has been shipping their AI products with accelerated speed taking control of the narrative over their search disruption and turning it on it’s head. You can see the level of their innovation with the timeline from Nov 2025 to May 2026 updating several models and products within that time frame.

Also let’s look at their amazing earnings highlights. Most notably from the graphic below is that Google Cloud rose 82% Y/Y with a backlog of $514 B. This is phenomenal growth from this division and the other results were also great.

But why did the stock go down initially after the earnings?

The reason is AI capex. This narrative has clouded the hyperscalers to no end recently and it’s clear why. A lot of these companies are getting to a point of negative free cash flow and debt to pay for their AI capex obligations. This directly affects the value of shareholders and they don’t seem to like it.

Let’s take another look at their valuation after this earnings report. I calculated an intrinsic value of $362.27 per share last time around the Q1 ‘26 earnings using my google sheet template.

However, I have started using a more comprehensive look at valuation using Stock Analysis going forward.

A sidebar here: if you are a serious investor or thinking about becoming a serious investor, use Stock Analysis to analyze stocks. It’s much easier than writing your own DCF tables and performing a cash flow analysis. You can get a discount using code ‘BEARD’ at this link: https://stockanalysis.com/pro/?ref=beardedinvestor.

So using Stock Analysis, I pulled up the forecast and valuation of based on the number of analysts covering the stock. Check it out here, but let’s go through the data.

Stock Analysis first gives you a clear indication whether the stock is a buy or not with a price target and an analyst consensus buy rating. Here we can see that is considered a Strong Buy.

In addition, there is a 12 month forecast that is more useful than a 10 year projection for all practical matters. If the 12 month projection does not look good AND the fundamentals are weak or non-existent, I wouldn’t buy and hold the company for 10+ years anyways.

Another highly useful feature on Stock Analysis is the recommendation trends to see where analysts fall on the spectrum of Strong Buy all the way to Strong Sell ratings. This gives weight to the analyst ratings. You can then see which rating the majority of analysts (who have the means and research data to run these advanced DCF models) are leaning towards.

Analyst rating upgrades and downgrades are also super important to see the latest information and news about a particular stock. seem to be having upward revisions after their earnings report.

The financial forecast is also super important as it can tell you whether a business is going to experience a slowdown that we as retail investors may not be able to see or forecast. seems to be indicating an EPS decrease next year possibly due to the high capex they are projecting. Even so, their other metrics like revenue look like they are trending up.

The most important table that I look at this forecast table. It shows the projected numbers for future years. is showing good revenue growth numbers, maintaining gross margin, but will have an issue with their EPS growth rates in 2027. Free cash flow looks bad in 2027 as well with a recovery in 2028. This can be useful to determine when a great investment can be bought at a good price.

Not financial advice. Please do your own due diligence when investing your own money.

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Now, did report zero AI capex spend or something drastically different than other mega cap tech names? Not at all. But the difference is how they have locked in massive future revenues through customer commitments, have a high-growth cloud business to absorb AI capex, and the ability to deliver actual revenue from that capex through advertising and selling that compute to customers.

Let’s first look at their earnings results from this past quarter. I have shared quick earnings results on my social platforms (definitely follow my social accounts to get the latest information very quickly), but here they are once more so we can have them as a reference.

For this analysis, I used an un-levered beta of 1.55 (software internet industry) which was re-levered to 1.37 using the Hamada equation. In addition, I also used an ERP of 4.5% (for US equities), an effective tax rate of 17.61%, and a risk free rate of 3.76%.

Please refer to Stock Analysis for all the data I used in this analysis.

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For this analysis, I used an un-levered beta of 1.23 (internet application and software industry) which was re-levered to 1.18 using the Hamada equation. In addition, I also used an ERP of 4.5% (for US equities), an effective tax rate of 14.5% based on CFO commentary, and a risk free rate of 3.76%.

Please refer to Stock Analysis for all the data I used in this analysis.

I used the long dated bond rate for which is 4.875% for the pre-tax cost of debt as of the writing of this analysis. Now with those parameters out of the way, here is the company guidance.

They are guiding for a second quarter revenue of $59.5 billion (midpoint) which is only slightly above analyst expectations and largely inline. Total expenses remain unchanged which is telling because that indicates that the increase in capex is largely due to component pricing increases rather than spending more to acquire more compute.

Even so, $125-$145 billion is a large amount of capex for internal use AI that is not directly sold to customers and consumers. For that reason, the stock is getting hammered post earnings. In addition, looking at the DAP (daily active people) metric, which is arguably the most important metric for as they require people to view and click on ads which fund their advertising business, it’s clear that there were extenuating circumstances.

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For this analysis, I used an un-levered beta of 1.23 (internet application and software industry) which was re-levered to 1.16 using the Hamada equation. In addition, I also used an ERP of 4.5% (for US equities), an effective tax rate of 26.15%, and a risk free rate of 3.76%.

Since the interest expenses are not available for on Stock Analysis, I used the 2030 bond rate for which is 4.73% as of the writing of this analysis. Now with those parameters out of the way, here is the company guidance.

As you can see for their FY 26 guidance, management describes full year guidance for subscription revenues only not the professional/other revenues. Based on this, I used a 22.25% revenue growth rate for both subscription and other revenues as an approximation for Year 1.

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Here’s the deal on how the quarter actually shook out, but if you want to look at Tesla on Stock Analysis just click here.

Tesla’s delivery numbers for Q1 were already known to be a bit soft, but the full financial report adds some serious context

• Revenue: Totaled $22.39 billion, a slight miss on expectations and an increase of 16% YoY.

• Earnings Per Share (EPS): Adjusted EPS landed at $0.41, up from $0.27 this time last year.

• Deliveries: Tesla produced over 408,000 vehicles but only delivered about 358,000. That left a record 50,000 vehicles sitting in inventory—the biggest gap in company history and setting up for more annual declines in deliveries.

• Profitability: Gross margins recovered slightly to 21.08%, while operating margins ticked up to roughly 4.20% (a nice jump from the dismal 2.1% in Q1 2025).

Elon Musk and the team are clearly trying to shift the focus away from just counting cars.

• Terafab & AI Compute: The market is obsessing over Terafab, Tesla’s planned one-terawatt AI compute facility.

• Capex Creep: 2026 capital expenditure (capex) guidance is expected to top $20 billion. Most of that cash is being dumped into AI infrastructure and the Optimus robot program.

• Energy Storage: This remains a major bright spot, with 8.8 GWh deployed this quarter. The energy segment is consistently proving it can have better profitability than the automotive side.

Despite the heavy spending on robots and AI chips, Tesla is still sitting on a mountain of cash:

• Liquidity: They ended the quarter with over $44.74 billion in Cash, cash equivalents and short-term investments.

• Free Cash Flow: While they’re spending billions on growth, the company remains cash-flow positive at the operating level.

Investors are currently treating Tesla like a credible AI play that happens to sell cars on the side. The stock has been oscillating right below the $400 mark, as the market decides if the AI future is worth the high multiple even as car growth slows down.

Tesla is in the middle of a massive transformation. It’s no longer just about how many Model 3s they can deliver; it’s about how fast they can build the AI infrastructure for the future.

Revenue is up and margins are recovering, but the massive inventory buildup means Tesla has to prove it can still sell the cars it builds while it waits for the AI revolution to pay off.

Not Financial Advice. Please do your own due diligence before investing any of your money.

For this analysis, I used an un-levered beta of 0.77 (consumer services industry) which was re-levered to 0.85 using the Hamada equation. In addition, I also used an ERP of 4.5% (for US equities), an effective tax rate of 6.00%, and a risk free rate of 3.76%.

Since the interest expenses are not available for on Stock Analysis and does not have 10 year bond rates, I searched for analyst’s estimates for the pre-tax cost of debt which is ~7.2% as of now. Now with those parameters out of the way, here is some information from the company’s investor presentations and earnings.

For their 2026 guidance, management describes several ranges for key metrics and I use the midpoint of those just like the other analysis I have done. Based on this, I used a 16.5% revenue growth rate and a 10.08% operating margin for Year 1.

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Since the interest expenses are not available for on Stock Analysis, I used the 10-year (2036) Salesforce bond maturity rate for the pre-tax cost of debt which is 5.55%. Now with those parameters out of the way, here is some information from the company’s investor presentations and earnings around FY 27 guidance.

In their FY ‘27 (2026) guidance, management describes several ranges for key metrics and I use the midpoint of those just like the other analysis I have done. Based on this, I used a 10.5% revenue growth rate and a 20.9% operating margin for Year 1.

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management put out guidance for Year 1 financials (2026), in their February update for Q4 2025 and full year 2025 results presentation.

In this 2026 guidance, they offer ranges of values for several key metrics of which I use the midpoint in the subsequent calculations. Using these numbers, I derive a revenue of ~$1.69 billion, operating margin of ~2.37%, and capex (sustaining and project capex) of ~$172.5 million.

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I used an un-levered beta of 1.23 based on Aswath Damodaran’s work for a software application/service company industry. This beta was re-levered to 1.18 using the Hamadi equation.

Effective tax rates, pre-tax cost of debt and base year drivers were all calculated using TTM or most current data pulled from stockanalysis.com.

The ERP or equity risk premium was 4.5 for equities centered in the US. Base year revenue growth was calculated with the TTM financials and came in at 10.96% growth. Let’s look at how I structured stage 1 of the DCF projection:

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A un-levered beta of 1.35 was used based on Aswath Damodaran’s work for semiconductor equipment providers. This beta was re-levered to 1.23 using the Hamadi equation. Effective tax rates, pre-tax cost of debt and base year drivers were all calculated using TTM or most current data.

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just dropped it’s Fiscal Q2 2026 results (ending February 26, 2026), and they posted amazing results. AI drove Micron’s revenue to nearly triple compared to last year.

Here are the highlights:

• Total Revenue: $23.86 billion, up a staggering 196% year-over-year.

• Net Income (Non-GAAP): A massive $14.02 billion.

• Earnings Per Share (EPS): $12.20, crushing analyst estimates of roughly $8.60.

• Operating Margin: Jumped to 69%, up from just 24.9% a year ago.

• Free Cash Flow: Generated $6.9 billion in adjusted free cash flow this quarter alone.

The demand for AI infrastructure is turning memory from a commodity into a “strategic asset”.

• DRAM Revenue: Hit $18.8 billion (up 207% y/y), fueled by High Bandwidth Memory (HBM) and data center demand.

• NAND Revenue: Reached $5 billion (up 169% y/y), with data center NAND sales more than doubling from the previous quarter.

• Business Units: Every single business unit—Cloud, Core Data Center, Mobile, and Auto—hit new record highs.

is feeling flush with cash that they are passing the wins directly to shareholders:

• Dividend Hike: The board approved a 30% increase in the quarterly dividend to $0.15 per share.

• Share Repurchases: They bought back $350 million worth of shares during the quarter which basically offsets any dilution.

Their outlook for the next quarter (Q3 2026) is even more aggressive:

• Projected Revenue: $33.5 billion (give or take $750 million). To put that in perspective, their single-quarter forecast is higher than their full-year revenue for any year before 2025.

• Projected EPS: Around $19.15, which is way ahead of what Wall Street was expecting.

CEO Sanjay Mehrotra put it best: “AI has fundamentally recast memory as a defining strategic asset”. With supply staying tight and AI models getting even more memory-intensive, is currently sitting in a critical seat of the semiconductor world.

If you are a visual learner, I have posted a video on stock on my Bearded Investor YouTube channel here:

just released it’s Q4 and full-year 2025 results, and the company closed out the year with serious momentum. Between hitting massive milestones with Base44 and launching Wix Harmony, the company is proving that it’s pivot into the AI era is paying off in a major way.

Here is the breakdown of the 2025 financials and what to expect next.

The Full-Year 2025 Highlights

cleared nearly $2 billion in revenue in 2025, driven by a growing community of pros and businesses.

• Total Revenue: $1.99 billion, up 13% compared to 2024.

• Total Bookings: $2.07 billion, representing 13% year-over-year growth.

• Profitability (GAAP): Net income hit $50.6 million, or $0.88 per diluted share.

• Free Cash Flow: Generated a massive $573 million in free cash flow. If you exclude acquisition costs, that number jumps to $605.1 million (a healthy 30% margin).

• User Growth: now has over 304 million registered users and 6.11 million premium subscriptions.

Q4 2025 Performance

The final quarter of the year saw an acceleration in both bookings and revenue, largely thanks to new product momentum.

• Revenue: $524.3 million (up 14% y/y).

• Bookings: $534.5 million (up 15% y/y).

• Partners Revenue: This segment—focused on agencies and freelancers—grew 21% to $203.2 million, showing that pros are increasingly choosing .

• GAAP Net Loss: The company reported a net loss of $40.2 million for the quarter, largely due to $90 million in acquisition-related expenses. On a non-GAAP basis, they actually earned $111.3 million.

The “Game-changers”: Base44 and Wix Harmony

Management isn’t just looking at the balance sheet; they are focused on two flagship products they are calling “game-changers”:

1. Base44: This no-code application platform reached $100 million in Annual Recurring Revenue (ARR) just one year after it was founded. It’s significantly expanding the type of software apps people can build on .

2. Wix Harmony: This is showing early “better-than-expected” results in how it converts and monetizes users, which is expected to drive even faster growth in 2026.

Share Repurchases & Investments

is doubling down on it’s own company. They completed $575 million in share repurchases in 2025. Looking ahead, they plan to complete the majority of a massive $2 billion repurchase program by the end of 2026, which would be close to 40%-50% of the shares outstanding at the current moment.

Additionally, Durable Capital Partners led a $250 million equity investment in , a major vote of confidence in the company’s long-term AI strategy.

2026 Guidance

expects 2026 to be another big year, with mid-teens growth anticipated for both bookings and revenue. They are forecasting free cash flow margins in the low-to-mid 20% range, reflecting the investments needed to keep leading the market in AI-driven website and app creation.

has successfully navigated 2024 and 2025 to emerge as a highly profitable, AI-centric platform. With a strong cash position and new flagship products taking off, they are “playing to win” in the next era of the internet.

This is a short report of the $HCC results from today which I wanted to get out as soon as possible. I will have a video analyzing these results and how the company looks now very soon.

Warrior Met Coal just dropped its latest earnings report, and if there’s one takeaway, it’s that the Blue Creek mine is officially the star of the show. Despite some headwinds in the global coal market, the company finished the year on a high note.

Here’s the breakdown of what happened and why it matters.

The Big Wins: Records and Ramps

The headline story is the Blue Creek longwall, which started up in October—a full eight months ahead of schedule. Because of that early start, $HCC absolutely smashed it’s sales and production records:

* Sales: They moved a record 2.9 million short tons in Q4 alone (a 53% jump from last year).

* Production: They dug up 3.4 million short tons in Q4, up 61% year-over-year.

* Blue Creek: Even though it’s just getting started, Blue Creek has already contributed nearly 900,000 tons to those sales numbers.

The Financials

On the financial side, things are looking much healthier than this time last year.

* Net Income: For Q4, they pulled in $23 million ($0.44 per share). To put that in perspective, they only made $1.1 million in the same quarter last year.

* Adjusted EBITDA: This hit $92.9 million for the quarter, nearly double last year’s $53.2 million.

Lower Costs, Even with Lower Prices

Global coal prices actually dropped (the average selling price was down about 16% in Q4 compared to last year). However, Warrior managed to offset that by being much more efficient.

Their cash cost of sales fell by 22% to about $93.50 per ton because Blue Creek is a lower-cost operation by nature. As they scale up, they’re getting more "bang for their buck" on every ton they pull out of the ground.

2026 Guidance and Beyond

The company is feeling so confident about their operational performance that they’ve actually raised their volume guidance for 2026.

They also tucked a little extra "future proofing" into the report: they finalized two new federal coal leases in Alabama. This adds about 53 million short tons of reserves to their pocket, ensuring they have plenty of high-quality steelmaking coal to dig up for years to come in their other two mines, mine 4 and mine 7.

Conclusion

Warrior Met Coal is shifting from a "development" phase into a "growth" phase. With Blue Creek firing on all cylinders earlier than expected and costs trending down, they’ve positioned themselves to be a powerhouse in the steelmaking coal market, even if global prices stay a bit shaky.

I hold a position in $HCC and this is not financial advice.

For the shareholders out there, the board also approved a regular quarterly dividend of $0.08 per share, payable on March 2.

Warren Buffett has said, in so many words, that it does not take a rocket scientist to perform a thorough analysis of a company to get a great result. A robust investment thesis DOES require a multi-dimensional view. It must combine quantitative financial rigor with qualitative assessments of things like competitive advantage and management integrity.

In this guide, I will break down how I scrutinize companies, both qualitatively and quantitatively, before committing investment capital. Frequent viewers of my Bearded Investor YouTube channel will be familiar with how I move through my analysis of the fundamental business model/moat to things like intricate financial metrics and capital allocation.

Understand The Business Before Committing Capital

Before opening a spreadsheet or placing a trade, you must understand what the company does AND why it is / will be successful. If you cannot easily explain how the business makes money, you should not own it.

“Never invest in a business you cannot understand.” - Warren Buffett

Warren Buffett famously coined the term “economic moat” to describe a company’s durable competitive advantage. Without a moat, high profits are a beacon, attracting competitors who will eventually compete away those profits.

In other words, the goods and services that a company provides can become commoditized and pricing power and margins collapse. To make large amounts of money in investing, you need to be able to hold a company for an extended amount of time and be confident in the business's ability to defend itself.

So, what do you need to look for in a company with an economic moat?

Does the company have a brand identity that allows for premium pricing? And does it hold patents or regulatory licenses that block competitors? Look at companies like or and you would be hard pressed to find someone in the world who does not know of their product, brand, or a combination of both.

You should also ask how hard is it to use

similar services or goods from a competitor if there are any. Switching costs are a real thing and many businesses avoid switching to a competitor after services are embedded into their organization. Think of the services from or ; these companies have built entire software suites that are embedded into organizations and governments.

This goes into network effects as well because if the service becomes more valuable as more people use it such as or , then this often is the strongest type of moat. Another type of moat can arise in pricing power; i.e. can a company produce its goods or services cheaper than anyone else due to scale or unique processes like a ?

So find businesses where the moat is maintained or widening, not narrowing. A shrinking moat is often a precursor to deteriorating financial metrics.

Income Statements Are The Operational Bread & Butter Of The Company

Once you understand the model and moat of a business, look at a company’s operations. Growth is essential, but not all growth is created equal. You want to see a healthy relationship between revenue (sales brought in) and net income (profit kept).

The top line revenue is important. This is usually the first line that you will read on a 10-Q or 10-K on the income statement. I look for consistent revenue growth that shows that the company is continually exploring new markets, or finding new members, subscribers, users, customers, etc in existing markets. Mature companies usually have slower revenue growth rates year over year (YoY), but they should still grow stable organic revenues.

Are the gross margins stable or rising? Declining gross margins indicate pricing pressure from competitors or rising input costs the company cannot pass on to consumers. Basically, the cost of the goods sold (COGS) must be kept low; otherwise the company is sacrificing potential profitability for market share.

At the same time you want to see net income and EPS growing as well. Net income is known as the bottom line because it is the final line on a company’s income statement. Net income can sometimes be noisy due to taxes, one-time charges, or interest payments. Operational metrics are closer to the core health of the business and are often a better indicator of a business's true performance.

When operating income growth rates (EBIT Margins - Earnings Before Interest and Taxes) are faster than revenue growth rates, you usually have a nice setup. A rising EBIT margin proves management is becoming more efficient at running the actual business. This measures the profitability of operations before capital structure (debt) and tax regimes get involved. You can compare this metric against competitors in the same industry to derive a sense of what is a “good“ EBIT margin within a particular industry.

The Balance Sheet Is Considered the Fortress Of The Company

While the income statement tells you how profitable a company was over a period of time, the balance sheet is a snapshot taken at a single moment. It answers a simpler, but more critical question: If the business stopped making money today, how long could it survive?

A strong balance sheet is a shield against bad luck, recessions, or operational mistakes. When analyzing this statement, you should focus on the relationship between what the company owns (Assets) and what it owes (Liabilities).

The first check is for “liquidity”—can the company pay its immediate bills? The standard metric here is the Asset to Liability ratio (current assets divided by current liabilities). A ratio above 1.5 is generally healthy, meaning the company has significantly more cash and inventory on hand than it has bills due in the next 12 months. If this number is below 1.0, the company may face a cash crunch if revenues dip unexpectedly.

However, you must look closer at what makes up those assets. You want to see a balance sheet rich in cash. Cash is the ultimate option value; it allows a company to buy back stock when it crashes, acquire distressed competitors, or simply weather a storm. Conversely, be wary if the assets are dominated by inventory or accounts receivable that are growing faster than sales. This is a classic “red flag” indicating that the company is making products it can’t sell or booking sales for which it hasn’t yet been paid.

Debt acts as leverage; it magnifies returns in good times but can wipe out equity in bad times. When looking at long-term health (solvency), checking the net debt position is essential. This is calculated by taking the company’s total debt and subtracting its cash pile.

• Companies like Google or Apple often hold more cash than debt. This is a “Fortress Balance Sheet.” It implies zero risk of bankruptcy from creditors.

• Most companies carry some level of net debt. The key is manageability. A common metric is the net debt-to-EBITDA ratio. Generally, a ratio below 3.0x is acceptable for stable industries. Anything above 4.0x or 5.0x signals a highly leveraged company that is vulnerable to rising interest rates.

Follow The Cash And It May Lead You To A Great Investment

Accounting profits are governed by complex rules and can depend on management estimates. Cash, on the other hand, is a fact. Cash flow is the lifeblood of a business; it pays the bills, services debt, funds M&A, and can be crucial to sustaining capital returns to shareholders.

Free Cash Flow (FCF) is the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. It is calculated essentially as: Operating Cash Flow minus Capital Expenditures (CapEx). Obviously, you want companies that generate surplus cash. A company that consistently burns cash must eventually raise money through debt or diluting shareholders by selling stock.

Compare FCF to Net Income. Over time, FCF should be roughly equal to or greater than Net Income. If Net Income is high but FCF is low, management might be aggressively recognizing revenue that hasn’t actually been collected as cash yet (accrual accounting) OR spending aggressively on capex.

FCF Yield is a valuation metric calculated as (Free Cash Flow per Share / Stock Price). It is essentially the cash return you would get if you bought the whole company today. Ideally, you want a high, stable, or growing FCF yield relative to a risk-free rate (like a 10-year Treasury bond). If a stock has a 1% FCF yield when bonds pay 5%, the stock is likely overvalued unless massive growth is imminent.

Ratios Form The Basis Of Comparing One Company To Another

A ratio is a unitless number that is used to compare two or more things. In this case, you can make several financial ratios from financial metrics for each company and then compare it to other companies in that industry.

While raw numbers like revenue or debt are important, they lack context until they are converted into ratios. Ratios allow you to compare a global giant against a regional upstart on an even playing field.

The most important ratio for many investors is the Price-to-Earnings (P/E) ratio. It answers the fundamental question of valuation: How much am I paying for one dollar of the company’s earnings? Calculated by dividing the current stock price by its earnings per share (EPS), this metric acts as a price tag for profits.

However, interpreting the P/E ratio requires nuance. If company A trades at a 30x P/E and company B trades at 15x, Company A is technically twice as expensive. Yet, a “high” P/E isn’t inherently negative; it often signals that the market expects rapid future growth, common in technology sectors. Conversely, a “low” P/E might appear to be a bargain, but it can sometimes represent a “value trap”—a company that is cheap simply because its business is in structural decline.

Therefore, you should always compare a company’s P/E against its industry peers and it’s own five-year historical average to determine if the price is truly justified.

The P/E ratio has a significant flaw: it does not account for how fast a company is growing. To solve this, investors utilize the PEG Ratio (Price/Earnings-to-Growth), a metric popularized by legendary investor Peter Lynch. By dividing the P/E ratio by the company’s expected annual growth rate, the PEG ratio acts as an equalizer between slow-growth and high-growth businesses.

The general rule of thumb is that a PEG ratio of 1.0 represents “fair value”—meaning you are paying a fair price for the growth you are getting. A ratio below 1.0 suggests the stock may be undervalued relative to its growth potential, while a ratio above 2.0 often implies the stock is overvalued or “priced for perfection.” This metric reveals why a software company with a P/E of 40 might actually be “cheaper” than a utility company with a P/E of 15, provided the software company is growing its earnings significantly faster.

While earnings-based ratios are critical, seasoned investors employ a broader suite of metrics to sanity-check their thesis. For young, high-growth companies that have not yet turned a profit—and thus have no “earnings” for a P/E ratio—the price-to-sales (P/S) ratio becomes the default tool, comparing the stock price directly to revenue.

When comparing companies with vastly different tax situations or debt levels, such as airlines or telecom giants, the EV/EBITDA ratio is preferred. This metric strips away accounting decisions to reveal the value of the raw business operations. Finally, to assess risk rather than value, the debt-to-equity ratio is essential. If this number is significantly higher than industry peers, the company is highly leveraged, increasing the risk of bankruptcy during economic downturns.

What Can Support Or Kill Returns For Shareholders?

Stock based compensation (SBC) is a non-cash expense used to reward employees with stock options or restricted stock units. While necessary to attract talent (especially in tech), it’s a very real cost to existing shareholders because it increases the share count, diluting your ownership stake.

You want to make sure of a few things when analyzing a company:

• SBC as a Percentage of Revenue: Is this number alarmingly high (e.g., over 20%)? This could indicate that the company is too aggressive in retaining talent or management missteps.

• SBC vs. Free Cash Flow: Some tech companies boast high “Adjusted” earnings, but if you subtract SBC, they are barely profitable. If SBC is higher than FCF, the business model may rely too heavily on paying employees with equity rather than cash generated by operations.

Once a company generates free cash flow, what management does with that cash determines long-term shareholder returns. They have five main choices: pay down debt, reinvest in the business, engage in M&A, pay dividends, or buy back stock.

You should find out if management owns a significant amount of stock purchased with their own money. This makes management owners of the business just like you and very much aligned to the success of the business.

Return on invested capital (ROIC) is the ultimate metric of management competence. It measures how effectively a company uses money (both borrowed and shareholder equity) to generate returns. A company with a high ROIC (consistently above 15-20%) can compound wealth incredibly fast by reinvesting its profits back into itself.

If you are looking at a dividend paying stock, make sure you look for consistency and sustainability. The “Payout Ratio” (Dividends / Net Income) should generally be below 60-70% to ensure the dividend is safe even in a downturn. Also, there is much debate regarding chasing high dividend yield or high dividend growth. If the company is able to sustain high dividend growth, then it is generally better as you will grow your ownership through higher dividends over time. Just check out this article on how much Warren Buffett gets from his dividend stocks:

This is where it gets truly interesting with share buybacks. Imagine a company buying their shares to remove them from circulation and trading. This, effectively, increases your ownership of the company without doing anything on your part!

However, management MUST buy back stock when the price is below intrinsic value. This increases the remaining shareholders’ slice of the pie. Buying back stock at all-time highs just to offset the dilution caused by excessive Stock-Based Compensation, is a disaster.

Finally, be wary of serial acquirers. While some CEOs are masters at M&A like, many large acquisitions destroy shareholder value through overpaying and failing to integrate the distinct pieces.

Bringing It All Together For The Intelligent Investor

No single metric tells the whole story. An investment might have soaring revenue but terrifying cash burn. Another might have a great dividend yield but a rotting business model underneath.

Successful investing requires a composite view—a strong growth story and moat, not missing something in the financials, and industry-specific analysis.

The ideal investment looks something like this:

1. It has a durable, widening economic moat.

2. It exhibits rising revenue with even faster-growing earnings (operating leverage).

3. It generates copious amounts of real Free Cash Flow.

4. It has reasonable P/E and PEG ratios relative to peers and industry.

5. Management keeps Stock-Based Compensation, SG&A, and R&D under control.

6. Management has “skin in the game” and a track record of high-ROIC capital allocation (smart reinvestment, disciplined buybacks, and/or growing dividends).

Finding companies that tick all these boxes is rare. When you find one, and the valuation is reasonable, patience becomes your most valuable asset.

Disclaimer: None of this content is financial advice. Please do your due diligence before committing capital to any investment.

While the company continues to beat top-line expectations, the market’s reaction to it’s shifting cost structure and aggressive AI investments has created a volatile backdrop for investors.

Whether this shift is a s…

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The books are closing on 2025, and if you’ve been trading the commodity space this year, you’re likely either exhausted, up to your neck in profits, or a confusing mix of both.

Sitting here on New Year’s Eve, looking back at the charts, the narrative wasn’t the “recessionary collapse” many feared back in ‘24, nor was it an uniform boom. It was a year of divergence. We saw energy markets wrestling with a supply glut while rare and precious metals—specifically the ones powering our tech and grid—went absolutely parabolic.

Here is my personal deep dive into what just happened in the commodity space in 2025 and, more importantly, where I’m putting my money for 2026.

Oil Oversupply Or An Amazing Opportunity?

If you were long oil this year hoping for a geopolitical spike to save you, it was a frustrating trade. Despite the noise in the Middle East and tensions in the Caribbean, the story of 2025 was one of overwhelming supply.

HFI Research

(Public) Global Oil-On-Water Never Was And Never Will Be A Leading Indicator For The Oil Market

People familiar with our writing should be aware that we are not oil bulls, at least not at present. In fact, we are 35% net short in our portfolio (our last update…

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9 months ago · 28 likes · HFI Research

In the meantime, oil demand is forecasted to fall according to sources like the U.S. Energy Information Administration (EIA):

We spent much of 2025 watching US shale defy gravity (again). Production held steady, and even with OPEC+ trying to manage the floor, the market felt heavy. We saw WTI struggle to hold the $70s and eventually drift lower into the $50s as the year ends. The “scarcity premium” just evaporated.

The 2026 forecast looks bearish from the major agencies tracking and forecasting oil demand and supply. The IEA and major banks are shouting about a “supply wave” hitting in 2026. They suggest that we are looking at a potential surplus of 3.84 million barrels per day (bpd) next year.

However, these low prices are not sustainable forever. Companies, organizations, and governments will choose to lower production and capital expenditures (capex) if prices keep falling and stay low.

• Prominent analysts forecast Brent to average near $55/bbl in Q1 2026.

• Oil is a long term play in my opinion. The world still needs oil and energy with some even saying that oil will partially power AI. With many other commodities exploding in price, it’s a matter of time once

  • A trade for 2026 is likely in refiners (who benefit from cheap crude input and higher refining margins) or just stepping aside.

  • The cure for low prices is low prices; we are already seeing many producers cut back capex spending on projects. If you are patient enough, this is setting up for a nice supply shock situation at some point in the future.

  • Unless we see a massive, unforeseen black swan event from a major player like Russia or Iran, the supply/demand dynamic still needs to be brought into balance.

Silver Was The “Rockstar” of 2025

I’ve been saying for years that Silver was undervalued, but 2025 was the year it finally woke up and chose to go to the moon:

Silver didn’t just rise; it exploded. We saw a move of nearly 150%, rallying from ~$30 to over $70/oz by December. This wasn’t a meme-stock rally; it was structural. The industrial burn rate—driven largely by the solar PV sector and electronics—finally broke the back of available inventory. We’ve been in a deficit for five years, and in 2025, the vaults finally looked empty.

The momentum is real looking to 2026. With the “Green & AI” trade overlapping, silver is the singular critical metal for both as it is widely used in so many different industrial uses.

• $100 silver is no longer a crazy “tinfoil hat” prediction; it’s a legitimate technical target for 2026. Banks are upgrading targets to the $60–$80 range as a base case.

• Watch out for a potential pullback if the Fed pauses rate cuts, but the industrial floor is rock solid.

• Getting into silver now should be for long term investors only; traders may be burnt in very short time frames after such a run.

Gold As An Unstoppable Inflation Hedge

While Silver was the volatile rockstar, Gold was the adult in the room. It just kept grinding higher.

Gold pierced the $4,500/oz mark this year. The driver wasn’t just fear; it was the Central Bank Put. Nations (especially in the BRICS block - Brazil, Russia, India, China, South Africa) continued to aggressively swap US Treasuries for physical gold bars. The “de-dollarization” narrative moved from conspiracy theory to observable central bank policy.

I don’t see the gold trade stopping momentum, especially as there will be further rates cuts in the mix. J.P. Morgan and others are eyeing $5,000+ in 2026.

• Sovereign debt fears, rate cuts, inflation, geopolitical tensions, and other factors will lead to gold going higher. With US debt interest spiraling, gold is being bid up as the only “neutral” reserve asset.

• I would not sell gold here; long term investors will be rewarded for holding this metal that has been used as a currency and commodity for thousands of years in my opinion. This is a multi-year super-cycle.

The “Detachment” in the Liquified Natural Gas (LNG) trade

Natural Gas is usually a weather trade, but in 2025, it became an export capacity trade.

We saw a fascinating decoupling in 2025 with liquid natural gas. While global LNG prices softened due to a flood of supply from the US and Qatar (the “LNG Wave”), domestic US gas prices actually started to climb. Why? Because we are exporting so much of it that we’re tightening our own local market.

We are entering the “Golden Age of Gas” globally, but it’s going to be volatile.

• Expect a possible glut globally and international prices might drop as new liquefaction trains in Qatar and the US come online.

• Bullish on U.S. domestic gas prices. The EIA sees prices averaging over $4.00/MMBtu in 2026 because production growth (up only ~1%) can’t keep up with the insatiable demand from LNG export terminals.

• Investors could go long U.S. liquid gas producers who have export exposure which can maximize their returns. Not financial advice.

The Red Metal Renaissance with Copper

If you missed the Copper trade in 2025, you missed the story of the decade: The AI Infrastructure Buildout.

Copper hit record highs this year, over $12500/tonne by year-end. The story shifted from “EVs need copper” to “Data Centers need copper.” AI data centers require massive power infrastructure, and you can’t build the grid without the red metal. Smelters were fighting for concentrate all year, pushing processing fees to record lows.

We are staring down the barrel of a structural deficit and that picture is likely going to get worse.

• Analyst price targets of $12,500/tonne by Q2 2026 have already been achieved, so this will likely get re-rated higher.

• Mines can take 10+ years to build. Data centers can take roughly 2 years. Do the math. There simply isn’t enough copper coming out of the ground to meet the 2026 and beyond demand schedule.

• Every dip is a buy here just like the gold markets. This is the tightest market in the commodity complex and tightest market copper has seen in years.

Rare Earths: The Silent War

This sector is less about “markets” and more about “geopolitics.” The huge story this year has been how the U.S. tariffs caused China to “retaliate“ with rare earth export restrictions. These rare earths are so named because they are rare and needed in critical industries.

China tightened the screws on exports again in 2025, reminding the world they control the processing choke points. Prices for Neodymium (NdPr) and Dysprosium rose steadily (~10-16%) not just on EV demand, but on defense stockpiling.

The “China Plus One (C+1)” strategy is in full swing, but Western supply chains are still years away from maturity. The C+1 strategy involves using other countries besides just China in supply chains to make sure there are redundancies to prevent a chokepoint.

• Expect continued price volatility driven by trade bans or tariffs rather than pure supply/demand.

• Western miners outside of China (like MP Materials) are the only insurance policy the West has. These companies have already caught the U.S. governments attention and gone up due to government investments.

Final Thoughts for a Prosperous 2026

If 2025 taught us anything, it’s that commodities are no longer a monolithic asset class. You can’t just “buy commodities” anymore, you have to look at geo-politics, uses, inflation and so many other factors.

Buckle up. The volatility isn’t going anywhere.

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