Miska Repo @mick_repo: "2026 Performance YTD @mick_repo: +5.09% MSCI World..."

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2026 Performance YTD @mick_repo: +5.09% MSCI World Index: +0.73% S&P 500: -0.94% As geopolitics takes center stage again in global markets, it’s worth remembering that markets tend to overreact when uncertainty is high. And importantly, uncertainty is not the same as risk. With that in mind, let’s look at some recent developments in a couple of companies in our portfolio. In my last post I mentioned that I would share some thoughts on $PYPL (PayPal Holdings) , since we opened a new position in the company last month. PayPal released its Q4 and FY2025 results in early February, and a few things are worth mentioning: 1. Free cash flow guidance for 2026: USD 6+ billion. After adjusting for approximately USD 1 billion in stock-based compensation, this would still be around USD 5 billion. 2. Share buyback guidance for 2026: USD 6 billion. At the current valuation, this implies that PayPal could repurchase roughly 13–14% of its outstanding shares in 2026. The main reason for PayPal’s relatively low valuation is slowing growth and margin pressure. The company recently appointed a new CEO, who previously worked at HPQ, and it’s likely that he will run a tight ship on costs, much as he did there. This means that PayPal should continue to generate strong levels of free cash flow also going forward, and since most of that cash is expected to be allocated to share buybacks and dividends, my assessment is that the upside potential outweighs the downside risk. Another way to view PayPal is through a sum-of-the-parts valuation. PayPal owns several valuable payment assets, including its branded checkout business, Braintree, and Venmo. Assigning reasonable valuations to each of these businesses supports the investment thesis. In short, the market seems to be treating PayPal as a declining fintech, while its cash-flow profile suggests a much more resilient business. As always, time will tell how this plays out, but the stock is currently up about 15% since we initiated the position. Then moving on to $VNA.DE (Vonovia SE), a position we re-entered a little over a month ago. Vonovia is the largest residential real estate company in Europe. The majority of its revenue comes from rental properties, although the company is gradually increasing the share of income generated from non-rental activities. Similar to PayPal, Vonovia has also recently appointed a new CEO, and the company has indicated that it will focus on improving profitability over the next three years. Management is currently guiding toward approximately €2 billion in earnings before tax for 2026, with an objective to grow this at a mid-single-digit rate through 2028. The company’s current market capitalization is around €23 billion. Vonovia’s net tangible assets are approximately €44–45 per share, while the stock currently trades around €27, meaning it is trading significantly below its tangible asset value, which provides a meaningful level of downside protection. Being a real estate company, debt leverage is a big part of the business model. If the company were to face challenges refinancing its debt, it could always sell parts of its real-estate portfolio and use the proceeds to reduce leverage, much like they have already done over the last couple of years. The selling prices of the assets would likely be close to book value. Since we initiated the position a bit over a month ago, Vonovia’s share price has risen by roughly 10%. It’s clear that geopolitics will be the main topic now for at least the next few months, and the market volatility is likely to remain elevated during that period. However, let’s remember that if you can always simply look beyond “the next quarter”, you are already one step ahead of most investors. “It is impossible to produce superior performance unless you do something different from the majority.” — Sir John Templeton Cheers, Mick $NSDQ100 $GER40

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