1 00:00:00,100 --> 00:00:01,800 Welcome back. Everyone to the Joseph Carlson 2 00:00:01,800 --> 00:00:05,400 show in this episode. It's time for a full portfolio, 3 00:00:05,400 --> 00:00:08,100 overview. This is something that I like to 4 00:00:08,100 --> 00:00:11,300 do quite frequently. I do these portfolio, updates 5 00:00:11,300 --> 00:00:15,000 and overviews all the time because before I got into 6 00:00:15,000 --> 00:00:18,500 Finance, before I got into Financial content creation, this 7 00:00:18,500 --> 00:00:21,400 was one of my biggest complaints, everyone talked 8 00:00:21,400 --> 00:00:23,600 about stocks, they talk about how great of investors they 9 00:00:23,600 --> 00:00:26,800 were, they talk about how great they are with money, but they 10 00:00:26,800 --> 00:00:29,200 wouldn't really show you exactly what they're doing with their 11 00:00:29,200 --> 00:00:31,000 money. They Don't show you their full 12 00:00:31,000 --> 00:00:33,000 returns where they're investing it. 13 00:00:33,000 --> 00:00:36,100 What their portfolio looks like in a very transparent and 14 00:00:36,100 --> 00:00:39,200 consistent way. So rather than being someone 15 00:00:39,200 --> 00:00:42,900 that just complains I decided to be part of the solution showing 16 00:00:42,900 --> 00:00:46,900 what I do with my finances every single week week after week 17 00:00:46,900 --> 00:00:49,600 after week. Now I have two portfolios. 18 00:00:49,900 --> 00:00:52,800 The big one is the dividend growth portfolio called the 19 00:00:52,800 --> 00:00:55,600 passive income portfolio. That one's over four hundred 20 00:00:55,600 --> 00:00:58,400 thousand dollars in value. It's doing really well, that 21 00:00:58,400 --> 00:01:00,400 one's actually. It's Performing. 22 00:01:00,400 --> 00:01:03,100 Well, I've been really happy with that one, but then we have 23 00:01:03,100 --> 00:01:06,500 this story fund, a smaller portfolio currently at a value 24 00:01:06,500 --> 00:01:10,400 of around 120,000. And this one is mostly focused 25 00:01:10,400 --> 00:01:13,300 on tech companies and it has not been doing as well. 26 00:01:13,600 --> 00:01:15,000 This is the one that we're going to be looking at. 27 00:01:15,000 --> 00:01:18,900 In this video, the Holdings in this portfolio are Amazon 28 00:01:19,000 --> 00:01:21,600 Netflix. Google Microsoft Adobe 29 00:01:21,600 --> 00:01:25,000 Salesforce and Apple. So, there's seven in total, it's 30 00:01:25,000 --> 00:01:28,000 a concentrated portfolio. I'll be going through each one 31 00:01:28,000 --> 00:01:30,600 of them and giving a little highlight of why Why I'm still 32 00:01:30,600 --> 00:01:32,900 holding these companies? So without further Ado, let's go 33 00:01:32,900 --> 00:01:34,600 ahead and jump in. You're looking at the actual 34 00:01:34,600 --> 00:01:37,000 portfolio here. This is straight from my 35 00:01:37,000 --> 00:01:39,300 brokerage. So we're looking at the story 36 00:01:39,300 --> 00:01:43,600 fund here, the seven positions and you can see, Amazon's atop 37 00:01:43,600 --> 00:01:45,600 holding apples. The smallest holding in the 38 00:01:45,600 --> 00:01:48,100 portfolio. You can also see the unrealized 39 00:01:48,100 --> 00:01:50,400 losses and gains for each of these companies. 40 00:01:50,400 --> 00:01:54,100 So most of them, I'm in the red currently, I started this 41 00:01:54,100 --> 00:01:56,700 portfolio towards the beginning of 2021. 42 00:01:57,000 --> 00:01:58,700 That's where I put in the majority of money. 43 00:01:58,700 --> 00:02:02,200 I deposited a lot of Unfortunately, in 2021 the 44 00:02:02,200 --> 00:02:04,500 market has not done well overall since then. 45 00:02:04,900 --> 00:02:06,800 But it's starting to recover a little bit. 46 00:02:07,100 --> 00:02:11,300 I Benchmark this portfolio against the S&P 500 and I do 47 00:02:11,300 --> 00:02:14,800 this in a very accurate way. What I did was I actually made 48 00:02:14,800 --> 00:02:19,800 it so that every single deposit I do, I made a spreadsheet that 49 00:02:19,800 --> 00:02:23,500 tracks it time-weighted, as if I did the exact same deposit into 50 00:02:23,500 --> 00:02:26,500 the S&P 500. So I basically created an 51 00:02:26,500 --> 00:02:29,800 alternate reality had I invested my money in. 52 00:02:29,900 --> 00:02:33,700 Spy, instead of the story fund at the same time on the same 53 00:02:33,700 --> 00:02:36,800 day, this is what it would have looked like my performance. 54 00:02:36,800 --> 00:02:40,000 If I invested in spy would have looked like this the red line 55 00:02:40,700 --> 00:02:43,700 and my performance in reality investing in the story fund 56 00:02:43,700 --> 00:02:46,500 looks like this the blue line. So right now we are 57 00:02:46,500 --> 00:02:50,700 underperforming the alternate reality as if I invested in spy 58 00:02:51,000 --> 00:02:54,900 but this is still ongoing. We're only a couple years in and 59 00:02:54,900 --> 00:02:57,400 one thing I'll know is that we're starting to close the gap 60 00:02:57,400 --> 00:02:59,600 a little bit. We were, we were down quite a 61 00:02:59,600 --> 00:03:02,300 bit. We were afar ways away from Spy. 62 00:03:02,800 --> 00:03:04,200 Now, we're getting a little bit closer here. 63 00:03:04,400 --> 00:03:06,400 We're kind of in a closer distance. 64 00:03:06,900 --> 00:03:09,600 Things can change really fast with individual companies, a 65 00:03:09,600 --> 00:03:12,900 concentrated portfolio. It only takes a couple Holdings 66 00:03:12,900 --> 00:03:16,600 in my portfolio to do really well to close this Gap, very, 67 00:03:16,600 --> 00:03:18,800 very quickly. So right now we're down around 68 00:03:18,800 --> 00:03:22,000 9% from the beginning. This is time-weighted again, and 69 00:03:22,000 --> 00:03:25,500 yes, I'm p500. As of updated today is up three 70 00:03:25,500 --> 00:03:28,800 point three, five percent. So we still have 12 or 13 71 00:03:28,800 --> 00:03:32,200 percent Gap. Between my portfolio and the S&P 72 00:03:32,200 --> 00:03:34,300 500. What I'll be doing is I'll be 73 00:03:34,300 --> 00:03:37,300 tracking this spreadsheet and I'll be giving updates every 74 00:03:37,300 --> 00:03:40,900 single week going into 2025 and 2026. 75 00:03:41,000 --> 00:03:44,500 Now, of course outperforming, the S&P 500 is very difficult 76 00:03:44,600 --> 00:03:47,300 and I'll be interesting to see how this plays out the way that 77 00:03:47,300 --> 00:03:51,000 I plan on outperforming the S&P 500 with this portfolio is by 78 00:03:51,000 --> 00:03:53,800 investing in what I consider to be compounding machines, 79 00:03:54,100 --> 00:03:56,800 companies that can grow their intrinsic value year after year. 80 00:03:57,200 --> 00:04:01,700 What I gauge to be intrinsic value, The biggest estimates are 81 00:04:01,700 --> 00:04:04,100 the biggest things that I think factor into intrinsic value of 82 00:04:04,100 --> 00:04:07,000 companies is there consistent Revenue. 83 00:04:07,300 --> 00:04:10,200 They're consistent earnings per share and they're consistent 84 00:04:10,200 --> 00:04:13,000 free cash flow per share. So I'm looking for companies 85 00:04:13,000 --> 00:04:14,700 that can grow those three metrics. 86 00:04:14,900 --> 00:04:17,800 They can grow Revenue, they can grow earnings per share and they 87 00:04:17,800 --> 00:04:20,600 can grow especially the free cash flow per share. 88 00:04:21,000 --> 00:04:24,700 I believe the free cash flow per share is the best gauge of the 89 00:04:24,700 --> 00:04:27,300 intrinsic value of a company. So when I'm looking at the 90 00:04:27,300 --> 00:04:30,500 company's I'm investing in, I'm selecting, Ones that I think 91 00:04:30,500 --> 00:04:33,700 we'll have a lot of free cash flow per share growth over the 92 00:04:33,700 --> 00:04:36,300 next five years. Let's go ahead and start off 93 00:04:36,300 --> 00:04:40,600 looking at Amazon. Amazon is a company, I love the 94 00:04:40,600 --> 00:04:42,300 company. Overall, I love the retail 95 00:04:42,300 --> 00:04:45,700 business, I love the Amazon subscription, the Amazon Prime 96 00:04:45,700 --> 00:04:48,400 service. I've had it for over 12 years. 97 00:04:48,400 --> 00:04:50,200 I've been a subscriber of Amazon Prime. 98 00:04:50,600 --> 00:04:54,700 I like the Prime video library. I like all, they're all the 99 00:04:54,707 --> 00:04:56,600 things they offer with the prime service. 100 00:04:56,600 --> 00:05:00,200 I like AWS as a developer. I have an appreciation for How 101 00:05:00,200 --> 00:05:03,000 powerful AWS is. And then, of course, they have 102 00:05:03,000 --> 00:05:06,000 the ads business, which I think is a pretty spectacular business 103 00:05:06,000 --> 00:05:09,300 to Amazon developed, basically out of nowhere, just off of 104 00:05:09,308 --> 00:05:11,800 their website. So, Amazon's a company that 105 00:05:11,800 --> 00:05:15,100 keeps coming up with Incredible businesses that I don't believe 106 00:05:15,100 --> 00:05:18,200 are fully appreciated by the market by that. 107 00:05:18,200 --> 00:05:21,300 I mean, the company's undervalued, it's literally not 108 00:05:21,300 --> 00:05:23,000 being appreciated by market participants. 109 00:05:23,008 --> 00:05:25,400 We can look at the story of the price. 110 00:05:25,400 --> 00:05:30,500 It was creating for around $80 in And 18. 111 00:05:30,800 --> 00:05:36,800 It went up to $180 in 2021 and 2020 and it hung around this 112 00:05:36,800 --> 00:05:38,100 period for a long period of time. 113 00:05:38,600 --> 00:05:40,100 I was buying the company right here. 114 00:05:40,400 --> 00:05:43,000 I bought the company after it dipped and I bought the company 115 00:05:43,000 --> 00:05:46,400 after it dipped again, I haven't given up on Amazon because I 116 00:05:46,407 --> 00:05:49,000 think the company is much stronger today than it was five 117 00:05:49,000 --> 00:05:52,000 years ago. I believe that the main drivers 118 00:05:52,000 --> 00:05:55,500 of intrinsic value which is the retail business, the Amazon 119 00:05:55,700 --> 00:05:59,400 Prime subscription, the advertising business and AWS. 120 00:05:59,900 --> 00:06:03,300 All of those business lines are substantially, bigger more 121 00:06:03,300 --> 00:06:06,200 economically powerful than they were five years ago. 122 00:06:07,000 --> 00:06:11,300 So, so right now we're in a situation where the price has 123 00:06:11,300 --> 00:06:15,600 gone down over the past three years while the intrinsic value 124 00:06:15,600 --> 00:06:18,800 drivers. The ads business Prime service 125 00:06:19,100 --> 00:06:22,800 AWS have all increased. The reason that investors are 126 00:06:22,800 --> 00:06:26,300 selling out of this company is because of the free cash flow. 127 00:06:26,600 --> 00:06:29,700 The free cash flow has been put into the - because of me. 128 00:06:29,800 --> 00:06:31,800 Massive Investments. Amazon is done. 129 00:06:32,000 --> 00:06:36,700 Remember that free cash flow is the cash from operations - 130 00:06:36,700 --> 00:06:40,000 Capital expenditures. So you have to subtract Capital 131 00:06:40,000 --> 00:06:44,100 expenditures will Amazon spent a lot of money on capex over the 132 00:06:44,100 --> 00:06:46,900 past two years to double their fulfillment Network. 133 00:06:47,200 --> 00:06:49,200 In fact, I've looked at the charts of the amount of 134 00:06:49,200 --> 00:06:52,600 warehouses they have and this is what it looks like over time. 135 00:06:53,200 --> 00:06:55,500 This is what their actual amount of warehouses. 136 00:06:55,500 --> 00:06:59,500 Looks like the growth of it. It goes along this period. 137 00:06:59,800 --> 00:07:03,300 And then in 2020, the amount of warehouses goes like this. 138 00:07:05,900 --> 00:07:09,700 They doubled the amount of warehouses the entire company. 139 00:07:09,700 --> 00:07:14,400 Has they doubled that amount in literally a one year period from 140 00:07:14,400 --> 00:07:16,600 the entire amount they had over the past 20 years. 141 00:07:17,100 --> 00:07:21,100 So obviously when they make that radical of an investment it 142 00:07:21,100 --> 00:07:24,500 throws the amount of capex way into the sky and amount of free 143 00:07:24,500 --> 00:07:27,500 cash flow through the floor. That's what we're seeing here. 144 00:07:28,100 --> 00:07:30,000 In my opinion. I think that these are good 145 00:07:30,000 --> 00:07:31,800 Investments. I think the Amazon will have a 146 00:07:31,800 --> 00:07:35,100 positive Roi on them. So, what I expect to see and 147 00:07:35,100 --> 00:07:38,700 this is where It gets a little bit more into predictions but 148 00:07:38,700 --> 00:07:42,500 what I'm expecting to see is a large, influx of positive free 149 00:07:42,500 --> 00:07:44,700 cash flow. I don't know exactly when this 150 00:07:44,700 --> 00:07:47,700 is going to happen I can't say specifically which quarters it's 151 00:07:47,700 --> 00:07:49,800 going to happen. I think over the next couple of 152 00:07:49,800 --> 00:07:53,200 years we could see forty fifty sixty billion dollars of free 153 00:07:53,200 --> 00:07:56,700 cash flow from Amazon per year and see that grow. 154 00:07:57,100 --> 00:07:59,400 If that happened. I think there would be immense 155 00:07:59,400 --> 00:08:03,000 upside for the company. Another problem with Amazon is 156 00:08:03,100 --> 00:08:05,600 the cost of the company. They've had a lot. 157 00:08:05,800 --> 00:08:08,600 Employees at their hiring. They've up the pay, they've up 158 00:08:08,600 --> 00:08:10,600 the benefits. You can see these stock-based 159 00:08:10,600 --> 00:08:13,700 compensation accelerating up to 19 billion dollars. 160 00:08:14,200 --> 00:08:17,300 That's been a problem for the company, and Amazon is currently 161 00:08:17,300 --> 00:08:19,600 addressing that. They've done multiple rounds of 162 00:08:19,600 --> 00:08:21,900 layoffs, they're doing cost-cutting, they're cutting 163 00:08:21,900 --> 00:08:24,600 down entire departments. I've heard from employees of 164 00:08:24,600 --> 00:08:26,900 Amazon that they're focused on that a lot. 165 00:08:27,000 --> 00:08:30,000 They're making every aspect of their business more efficient. 166 00:08:30,300 --> 00:08:33,100 So I think that's going to be another driver value over the 167 00:08:33,100 --> 00:08:35,299 upcoming years. Now, another thing I'll mention 168 00:08:35,400 --> 00:08:38,299 is the these analysts notes that we're getting a lot of analysts 169 00:08:38,299 --> 00:08:41,200 are now seeing over 50% upside for Amazon. 170 00:08:41,299 --> 00:08:45,200 In this note for Morgan Stanley, they say the incremental AWS 171 00:08:45,200 --> 00:08:49,200 headcount reductions should help protect AWS ebit through the 172 00:08:49,200 --> 00:08:53,000 near-term macro and optimization driven deceleration. 173 00:08:53,400 --> 00:08:58,700 Indeed are a wsq to 2023 and full year 23 E B margins Rise by 174 00:08:58,700 --> 00:09:03,500 100 basis points. 50 basis points now, at 21 percent to 22 175 00:09:03,500 --> 00:09:05,500 percent respectively. So they're saying that the 176 00:09:05,700 --> 00:09:09,000 Margins are going to increase on AWS because of the lower head 177 00:09:09,000 --> 00:09:11,600 count, they're going to reduce the amount of employees and have 178 00:09:11,600 --> 00:09:14,900 the same Revenue. They also increase their 179 00:09:14,900 --> 00:09:18,400 projections for 2024, the margins on that as well, they 180 00:09:18,400 --> 00:09:21,800 say are 23 and 24. E, b Rises as incremental 181 00:09:21,800 --> 00:09:23,800 headcount cut speaks to the levers. 182 00:09:24,100 --> 00:09:28,100 Amazon has to pull to Scaly bit in addition to continue to 183 00:09:28,100 --> 00:09:30,800 fulfillment and shipping cost per unit improvements from 184 00:09:30,800 --> 00:09:34,600 Leverage and overbuild. So Amazon did overbuild. 185 00:09:34,900 --> 00:09:38,700 They built to Any warehouses, they over estimated their demand 186 00:09:38,900 --> 00:09:40,400 and they're trying to grow into that. 187 00:09:40,700 --> 00:09:42,200 But that is something they can fix. 188 00:09:42,200 --> 00:09:45,000 Companies can reduce the amount of head count, especially in 189 00:09:45,008 --> 00:09:48,400 warehouses, they simply stop hiring people and natural 190 00:09:48,400 --> 00:09:52,300 turnover will reduce headcount. So Morgan Stanley sees a Target 191 00:09:52,300 --> 00:09:55,700 price. Now of $150, which represents a 192 00:09:55,700 --> 00:09:58,600 52% upside. Now my average price on Amazon 193 00:09:58,600 --> 00:10:01,900 is 134. So if Amazon traded up to 150, 194 00:10:02,100 --> 00:10:03,900 I'd be heavily in the green at that point. 195 00:10:03,900 --> 00:10:05,500 Probably 12, 15 thousand dollars. 196 00:10:05,700 --> 00:10:07,600 So it'd be a big winner at that point. 197 00:10:07,600 --> 00:10:10,500 So things can change quickly Amazon's a big loser for me 198 00:10:10,500 --> 00:10:12,400 right now. I think holding on to this 199 00:10:12,400 --> 00:10:15,100 company over the next couple of years, I'm optimistic that it 200 00:10:15,100 --> 00:10:17,500 will be a big winner. Next up, we have Netflix. 201 00:10:17,500 --> 00:10:21,100 This is a company that has actually recovered a lot. 202 00:10:21,100 --> 00:10:25,300 I'm now down 24% on the stock. At one point, this thing was 203 00:10:25,300 --> 00:10:28,900 down around, 50% it recovered. It went up 100%. 204 00:10:29,000 --> 00:10:31,200 Now I'm down twenty four percent, which is minus eight 205 00:10:31,200 --> 00:10:32,900 thousand dollars. Let's go ahead and take a look 206 00:10:32,900 --> 00:10:36,400 at Netflix here. This one has a lot of news 207 00:10:36,400 --> 00:10:38,800 that's upsetting customers the password. 208 00:10:38,800 --> 00:10:40,500 Sharing problem is something that's upset. 209 00:10:40,500 --> 00:10:43,300 A lot of people but as an investor you have to look at 210 00:10:43,300 --> 00:10:46,400 this both ways I can't just look at if customers are upset, I 211 00:10:46,408 --> 00:10:49,000 have to look at if this is impacting, the company in a 212 00:10:49,000 --> 00:10:51,800 negative way. While there's many reports that 213 00:10:51,800 --> 00:10:55,300 people are canceling Netflix and they're outraged, there's also a 214 00:10:55,300 --> 00:10:58,900 lot of data to show that people still love Netflix, they still 215 00:10:58,900 --> 00:11:02,000 love the content, and many of them are signing up for their 216 00:11:02,000 --> 00:11:04,500 own plans. We can look at a couple Anna. 217 00:11:04,700 --> 00:11:07,400 It's reports here. This one is from, let's take a 218 00:11:07,408 --> 00:11:09,500 look here. This one's from Wells, Fargo. 219 00:11:10,400 --> 00:11:13,500 We have a Wells Fargo analysts saying, quote, while much has 220 00:11:13,500 --> 00:11:17,100 been written about a vodka, the ad supported video on demand. 221 00:11:17,100 --> 00:11:18,400 That's the new plan from Netflix. 222 00:11:18,900 --> 00:11:22,300 Paid sharing is arguably the bigger near term earnings 223 00:11:22,300 --> 00:11:25,100 opportunity. Given some 100 million Global 224 00:11:25,100 --> 00:11:27,600 page, shares, 30 million domestically. 225 00:11:28,000 --> 00:11:31,500 There's a lot of people sharing accounts, a lot to 100 million 226 00:11:31,500 --> 00:11:34,800 households are sharing accounts and while forecasting page Thing 227 00:11:34,800 --> 00:11:36,100 is tough Wall. Street. 228 00:11:36,100 --> 00:11:40,600 Consensus is at 15 million. Net adds this year, quote paid 229 00:11:40,600 --> 00:11:44,000 sharing alone, could be more than 20 million in our base 230 00:11:44,000 --> 00:11:46,500 case. So they believe that there is 231 00:11:46,500 --> 00:11:50,300 substantial upside with the paid sharing, meaning that out of all 232 00:11:50,300 --> 00:11:53,000 the people being cut off. Not all of them are just going 233 00:11:53,000 --> 00:11:56,400 to go without Netflix forever. They're going to want Netflix so 234 00:11:56,400 --> 00:11:58,500 they're going to eventually sign back up for it. 235 00:11:58,500 --> 00:12:01,100 Maybe on a cheaper plan, maybe they'll do the seven dollar a 236 00:12:01,108 --> 00:12:05,100 month, add to your plan, either way, they're expecting an All 20 237 00:12:05,100 --> 00:12:07,000 million signups through the paid sharing. 238 00:12:07,600 --> 00:12:10,100 Now we have another report here. This one is from Bank of 239 00:12:10,100 --> 00:12:13,000 America, so we had Wells Fargo. Now we have Bank of America 240 00:12:13,000 --> 00:12:17,500 commenting on Netflix analyst Jessica Reef who reiterated her 241 00:12:17,500 --> 00:12:21,500 by rating and per share price, target of 410 for Netflix cited, 242 00:12:21,500 --> 00:12:23,200 an unnamed third party data source. 243 00:12:23,200 --> 00:12:26,400 That shows a company will add subscribers in North America. 244 00:12:26,400 --> 00:12:30,400 At significantly stronger rates than the 100,000 Wall Street is 245 00:12:30,400 --> 00:12:33,500 expecting, so this is what wall Street's looking for a hundred 246 00:12:33,500 --> 00:12:37,400 thousand net additions. They say specifically, the data 247 00:12:37,400 --> 00:12:41,200 source has indicated that net ads will be greater than 500,000 248 00:12:41,200 --> 00:12:45,100 in the US and Canada as gross ads and Canada, have accelerated 249 00:12:45,200 --> 00:12:47,900 materially. Now, this is a little bit 250 00:12:47,900 --> 00:12:52,200 surprising what I've seen in YouTube videos and outraged. 251 00:12:52,300 --> 00:12:56,400 Outraged viewers of Netflix, is that Canada overall is done with 252 00:12:56,400 --> 00:12:58,000 Netflix. They're quitting the platform, 253 00:12:58,000 --> 00:13:01,000 they're canceling, the service because they were able to share 254 00:13:01,000 --> 00:13:03,300 before. Now they're not sharing any more 255 00:13:03,600 --> 00:13:05,900 so Canada is. Be done with Netflix's what I've 256 00:13:05,900 --> 00:13:08,700 been hearing but then we have third-party data sources. 257 00:13:08,700 --> 00:13:11,200 That are saying that Canada is actually signing up for Netflix, 258 00:13:11,500 --> 00:13:13,700 there's more subscribers there than there was previously. 259 00:13:14,300 --> 00:13:18,100 Of course, this isn't confirmed. I would not go out and buy a 260 00:13:18,100 --> 00:13:20,300 Netflix specifically because of this rumor. 261 00:13:20,900 --> 00:13:22,800 But this is an alternate data source. 262 00:13:22,800 --> 00:13:26,700 This is an analyst, from Bank of America sing that these numbers 263 00:13:26,700 --> 00:13:29,200 should be strong based on the analytics they're looking at. 264 00:13:29,800 --> 00:13:32,600 They also noted that password turn Crackdown in Canada has 265 00:13:32,600 --> 00:13:35,600 gone. Well, Again this is the opposite 266 00:13:35,600 --> 00:13:39,000 of everything that social media would lead you to believe which 267 00:13:39,000 --> 00:13:42,100 bodes well for the eventual launch in the u.s. even if it 268 00:13:42,100 --> 00:13:44,900 doesn't boost the company's first, quarter Revenue that much 269 00:13:45,100 --> 00:13:47,200 the indication of much stronger than anticipated. 270 00:13:47,200 --> 00:13:49,300 Sub data in Canada is encouraging. 271 00:13:49,300 --> 00:13:52,500 Sign that Netflix recent Crackdown on password sharing is 272 00:13:52,500 --> 00:13:55,300 driving a new Subs to the service analysts noted. 273 00:13:55,300 --> 00:13:57,900 So here we have a lot of conflicting data about Netflix. 274 00:13:58,200 --> 00:14:01,800 We have a lot of social media outrage on them cracking down on 275 00:14:01,800 --> 00:14:05,100 password sharing but then the actual Third party analytics 276 00:14:05,100 --> 00:14:07,100 show that people are signing up for their own accounts. 277 00:14:07,400 --> 00:14:09,100 So how is this going to impact the stock? 278 00:14:09,100 --> 00:14:11,700 We're just going to have to wait and see but overall this isn't a 279 00:14:11,708 --> 00:14:13,200 main reason I'm invested in Netflix. 280 00:14:13,200 --> 00:14:15,500 It has nothing to do with password sharing, what's going 281 00:14:15,500 --> 00:14:18,100 to happen next quarter. That's not the reason I bought 282 00:14:18,100 --> 00:14:21,100 this company. I consider Netflix to be a 283 00:14:21,100 --> 00:14:24,500 long-term. Compounder a company that will 284 00:14:24,500 --> 00:14:27,900 grow its earnings and free cash flow substantially over the next 285 00:14:27,900 --> 00:14:30,500 10 years. Media companies like Netflix and 286 00:14:30,500 --> 00:14:33,800 Disney and Paramount and MBC they last forever. 287 00:14:33,900 --> 00:14:37,400 Generations, hundreds of years. I think that Netflix will be 288 00:14:37,400 --> 00:14:40,400 around for 50 plus years, so it's one that I'm happy to 289 00:14:40,400 --> 00:14:43,200 dollar cost average. In another big thing, I'm 290 00:14:43,200 --> 00:14:47,100 looking at here is while Netflix historically has been a 291 00:14:47,100 --> 00:14:50,200 money-losing free, cash flow negative company. 292 00:14:50,700 --> 00:14:54,600 They've had the influx, the influx of positive free cash 293 00:14:54,600 --> 00:14:56,700 flow. If I break this down annually, 294 00:14:57,100 --> 00:15:01,400 this is what it looks like. Again - free cash flow for years 295 00:15:01,400 --> 00:15:05,100 prior and then all of a sudden they have the rapid influx and 296 00:15:05,100 --> 00:15:08,300 positive free cash flow. That represents operating 297 00:15:08,300 --> 00:15:12,100 leverage and scalability, the company's exercising, strong 298 00:15:12,100 --> 00:15:15,300 operating leverage, that's where we seeing free cash, flows of 299 00:15:15,300 --> 00:15:19,600 1.6 billion dollars in 2022. And I'll mention that that's 300 00:15:19,600 --> 00:15:22,000 much higher than the stock based compensation as well. 301 00:15:22,400 --> 00:15:25,600 So, this is a free cash flow generative company this year in 302 00:15:25,600 --> 00:15:28,400 2023. They're expecting to double this 303 00:15:28,400 --> 00:15:30,200 from one. It's six to three billion 304 00:15:30,200 --> 00:15:33,500 dollars in free cash flow. That is an immense growth rate 305 00:15:33,500 --> 00:15:36,200 in free cash flow and the free cash flow per share of the 306 00:15:36,200 --> 00:15:39,000 company. So I'm looking at Netflix as a 307 00:15:39,000 --> 00:15:42,000 profitable company highly profitable that's going to be a 308 00:15:42,000 --> 00:15:46,000 cash generative machine that can pay dividends in Dubai backs and 309 00:15:46,000 --> 00:15:48,400 I'll be around for 100 years. That's the reason that I'm 310 00:15:48,408 --> 00:15:50,700 invested in the company. Now, let's go ahead and move on. 311 00:15:50,800 --> 00:15:53,300 Let's go ahead and take a look at Google here for me. 312 00:15:53,300 --> 00:15:56,000 The investment thesis, really hasn't changed much at all for 313 00:15:56,000 --> 00:15:58,800 Google. The company has a PE ratio of 17 314 00:15:58,900 --> 00:16:02,000 .8, it's around the same as the market average. 315 00:16:02,000 --> 00:16:05,200 The company is a substantially better company than the market 316 00:16:05,200 --> 00:16:07,600 average. It has a massive cash balance 317 00:16:07,600 --> 00:16:10,600 that they can use any time. There's really no risk of ever 318 00:16:10,600 --> 00:16:13,300 going bankrupt because they have 100 billion dollars in cash. 319 00:16:13,800 --> 00:16:17,000 On top of that they have a free cash flow yield of four point 320 00:16:17,000 --> 00:16:19,900 three seven percent. So it's just a phenomenal 321 00:16:19,900 --> 00:16:23,600 company, a wide moat service based company with multiple 322 00:16:23,600 --> 00:16:26,600 growing aspects of it. I think investors are sleeping 323 00:16:26,600 --> 00:16:28,800 on Google Cloud, one of the main value drivers. 324 00:16:29,000 --> 00:16:31,200 Of the company, we're going to see Google Cloud. 325 00:16:31,200 --> 00:16:33,500 Probably become profitable this year. 326 00:16:33,900 --> 00:16:36,600 If we see that, I think they'll be a major tail when for the 327 00:16:36,600 --> 00:16:39,200 company. The biggest complaint about 328 00:16:39,200 --> 00:16:43,400 Google that investors have is the undisciplined cost structure 329 00:16:43,400 --> 00:16:46,300 of the company. They spend a lot of money on 330 00:16:46,700 --> 00:16:49,400 random things and investors don't like hiring 50 different 331 00:16:49,400 --> 00:16:51,400 masseuses at their locations, right? 332 00:16:51,400 --> 00:16:53,900 Things like that. They have a lot of stock-based 333 00:16:53,900 --> 00:16:56,600 compensation. That's a little bit dilute of to 334 00:16:56,600 --> 00:16:59,200 the free cash flow. But these are things that Google 335 00:16:59,200 --> 00:17:01,300 can work on. They can solve these aren't 336 00:17:01,300 --> 00:17:04,700 unfixable problems and Google is doing that by reducing the 337 00:17:04,708 --> 00:17:07,400 amount of head count focusing on cost structure. 338 00:17:07,599 --> 00:17:09,400 So, for me, Google simple, I think the company is 339 00:17:09,400 --> 00:17:11,000 undervalued. It's a wide moat company that 340 00:17:11,000 --> 00:17:14,700 has multiple growth levers, especially with Google cloud. 341 00:17:15,000 --> 00:17:17,000 And I don't believe that Microsoft is going to take 342 00:17:17,000 --> 00:17:19,900 enough market share to have a meaningful impact on Google's 343 00:17:19,900 --> 00:17:22,599 future. So as of now, I remain just as 344 00:17:22,599 --> 00:17:24,300 bullish is on day one at buying Google. 345 00:17:24,599 --> 00:17:26,500 I think the company is widely undervalued. 346 00:17:26,900 --> 00:17:30,600 Next up, we have Microsoft this Me, I'm in the green on, it's 347 00:17:30,600 --> 00:17:33,500 actually outperform the market since buying it and this is one 348 00:17:33,500 --> 00:17:37,100 that I'd say relative to the rest of the market is performed 349 00:17:37,100 --> 00:17:40,700 really good and it's not one that I would be buying right now 350 00:17:40,700 --> 00:17:42,400 because I think there's better deals. 351 00:17:42,700 --> 00:17:45,600 I think Google's a better deal. I think Amazon's a better deal, 352 00:17:45,900 --> 00:17:48,500 Microsoft is an incredibly high quality company. 353 00:17:48,800 --> 00:17:52,400 I said this often when I look at Microsoft's fundamentals on qual 354 00:17:52,400 --> 00:17:54,900 trim. It's almost comical. 355 00:17:54,900 --> 00:17:57,400 How good they are. It's like the poster child of 356 00:17:57,400 --> 00:18:00,000 the perfect fundamentals in a P'nay, the revenue. 357 00:18:00,000 --> 00:18:02,400 Always grows the ibadah, grows the free, cash flow gross, and 358 00:18:02,400 --> 00:18:04,300 net income goes up the earnings per share. 359 00:18:04,300 --> 00:18:06,200 Goes up. The balance sheet has a ton of 360 00:18:06,200 --> 00:18:07,900 cash. The dividend growth is 361 00:18:07,900 --> 00:18:10,800 remarkable and long-standing. The shares outstanding 362 00:18:10,800 --> 00:18:13,600 continually go down, showing the company's doing a lot of 363 00:18:13,600 --> 00:18:15,600 BuyBacks. They have their expenses under 364 00:18:15,600 --> 00:18:18,400 control and of course they have very high Returns on Capital 365 00:18:18,400 --> 00:18:21,000 employed. This is through and through a 366 00:18:21,000 --> 00:18:24,400 compounder and then all of the businesses there in are 367 00:18:24,400 --> 00:18:27,700 incredibly wide moat businesses, they're in a lot of growth here. 368 00:18:27,700 --> 00:18:32,400 Is there in video Is there an Azure Cloud hosting the second 369 00:18:32,400 --> 00:18:35,400 competitor to AWS? They have all their Suite of 370 00:18:35,400 --> 00:18:37,900 business software which they're implementing all the AI 371 00:18:37,900 --> 00:18:40,300 Technologies in. I think the company is 372 00:18:40,300 --> 00:18:42,500 incredible, it has a ton of growth ahead of it. 373 00:18:42,800 --> 00:18:46,300 Having said that, when I'm looking at opportunities and 374 00:18:46,300 --> 00:18:49,300 what I think is currently the best value, my portfolio. 375 00:18:50,100 --> 00:18:53,400 Microsoft is now trading below a three percent free, cash flow 376 00:18:53,400 --> 00:18:56,600 yield. So it's priced at a price point 377 00:18:56,800 --> 00:18:58,700 where there's not as much margin of error. 378 00:18:58,900 --> 00:19:01,600 And I don't think there's much room for upside multiple 379 00:19:01,600 --> 00:19:05,300 expansion. I think over time, Microsoft is 380 00:19:05,300 --> 00:19:09,300 a company that can trade above a 30 PE ratio, but you don't 381 00:19:09,300 --> 00:19:11,500 really want to bank on that. That's not something I really 382 00:19:11,500 --> 00:19:13,900 want to bet on. So right now I'm not selling 383 00:19:13,900 --> 00:19:15,300 Microsoft. I'm going to hold it in the 384 00:19:15,300 --> 00:19:17,900 portfolio but I'm simply not buying it right now. 385 00:19:17,900 --> 00:19:20,900 I'm going to let Microsoft run, I think the company's great but 386 00:19:20,900 --> 00:19:24,100 I'm not adding to the position at this point in time after 387 00:19:24,100 --> 00:19:30,300 Microsoft we have Adobe I really like Adobe this It just amazes 388 00:19:30,300 --> 00:19:33,500 me what this company can do. First of all, I'm basically flat 389 00:19:33,500 --> 00:19:37,300 on the company so I own around ten thousand dollars of it and 390 00:19:37,300 --> 00:19:41,300 I'm down 1.7% $170. Let's go ahead and bring up 391 00:19:41,300 --> 00:19:44,300 adobe here and let me talk about what impresses me the most about 392 00:19:44,300 --> 00:19:46,500 this company in this holding and the way that they've managed to 393 00:19:46,500 --> 00:19:49,200 company. First of all, I think Adobe 394 00:19:49,200 --> 00:19:52,900 right now is undervalued. I'd rather by Adobe and I have 395 00:19:52,900 --> 00:19:55,200 bought this company more recently than Microsoft. 396 00:19:55,200 --> 00:19:58,100 For example, the free cash flow yield is higher at a four point 397 00:19:58,100 --> 00:20:00,200 one six. Scent free cash flow yield. 398 00:20:00,200 --> 00:20:03,500 The stock based composite not unreasonable and the forward 399 00:20:03,500 --> 00:20:09,000 P/E, ratios only 22 a 22 for PE ratio for company that has a 400 00:20:09,000 --> 00:20:13,500 moat as wide as adobe's. And a recurring Revenue stream, 401 00:20:13,500 --> 00:20:17,200 almost all of their revenue is subscription-based with a very 402 00:20:17,200 --> 00:20:20,200 high reoccurring Revenue stream, the growth of the company's 403 00:20:20,200 --> 00:20:22,900 astronomical. You look at these charts and 404 00:20:22,900 --> 00:20:25,900 there's not many companies like it, the growth in ibadah, the 405 00:20:25,900 --> 00:20:28,500 growth and free cash flow. We've seen it all their free 406 00:20:28,500 --> 00:20:30,200 cash. Per share growth, which is what 407 00:20:30,200 --> 00:20:33,700 I said is my biggest, focus is 20 percent. 408 00:20:33,700 --> 00:20:38,200 Compounded over the past decade 20 percent over 10 year period, 409 00:20:38,400 --> 00:20:41,500 this company knows how to grow free cash flow per share. 410 00:20:42,200 --> 00:20:45,400 And then you might think that adobe has a lot of competition. 411 00:20:45,400 --> 00:20:48,300 They have companies taking over. Well, one of them are trying to 412 00:20:48,300 --> 00:20:50,800 buy, which is figma, which I hope the deal goes through. 413 00:20:50,800 --> 00:20:53,600 I think it would be a great addition to their product Suite. 414 00:20:54,000 --> 00:20:57,000 If not, I'm going to remain invested in Adobe what they're 415 00:20:57,000 --> 00:20:59,600 building specifically with. Firefly. 416 00:21:00,300 --> 00:21:02,800 I don't consider myself too easily impressed. 417 00:21:03,100 --> 00:21:06,100 And I think that this is incredibly impressive, I am 418 00:21:06,100 --> 00:21:09,600 blown away by the Technologies. This companies developing an AI 419 00:21:10,000 --> 00:21:13,900 Adobe did not contract. They didn't use the API of a 420 00:21:13,900 --> 00:21:16,200 different company. They didn't just by a different 421 00:21:16,200 --> 00:21:19,900 company, to, to build this product, they built this from 422 00:21:19,900 --> 00:21:23,400 the ground up. It's not a thin veneer Firefly 423 00:21:23,400 --> 00:21:27,600 is 100% owned by Adobe, and this is where you can create images 424 00:21:27,600 --> 00:21:29,900 out of text prompts. And then you can do crazy 425 00:21:29,900 --> 00:21:32,700 amounts of editing of the images after you create them. 426 00:21:33,100 --> 00:21:34,500 It shows all these little changes. 427 00:21:34,500 --> 00:21:37,600 You can make like, you can change the lighthouse here with 428 00:21:37,600 --> 00:21:40,700 a click of a button. You can add more, add an 429 00:21:40,700 --> 00:21:43,000 underwater city. It says and it just builds it 430 00:21:43,000 --> 00:21:45,300 right there. The image creation is just 431 00:21:45,300 --> 00:21:48,800 incredible what they're doing with type facing is also just 432 00:21:48,800 --> 00:21:50,900 incredible. So adobe's this company that's 433 00:21:50,900 --> 00:21:54,200 fast-growing has a durable competitive Advantage. 434 00:21:54,200 --> 00:21:57,400 I think the companies developing amazing tools with firefly being 435 00:21:57,400 --> 00:22:00,000 the recent one. Overall, I'm excited to hold 436 00:22:00,000 --> 00:22:02,200 this company. I don't see any real problems 437 00:22:02,200 --> 00:22:04,700 with Adobe moving on. We have Salesforce. 438 00:22:04,700 --> 00:22:07,400 This is a company that I previously had a lot more gripes 439 00:22:07,400 --> 00:22:09,900 with especially the management of the company. 440 00:22:10,400 --> 00:22:14,300 It was doing the low interest rate environment phenomenon of 441 00:22:14,300 --> 00:22:17,900 wasting money casual spending lots of pet projects, lots of 442 00:22:17,900 --> 00:22:22,600 big events for the investors and the CEO had reports of hanging 443 00:22:22,600 --> 00:22:24,900 out with celebrities having them on the payroll. 444 00:22:25,300 --> 00:22:27,700 Lots of things that I didn't really want to see for a company 445 00:22:28,000 --> 00:22:31,800 that had been Gurgling now the CEO did what Mark Zuckerberg 446 00:22:31,800 --> 00:22:34,400 did. He did a massive pivot in the 447 00:22:34,400 --> 00:22:35,800 direction. He was taking the company 448 00:22:36,100 --> 00:22:39,300 instead of focusing on the metaverse and fun pet projects. 449 00:22:39,600 --> 00:22:41,900 He decided to focus on efficiency. 450 00:22:42,000 --> 00:22:44,400 So what I would describe Marc benioff doing is a copycat 451 00:22:44,400 --> 00:22:48,300 version of Mark, Zuckerberg, a pivot to efficiency and that 452 00:22:48,300 --> 00:22:51,000 pivot has worked out. Well, if you can see this, this 453 00:22:51,000 --> 00:22:53,500 is the year to date. Performance of Salesforce, it's 454 00:22:53,500 --> 00:22:57,500 up 48 percent. Some massive recovery in the 455 00:22:57,500 --> 00:23:00,300 share price of this company. I'll be over the last five 456 00:23:00,300 --> 00:23:02,400 years. It still has Room to Grow, but 457 00:23:02,400 --> 00:23:04,800 Salesforce is a compound. It's a company that does have a 458 00:23:04,800 --> 00:23:07,700 lot of quality metrics. One of them, being the revenue 459 00:23:07,700 --> 00:23:10,800 of the company, it grows substantially, the free cash 460 00:23:10,800 --> 00:23:13,300 flow of the company. Grow substantially, the big flaw 461 00:23:13,300 --> 00:23:15,000 with the free cash flow. Is that a lot of it? 462 00:23:15,000 --> 00:23:19,800 Approximately 50% is eaten up by the stock based compensation. 463 00:23:20,300 --> 00:23:23,500 So they need to grow the free cash flow but they're also 464 00:23:23,500 --> 00:23:25,300 growing. The stock-based compensation 465 00:23:25,300 --> 00:23:28,500 lockstep, either way, the free cash flow per share is still 466 00:23:28,500 --> 00:23:30,100 growing being at an attractive rate. 467 00:23:30,100 --> 00:23:33,400 And again, the big Focus here for Salesforce going forward is 468 00:23:33,400 --> 00:23:36,500 efficiency. Meaning raising the margins 469 00:23:36,600 --> 00:23:39,800 cutting down on wasteful spending and making the company 470 00:23:39,800 --> 00:23:43,200 more profitable. They are doing this at a rapid 471 00:23:43,200 --> 00:23:47,100 speed, the margins at their guiding for this year are the 472 00:23:47,100 --> 00:23:50,000 margins that people were predicting 5 to 10 years from 473 00:23:50,000 --> 00:23:52,300 now. So Marc benioff to his credit. 474 00:23:52,300 --> 00:23:55,600 And I've been highly critical of him of the past to his credit. 475 00:23:55,600 --> 00:23:59,400 He pivoted hard to profitability and he's doing Faster than 476 00:23:59,400 --> 00:24:01,900 investors are expecting. So I think he needs credit where 477 00:24:01,900 --> 00:24:04,600 credit is due. He made this pivot very quickly 478 00:24:04,600 --> 00:24:06,900 and the stock is reacting as a response to it. 479 00:24:07,000 --> 00:24:08,800 We have reports here from Fortune. 480 00:24:08,800 --> 00:24:11,800 Another interview with him. Marc benioff says that he can 481 00:24:11,800 --> 00:24:14,500 juggle empathy Cost Cuts and layoffs. 482 00:24:14,500 --> 00:24:19,200 As he doubles down on efficiency at Salesforce taken straight 483 00:24:19,200 --> 00:24:22,100 from Mark Zuckerberg Marc, benioff is learning from 484 00:24:22,100 --> 00:24:25,800 Zuckerberg focusing on profits. It's what I like to see. 485 00:24:26,000 --> 00:24:27,700 At the end of the day, the profits and cash. 486 00:24:27,700 --> 00:24:29,800 Flows are what? You own of the company. 487 00:24:30,000 --> 00:24:33,300 So in terms of sales force, I have a lot of renewed enthusiasm 488 00:24:33,300 --> 00:24:35,400 in this company. The direction the Management's 489 00:24:35,400 --> 00:24:37,700 going, the direction, the company's going, I think is a 490 00:24:37,700 --> 00:24:41,800 fantastic Direction. Finally, we have apple one of 491 00:24:41,800 --> 00:24:44,400 the other companies that I'm actually in the green on by 492 00:24:44,400 --> 00:24:47,800 decent amount by 27% apples. A company I have in both 493 00:24:47,800 --> 00:24:50,400 portfolios and it's my biggest winner by far, I've been buying 494 00:24:50,400 --> 00:24:53,200 this company since 2017. Now, the first thing I want to 495 00:24:53,208 --> 00:24:55,500 mention with apple before, even looking at the metrics of the 496 00:24:55,500 --> 00:24:58,700 company, is this news right here, we're seeing lots of 497 00:24:58,900 --> 00:25:00,500 Ports. Again, and lots of rumors and 498 00:25:00,500 --> 00:25:03,200 talk about Apple potentially buying Disney. 499 00:25:04,000 --> 00:25:07,300 This rumor that continues on year after year. 500 00:25:07,900 --> 00:25:10,400 I just hate it. I hate the idea of Apple. 501 00:25:10,400 --> 00:25:13,500 Buying Disney, I realized the math checks out, because Apple 502 00:25:13,500 --> 00:25:15,400 has hundreds of millions of dollars in cash. 503 00:25:15,600 --> 00:25:18,600 They could easily by Disney. It would be it'd be something 504 00:25:18,600 --> 00:25:21,000 they could afford and then in a couple of years that have their 505 00:25:21,000 --> 00:25:24,200 cash balance right back up. So Apple could theoretically, 506 00:25:24,300 --> 00:25:27,300 they could mathematically by Disney, but the analysts saying 507 00:25:27,300 --> 00:25:30,200 that this would be a good idea are A Fool's Apple would 508 00:25:30,200 --> 00:25:32,700 instantly be wrapped up in multiple lawsuits from the 509 00:25:32,700 --> 00:25:35,100 government, from anti-competitive Clauses from 510 00:25:35,100 --> 00:25:39,200 the doj that have all of that, bad press of them being this big 511 00:25:39,200 --> 00:25:41,700 monopolistic business that swallowing up other beloved 512 00:25:41,700 --> 00:25:44,900 companies like Disney. That's not a good look for apple 513 00:25:44,900 --> 00:25:47,300 on top of all of the political and PR nightmare that would 514 00:25:47,300 --> 00:25:51,200 cause apples also accompanied that successful precisely 515 00:25:51,200 --> 00:25:53,300 because they're not buying other big companies. 516 00:25:53,500 --> 00:25:55,300 They've never done that in the past. 517 00:25:55,600 --> 00:25:58,600 And the last type of company Apple should buy is a 518 00:25:58,800 --> 00:26:02,800 Operationally complex business like Disney Disney is a complex 519 00:26:02,800 --> 00:26:06,900 company, they operate Parks, retail, cruise ships Broadway 520 00:26:07,100 --> 00:26:10,800 Blockbuster films, they have a whole Sports division, with ESPN 521 00:26:11,000 --> 00:26:14,500 and linear cable, and streaming, all of a sudden app would find 522 00:26:14,500 --> 00:26:17,300 itself having to manage multiple business lines. 523 00:26:17,500 --> 00:26:19,300 Some of which they've never managed before. 524 00:26:19,600 --> 00:26:22,600 And that would be a total nightmare for the company. 525 00:26:23,000 --> 00:26:25,500 They had increased the complexity without increasing 526 00:26:25,500 --> 00:26:28,600 the value of the company that much apple can build out. 527 00:26:28,700 --> 00:26:32,100 Similar things to Disney without having to buy Disney, they can 528 00:26:32,100 --> 00:26:34,300 build out their own streaming Library, they're doing that 529 00:26:34,300 --> 00:26:37,200 successfully, they can build out their own retail business. 530 00:26:37,400 --> 00:26:40,000 They've done that successfully with their their, their own 531 00:26:40,000 --> 00:26:43,000 devices. So Apple doesn't need Disney and 532 00:26:43,000 --> 00:26:46,800 they should not by Disney. If Apple tried to buy Disney, I 533 00:26:46,800 --> 00:26:49,400 would sell my holding an apple. That's how strongly I feel 534 00:26:49,400 --> 00:26:52,000 against this news. So that's the first thing that I 535 00:26:52,008 --> 00:26:54,000 wanted a dress. I think that some analysts don't 536 00:26:54,000 --> 00:26:56,200 think through things Beyond some simple math. 537 00:26:56,600 --> 00:26:59,800 Even the calculations of how that would be a Of don't check 538 00:26:59,800 --> 00:27:01,100 out. I've looked through the actual 539 00:27:01,200 --> 00:27:02,300 math on it. Now. 540 00:27:02,300 --> 00:27:04,800 Other than that, apples a high-quality compounder, we've 541 00:27:04,800 --> 00:27:06,000 looked at the fundamentals in this. 542 00:27:06,300 --> 00:27:08,700 They're growing their free cash flow, their free cash flow per 543 00:27:08,700 --> 00:27:10,700 share at an incredibly fast rate. 544 00:27:10,900 --> 00:27:13,900 They've also done well, this year as investors had renewed 545 00:27:13,900 --> 00:27:17,300 enthusiasm and tech companies, their revenue continues to grow. 546 00:27:17,700 --> 00:27:20,800 It might flatten out for a year or two, but I don't think the 547 00:27:20,800 --> 00:27:23,900 growth is over from Apple. There's a lot of ways to Apples 548 00:27:23,900 --> 00:27:26,700 growing without having to buy companies like Disney. 549 00:27:27,000 --> 00:27:28,300 The first one is the Apple watch. 550 00:27:28,300 --> 00:27:31,000 It's Coming a Genuine Health Care device. 551 00:27:31,400 --> 00:27:34,200 If they get glucose monitoring which there's rumors that 552 00:27:34,200 --> 00:27:37,000 they're getting closer to that, that will be a game changer for 553 00:27:37,000 --> 00:27:40,300 the Apple watch outside of that they're growing in the fintech 554 00:27:40,300 --> 00:27:42,000 category. The Wall Street Journal just 555 00:27:42,000 --> 00:27:44,500 came out with a report that they're making Banks nervous 556 00:27:44,700 --> 00:27:48,400 with how big of a network Apple. Pay is the Apple wallet is a 557 00:27:48,400 --> 00:27:51,000 growth path for apple. Apple has credit cards. 558 00:27:51,200 --> 00:27:53,900 They also just introduced a buy, now pay later service. 559 00:27:54,200 --> 00:27:57,800 This is consolidating finance onto the Apple platform away 560 00:27:57,800 --> 00:28:00,000 from the banks. So apple is still growing in 561 00:28:00,000 --> 00:28:02,500 lots of different ways. On top of that, they still sit 562 00:28:02,500 --> 00:28:05,800 atop their busy Bridge with their toll booth, which is the 563 00:28:05,800 --> 00:28:09,100 Apple Store and the service growth has been incredible for 564 00:28:09,100 --> 00:28:13,200 Apple over the past five years. So as of now, I'm still holding 565 00:28:13,200 --> 00:28:15,100 on the Apple. I'm not selling any of it. 566 00:28:15,100 --> 00:28:17,400 I'm just holding it because I still see a lot of positive 567 00:28:17,400 --> 00:28:19,100 things happening for the company. 568 00:28:19,100 --> 00:28:22,100 So that's the portfolio. Overall, every single company. 569 00:28:22,600 --> 00:28:24,700 That's the update for now. Let me know what you think, and 570 00:28:24,700 --> 00:28:26,100 I'll see you in the next one.