imaginima/iStock via Getty Images Investment Thesis I believe it's likely that MercadoLibre ( MELI ) will compound earnings at over 25% annually over the next 5 years as the business's Fintech segment continues to scale and margins expand modestly. In the event that such actually happens, I think the stock can have a plausible route of providing 3-4x returns over the next decade. Mercado Pago is a...
imaginima/iStock via Getty Images Investment Thesis I believe it's likely that MercadoLibre ( MELI ) will compound earnings at over 25% annually over the next 5 years as the business's Fintech segment continues to scale and margins expand modestly. In the event that such actually happens, I think the stock can have a plausible route of providing 3-4x returns over the next decade. Mercado Pago is a driving force behind this. The market still largely frames MercadoLibre as an e-commerce business, but fintech now accounts for roughly half of the company's revenue, is growing faster than commerce, and carries structurally higher monetization potential. More importantly, Mercado Pago sits on top of MELI's marketplace, which will help build a closed-loop system where commerce drives payments, payments generate data, and data improves underwriting and credit expansion. That loop increases engagement, raises spend per user, and strengthens the entire business's long-term economics. Meanwhile, I also think that MELI's current margins understate the company's long-term earnings power, since management is still reinvesting in logistics, credit, and user growth. Should even a portion of that expenditure stabilize with the maturity of the ecosystem, I believe it would be highly likely that margins across the business would grow. Combined, I believe $MELI has a credible path to 25% annual earnings growth over the next 5+ years driven by sustained 20% annual revenue growth, modest margin expansion, and a growing mix of higher-quality fintech earnings. With MELI currently trading a bit below $1,900 per share at 37x forward earnings, the stock doesn't seem terribly expensive if the business delivers earnings growth in line with analysts' consensus estimates. MercadoLibre Business Overview MercadoLibre operates two core segments: Commerce and Fintech. The Commerce division encompasses the marketplace, logistics network, and merchant tools that combine to achieve transaction volume th...
jetcityimage/iStock Editorial via Getty Images Investment Thesis Tractor Supply Company ( TSCO ) has recently experienced a significant sell-off after less than optimistic earnings , and it seems that there is an unclear path back to growth. As a value investor and a dividend investor, TSCO's sell-off presents an opportunity to acquire additional shares at a cheaper valuation, but there are warnin...
jetcityimage/iStock Editorial via Getty Images Investment Thesis Tractor Supply Company ( TSCO ) has recently experienced a significant sell-off after less than optimistic earnings , and it seems that there is an unclear path back to growth. As a value investor and a dividend investor, TSCO's sell-off presents an opportunity to acquire additional shares at a cheaper valuation, but there are warning signs that the company may not be able to make a quick turnaround in the stock price. Year to date, TSCO has significantly underperformed the market, trading down about 25% so far. Comparing their fundamentals to the sector, TSCO still trades at a premium after the recent sell-off. Investors should note that this could be a value trap and pay close attention to how things change over the next few quarters to see if the company can turn around their growth. Data by YCharts [object HTMLElement] Company Overview Tractor Supply Company (TSCO) has been around for almost a century, founded in 1938 , and is expanding to be a one-stop shop for all things related to living a rural lifestyle. This includes building their online presence and retail stores with merchandise inclusive of livestock, poultry, small and large animals, and even clothing for farm-style living. Recent business growth has come from new store openings , Neighbor's Club memberships, strong performance from garden centers, and inroads into more veterinarian-related offerings, such as their partnership with PetVet mobile clinics and fresh food products for pets. Earnings Review TSCO reported their Q1 earnings on April 21st, where they missed on both the top and bottom lines. Business growth in this quarter was mainly driven by their new store openings, while existing stores underperformed. They opened 40 new Tractor Supply stores, discussed their plan to expand their fresh pet offerings and grow their sales representatives, and management also reaffirmed sales growth of 1-3%. Overall, TSCO has had two relatively ...
What has Warren Buffett been doing since he stepped down as CEO of Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) ? In his first letter to Berkshire's shareholders, new CEO Greg Abel mentioned that Buffett still comes into the office every day. In an interview with CNBC on March 31, Buffett shed more light on his current focus. After briefly talking with Buffett about his philanthropic work with NBA...
What has Warren Buffett been doing since he stepped down as CEO of Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) ? In his first letter to Berkshire's shareholders, new CEO Greg Abel mentioned that Buffett still comes into the office every day. In an interview with CNBC on March 31, Buffett shed more light on his current focus. After briefly talking with Buffett about his philanthropic work with NBA player Stephen Curry and the Glide Foundation, CNBC's Becky Quick asked him how things were different now that he is no longer at Berkshire's helm. Buffett confirmed that he goes to the conglomerate's headquarters every day. Quick then asked him, "Well, are you still involved in making investments at all?" Buffett responded initially with 11 words. And I think those words arguably make Berkshire Hathaway stock a no-brainer buy right now. Continue reading
Hong Kong’s Cinema Day has drawn a record-breaking 201,000 film-goers, despite a marginal decline in occupancy rates compared with last year. The Hong Kong Theatres Association, which organises the annual event, revealed the figures on Sunday, just a day after 52 cinemas offered HK$30 (US$3.83) movie tickets for 1,694 screenings. “It marks a new high for the event, with 201,000 admissions and an a...
Hong Kong’s Cinema Day has drawn a record-breaking 201,000 film-goers, despite a marginal decline in occupancy rates compared with last year. The Hong Kong Theatres Association, which organises the annual event, revealed the figures on Sunday, just a day after 52 cinemas offered HK$30 (US$3.83) movie tickets for 1,694 screenings. “It marks a new high for the event, with 201,000 admissions and an average occupancy rate of 81 per cent,” a post on the promotion’s social media page read. “Families,...
Prime minister says ‘you never hear from … the people who are supportive, loyal and just want to get on with the job’ When asked by Laura Kuenssberg on if his party was playing games around Mandelson, Chris Philp , shadow home secretary, said that integrity matters and that “ Keir Starmer is the one who cloaked himself in a mantel of moral superiority” only to find himself in this situation. “Keir...
Prime minister says ‘you never hear from … the people who are supportive, loyal and just want to get on with the job’ When asked by Laura Kuenssberg on if his party was playing games around Mandelson, Chris Philp , shadow home secretary, said that integrity matters and that “ Keir Starmer is the one who cloaked himself in a mantel of moral superiority” only to find himself in this situation. “Keir Starmer should resign because he appointed Mandelson in the first place…and if not, Labour backbenchers and ministers should develop a backbone and get rid of him,” Philp said. Continue reading...
Germany’s Hensoldt AG , a supplier of radar and sensor technology, doesn’t expect Chinese export curbs to have any material impact on its operations or outlook. Hensoldt was among companies added to an export control list over their involvement in arms sales to Taiwan. “Hensoldt does not rely on direct strategic sourcing relationships in China for critical components relevant to its core business,...
Germany’s Hensoldt AG , a supplier of radar and sensor technology, doesn’t expect Chinese export curbs to have any material impact on its operations or outlook. Hensoldt was among companies added to an export control list over their involvement in arms sales to Taiwan. “Hensoldt does not rely on direct strategic sourcing relationships in China for critical components relevant to its core business,” the company said in a statement. “The company sources primarily standard commodities with Chinese country-of-origin through established European distributors,” it added. The move by China marked the first time that Beijing has deployed the trade blacklist against companies in Europe. Belgium’s FN Herstal and FN Browning Group , primarily small-arms manufacturers, were also included. “Hensoldt has for years systematically worked to strengthen resilience and diversify sourcing structures,” it said.
VanderWolf-Images/iStock Editorial via Getty Images Paints, coatings, and similar chemicals are part of a very fundamental driver of our industrial world. Almost nothing in the industry can be manufactured and sold either to a commercial or consumer customer without receiving some sort of paint and coating. The coating, whichever form it takes, serves as the primary protective barrier against vari...
VanderWolf-Images/iStock Editorial via Getty Images Paints, coatings, and similar chemicals are part of a very fundamental driver of our industrial world. Almost nothing in the industry can be manufactured and sold either to a commercial or consumer customer without receiving some sort of paint and coating. The coating, whichever form it takes, serves as the primary protective barrier against various types of environmental degradation, which in turn not only increases the aesthetic value of the item but also its lifespan. The use of coatings and paints increases value, increases operational liability, reduces maintenance, and provides safety in harsh conditions. It's fair to say that leading companies in this sector serve a primary function and field, which is why it's a sector that I am interested in. I have covered Akzo Nobel ( AKZOY ) previously and maintain a position in the company. I am now ready to increase that position even further. The reason I'm ready to do this is that the market continues to undervalue Akzo Nobel - and also because some of the market trends may have been more long-term than I saw. Long-term market trends or headwinds do not frighten me. I, in fact, believe them to be a counter-indicator when they go below a certain point. Over 90% of my returns are made investing in companies that, by other investors, are viewed as unfavorable for one reason or another. My job here, my job for you, is to sift the companies that deserve to be trading lower in the long term from the companies where the headwinds are only a signal of misappreciation or misunderstanding on the part of the market. The market not only always misappreciates, but it also overreacts - both to the positive and the negative. My job is to see, as said above, when this overreaction is wrong. I believe the reaction to be deeply negative here, and in this article, I will justify the reason for thinking so. You can find my previous piece on the company here. Akzo Nobel - Upside From Pa...
In the span of a few days earlier this month, developments that usually sit in separate policy compartments began to converge. Abu Dhabi’s crown prince arrived in Beijing as President Xi Jinping used the visit to set out China’s four-point position on the Iran war. Pakistan, now central to keeping US-Iran diplomacy alive, said no date was fixed for the next round of talks. Washington escalated pre...
In the span of a few days earlier this month, developments that usually sit in separate policy compartments began to converge. Abu Dhabi’s crown prince arrived in Beijing as President Xi Jinping used the visit to set out China’s four-point position on the Iran war. Pakistan, now central to keeping US-Iran diplomacy alive, said no date was fixed for the next round of talks. Washington escalated pressure on buyers of Iranian oil and the banks handling related funds. Reports circulated of yuan use...
Sundry Photography/iStock Editorial via Getty Images This time last year, I initiated coverage on Coupang ( CPNG ), the South Korean online retailer, at a hold, but one that was worth watching because of meaningful revenue growth on multiple fronts. Top-line growth in 2024 was substantial, but the earnings just weren’t there. South Korea was also facing economic uncertainty in 2025 because of the ...
Sundry Photography/iStock Editorial via Getty Images This time last year, I initiated coverage on Coupang ( CPNG ), the South Korean online retailer, at a hold, but one that was worth watching because of meaningful revenue growth on multiple fronts. Top-line growth in 2024 was substantial, but the earnings just weren’t there. South Korea was also facing economic uncertainty in 2025 because of the tariffs, which were a big part of why I settled on a hold. Fast forward a year, and new problems are starting to emerge. The growth momentum seems to have faded. The tariff concern was never fully settled, and the latest economic crisis surrounding soaring oil prices looks like it’s going to hit South Korea particularly hard . Revenue Growth Slows, Earnings Stall 2025 was indeed a challenge for Coupang, as we expected last April, and while top line growth persisted, it was slower than before. More concerning, however, is what we didn’t see: earnings growth. 2023 2024 2025 Revenue $24.4 billion $30.3 billion $34.5 billion Operating Income $473 million $436 million $473 million Net Income $1.36 billion $154 million $208 million GAAP EPS 76¢ 9¢ 11¢ Non-GAAP EPS 26¢ 22¢ 12¢ Click to enlarge (Source: most recent 10-K from SEC) Revenue growth weakened later in the year over a data loss scandal, which we’ll discuss later, but whether Coupang is growing its revenue at 20% per year or 10%, operating income remains more or less flat, and to make matters worse, the company is just not making meaningful money, whether we reckon it from a GAAP or adjusted perspective. The GAAP P/E is 186.45, compared to the sector median of 20.48. The non-GAAP number is really no better, 170.92 compared to the sector’s 15.86. Coupang has often traded at a higher than normal P/E ratio, but any hope that one could justify it with faster growth means very little when that growth is slowing noticeably and isn’t improving the operating results beyond the top line. The one bright spot in Coupang’s growth stor...
Southwestern China’s busiest airport was mopping up and struggling to resume operations on Sunday after the biggest hailstorm in decades grounded flights, damaged aircraft and stranded passengers. Hailstones, some as big as fists, battered Kunming Changshui International Airport in Kunming, Yunnan province, when the storm struck early on Saturday. The storm lashed runways, terminal roofs and some ...
Southwestern China’s busiest airport was mopping up and struggling to resume operations on Sunday after the biggest hailstorm in decades grounded flights, damaged aircraft and stranded passengers. Hailstones, some as big as fists, battered Kunming Changshui International Airport in Kunming, Yunnan province, when the storm struck early on Saturday. The storm lashed runways, terminal roofs and some of the more than 110 aircraft at the facility on Saturday morning, with water seen seeping down into...