Chit Chat Stocks

Episode: 6 Stocks With Insider Buys This Week; CoreWeave's Collapse; Amazon's New Grocery Venture

Date: August 15, 2025
Hosts: Ryan Henderson & Brett Schafer

EPISODE OVERVIEW

Ryan and Brett tackle a loaded agenda on this week’s Power Hour, hitting on:

• The debated “AI eating software” narrative and its impact on large software stocks
• Notable insider buys in six well-known companies
• Amazon’s new push into grocery delivery and what it means for Instacart and the sector
• CoreWeave’s collapse after their earnings report
• Restaurant and grocery trends, plus quick hits on other notable market events
• A sprinkle of bubble-watch and IPO observations

The tone is conversational, witty, and skeptical, with both hosts approaching hot topics with analyst-grade skepticism and the dry humor Power Hour regulars expect.

KEY DISCUSSION POINTS & INSIGHTS

1. AI Eating Software: Hype, Drawdown, and Opportunity?

Timestamps: 03:14–13:38

• Narrative Overview:
  There’s a growing belief, supported by recent analyst reports, that AI will make it easy for companies to build in-house versions of tools they’d otherwise buy from big SaaS firms (Salesforce, Adobe, etc.), leading to deep drawdowns across major software names.
• Recent Stock Moves:
  • Salesforce: Down 36% from highs
  • ServiceNow: Down 27%
  • Adobe: -49%
  • Monday.com: -61%
  • HubSpot: Cut in half
• Valuations are now way below historic norms.
  Salesforce and Adobe trading at their lowest multiples in years; Adobe at around 16–17x EV/EBIT.
• Ryan (08:35): "I had been a buyer of Adobe...I think you get good returns from here would be my gut reaction. The fact that they're buying so much stock, it's at basically an 8% buyback yield."
• Brett is skeptical about the “in-house everything” thesis: "Companies aren't going to build all this stuff in house. They're not going to build Adobe in house. Canva in house. Common house.”
• Takeaway:
  AI is a disruptor, but Wall Street and online narratives exaggerate. The best in SaaS probably remain entrenched, but lower multiples could mean opportunity for patient investors.

2. The Fall of Alcohol Consumption — Trend or Blip?

Timestamps: 13:38–21:02

• Gallup Survey: U.S. adult alcohol consumption down to 54%, lowest in 90 years of tracking.
• Women, lower-income Americans, and Republicans are abstaining more than average.
• Ryan ponders the investment thesis: "This is pressure on the alcohol beverage companies...no way this is not leading to some sort of top line pressure."
• Brett: “I would fade this a little bit. Alcohol has been a part of human civilization for thousands of years and I don't know if I can call the end yet...But for a company that could be in terminal decline, it's more of I want what Altria was sub-$40, which is like 6 times earnings.”
• No evidence that marijuana legalization is accelerating the alcohol downturn.
• Takeaway:
  Investors should demand a steep discount and high yields before considering alcohol stocks amidst these secular (and possibly survey-inflated) pressures.

3. Amazon’s Grocery Blitz—Real Threat to Instacart?

Timestamps: 23:05–29:57

• Amazon now offers free same-day delivery of perishable groceries in 1,000+ cities for orders over $25.
• Brett: "Cost wise, this is a significant undercut to Instacart or Doordash."
• Both are curious if this industry move is as disruptive as it seems. Could it finally be Amazon’s successful foray into grocery after numerous previous tries? Or will user habits—and loyalty to local grocers—protect Instacart?
• Instacart’s valuation (about 20x operating profit) may not be enough of a "scared" multiple for Brett, but he sees opportunity if the market over-panics.
• Ryan: "A lot of people that use Instacart already, cost is not their primary concern. If cost was their primary concern, they wouldn't use Instacart."
• Takeaway:
  Amazon’s new service could undercut, but hasn’t solved user experience. Not a death blow yet—watch behavior closely.

4. Fast Casual Restaurant Stocks: Cava, Chipotle, Portillo’s, etc.

Timestamps: 30:54–38:03

• Cava’s Quarter: Revenue up 20%, 16 new openings, but same-store sales growth down to 2.1%. $10B market cap, $3M AUV restaurants valued at $25M each, trading at 40x restaurant-level profit.
• Ryan: “If they got to like 15 to 20 times restaurant level profits, I would be interested. But we're 50% away from that.”
• Brett: “If they're going to be a normal comp store sales grower...do you really want to buy that at, say, 55 PE? I don't think so.”
• Chili’s and Texas Roadhouse stand out with strong comp sales (+20% for Chili’s).
• Portillo’s: Only fast-casual chain in the sample with positive comps this quarter. Insider buying (CEO, CFO, board) noted as a bullish signal by Brett.
• Takeaway:
  Growth in the category is slowing, valuations are generally rich, and only select chains (based on price, comp sales, and insider confidence) stand out as attractive.

5. Notable Insider Buying — Management’s Vote of Confidence

Timestamps: 40:01–44:16

• Key Companies with Insider Buys:
  • Asana: CEO Dustin Moskovitz on automatic weekly buys
  • Elevance Health: CEO increased stake by 7%
  • TransMedics
  • Shift4 Payments: CEO Jared Isaacman bought $16.3M, increased stake by 26% post-earnings collapse
  • Sonos: CEO, CFO, and directors all bought; not at 52-week lows
  • Portillo’s: CEO, CFO, GC, board all buying after a tough quarter
• Ryan: “The big thing I look for here is not nominally how much do they buy, but how much of a change in their ownership was it?”
• Brett: “The fact that [Portillo’s management is] confident here, along with activist investors and new board members...is a good team.”

6. Bubble Watch & IPO Madness

Timestamps: 45:22–50:12

• Bullish, a new crypto exchange, IPO’d and popped 143% on day one.
• “Classic sign of bubble behavior” cited: IPO pops, 18-year-olds on LinkedIn bragging about hedge-fund-killing returns, comedian Druski on Bloomberg.
• Advice: If you want to take a company public, now is the time. For investors, almost all IPOs are lower a year out—so wait.
  • Brett: "If you like the company, just wait, wait a year. Just wait a year. You'll get a cheaper price."
• Takeaway:
  Current tech/IPO euphoria matches previous market-topping cycles—extreme caution advised.

7. Adyen & Payment Processors: Slowdown or Normalization?

Timestamps: 51:32–57:08

• Slowest growth on record for Adyen (processed €334B, up just 4%). Block’s exit a big drag.
• Ryan: "My investing career [rules]: Don't buy IPOs...if Dorsey's involved, don't go anywhere near it."
• Shift4, Toast, and Square also reporting slowing momentum.
  J.P. Morgan emerging as a dark-horse payments competitor as block moves its volume.
• Brett: “Companies are going to grow faster if inflation’s higher, but I don’t know if the chart really is showing that.”
• Payments space remains competitive and decelerating, with scale and diversification proving crucial.

8. CoreWeave: AI Infrastructure Darling or Future Bankruptcy Case?

Timestamps: 57:19–63:24

• CoreWeave Q2:
  • $1.2B revenue (up from $395M YoY!)
  • Operating margin down to 2% (from 20%)
  • Interest expense: 22% of revenue
  • $4B FCF outflow in first 6 months of 2025
  • Raised $2B at 9.25% interest
  • $30.1B backlog (unverifiable)
• Brett’s Core Question: "Does this equity exist at this time in 2028?" (59:01)
• Ryan: "They might have enough financing to last three years...but I think it's a terrible business."
• CoreWeave rents out GPUs—an asset class “depreciating faster than anything in human history.”
• Takeaway:
  Extreme capex, leveraged business model, skeptical outlook. Most aggressive AI infra play out there, but viability highly questioned by both hosts.

NOTABLE QUOTES & TIMESTAMPS

• "Companies aren't going to build all this stuff in house. They're not going to build Adobe in house."
  — Brett, 11:12
• "Every time...I've seen a business that's been deemed ultra high quality for 15 years get really cheap...when those management teams start turning on the buyback machine, it usually ends up in pretty good results."
  — Ryan, 09:00
• "Alcohol has been a part of human civilization for thousands of years and I don't know if I can call the end yet."
  — Brett, 16:57
• "This is a significant undercut to Instacart or Doordash."
  — Brett, 26:06
• "Portillo’s...the CEO, CFO, general counsel, and a board member all bought shares in the last week."
  — Ryan, 43:07
• "Does this equity exist at this time in 2028?"
  — Brett, 58:51
• "GPUs are the fastest depreciating asset in human history. For a company like CoreWeave, that's their entire business."
  — Ryan, 61:00

TIMESTAMPED SEGMENT GUIDE

| Topic | Start | End | |-------------------------------------------|----------|----------| | AI Eating Software – Drawdown & Debate | 03:14 | 13:38 | | Alcohol Consumption Trends & Investing | 13:38 | 21:02 | | Amazon’s New Grocery Move vs Instacart | 23:05 | 29:57 | | Fast Casual Restaurant Earnings/Insights | 30:54 | 38:03 | | Insider Buying in 6 Stocks | 40:01 | 44:16 | | Bubble Watch, IPO Mania | 45:22 | 50:12 | | Adyen & Payments Sector Slowdown | 51:32 | 57:08 | | CoreWeave’s Collapse | 57:19 | 63:24 |

CONCLUSION

Ryan and Brett deliver a sharp, skeptical, and insightful Power Hour:

• The AI-overhang is real, but mostly “narrative-driven”—select software names may be bargains.
• Insider buying, especially when representing meaningful portfolio increases by management, is a serious green flag.
• In restaurants and groceries, macro and business model changes highlight the need for careful valuation discipline.
• Euphoria in IPOs, crypto stocks, and social media is another reason to stay cautious.
• CoreWeave’s story is a cautionary tale about chasing short-term “AI” themes with aggressive financial engineering.
• Expect more volatility, hype, and “bubble watch”—but with diligent research, investors can still find edge.

If you invest with a clear head, ignore the noise, and watch for real signs of value (like meaningful insider buying and proven business models), you’ll stack the odds in your favor—even in a frothy market.