Roberto Chamorro gilaberte @robchamow: "💼 How is my portfolio..."

Spain

💼 How is my portfolio positioned today? Most of the companies in my portfolio are reporting record revenues, record profits and record cash flow generation. Yet many of them continue to trade below their historical valuation multiples because negative narratives still dominate market sentiment. Over the last 12 months, Nvidia, ASML, TSMC and Alphabet have been some of the biggest winners in the portfolio, each delivering well over 100% returns and becoming true baggers. I sold ASML and TSMC when valuations became too demanding, just as I previously did with Apple and Tesla. Valuation always matters. Today, many of my positions continue to trade below their historical average valuations. Companies such as Microsoft, Mastercard, Meta, Netflix, Booking, Hermès, Ferrari, LVMH and Nvidia still offer what I believe is an attractive combination of quality and valuation. We have also witnessed some fascinating market narratives over the past year. On one hand, many software companies were punished because investors believed artificial intelligence would destroy their competitive advantages. Adobe, Booking and even Microsoft experienced significant corrections as the market tried to identify winners and losers. At the same time, Microsoft, Meta, Alphabet and Amazon were also punished because investors questioned whether their massive AI and data center investments would generate attractive returns. It is remarkable that the market can simultaneously fear that AI will destroy software businesses while also believing that AI investments will never generate adequate returns. We maintained our positions because our view was different. Management teams repeatedly explained that AI can improve productivity, strengthen competitive advantages, enhance products and create entirely new revenue streams. Another interesting case is Visa and Mastercard. Both companies continue to deliver record revenues, record profits and record free cash flow, yet they still trade below their historical valuation averages. Moreover, roughly 30-40% of their revenues are no longer directly linked to payment processing. Increasingly, their businesses are driven by value-added services, fraud prevention, cybersecurity, analytics, data solutions and enterprise services. The luxury sector is another area where I continue to see opportunity. Today we maintain exposure through Hermès, Ferrari, LVMH and Moncler. The sector faces short-term challenges. Slower demand in China, geopolitical tensions and conflicts in the Middle East have weighed on sentiment and growth expectations. However, many luxury companies are trading below their historical valuation averages and, in some cases, even below the multiples seen during the Covid period. Growth has slowed, but these remain businesses with extraordinary brands, high margins, exceptional cash generation and competitive advantages that are extremely difficult to replicate. Artificial intelligence is highly unlikely to disrupt these brands. Meanwhile, the long-term growth of the global middle class and aspirational consumption should remain powerful tailwinds for years to come. That is why we continue to maintain meaningful exposure to the sector. Amazon and Alphabet have already experienced meaningful multiple expansion. Their valuations are now much closer to fair value, which partly explains their lower portfolio weights today, although I still see attractive long-term upside. American Express is another case where I believe further multiple expansion remains possible. I do not need the market to agree with me in the short term. My job is not simply to find bargains. My job is to allocate capital rationally, manage portfolio weights and own some of the best businesses in the world. Valuation matters. Quality matters. Capital allocation matters. That is why I rebalance when upside potential becomes more limited and reallocate capital toward opportunities with a better risk-reward profile. Today, I still see more upside in some businesses than in others, and that is reflected in the portfolio weights. Investing is not about being right every day. It is about making good decisions consistently over many years, which is exactly what we have been doing. I currently have more than $123,000 invested in the portfolio myself. My skin in the game is unquestionable. I believe this remains an attractive moment to add capital and increase exposure to the portfolio. — Roberto Chamorro Capital at risk. Past performance does not guarantee future results. $NVDA (NVIDIA Corporation) $AMD (Advanced Micro Devices Inc) $MU (Micron Technology, Inc.) $MSFT (Microsoft) $BTC

Not investment advice. The author may have financial interests in the mentioned instruments.