deliver winners. We've picked out 3 stocks that have been unjustly beaten down this year, and we think they'll outperform in 2025 no matter what happens with tariffs. And think, you know, good long-term and short-term potential performance there. We've got a link here that I will share. You guys can take a look. Do you see a question? If we have any plans for more ETFs? I do not know at the time. That would be something David could speak to. Right now we've got the Bloomberg benchmarks, you know, those are obviously doing really well. And so we'd be trying to, you know, use that performance, kind of leverage it wherever we can. Right now, it's— we use it as a great kind of measuring stick of how our picks are doing. So people can see in real time. But this is the tariff-proof stocks to buy. But today, we're not just talking about the tariff-proof stocks. Like I said, we'll get the bundle of 3 tariff-proof stock picks, they'll be delivered with the professional-level report, basically takes all the data from our rating and puts it into an 8-page report. You get the ratings, you get 5 years of history, a lot of the charts we looked at today, and the detailed breakdown. You know, you get the balance sheet, income statement data that we've pulled from the filings, all that data for the specific companies, as well as the overall rating, the trends and rating and everything. But also get 12 months of Stock Tracker 50 membership. This is where you can basically track and look at your tickers up to 50 in a portfolio. You can get the ratings on all the tickers in our system. So you can go and find, you know, you want to see what IBM looks like. You can find what IBM looks like, see what the rating looks like. You can get ratings change alerts daily whenever a rating changes. Like right now we're getting a lot of the ratings changes because of the earnings. And you get that easy to read. Red means bad. Yellow is hold. Green is good. And as a Stock Tracker 50 member, you would also get all of our education section. And that's where we've got the white papers on all the adjustments we make, the details behind all of our ratings, the details behind all of our metrics, how you, you know, how we make adjustments to NOPAT, how we calculate core earnings, all of that information you can read in the education section of our site with a Stock Tracker 50 membership. So it really gives you a way to not only find some high-quality rated stocks, find the stocks maybe to avoid, track the stocks you're most interested in and be alerted to those. We also get that education. And, you know, special right now is those 3 tariff-proof stocks as well. We are calling it the Tariff-Proof Stocks to Buy Now. And we can check it out at that link I put in the chat there. And with that, I do want to hit one more item. We think it's a great time to talk about the other live webinars we've done recently. If you haven't checked them out, David has done seven different earnings watches this quarter. There's some companies, you know: J.P. Morgan, General Electric, Pepsi, Qualcomm, MicroStrategy, which I think we're you know changed the name to just Strategy, Advanced Micro Devices, and then just yesterday Uber, Disney, DoorDash, AppLovin, and much more. We've got these sessions through earnings season, and probably end up doing a few more next week as well. Today was the combined one with our monthly podcast. But if you haven't, we've got links to all these. be shared in the replay with the slides out on our community. And we'll also put— these are all up on the website as well. So you can check out at the blog on the site, check out the replays along with the questions that went into it and look at all the analysis on all these companies. So I want to thank you guys for sticking around today, checking out our combined Earnings Watch and monthly podcast. Like I said at the top, the next one of these will be June 13th. We'll be out of Earnings season by then. So it'll be more of the traditional monthly podcast, we'll dive into the community, what's going on there, the discussions that are being had, and kind of the overarching themes and narratives driving the market and how we kind of interact with those and plan for the best portfolio we can make. So we will see you then. Look for the replay out in the society. If you have not signed up for the society yet, you can go to newconstructs.com/society. I hope you guys have a great weekend, and we'll see you next time.

Bye.