Acquisition Mania (Roku, Salesforce, And More); Catching Falling Knives; New Small Cap Stocks

Summary

Chit Chat Stocks – Detailed Episode Summary

Episode Title: Acquisition Mania (Roku, Salesforce, And More); Catching Falling Knives; New Small Cap Stocks
Date: June 19, 2026
Hosts: Ryan Henderson (“A”), Brett Schafer (“B”)

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Overview

This episode dives into a dynamic week full of acquisition headlines, major corporate turmoil, and an engaging tour of international small-cap and value stock opportunities. Ryan and Brett dissect the blockbuster Fox-Roku deal, break down strategic plays by Salesforce and American Express, explore investor psychology around “catching falling knives,” and deliver hands-on analysis of small and micro-cap stocks. The episode maintains the show’s trademark candid, analytical, and occasionally skeptical tone, while weaving in live listener questions and international perspectives.

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Key Discussion Points and Insights

1. Roku Acquired by Fox: Implications for Media, Streaming, and Investors

• Segment Start: [01:35]
• Headline: Fox Corp announces acquisition of Roku for $22B (cash and stock), a roughly 30% premium over Roku’s recent price.
• Hosts’ Take:
  • Brett: “2021 darling, I think it's getting bought out well below 50% from its all time highs.”
  • Ryan: Roku is the “leading operating system for smart TVs,” but its business hasn’t hit the inflection point investors hoped for—“fine but maybe not what we were expecting.”
  • Shares of both companies dropped after the announcement—unusual for M&A news.
• Strategic Rationale: Fox, heavily exposed to declining linear TV, wants priority smart TV distribution for its first-party content and advertising.
  • Brett: “It's a bit like a move of a Comcast acquiring... NBC Universal. It's kind of in a similar vein.”
• Key Concerns:
  • Conflict with other content providers? If Fox owns Roku, will Netflix/Disney balk at advertising or revenue-sharing?
  • Brett: “Look, they're still in structural decline. But it's very smart for them to acquire Roku... it's a defensive move.”
  • Ryan: “I would be disappointed if I were a Roku shareholder but for Fox I think it makes sense.”

2. TripAdvisor Sells The Fork to American Express: Unlocking Value

• Segment Start: [14:10]
• News: TripAdvisor selling its European restaurant booking platform The Fork (a sort of “OpenTable/Resy of Europe”) to American Express for $700M.
• Business Angle:
  • The Fork: ~10% EU market share, 16% annual growth since pre-pandemic, now Adj. EBITDA positive.
  • Amex buying for 3x revenue to strengthen its European travel/restaurant perks, aligning with its US investments in Resy.
  • Brett: “If they want to try to gain their market share in Europe, they can build a better loyalty program if they own the Fork.”
• Investor Play:
  • Post-sale, TripAdvisor's Viator experiences platform could be worth more than the parent’s entire market cap.
  • Potential for activist-driven spinoffs/cash returns to unlock sum-of-the-parts value.
  • Ryan: “You're looking at 1.4 billion market cap, $800 million in net cash. The EV to remaining EBITDA is about three times.”

3. Quick Hits—Other Notable M&A and Executive Drama

SpaceX & Alphabet/Google

• [11:55] – Ongoing speculation, little actionable news. SpaceX’s acquisition of Cursor for $60B mentioned in passing.

Salesforce Acquires Fin (formerly Intercom)

• Segment Start: [51:08]
• Salesforce buys FIN, an AI customer support agent company, for $3.6B in cash (~10x revenue).
• Significant cross-sell opportunities as Salesforce integrates for enterprise bundling.
• Ryan: “Whenever Salesforce makes an acquisition, I think they spend too much... but this can make sense.”

Fiserv Executive Turmoil

• Segment Start: [36:08]
• Rapid CEO turnover and missed earnings. Investors worry about deeper problems—value play or value trap?
• Brett: “That would scare me because it makes it feel like there's something under the hood here that people aren't noticing.”

Adobe & Accenture – “Falling Knives”

• Segment Start: [31:38] (Accenture), [40:51] (Adobe)
• Accenture: 16% FCF yield, 5% dividend yield, unloved by market over AI risk.
• Brett: “You cannot own this at any price. It's like the opposite of... AI winners... There's no price.”
• Adobe: CFO resigning, adding to software sector nervousness.
• “Catching falling knives” as a strategy—timing the bottom is tough, but some yields become so high the risk/reward tilts.

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4. Deep Dive: Fishing for Value Abroad—The Danish Stock Index

• Segment Start: [21:39]
• Listener “Kender” champions Denmark’s 25-company index as an under-the-radar value play (“basket of non tech and hard to disrupt value”).
• Largest constituents: Novo Nordisk (pharma), Carlsberg (beer), Pandora (jewelry), Scandinavian Tobacco, etc.
• Beer Volumes: In secular decline, with Carlsberg’s volumes down ~12% since 2019 despite the “World Cup effect.”
• Tobacco & Alcohol: Both challenged, but some (like Scandinavian Tobacco, 13% yield) offer huge cash returns.
• Ryan: “In general, I'm not necessarily buying... you're buying Denmark broadly... a little bit of hair [risk]... but they all look fairly cheap.”

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5. Small Cap of the Week: Spectra Systems & Legacy Education

Spectra Systems

• [43:08] – Listener suggestion. UK-listed, $130M market cap, provides anti-counterfeiting & authentication for currency, brands, gambling.
• PE: 6.6 (though with one-time contract impacts).
• Brett: “It seems like... fraud detection... will [increasingly] be more in need. Could be a gem. I didn’t look at capital returns but... maybe a 6 out of 10.”
• Ryan: “I'm probably going to pass. Gotta raise my bar for what interests me.”

Legacy Education

• [46:40] – $142M market cap, operator/acquirer of career/healthcare colleges, mostly in California.
• Strategy: Roll-up “accredited but subscale” schools, focus on in-person requirements for healthcare.
• Strong returns — 38% 5Y ROIC, little debt, 12x fwd PE.
• Ryan: “I like colleges as a business... less susceptible to online disruption.”

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6. Investor Psychology: Executive Departures, Watching “Falling Knives”

• [45:00] Tyler (listener): “Anytime the main decision maker for a business leaves it is because they don't believe in the future of that business. I would say 90 plus of the time.”
• Investor “scar tissue” with companies like Adobe, Autodesk, Fiserv—as yields rise but stocks fall, are investors “catching falling knives” or stepping into value traps?

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7. Memorable Moments & Quotes

• On the Fox–Roku deal:
  Brett: “Why would I want to invest in a company that's forced to play defense as not one of the scaled players? It's tough.” [10:09]
  Ryan: “I would be disappointed if I were a Roku shareholder but for Fox I think it makes sense.” [09:49]

• On M&A motivations:
  Brett (re: Salesforce): “This is why I can't talk to a human. This is who I yell at—‘talk to a human’ all caps until I get a human.” [51:52]

• On Denmark’s Stock Index:
  Brett: “Indexes feels low class. We got to be professional as possible here on this DIY podcast.” [23:45]

• On beer/alcohol secular decline:
  Ryan: “This is across pretty much every market, alcohol consumption is declining.” [27:54]
  Brett: “It would be, I think, a little egotistical to make the claim alcohol is going away like this moment. But where is the floor?” [28:25]

• On Spectra Systems pitch:
  Brett: “I'm probably going to pass. Honestly, too many times on these small cap... I say I'm on the fence and it goes on a watchlist and then I am never truly interested.” [43:37]

• On Executive Moves:
  Ryan: “...when something's on the line of like value play, value trap. Which is it? I'm not sure. Multiple executive departures, especially in a row... That would scare me because it makes it feel like there's something under the hood here that people aren't noticing.” [38:14]

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8. Listener Engagement & World Market Insights

• Strong international presence—listeners from Norway, Denmark.
• Discussed fishing in “small, overlooked markets,” especially as a basket diversification play outside the US.
• Listener questions drive segments on SpaceX, DLocal, and others.

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9. Memorable, Lighthearted Moments

• “At least [Benioff’s] not... just trying to be cool constantly.” [54:45]
• “Evan Spiegel’s AR glasses... It looks like someone took a picture … and put the sunglasses emoji, blew it up and put it on his face.” [56:48]
• Bill Ackman quote: “One of the things that makes SpaceX so valuable is how valuable it is.” [59:31]

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Important Segment Timestamps

• Fox–Roku Takeover Deep Dive: [01:35] – [13:17]
• TripAdvisor/Amex “Fork” Sale: [14:10] – [21:39]
• Danish Small Cap/Index Tour: [21:39] – [31:34]
• Accenture, Fiserv, Adobe “Falling Knives”: [31:38] – [41:17]
• Small Cap of the Week (Spectra, Legacy Ed): [43:08] – [49:43]
• Salesforce/Fin Acquisition: [51:08] – [54:29]
• Snap/AR Glasses Debacle: [56:27] – [59:16]
• Listener Q&A Threads Throughout

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Conclusion

A densely-packed episode filled with practical market takeaways, insider analysis, and the hosts’ unique brand of conversational investing commentary. Highlights include the strategic logic (and potential pitfalls) of legacy media’s defense moves, methods to play international small caps, and the nuances of bottom-fishing among undervalued growth names. The timeless advice: look for cash, beware too much hope, and always dig into management’s motives.

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For more, join the live show Thursdays at 5pm ET on YouTube and contribute to the Substack community chat for future stock analysis requests.

Transcript

[A]

For the past three years, IBKR individual clients averaged 24.3% annually, beating the S&P 500's 23.1%. Lower costs and 170 plus global markets matter. Interactive Brokers Member SIPC Visit ibkr.com performance welcome to Chit Chat Stocks, the podcast that helps you find your next great investment. I'm one of your hosts, Ryan Henderson, and I am joined as always by the one and only Brett Schaefer. This is our week Investing Power hour episode. We do these live on Thursdays at 5pm Eastern Time on YouTube. So if you ever want to ask us any questions, head on over to YouTube, look up chit chat stocks 5pm eastern time on Thursdays and throw them in the chat. But on this show we talk all things financial markets. We've got tons of news this week, a lot of headlines in the M A world, a lot of acquisitions, a lot of spin offs, potential opportunities in there. We've got a lot of requests from the emerging Moats chat, which is totally free by the way, to go check out and ask any comments. And so a lot of questions, a lot of stuff in the audience. We've got small cap of the week that I find actually pretty enticing. And then we have two companies, actually three companies now sort of on the hot seat in turmoil. The CNBC headline markets in turmoil. I think maybe there's a few companies in turmoil this week that we can talk about, but I'll leave it there. Brett, what do you want to start with?

[B]

That's a good question, Ryan, why don't we talk about. Let's talk Roku, one of the 2021 flame of ours. Yeah, we've been following this for a long time. It's kind of one of the ones we'd look at when we were novices out there. 2021, 2021, darling. I think it's getting bought out well below 50% from its all time highs. Take us through the details here. What is Fox doing with Roku?

[A]

Yeah, so Roku, I guess our thesis way back when was that it'll be sort of the operating system for smart TVs, the leading operating system. And I would say honestly that thesis has played out for the most part. They are still the leading operating system. They don't report active accounts anymore, but they are the leader in active accounts and streaming hours has continued to rise. However, it hasn't necessarily translated to success or any real operating income inflection. I mean it's been, I think the business has been fine but maybe not what we were expecting. Anyways, news came out this week that Fox Corporation. Yes, that is Fox, the parent company of Fox News, Fox Business, Fox Sports under the FS1, FS2 brands I think a few other notable networks is acquiring Roku for $22 billion in a cash and stock deal. Shares of both companies dropped on the news. I don't know if I've ever seen both companies. Well, Roku jumped slightly I should say. But then the next day it dropped. It was just a little bizarre but it wasn't really quite the premium I think Roku investors were expecting. So it was just over a 30% premium to where Roku's shares were trading. And I'm checking the stock price now. I actually had the timing wrong. Roku shares did jump on the news, but not by a whole lot. There's still, I guess before we get into the implications of this deal, why Fox is trying to acquire Roku, I will mention that there is still a spread between the current share price about $138 and what the acquisition price would go through at which I believe is around $160 per share. So if you're, if you like the merger Arb World, this could potentially be interesting. I also there's some political dynamics. I have doubts that the current administration would, would really try to block this deal. But maybe I don't know all the workings there. Why are they making this acquisition? So they didn't explicitly lay it out but I think you can probably make some assumptions. Fox is basically a TV network business that has for a long time relied on linear tv. Linear tv. Obviously if you haven't been living under a rock it's sort of in structural decline. Probably has been for the better part of a decade. And in theory if they own the leading operating system in the smart TV world, they could give themselves sort of priority placement for their first party content. And there's probably some other kind of hidden benefits there as well. But the follow up question for me is I guess first the two part question for you Brett. Does this acquisition make sense? And then if Fox owns Roku, do you think Roku gets less demand from other content players? Because right now they generate most of their revenue through advertising from the Netflixes of the world or the Disney's of the world. If it's owned by Fox, is there sort of a conflict of interest there with other parties?

[B]

Yeah, that's fair to have on the last part there. I don't think it would be the end of the world you're also still doing your revenue share agreements, which is not as large of a business or part of the business anymore. I think the acquisition makes sense. They want to get into. Okay, well Fox also owns 2B. I think they all have strange names, but one of the ad supported streaming channels, Roku Channel is really dominating in that. And if you can just funnel a bunch of that ad supported, I don't want to call it slop content, but reruns, stuff like that through to be Roku Channel, things of that nature. You layer on Roku's advertising technology, which I always think these type of things are overrated. They say, oh, we have these anti walled garden targeting capabilities. All right, we'll see. Everyone seems to still want to just spend on Instagram. I think that is. It makes sense. And the stock wasn't at a super expensive multiple. When you look at like a gross profit or a revenue basis, I'm sure they're not as profitable as they could be. I like it. I don't know if I would buy a Fox because look, they're still in structural decline. But it's very smart for them to acquire Roku because you get all these households, you get the distribution. It's a bit like a move of a Comcast acquiring. Oh, what do they acquire? NBC Universal. It's kind of in a similar vein, but almost the opposite. Like the opposite person is acquiring. And I think it totally makes sense because if you're going to compete with a Netflix or a YouTube or even Amazon prime or an Apple who have different budgetary concerns, if you're going to really compete with Netflix or YouTube, you're going to need some sort of advantage. I think this makes perfect sense for them. If you're looking at someone like Disney, I kind of would worry that this is another competitive threat coming at you in the streaming TV space. Look, that's not really where your, your profits go from parks and experiences and things like that. But you still need people, you still need to be very relevant within streaming TV and TV in general. And if Disney has a larger competitive threat with a Roku combined with Fox, yeah, I'd be slightly concerned.

[A]

So right now, Fox, over the last 12 months, Fox has done $16.2 billion in revenue. Can you guess what they were, how much they were generating revenue 10 years ago?

[B]

Who, sorry, fox, fox.

[A]

They're currently generating 16 billion. Can you get.

[B]

Might have been a spin. I think they separated parts of the business. Correct. Sold it to Disney. Sold some of the content studios to Disney. Yeah. Let me Was this app spin?

[A]

I believe it's post spin.

[B]

Okay, well keep this in mind. We could be, we could be using not apples to apples here. I have no clue what the revenue is. 30 billion 28 8. What does that say?

[A]

No 8 billion. Well 9 billion in 2016. So they've doubled revenue over the last 10 years basically to be.

[B]

Gotta love to be.

[A]

Operating income I believe is about flat. Let me see if I can get. Yeah, well there's been a big drop this year but operating income has barely budged. I, I think part of that is that the. In the Fox sports world I, I would imagine you're. You're constantly bidding more for the sports rights. So even if your revenue grows your content costs might be growing or outpacing that growth as well.

[B]

The.

[A]

I think it makes sense from Fox's perspective honestly there's a lot of value in owning that distribution arm. I think Roku probably has I want to say 100 million active accounts. I could be getting that. They don't report it anymore. But that's roughly right.

[B]

I think they're north of 100 million.

[A]

Yeah, yeah. Last it was reported was 90 million in 2024. So you could guess that they've continued to grow. I think this is. I would be disappointed if I were a Roku shareholder but for Fox I think it makes sense which is a little bizarre because Fox shares are down I want to say 15, 20% the news.

[B]

So yeah, I still don't want to own anything in the media space, the traditional media space it this maybe we can look at what the numbers are combined but even merger are possibly if that's your game. But the combined businesses. I still think it's just hyper competitive and you're going up against the youtubes of the world for example with the World Cup I know in the United States on Fox but in Brazil there was a. I think a traditional TV newscaster but there's also just a YouTube channel that got the rights somehow I don't know if it's a shared thing or if everyone has the rights to the World cup. They have 30 million people watching that. So that is I think long term it's just going to get more and more and more competitive. This is defensive move but why would I want to invest in a company that's forced to play defense as not one of the scaled players? It's tough. All right, we have listener comments here. Someone says gosh, what do you think? Well, they want us to talk about SpaceX. Another one someone Chris says please no SpaceX talk. We are gonna have a rule to not talk much SpaceX at all going forward. I'm significantly covering it. The Motley fool as well as it's all over cnbc. We talked about it a bunch leading up to the ipo, but we did have a listener ask why. Why do you think the stock popped? Essentially it's pretty simple. There was a lot more buyer demand than they could get into the ipo. A lot of people chased after it the few days after it got public. And now it's probably going to slowly bleed over the next few years. And it's about my SpaceX update.

[A]

Yeah, I definitely don't want to talk about SpaceX stock price movements because we're probably going to get the chance to do that just about every week for the next year would be my guess. But yeah, there were some interesting developments, I guess. Well, they signed a deal with Google that's slightly old news. Tyler asked why did they. Why did Google sign that deal? My guess is Space X offered them cheap Compute is the answer. And there's a lot of opt out clauses, I believe. I think they have like a 60 day opt out clause at any point, if I'm not mistaken.

[B]

So here's another note. Alphabet Google, they own SpaceX shares worth about $100 billion. And if they can get the stock price elevated until they can dump it. Not a bad move. Right? And this can help them get there.

[A]

Yeah, that's true. But I. And the other news I guess is they're making one of the biggest private acquisitions of all time. Potentially, at least on the face. Face number there. $60 billion acquisition of cursor. I think the actual name something else. But Cursor is the customer facing name.

[B]

Do you know anything about Cursor?

[A]

I don't.

[B]

Neither do I. They're just trying to spin up revenue growth. I think that's about it. We've talked two minutes on them maybe. Is that. Is that too long here? Should we go on to another too long? Yeah, yeah.

[A]

And then Chris, Chris also says in the chat, guessing Roku is mainly prominent in the U.S. yes, I believe it mostly is here in the U.S. most of their Activ accounts are. But I could not name a single original piece of content that they produce. I don't think they really do produce much original content.

[B]

No, I think they bought the Quibi Library for like a million bucks, but that's about it. They just throw stuff onto the ad supporting like they. Okay, for example, what's a popular rewatch movie that people have Like Inception, something like that. Christopher Nol movies. People toss those on the Roku channel. They get them on there, they load it up with a bunch of advertisements and you can watch it for free. But that's how they make the money.

[A]

All right, do we want to talk more M and A news? There's a few that we can rip through. So Brett, you tell me which one interests you the most. We could talk Salesforce, TripAdvisor, Pizza Hut.

[B]

TripAdvisor first Pizza Hut. No pizza trip.

[A]

TripAdvisor. I think this is, it's the smallest acquisition of the news headlines from this week, but it's probably the most actionable for my portfolio would be my guess. So the news is TripAdvisor is selling the Fork, which kind of a funny name, but the fork to American Express for $700 million. The fork for those over here in the US is the leading restaurant reservation platform in the Europe. In Europe and the UK they have an estimated 10% market share.

[B]

Open table or Resi for Europe?

[A]

Pretty much, yeah. And American Express owns Resi, correct? Correct or yeah. Okay. So I guess this will be similar for the UK market or the EU market. And the business has, has actually been in pretty solid shape. So I've got a chart pulled up here, Brett, maybe you can share it. But revenue has grown at 16% a year for the fork, the division under TripAdvisor basically since pre pandemic. And they've just turned the corner to again take this with a grain of salt. But adjusted EBITDA positive, they're now at about 10% adjusted EBITDA margins for that business. So 232 million in revenue, decently sized business here. American Express is basically buying them for three times revenue. I think as an American Express shareholder, I think you should probably be excited about this, honestly. There's a lot of tie ins that they can do with these reservation platforms and ways to kind of make you feel prestigious if you're an American Express card holder by giving you priority reservations and stuff like that.

[B]

Yeah. And for what they did with the refresh on their latest, both of the flagship cards, Platinum and Gold, is you now get Resi like kickbacks for the United States customers every quarter. So I think you're Platinum, you get a hundred dollars every quarter. Now the fork is based in Europe, so it makes sense for them if they want to try to gain their market share in Europe, they can build a better loyalty program if they own the fork. And it already seems like a decent business.

[A]

Yeah. And the, the part that I guess excites me is if you look at the remaining TripAdvisor company, I think it's pretty attractive here. So the rest of what's under the TripAdvisor portfolio is TripAdvisor's legacy brands, which are basically connectors for hotel bookings, which is in structural decline, so basically in runoff. But then Viator is in there as well, which is the leading experiences platform, which Airbnb is making a big push in there. And there's been some rumors that potentially airbnb could be vying for that business.

[B]

Definitely not dropped by TripAdvisor or their activist. They're not trying to get that narrative started. Airbnb buy this. Airbnb is thinking, why would we do this? But hey, could be a good way to make some. Make some money as a shareholder.

[A]

Yeah. And so Viator and the legacy TripAdvisor businesses, so stripping out the fork, they generate about $1.8 billion in revenue and $270 million in adjusted EBITDA. Combined, those two businesses. TripAdvisor recently had an activist investor come in. I think it's Value Act Capital was I believe the name of them. And I suspect they were the ones really encouraging the spinoff here. If they're getting 700 million in cash, TripAdvisor has a $1.4 billion market cap today, and I think they've got about 100 million net cash on the balance sheet. You're looking at 1.4 billion market cap, $800 million in net cash. The EV to remaining EBITDA is about three times. Now, keep in mind, adjusted Ebitda, it's adjusted, it's not cash flow. So, you know, do your own work here. But it looks pretty cheap and if they choose to, they could take out a ton of their shares. They've got more than half their market cap in cash. With if this once this acquisition would go through, I assume it's an all cash deal. I didn't check, but I, I should probably double check that.

[B]

I think, I think it's definitely all cash. But yeah, let's say we're not 100% certain there. The. Yeah. Viator could be worth billion or 2. 2 billion. Right. It could be worth more than its entire market cap today. So you could get a nice sum of the parts realization here. And the fact that they already sold the fork may just be the catalyst you need where you go, oh, okay. They're actually thinking of getting rid of everything and just trying to realize some value here. Where before the activists had come In I think it's maybe at some point over the last 12 months, there have been talks, management says we're listening, blah, blah, blah. But we're actually seeing action now. So this could make it a much better risk reward. Not saying I've looked at TripAdvisor closely, but this could be a much better risk reward now that we know they are willing to sell Viator or the fork. You research your investments, you analyze markets, you manage risk. But did you research your broker? For the past three years, IBKR individual clients averaged an annual return of 24.3% compared to 23.1% on the S&P 500. IBKR's lower trading cost, competitive rates, efficient execution, and access to more than 170 global markets helped investors keep more of what they earn and put more capital to work. Over time, the broker you choose matters. Interactive Brokers member sipc if you care about performance, find out why the best informed investors choose interactive [e-mail] performance yeah,

[A]

I mean, if this, it's worth more dead than alive potentially here.

[B]

Yeah. And TripAdvisor is, it's, it's dying. It's okay.

[A]

It's. Yeah. I think there's a chance for investors to make, you know, potentially double their money in short order. Again, I don't think this is assuming that this becomes spin offs and cash returns type story to shareholders.

[B]

Right. Things need to go. Right. It's not a couple of steps need to be had, but this is one of them.

[A]

Yeah. The last thing you want right now is a management team that thinks they can revive the business. That's. You don't want them to be too aspirational.

[B]

We're pouring money into the core TripAdvisor brand to try to regain market share. From who? Wikipedia or not Wikipedia. Expedia. I don't even know what TripAdvisor competes with. That's. That's a business I never even knew. You get Those lists of 10 things that just seem wrong for your trip. You're like, here are 10 things to do. And it's like I, my gut says these are actually scams. Yeah, but what. Anything else before we move on to another topic? No.

[A]

The only other thing I could potentially be interested in is if somehow they're able to spin off the legacy TripAdvisor business and you get the remainder, which is just Viator. I think Viator on its own is worth a lot more than the current market cap.

[B]

So toss TripAdvisor to a PE firm, something like that. Let them.

[A]

I Just don't know who's really going to buy.

[B]

Well, for how much depends on what price you could juice it for. I mean people made money still make money. Owning yellow pages. It's just 99% smaller than 25 years ago. So at the price. Yeah, who knows? All right, we got more international listeners. Maybe it's the World Cup. Everyone's interested in the United States now. Hey guys from Norway, been following for a while and appreciate your work. Especially Nelnet is a great case that would never appear on my radar. Yeah, we have some other under the radar stocks we want to cover on this show today. And I will say on emerging modes. I wrote a detailed write up on Nelnet. We have some other listener questions here maybe we can get to later if we have time. Can we go through Ryan? There was some stuff from last week that listeners recommended that I didn't get to first one here is the Denmark index detailed from Kender here had a detailed note in the substack chat. He says fishing where no one goes. Here in Denmark we have a small index of just 25 companies but Maersk is in twice so it's really 24. We don't have tech, we don't have a lot of growth but we have high quality companies. It used to be one of the best indices indexes. We need to really figure out if it's. If that's interchangeable.

[A]

But I thought about it by the way, I think they're both.

[B]

It both fits.

[A]

Usable in indices. I believe is like a group of indexes.

[B]

Okay, all right. And what about indexes? So indexes is. It's like another layer down. All right.

[A]

I remember writing something about it and I was like wait, there's a use case for both of them. I'm forgetting now but it'll. Let's. From this point forward we're going with indices.

[B]

I like saying indices. Indexes feels low class. We got to be professional as possible here on this DIY podcast.

[A]

Yeah.

[B]

Okay, back to the Denmark index. The past couple of years it's been one of the worst. It's also pretty cheap and pays a big dividend. The capital markets have been dead here, but we just had our first IPO in four years. A juice company at $3 million. Well, congrats. It's about 0.01% the size of SpaceX. I kid that's. I mean this is where you can kind of fish where no one's looking. South Korea, Japan's larger, Taiwan, Denmark, places like that where you should have good Business rule of law hopefully. And maybe you can find some diamonds in the rut that no one's looking at it to finish it off here. I don't own it myself but as a basket of non tech and hard to disrupt value, one of the best currencies in the world, I do think it add value compared to a tech USA high beta portfolio. Should we look at some of the largest companies? I should have pulled up the screener. I did this last week maybe. Yep, still on there. Thank you to our friends at Fiscal AI. The screener was pre loaded. We could start maybe we'll just go the top 10 largest companies here and anything that pops out to you first appear one that many people will know. Novo Nordisk 200 billion dollar market cap. That's I think dragging down the index a ton.

[A]

Yeah, interesting. I don't really have necessarily a strong opinion on Novo Nordisk here. It seems like Eli Lilly is becoming more and more competitive but again, who knows. I think once you get used to taking a drug there's or recommending a drug as a physician, there's some risk in switching.

[B]

Sure, that's fair. And I don't think the weight loss drug competition. Well one, it's a huge rising tide that's gonna lift. Yeah, everyone but two, I don't think the competition between these two companies and others is over. It's still a very new industry. It's only been five years. There could be new innovations. Novo Nordisk was the pioneer. I wouldn't completely write them off. Here's another one on the list. Carlsberg Beer Co. Craft and specialty beers you add are in the Europeans. According to these videos we're seeing in the World cup they drink a lot more than the US people. So maybe you want to be Europe focused when it comes to alcohol.

[A]

The data would relatively speaking they might drink a lot, but compared to 10 years ago, do they drink a lot? I'm not sure.

[B]

Here's Carlsberg Carl.

[A]

They've seen beer volume declines. I'll double check but yeah, you check that.

[B]

I'll give you some of the basic stats here. Revenue 3 years 8% 5 year 9%. This is annual growth 10 year 3%. Obviously there could be some spins or acquisitions there. Dividend yields 3.4% 10 year dividend growth of 12.4% trailing PE 18.6 forward PE 12.3. Not as cheap as you'd maybe like for a non. Something that you don't think is going to grow much above inflation. But maybe they're. I would expect more Of a discount is kind of what I'm saying. If this is a hidden gem on the Danish market,

[A]

what do you want to look at? Beer volume in Western Europe, Their beer volume in Asia, or like just their overall. Total global.

[B]

Total global. Let's just do that.

[A]

It is down, I would guess probably around 20% over the last six years.

[B]

Down.

[A]

Down about 12% since 2019.

[B]

Beer.

[A]

Total beer volumes. And Western Europe in particular has. They must have spun something off because it's almost been cut in half. Beer volumes.

[B]

Yeah, there's probably something in there, but again, you're.

[A]

I know it's the World cup, everyone's celebrating and people are drinking a lot of beer, but you're fighting a headwind here in terms of volume, even. I know it's one of those things where you get anecdotes in real life and it makes you feel like there's volume growth, but there's not globally. And this is across pretty much every market, alcohol consumption is declining.

[B]

Yeah, we talked about this before. The big question is, do you hit a bottom or is it a new secular trend? It's very hard to say. I think at some point you normalize. It's not going away. It's been around with humans for thousands of years. Like this is not sure. It would be, I think, a little egotistical to make the claim alcohol is going away like this moment. But where is the floor? That's where investors are concerned. Right.

[A]

It's. I mean, look, people still smoke cigarettes, but they. They've shed volume every year for 30 years. Yeah. Now, if that's the comp. Maybe it is a good investment because the returns have still been.

[B]

All right, but that's fair. That's fair. Yeah. They have some other ones in here. Pandora, also another struggler lab grown diamonds. I. I don't. I really do not want to mess with jewelry. Maybe Pandora has less, like, diamond ring exposure, but that feels like a huge headwind for. For places like Tiffany's owned by LVMH. Pandora could be interesting. We're at PE of 10, maybe take a look at that.

[A]

In general, I'm not necessarily buying. You're buying the basket. You're buying Denmark broadly. Now, a lot of these are global businesses, so, you know, the constituents matter. But I think if I were looking to buy one of these ETFs based on this index, it would probably be just like geographic exposure outside the United States. And all these companies you've mentioned, it seems like they've got a little bit of hair on them a Little bit of risk. Maybe some of them are seeing sort of headwinds. But they all look fairly cheap, probably at least the ones you've mentioned. Pandora, Novo Nordisk.

[B]

Here's the last one I have for you that might get you a little more excited. Scandinavian Tobacco Group PE according to fiscal AI. Again use our link. Fiscal AI chitchat. Get 15% of any paid plan. Most of the data throughout these episodes we use from them. PE here. 7.9 dividend yield 13% high dividend yields can be dangerous, you know, to be fair. But the 10 year revenue growth. 3% in Danish. Let's look at USD. Maybe it'll be different. Nope, it's about the same. That seems interesting. They sell cigars, right? It's always, always a solitude.

[A]

Are they tied to the. The pro Cyclical. They're tied to the Danish economy. Maybe better economic results. More cigars sold.

[B]

I'm guessing they sell international as well. But yeah, you're found at 1750. That's durable right there.

[A]

That is durable. Well, I'd say I'm on the fence. I don't, I'm not in love with any of the big index constituents there. At least the ones you've, We've, we've talked over. But Scandinavian tobacco, I mean 13% dividend yield, if they're able to keep growing it, you know, potentially.

[B]

All right, should we do some of the small caps of the week?

[A]

I want to talk about one. I want to talk about, I guess two companies that were mentioned in the chat. Accenture reported earnings the. And they reduced guidance for next year. I think it's like they're expecting revenue to grow like 3 to 4% the stock. Can you guess the current free cash flow yield for Accenture?

[B]

1512. Well, let me. Those are some wild guesses. It's over. Okay. I'm going to say over 10. I'm guaranteeing over 10.

[A]

Yeah, it is over 10. Do you want to win 16% free cash flow yield?

[B]

Yeah, that. No one cares. You cannot own this at any price. It's like the opposite of the space economy stocks, the AI winners, the data center infrastructure winners. It's. There's no price. I would own this. At same with wix, I think. Wix, there's a little bit of lumpiness, but it's at like 25% which is wild.

[A]

Are you saying like that's what investors think?

[B]

Like you can't own this at any price. There's no price. You would buy it for Accenture, the wix, the AI losers of the world Constellation Software maybe a little bit different.

[A]

But see, I, I don't agree.

[B]

Oh, I'm saying this is what investors are saying.

[A]

Yeah, yeah, yeah, yeah. It's been, there's a lot that are just being discarded, like just not want anything that's deemed AI risk they don't want. Investment groups want no association with it. But Accenture, to me, like consultants, I know what you'd think, like AI reduces the need for consultants. And yes, I think a lot of the work, you don't need to pay some junior level consultant, some whatever analyst associate to make you a slide deck anymore. But there's a lot of reasons that companies hire consultants and maintain relationships with big consulting firms like Accenture that are totally unrelated to productivity. Firing people, layoffs. We had Accenture come in and do a, conduct a business review and we need to do layoffs because Accenture told us compensation consultants. Sure, Accenture told me I need to be paid $50 million this year. Despite not hitting my hurdles.

[B]

I'm not sure that's what Accenture does, but maybe they have a small.

[A]

It might not be directly related to Accenture, but I think consulting is a pretty durable industry. More durable than people think. And okay, here's the only part that really entices me about accenture. Dividend yield, 5% dividend yield 5%. And they're paying about 30% of their cash flow towards the dividend. That's it. So I don't think even if their cash flow got cut in half, they could support the dividend yield. And I don't think that's going to happen. So I would be on the, I'm on the side that this works over the next five to 10 years, unless the multiple just keeps compressing, maybe we're going to be having the same conversation at a 50% free cash flow yield.

[B]

Maybe. Maybe. Yeah. This seems to be what. And a lot of people are giving him. I don't want to swear they're talking bad about him. Michael Burry for catching these falling knives. I don't know if Accenture was one of them, but there's the Adobes, the Fiservs. It looks terrible when it's down 50% and then it's going to keep falling at some point. Timing the bottom is very tough, but it would be insane if there was, unless the business totally fell off a cliff next year that Accenture was trading at a 50% free cash flow yield, which is, I mean, what, whatever, another 50, 60, 70% drop from here. But if they're buying back stock Which I think they are. And you have that dividend like there is a ton of protection even if the business turns into tobacco ish and you're in runoff and you're, you're seeing declining demand. Because I think what people get the mistake of is these businesses aren't going. If they're going away, they're not going away overnight. We talked about TripAdvisor. That was a structural loser 15 years ago. Still, I'm guessing generates positive unit economics today.

[A]

Yeah, to shift gears a bit there, you did mention Fiserv, that one. I don't know if you saw the headline this week but the.

[B]

I saw some of the CEO, he went on the land, he went on the lam. He just left.

[A]

Yeah, he left. So I'm going to go through the history real quick here. That's, I don't know if it was a proper like didn't, didn't respond to anyone and just left.

[B]

But like the, the funniest one is the Nissan CEO who was in trouble, I believe in Japan and he escaped in like a casket in the bottom of a plane to Lebanon. Yeah, famous story. Now he's still there, he can't leave.

[A]

So I don't think that's what happened here. But so to go through the history in January of 2025. So a year and a half ago, Pfizer's, Pfizer's old CEO left abruptly to join some role in the Trump administration. It was kind of a weird departure, but they then brought in, I believe his name is Brad Lyons from pnc who was sort of supposed to be the next up for the CEO role at pnc. The departure, the abrupt departure from the CEO spooked investors and shares started to drop in June of that year. So six months later after they missed earnings, the new CEO Brad Lyons basically said the company needs a critical and necessary reset. And he admitted, he basically blamed previous management that the financial guidance was totally un, unrealistic and they were relying on over aggressive cost cutting. And basically it was this like the old management really screwed up. I'm here now, I'm going to make changes. I'm getting rid of a lot of the old executives and bringing in my own team. The stock fell more then there was even claims around misleading accounting with their business in Argentina as well.

[B]

But well, they reported non FX neutral growth. So it looked really great while that currency was in free fall. But now that it's stabilized, well, can't play that trick anymore.

[A]

Yeah, I wonder how much of this Pfizer of drawdown Just comes purely down to Argentina's inflation driving the stock up anyways in May of this year. So a little over a month ago, they hosted an investor Day in Lyons. The CEO said the company was past the worst of its challenges and things are going to start to improve one month later. So a week ago, Brad Lyons steps down and takes a CEO role at Truist. Fiserv is now in a 78% drawdown from highs. That is where I get scared. Like when it. When something's on the line of like value play, value trap. Which is it? I'm not sure. Multiple executive departures, especially in a row, someone comes in and a year later he's out and voluntarily takes a job somewhere else. That would scare me because it makes it feel like there's something under the hood here that people aren't noticing.

[B]

That's completely fair. And the one thing, maybe to play devil's advocate on the other side, Lions is leaving for Truist. Truist has a larger market cap then Pfizer, probably a bigger name in the banking industry. It's, you know, it's not one of the big banks. But maybe this could be considered a step up where it's not necessarily like, all right, I'm stepping sideways to something that would be equivalent in that nature. So you can make that argument. Maybe he got an opportunity. He'd been waiting for this for a long time. I'd like to hear what he had to say or what management had to say because of that. If that's the case, maybe there's no cause for concern. But if he didn't see a lot of optimism within Pfizer's business, then I would say, yeah, it makes sense that he would leave and for reason for an investor to be nervous. But I'm looking at the stock here, Ryan, and I got a sneeze. That's why I'm. For anyone that's looking at the video I was trying to stop from sneezing there. The PE is 8 EV to EBIT, 6 EV to EBIT, 10 around those levels. Not terrible.

[A]

It's crazy to be in an almost 80% drawdown and still be trading on EV to EBIT of 10.

[B]

Like, yeah, it's kind of gone. Let's see where it's. If it's gone down, I would think it has to.

[A]

There must be some compression in the earnings. Another executive exodus. Brett, Adobe cfo. Don't know if you saw that.

[B]

Okay, yeah, let's move to that. But first for the listeners. Yeah, Ebit operating Profit peaked at 5.9 billion in 2024. Now we're at 5.34 billion over the last 12 months. I mean it's not that bad but it's a little bit down from the highs. It's moving in the wrong direction.

[A]

All right, do we want to take a small cap of the week, kind of eat our veggies here?

[B]

Yeah, people said they like when we talk about these and I have mine from last week. You have one from the listener suggestion this week. We can probably hit them both in five minutes each. Since you're the last topic, let me, let me just go first with this one. Spectra Systems. There's another listener recommendation. I thank everyone for joining the substack chat link there is in the show notes. Toss out all these. We may not be able to hit everything on the show but we'll try to hit anything interesting as any micro caps or small caps. Here is the company quote. Their core mission is to protect government, governments, central banks and private corporations against fraud, counterfeiting and security breaches. They do banknote authentication, banknote cleaning, helping brands with counterfeiting and detecting fraud for lotteries and gambling. It's listed in Britain, England. Market cap of $130 million. Revenue growth of 21 annually since 2017 16. Some of that was inorganic because they had acquisition of Carter Security printers in late 2023. These are really sexy industries. Gross margin 58% operating margin 38% PE is 6.6. But they had a forward PE of 14 to 17 due to a one time contract last year. Something I forget because I researched this last week. Something to do with banknotes but they work with central banks which again you might think oh, paper notes are going away but again they're going to need this probably forever. I would say some. Maybe you could argue in the other direction. It seems like this type of, you know, fraud detection, counterfeiting if they're within the banking industry, if they're working with brands, lotteries, kind of regulated systems, gambling and things like that. Yeah, you'd have to look at what the mode is but they've shown strong growth and it look it seems like with the rise of AI scams, things like that, you know, kind of supercharging fraud capabilities for and crime capabilities for anyone out there. Feels like this is something that will be more in need. Could be a gem. I didn't look at capital returns but what are your thoughts, Brian? I kind of, you know, lukewarm interest, maybe a 6 out of 10 of of future research

[A]

I'm probably going to pass. Honestly, I feel like too many times on these small cap of the weeks I say I'm on the fence and it goes on a watch list and then I am never truly interested. So I got to raise my bar for what interests me.

[B]

All right, let's maybe we can move on right to yours. Sorry to the listener. All right, we have another comment here from Tyler related to CEOs and it's a good note for any listeners that haven't experienced this type of thing before. I never truly understood this until Brian Nicholl left Chipotle. Anytime the main decision maker for a business leaves it is because they don't believe in the future of that business. I would say 90 plus of the time. That is correct. So it's a good rule of thumb. Now he has another question here related to the interview because Ryan had missed that one but that came out yesterday. If you're listening Friday, it would have came out on Wednesday on D Local with James Emanuel new guest. People seem a lot of comments that people like that so appreciate with that it was on D Local and he said Tyler says here are you adding it to the watch list? Seems like a clear acquisition candidate for something like Adyen the kind of comp for more not emerging markets Europe and the United States or in North America. Yeah, I mean D Local looks cheap. It looks like an acquisition candidate. It's growing quickly. They've gotten past the post IPO kind of SPAC craze era of 2020, 2021. They've come back down to earth and and they've gotten past the other side of a short report. They professionalize their management team. There's a lot to like. I have it really up there on the top of the watch list. There's quite a few. You know I have Toast TPB holdings, the discount grocer in Mexico that a lot of people like Clintroke and Miller. But Delocal for sure seems like a interesting business. Ryan, what about you?

[A]

I need to give the episode a listen.

[B]

Oh you're hurting our listeners, Ryan. Come on, you gotta help out.

[A]

I generally like that setup though is bombed out post IPO and everyone's just selling it because everyone else is selling it and it just feels like indiscriminate I guess and maybe there was some reasoning but I feel like a lot of my best investments have come from when sentiment is just really poor. Post ipo.

[B]

Well it's an emerging markets player and there was a muddy water short report so people get yeah, people just said, I'm not touching that.

[A]

Yeah, it's fair. And to whoever sent in the spectra systems, I don't mean to totally dismiss it, but I don't know, for some reason it just wasn't.

[B]

It

[A]

didn't do it for me. Not sure I'm sorry.

[B]

Hey, maybe that means there, you know, no one likes it. Maybe there's an opportunity, the listener there. Sometimes it'd be a good thing if Ryan and I disregard something because, you know, we're not. We're not clairvoyant. We're wrong a lot.

[A]

Yeah, I guess. This another small cap of the week. Thank you to Cade, I believe for submitting this one. This is Legacy Education, which I will say just a bad name. You shouldn't have Legacy in your name as a public company. It makes it sound like you have outdated systems. But Nonetheless it's a $142 million market cap company. So gas, you call it micro cap that went public in 2024. So fairly recent. And they own and operate colleges that are primarily focused in the healthcare space. So post high school, primarily healthcare focused.

[B]

They own these colleges?

[A]

Yes. So students pay tuition, they get their credentials, they become a nurse, whatever. And there's a lot of different like services or healthcare credentials that they can get through these colleges. I think it's. I think they have four campuses at the moment, primarily based in California, but they are acquirers of colleges. So here's a quote from Cade, who had a good write up on them on Substack. I recommend checking it out. It says Legacy's model is essentially a healthcare education rollup. They find accredited but subscale California career colleges acquire them at reasonable prices, integrate them onto its platform and grow enrollment through its shared marketing and operational infrastructure. The financials look pretty good. So with which is generally pretty rare for a micro cap. 78 million in revenue, 11 million in operating profit. They have been using stock to acquire some of these colleges. So keep in mind the dilution there. So look at it on a per share basis. But here's another quote from the write up. He says Legacy trades at a forward PE of just under 12 and a forward EV to EBIT of around 8. In addition, Legacy has a five year average return on invested capital of 38%, 22 million in cash and equivalents and basically no, no debt on the balance sheet.

[B]

So

[A]

in general I like colleges as a business. These are less susceptible to online disruption given that you need some in person experience for these fields. I also think that the healthcare sector and nursing and some of these, that's a career market.

[B]

Everyone's getting older and spending a lot more in health care. It's lovely.

[A]

Yeah. And it's resilient in tough times. Right. Like it's like the health church. Yeah. So I like it and I think it's a reasonable price. Maybe that's the reason I was dismissing the initial small cap pitch there. But I just. Two small caps in one week. I don't have the time, don't have the capacity to add them both to my portfolio. So yeah, legacy education, great listener rec. And maybe we can throw the substack right up that we saw in, in the show notes here for, for listeners if they want to check it out.

[B]

Yeah, I believe I've seen interacted with Cade before. I believe it is Cade Invest. But I'll. I'll toss the exact link there. I could be getting the name of the substack wrong. He. He does talk on our substack chat as well. Did you know, Ryan, that athletic powerhouse Grand Canyon University is a publicly traded stock and its stock is up 1000% since 2008?

[A]

I actually. Well publicly traded, but yeah, I did not realize it had performed so well.

[B]

Let's look at their enrollment numbers because I think it's is. It's just absurd and then we'll go on to another topic. AI overview says 130,000 students. I don't know how much bigger they can get, but it's been a nice winner. I could see that thesis 10 years ago working out.

[A]

Yeah, I don't know what to think of publicly traded universities. Maybe that's good. Maybe it's good for costs, for education costs.

[B]

Yeah, we have a comment here that says college as a service should be illegal. Yeah, I could see where people could have some red flags there. But you know, with the cost of stuff, you mention it, maybe this can help drive down cost if there's more competition.

[A]

Yeah, let's talk about this. Salesforce making another big splash with an acquisition. They are acquiring a company called Fin.

[B]

I thought for five seconds this was fiscal AI.

[A]

Yeah, actually you know it's funny on our. If you look up fiscal AI, Fin AI, which is the company that's being acquired here. Bids on our like is always one of the sponsored listings on Google just

[B]

because mistypings, stuff like that.

[A]

Yeah, totally different sector but yeah, it is kind of a similar name but it's an all cash deal. Salesforce is acquiring them. The company is formerly known AS Intercom for 3.6 billion. FIN is a customer support AI agent company. So they handle customer inquiries end to end across live chat, email, WhatsApp, text phone and Slack.

[B]

So this is why I can't talk to a human. This is who I yell at, talk to a human. All caps until I get a human.

[A]

Yeah, you probably interfaced if you've ever had a customer support. The little chat button in the corner. There's a chance that you've interfaced with this product. Fin does an estimated $400 million in ARR. So Salesforce is paying a little under 10 times revenue for this business. Most of that revenue at the moment is actually Finn's legacy help desk software, which, you know, it's still probably fine. You know, might, might get disrupted by AI, but they are also sort of the disruptor as well. So there's about 100 million in revenue from their AI agent business. They are buying this to bolster their agent force business to I. Whenever Salesforce makes an acquisition, I think they spend too much.

[B]

But go back to go. Yeah. Or you, you're in. You're in jail. What's the. Whatever the monopoly thing is, you got to go to jail. Go straight to jail.

[A]

But it's. I, I actually think Slack ended up being a good acquisition. I don't know.

[B]

Product wise, I believe it was at like 30 times sales. So yeah, revenue wise, maybe your IRR return on invested capital was low. But product wise, yeah, people are locked in. It's. It's nice. I mean fool uses Salesforce products all the time. I'm sure the sales side uses it more, but I don't interact with that. But tableau Slack I'm guessing would be this as well. And you bundle it all together. Sure. You can sell to Enterprises.

[A]

Yeah. And when I think too often people look at the headline multiples with acquisitions like these when in this case the upsell is going to be significant. So Salesforce can probably double Fin's revenue by just selling it to existing customers. At least double the revenue. Yeah.

[B]

Not immediately. Over a couple years. Sure.

[A]

I honestly think this can make sense. I don't know how much overlap there is between the sales department and the customer support, but maybe there's some tie ins there.

[B]

Yeah, yeah. You sound like you're on the IR team at Salesforce. We have a comment here on the other side. It says Benioff is back at it. He tried to sit on his hands and just buy back stock. He should have and he did. Maybe he went, we bought back $27 billion in a quarter. I'm done with this stock's not going anywhere. And I'm getting back to the old Benioff, and I'm going to acquire something at this price.

[A]

Isn't crazy, but I gotta say, Benioff is. He's really bad at being famous. I don't know if you follow him on Twitter, but every time he has, like, a meeting with, like, a political leader, he takes this selfie and like, it's. It's.

[B]

At least he's really uncomfortable. At least he's not. Yeah, it's better than people that just try to be cool constantly. All right. At least he's.

[A]

I mean, he's paying Matthew McConaughey $10 million a year to be friends with him.

[B]

So it's a little embarrassing. He doesn't care. Yeah. Owns like, Hawaii or something. It's fine.

[A]

Yeah. I mean, he doesn't care. Other side note, he has not been a buyer, but prior to the last six months, which I guess I should mention fiscally, I recently got this, like, insider transactions tracker that you can do so you can just see, like, Benioff buys and sells over the stock value every day.

[B]

There we go. Well worth the money.

[A]

Really. Like that feature. He was basically selling for the whole back half of 2025. He was. He's been a consistent seller. He always sells stock in the open market, and it's basically half a million dollars every week, which. Good for him. The. The sale stopped in 2026. He has stopped selling stock.

[B]

Now.

[A]

That's not buying stock, but that's pretty

[B]

much a levered buyback. Levered taking out debt to buy stock. If you're Mark Penny off.

[A]

Yeah. I mean, that's a step in the right direction if you're a sale. If you're a potential salesforce investor here, I think that's good sign.

[B]

Honestly, it's a sad state of affairs, but that would be a positive indicator. I'm not lying. I would say that's positive.

[A]

Yeah. Okay. We're potentially running up on time here,

[B]

so I gotta show you a photo. Let's just get your reaction here. I think you know what I'm gonna show you, but.

[A]

Oh, my gosh. Yeah.

[B]

Please describe what you were seeing, Ryan, for the people not watching.

[A]

For those that don't know, Evan Spiegel, the founder of Snap, formerly Snapchat. He made some glasses, I think. VR ar glasses.

[B]

Sorry, I'm just laughing looking at him right now.

[A]

It looks like someone took a picture of Evan Spiegel and put the sunglasses emoji, blew it up and put it on his face. Like with Photoshop, they look enormous. And there was a quote that he. I gotta pull this up. I gotta find this. Because it is an outrageous quote for a consumer product. He says these glasses are highly wearable.

[B]

Oh, that reminds me of the General Ackman this week. He said, what makes SpaceX valuable is that it's valuable. Do you remember that? Did you see this?

[A]

I did not see that. No.

[B]

I'm gonna pull up the exact tweet, but yeah, yeah, that's snap. Maybe that's my. No, I'm not buying this at any price. Like if you said you could buy this for a market cap of $100 million. I don't. I don't know. I don't even know if I would do it. This is ridiculous. This is. The RD is going to nowhere. First off, these type of things should be made illegal because it's just used to film people without their consent. Same with the meta Ray Bans. I think these are. Those are ridiculous. And like people that are focused on AI water uses at data centers, which if not to go on a rant, but if you're worried about AI usage, water usage at data centers, you should be worried about water usage at lazy rivers. It's the same analogy, just gets recycled. So it's not a thing, trust me. But yeah, back to the glasses. There's no use for these and I think they're bad for society and I think people are going to get very upset if they just get filmed constantly in public. And second, not a soul is buying these. At least the meta Ray Bans look all right. They got the Ray Ban brand. This is terrible.

[A]

Is a concept of a company. They're not a real company.

[B]

It's exactly right.

[A]

It's so. And I'm pretty sure he has a ton of voting power, so they can't oust him. I could be wrong. I would be surprised if he didn't have a bunch of voting power because I don't know how they did.

[B]

He's full dictator there. Yeah.

[A]

This is the most, like, egregious. I own the company and I'm just going to do nothing with it for 20 years except a bunch of fun side projects.

[B]

His life sounds good. Yeah. Honestly. All right, here's the bill. General Ackman's tweet, June 16. One of the things that makes SpaceX so valuable is how valuable it is.

[A]

I don't know where to go with that.

[B]

Is using the stock to buy cursor. That's like the people that would say back in the Day. Well, Palantir Shopify, they're trying to get such an expensive multiple, they're using their stock. The SPC shouldn't even count. It's kind of the things you see when the top is near.

[A]

Yeah, that is true. Whenever you start factoring in that, like if you ever start saying, wow, this is great, they can use their stock as currency and it's cheap. That's usually a bad sign. I remember thinking that a couple times with certain companies in 2020. I'm like, well, you know, they're making these acquisitions, but hey, they're using stock and now it's over. It's expensively valued. So, you know, maybe it's the right idea.

[B]

Yeah, they get advantage of you if you're doing that. Look, if the ducks are quacking, as they say, you got to feed them. I think it's smart for management teams to do this. And if your stock just goes to 100 times sales, you should sell at the ATM. What are those called at the money offerings until you go back to normal, just literally keep raising money until the stock goes down. I would love Rocket Lab to do this. Just keep selling stock until it happens. Let's see, we have some comments here that says people don't want to wear stuff on their face. That's why Lasik is popular. True. And pervs by those glasses, I'd say. Also true. Let's see. Yeah, we have another one. Realizing there's two Tyler's in the chat. Of the 20 that watch, there are two Tylers and yeah, they can get confusing. They're both great contributors though. All right, Ryan, any anything else?

[A]

Yeah, before we close out Autodesk, it's looking pretty interesting here.

[B]

Oh, God, that's famous last words. I know. I'm thinking the same thing. Below 200, it's such a dog. It is. God, just someone stop me from buying this because it looks attractive.

[A]

Ev to ebit, which is my favorite.

[B]

I don't want to know. Just I'm gonna keep pretending it's 50.

[A]

It's 21 and a half. So it's still, you know, it's still somewhat expensive. I think you could call that maybe a premium multiple. It's not a home run multiple, but they're reducing stock based compensation, which is driving up GAAP earnings. They should be able to consistently grow at will with high incremental margins. So I suspect margins will continue to grow. And CEO and CFO both bought shares in the open market this week.

[B]

Just don't get me. Don't. I Don't wanna. I don't wanna touch it. They are. Just caused me so much pain psychologically.

[A]

But the rule of 40.

[B]

Yeah, the rule of 40. The damn rule of 40. I like it. All right, here's. Before we get out of here, AI winner. AI loser. Autodesk.

[A]

AI winner. It'll be additive to their software. People are not going to switch software, but they would like probably some AI

[B]

improvements to the software and you can make. Make it more valuable for your customers. I'd agree with that as well. And they've been investing in automation for, like a decade. I just don't think they're telling their story very well. They're probably getting caught, tossed into that software index and everything. That index is going down until Mr. Market decides otherwise. All right, Ryan, anything else? Good luck to the AS people. Listen to this. The US Team is going to be playing in a couple hours. Maybe Ryan bit. One of the biggest days of Ryan's life. No, that's only like, the quarterfinals. I will be down by the stadium close by. Oh, Ryan's in Texas. Yeah. It should be fun, you know? Yeah, we'll see.

[A]

Exciting stuff.

[B]

All right.

[A]

All right.

[B]

Yeah. Ryan, you want to hit the disclosure?

[A]

Yeah. Thank you, everyone, for the comments. Very active chat today. Appreciate that. Thank you for all the questions in the substack chat as well. We want to remind listeners that Brett and I are not financial advisors. Anything we say or discuss here on Chitchat Stocks is not formal advice or recommendation. We may buy, sell, or hold any of the securities discussed on this podcast. So please do your own work. Thank you again for tuning in. We'll see you all next time. Sam,