Levente Tocaciu @Aguero1010: "𝐎𝐩𝐩𝐨𝐫𝐭𝐮𝐧𝐢𝐭𝐲 𝐨𝐫 𝐃𝐲𝐢𝐧𝐠 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐞𝐬? Dear investors, Lately,..."

Romania

𝐎𝐩𝐩𝐨𝐫𝐭𝐮𝐧𝐢𝐭𝐲 𝐨𝐫 𝐃𝐲𝐢𝐧𝐠 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐞𝐬? Dear investors, Lately, we’re seeing several well-known, large companies trading near their lowest levels in a year — despite new products, solid earnings, or improving business fundamentals. It raises a key question for investors: Are these stocks undervalued opportunities waiting for sentiment to turn? Or are they value traps — businesses in decline that the market is correctly pricing lower? 1. $PYPL (PayPal Holdings) 2. $TTD (Trade Desk Inc) 3. $CNH.US (CNH Industrial NV) 4. $JD.US (JD.com-ADR) 𝟏. 𝐏𝐚𝐲𝐩𝐚𝐥 PayPal is a global digital payments company enabling online payments, peer-to-peer money transfers, merchant checkout services, and “Buy Now, Pay Later” (BNPL) solutions, among other fintech offerings. Financials: Market cap: 58,85bn USD Year to date performance: -27% Revenue: 32,86bn USD Net income: 4,9bn USD Debt: 11,3bn USD The company has been trading at these multiples since 2022, when net income declined from 5bn to 2bn. However, revenue has increased every year. It seems the business has become more mature, and growth is not as stellar anymore — and the market just doesn’t like that. 𝐑𝐢𝐬𝐤𝐬: Competition from banks, other fintechs, wallet apps, and reduced consumer spending. It might be an opportunity, but the market needs a catalyst — which is not clear right now (or I just can’t see it). 𝟐. 𝐓𝐫𝐚𝐝𝐞 𝐃𝐞𝐬𝐤 Is an independent demand-side platform for digital advertising: it enables advertisers and agencies to buy and manage ad campaigns programmatically across formats (video, connected TV, mobile, audio, display) on the “open internet” (i.e. outside closed-ecosystem giants). Financials: Market cap: 19,32bn USD Year to date performance: -66% Revenue: 2,79bn USD Net income: 439mil USD Debt: 390mil USD Trade Desk peaked one year ago at a 141 USD stock price (today at ~40). Margins have been volatile, but that doesn’t fully explain the stock price decline. Interestingly, the operating margin is improving while the stock price keeps falling. 𝐑𝐢𝐬𝐤𝐬: Advertising is always an extra cost for companies, and when the economy doesn’t look good — companies like this suffer. The valuation is also still high — any disappointment in earnings will push investors to sell. It could be an interesting company if it continues to decline. 𝟑. 𝐂𝐍𝐇 𝐈𝐧𝐝𝐮𝐬𝐭𝐫𝐢𝐚𝐥 CNH Industrial builds and sells agricultural and construction equipment, commercial vehicles and offers associated financing solutions. Its brands (e.g. Case IH, New Holland Agriculture, CASE Construction Equipment) supply machinery worldwide. Financials: Market cap: 11,57bn USD Year to date performance: -16% Revenue: 17,8bn USD Net income: 597mil USD Debt: 27bn USD Just like other food and agricultural companies, CNH is in the downtrend phase of the cycle. 𝐑𝐢𝐬𝐤𝐬: Commodity prices, low sales volumes, and currently the high debt on the balance sheet. If they can manage to keep the business running until the cycle turns, it might become a good investment. We do not know where the bottom is. 𝟒. 𝐉𝐃.𝐜𝐨𝐦 JD.com is one of China’s largest e-commerce platforms, operating a mix of direct online retail, marketplace services, and a highly developed logistics and fulfillment network. The company focuses strongly on fast delivery and broad product availability. Financials: Market cap: 48,18bn USD Year-to-date performance: –12% Revenue: 178bn USD Net income: 4.3bn USD Debt: 21.2bn USD JD’s business continues to grow in terms of revenue and customer base, and investments in logistics give it a competitive advantage. However, the stock price performance has not followed the company’s operational improvements, partly due to weak sentiment toward Chinese equities. 𝐑𝐢𝐬𝐤𝐬: High competition in Chinese e-commerce, regulatory pressure in China, and lower consumer confidence. It is a retailer - what could be the competitive advantage of the company? From investing point of view - if it keeps falling, it might become too cheap to be ignored - I will follow it. These companies are on my watchlist. I follow their earnings and, of course, when they are getting cheaper I try to identify whether they represent a potential good investment with attractive returns or if they are too risky because the business is deteriorating. These are only a few ideas, but as you can see, there are opportunities even in a highly valued market. Feel free to share your thoughts. This is not investment advice. keep it simple, @Aguero1010