MSFT, TSLA, COIN, MGM and LYFT Face Bearish Trends

Travis Hoium
01-26

1. $Microsoft(MSFT)$

Something I'm thinking about a lot. What happens to the economics of the tech industry when capex goes exponential with unknown payoff?

Is there balance sheet risk (mis-understanding depreciation of GPUs)?

Are these now utilities?

ImageImage

2. $Tesla Motors(TSLA)$

Tesla's energy business happened to reach an inflection point in Q3 2022.

What else happened in Q3 2022? The IRA was passed!

If Trump rolls back the IRA (in particular PTC for batteries) the energy business likely goes to zero margin because...batteries are a commodity.

3. $Coinbase Global, Inc.(COIN)$

Look at how the revenue mix has shifted over the past 5 years.

Coinbase isn't the company it was in the last crypto cycle.

ImageImage

4. $MGM Resorts International(MGM)$

MGM stock is down 23% in the past year.

If management just keeps the buyback level flat, it could reduce shares outstanding at a 20%/yr pace right now.

ImageImage

5. $Lyft, Inc.(LYFT)$

A 25% revenue CAGR AND FCF positive?

Don't sleep on Lyft.

ImageImage

MSFT & META Earnings Divergence: Any Post Earnings Plan?
Meta Platforms reported strong fourth quarter earnings. EPS up annually by 50% to $8.02, compared to Wall Street's consensus estimate of $6.76. However, revenue outlook missed estimates. Microsoft reported slower-than-expected growth in its crucial Azure cloud business on Wednesday despite beating estimates for overall quarterly revenue, sending its shares down 5% in extended trading. -------- Is Microsoft a buy after the earnings dip? How do you view their capex? Is Meta's guidance miss a warning sign?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • Sandyboy
    01-26
    Sandyboy
    I agree on the Capex risk of $Microsoft(MSFT)$ especially on the data centres which are AI driven, after all AI can also be phased out by better technology as we see Deepseek being disruptive. The Capex may not be meaningful or may become obsolete very fast this is a risk for First adopters like Microsoft
Leave a comment
1
2