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?

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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.

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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.

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5. $Lyft, Inc.(LYFT)$

A 25% revenue CAGR AND FCF positive?

Don't sleep on Lyft.

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Amazon, Alphabet Earnings: Will Cloud and Ad Growth Estimates Be Met?
Alphabet and Amazon will release earnings this week. The market widely expects Alphabet's fourth-quarter revenue to be $96.69 billion. Google Search and YouTube revenues are projected to grow by 10% and 11%. Amazon's upcoming earnings will focus on AWS performance. In Q3, AWS revenue was $27.5bn, up 19% YoY, meeting expectations. With the stock hitting a new high ahead of the earnings report, can Google continue to grow? Do you see growth potential for Google and Amazon in AI and advertising? Is it possible for the stock to hit a new high after the earnings report?
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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
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