Oracle’s Blistering Backlog; Nebius + Microsoft AI Deal; Is Duolingo Dying? $ORCL $NBIS $DUOL

Summary

Chit Chat Stocks – Episode Summary

Podcast: Chit Chat Stocks
Hosts: Ryan Henderson and Brett Schafer
Episode: Oracle’s Blistering Backlog; Nebius + Microsoft AI Deal; Is Duolingo Dying?
Date: September 12, 2025

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Overview

In this “Power Hour” episode of Chit Chat Stocks, Ryan and Brett tackle a range of listener-recommended stocks and hot news items amidst a slow earnings season. Topics include Chipotle’s sharp decline, Duolingo’s troubles amid big tech threats, Oracle’s blockbuster backlog announcement, a major Microsoft/Nebius AI deal, and several under-the-radar stocks from cybersecurity to online gambling. The hosts debate whether some business models are permanently disrupted or merely in a temporary rut, and offer candid takes on AI bubble signals, meme stocks, and the never-ending parade of “must-own” tech infrastructure startups.

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Key Discussion Points & Insights

1. Chipotle’s Drawdown – Has “Peak Chipotle” Arrived?

[02:39 – 11:04]

• Stock Performance: Chipotle is down ~42% from its peak; negative 4% comp sales growth last quarter—the first such drop (ex-pandemic) since the E. coli crisis.
• Causes: General consumer weakness and a slowdown in fast-casual dining. Even with consumer “trade-down” favoring cheap eats like McDonald’s, Chipotle’s traffic is down.
• Expansion Limits: US store growth may be approaching saturation. International expansion (Europe, Middle East, Mexico City) could offer growth, but the investment case now rests on that.
• Valuation: Trading at PE ~36, the risk/reward isn’t attractive unless they can repeat historical ~13% EPS growth through international success.
• Hosts’ Takes:
  • Ryan: “I’d be surprised if you get comp store sales that are significantly higher than the inflation rate.” [08:21]
  • Brett: “If the concept can succeed in Mexico, I think it can probably succeed anywhere. But is it a good risk reward at this price? I’m not sure.” [09:48]

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2. Duolingo’s Stock Rout & Big Tech AI Threats

[11:04 – 19:39]

• Stock Drop: Down ~53% in five months; daily incremental declines driven by fears of Google Translate’s new features and Apple’s (AirPods) live translation announcement.
• Market Anxiety: Investors are worried AI and free live translation will wipe out language learning as a paid service.
• Fundamentals: Duolingo’s revenue is still growing, users and (importantly) paying users are up, and margins are strong (10% operating margin, EV/Gross Profit 18x, EV/EBIT ~100x).
• Risk Assessment:
  • Dual audience (learners vs. one-off translators) means full disruption isn’t imminent.
  • Churn is always a risk; the paid language learning market might not be growing.
  • Notable statistic: “The app still has an enterprise value of $11 billion… on pace for $1 billion in revenue this year.” [14:19]
• Memorable Quotes:
  • Brett: “You’re going opposite of lethargy of people, laziness. There’s gotta be pretty sizable churn here.” [15:45]
  • Ryan: “The Venn diagram of people who are going to Duolingo to learn a language and those that just want live translation is pretty small.” [19:05]
• Conclusion: Not “dirt cheap” even after the sell-off; hosts remain cautious.

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3. Oracle’s Explosive RPO & Cloud Infrastructure Optimism

[19:39 – 23:10]

• Stock Pop: Oracle up 27% after hours on massive new cloud backlog (“RPO now $455B; quadrupled year over year” [21:46]).
• Forecasting Precision: Management projects revenue growth from $18B to $144B over five years—claims most of this is “already booked” via contracts.
• Skepticism:
  • Ryan: “How can they be so precise?... If supply is constrained, why are you booking things four years out?” [20:48]
  • Brett: Compares it to Boeing’s perpetually-boasted but problematic backlog.
• Role in AI: Oracle emerging as “the fourth horseman” in cloud/data centers.

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4. OpenAI’s Staggering Projected Cash Burn

[23:10 – 31:19]

• Numbers: OpenAI projected to burn $115B through 2029 (“up $80B from earlier estimates”); annual burn hit $17B next year, $45B by 2028.
• Sustainability Doubts:
  • Brett: “At what point do we admit this is not a realistic business model or sustainable whatsoever?” [23:10]
  • Compares OpenAI’s strategy to WeWork’s: “Grow, lose more. Makes zero sense.” [26:29]
  • Microsoft may brake spending, but SoftBank, Oracle, and others are now footing bills.
• Stargate Project: OpenAI building in-house infrastructure (“the Meta route”); substantial execution risk.
• Insight: Heavy capex on infrastructure may not be sustainable except for a few hyperscalers.
• Cultural Concern: “Flying too close to the sun… This has the ingredients to blow up magnificently.” [29:47]

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5. Nebius + Microsoft $19B Deal & AI “Infra Bubble” Watch

[31:19 – 35:51]

• Deal: Nebius (ex-Yandex, Amsterdam) nabs $19.4B cloud GPU deal from Microsoft.
• Business Model Critique:
  • “Another CoreWeave copycat. These [companies] sprout up like... an infectious disease in your garden.” – Brett [32:35]
  • Business model boils down to “having GPUs others can’t get.”
• Market Frothiness: AI infrastructure copycats are flooding in, stocks can balloon on announcements.
• Shorting?
  • “Don’t short Nebius… the stock could easily go up 10x and become a total meme stock.” [34:22]
  • For larger names like Palantir, diversified “meme” shorting is more logical.

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6. Listener Stock Picks & Rapid Fire Analysis

[36:13 – 55:34]

a. Fortinet (FTNT) – Cybersecurity

• 10-year revenue CAGR: 22%, recent growth 18%/yr, FCF multiple: 30x.
• “Every cybersecurity company has a revenue chart that looks like this.” – Ryan [37:12]
• High recurring revenue, high switching costs; might merit ETF/basket approach.

b. Gambling.com (GAMB)

• Affiliate marketer/data provider for online gambling; 5-yr rev growth 51%; EV ~$370M; FCF multiple: 6x; margins ~94%.
• “Sort of a picks-and-shovels provider to an industry I’d be happy to be invested in.” – Ryan [45:35]
• 75% affiliate, 25% sports data subscriptions; regulatory risk is notable.

c. Samsara (IOT)

• IoT/cloud data services for industrial ops; 5-year revenue growth 60%; EV to Gross Profit 20x.
• Concerns over possible dependence on custom, low-leverage contracts unless truly SaaS.
• “This one, for sure, we ought to research further.” – Brett [50:19]

d. Rubrik (RBRK) – Cybersecurity

• ARR up 36% YoY ($1.25B); 80% gross margin; trades ~15–18x sales.
• “You could give [their] website to any cybersecurity company and I wouldn’t know the difference.” – Brett [51:34]
• High growth, massive industry “tailwinds,” but valuation across sector is steep.

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7. Market Bubble Watch & Meme Stock Mania

[59:46 – 64:22]

• 8Co Holdings/World Coin: Private placement at $1.46/share; trades at $40; links to World Coin “orb,” wild involvement from talking-head bulls (Tom Lee, Dan Ives).
  • “It’s a renaissance of pump and dumps—1910s, 1920s style.” – Brett [61:55]
• Open Door: Now $6/share, a “10-bagger from lows”; hosts critique the cult-like meme stock action and question business legitimacy.
  • “This is the most insane guy in finance at the moment. Michael Saylor, you have been topped.” – Ryan [63:27]
• Industry Warning: AI and meme stocks ripe for FOMO, money-losing models, and speculative surges.

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Memorable/Must-Quote Moments

• “How can they be so precise? If supply is constrained, why are you booking things four years out?” – Ryan (Oracle’s forecast, [20:48])
• “Grow, you lose more. You grow, you lose more. Makes zero sense.” – Brett (OpenAI, [26:29])
• “There’s an entirely different market of ‘I want to use Google Translate to converse’ versus ‘I want to actually learn the language.’” – Brett (Duolingo, [15:44])
• "You’re betting that new store growth is the crux of your thesis. There are other bets to make" – Ryan (Chipotle, [10:24])
• “The Venn diagram of people who are going to Duolingo to learn a language and those that just want live translation is pretty small.” – Ryan ([19:05])
• “These [AI infra companies] sprout up like an infectious disease in your garden.” – Brett (Nebius, [32:35])
• “It’s a renaissance of pump and dumps…1910s, 1920s style.” – Brett ([61:55])

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Timestamps for Key Segments

• Chipotle drawdown / “Peak Chipotle?” – [02:39 – 11:04]
• Duolingo disruption & AI/Big Tech threats – [11:04 – 19:39]
• Oracle’s backlog, RPO & AI cloud outlook – [19:39 – 23:10]
• OpenAI’s forecasted cash burn & infrastructure plans – [23:10 – 31:19]
• Nebius/Microsoft AI mega-deal & Bubble Watch – [31:19 – 35:51]
• Listener-stock rapid-fire: Fortinet, Gambling.com, Samsara, Rubrik – [36:13 – 55:34]
• Bubble Watch (8Co & World Coin, Open Door, meme stocks) – [59:46 – 64:22]

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Language & Tone

The episode features the hosts’ hallmark mix of skepticism, humor, and candor. They are quick with self-deprecating asides about their own knowledge gaps (“Outside my circle of competence,” “Maybe I'm giving myself a little hype pump-up talk here”), and maintain a conversational style even when dissecting complex business models or calling out industry absurdities.

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Summary Takeaways

• Market risks abound from overzealous AI investment and cash-burning models, but the fundamentals in core business sectors (cybersecurity, fast casual dining, online gambling) still drive the best discussions.
• Listener recommendations spark the discovery of promising niche stocks, but hosts emphasize circle of competence and due diligence before buying in—especially with meme stocks surging and cloud/AI deals flying every week.
• The AI/cloud infrastructure bubble may be inflating, with every GPU reseller nabbing billion-dollar contracts. “Basket” approaches and careful contrarianism are needed more than ever.

For complete, nuanced insights—including which companies have listeners most excited and what to watch for as AI and cloud shake up the market—this episode is a must-listen for engaged investors.

Transcript

[A]

Welcome to Chit Chat Stocks, a podcast that helps you discover your next great investment. I am one of your hosts, Ryan Henderson, and I am joined as always by the one and only Brett Schaefer. This is one of our weekly Power Hour episodes. We've got a couple topics we had to be a little creative this week. It's dead earning season. We've got a couple interesting topics though. Duolingo seems to be getting crushed. People are worried that the business model could collapse apparently. We've got a number of listener recommendation for stocks to look at. We've got news on Chipotle. We've got, I think five different listener recommendations on companies to talk about. So we're going to dig into all of those. Number of them are new to us, so we'll go through some of them. But before we do, quick reminder, please like or give us a review if you enjoy these shows and follow us on whatever your podcast player is. So Apple podcasts Spotify. That way you will never miss an episode. Brett, how are you today?

[B]

Doing well. Yeah, we got a lot of stuff to cover. Thank you to the listeners for sharing some stocks we want to look at. Just a little tease, some cybersecurity stuff, Internet of things company that kind of looks interesting if I'm being honest. A really cheap online gambling company. And of course some AI stuff. Luckily, as in each week there is new AI and cloud infrastructure news for us to cover as well as some bubble watch stuff. And when you said, you know, finding new stocks to buy the Ryan, we did get a nice review again this week for someone on Apple podcasts saying that or a show that helps find new stocks that they can research above all else. That's our goal here. And then the second thing I'll say is we're recording this before the episode is coming out. But for anyone listening, on Friday we recorded an interview with David Gardner. It's going to be out in your podcast feeds. We're super excited about this. One of our Mount Rushmore guests, he has a new book coming out. We asked, I think a ton of interesting questions, different questions that he gets asked on most financial media outlets. So if you want to hear the answers to those. That's my little tease. Go listen to that one. I think, Ryan, we should start with Chipotle. Multiple listeners wanted us to talk about this one. It's down, I don't know. We can check it on fiscal AI really quickly here, but it's down significantly from the peak. I'll let you start. What are your initial thoughts on the drawdown and what's happening with this business.

[A]

Yeah, maybe you can check the drawdown real quick. Or actually it looks like I'm pulling it up here on fiscal. I believe it's around down like 40% roughly. But I'll double check it here in a second. The, my, the question I pose. Yeah, it's down 42%. The question I tried to pose to people on socials this week and I think I already know your take because you came up with this take a couple of years ago. But has Chipotle peaked? So the big thing is that last quarter they reported negative 4% comp restaurant sales growth. That is their first decline in comp store sales since the pandemic. But if you exclude the pandemic since the E. Coli crisis and there have been difficult economic environments throughout that time, like even during the interest rate spike from last year, they were able to show great comps or sales. And it's really just been overall a pretty solid last five years for them. And they've grown through difficult environments. I mean, one of the benefits for them is that no, they aren't fast food, but they are a cheaper alternative. If you're looking for a healthy option, getting a $10 burrito bowl, whatever it is, that's a lower cost alternative to going out to a restaurant which ends up having them be in sort of the right spot even in difficult macro environments for consumers. However, right now we have seen an overall slowdown across pretty much all fast casual dining concepts. And part of it is I think consumer weakness that consumers are just maybe dining out less or they're trading down. We've seen positive numbers from McDonald's and Domino's and Taco Bell, and they've talked about the consumer trade down. But Chipotle's usually been resilient through that type of environment. And the average revenue per restaurant is down over the last three quarters now. So I guess my question to you is, do you think this is a temporary blip and just sort of temporary consumer weakness or have we hit peak Chipotle? Do you think revenue per restaurant will be much higher in five years?

[B]

I'm going to give you the boring answer and unexciting answer and say I'm not sure which factor it is. I think it might be a bit of both. We've seen the macro issues hit a ton of restaurants out there. I think it's just spending across the board. You've seen companies that are much cheaper or brands that have much cheaper alternatives, such as the Applebee's of the world doing quite well. The Domino's of the world doing quite well. But a lot of these other players, even ones that are relatively cheap price like Chipotle, traffic has gone down. I'm not sure exactly what it is. Maybe there's less return to office boost because it's such a lunchtime option. Maybe it's just the fact that they've lost their luster. Or maybe they had those one time deals. They always advertise the special. What is it like brisket or honey chicken that's always on the TV during sports commercials? That might not hit this quarter, who knows. But what I will say is that if you compare them to some of the other fast casual players such as a Cava, there was people that, you know, I think a quarter ago saying that, well, Cava's gay comp store sales look fantastic, Chipotle's look pretty weak. But now they're kind of tracking pretty equivalent here. Both are seeing declining numbers. I think that is more of an indicator that this is a macroeconomic effect. But I still don't know. At a PE, a trailing PE of 36 if I'm confident in buying this with inflation, I'm sure that their revenue per restaurant is going to. It'll be higher in five years. But is it going to significantly outpace inflation like it has been even in the historical ones that Ryan's pulling up from our friends at fiscal AI here. I'm not sure. What do you think, Ryan?

[A]

Yeah, they will probably grow at least. Can you hear me okay?

[B]

Yeah, you might have frozen.

[A]

All right, maybe I'll.

[B]

I can hear you now.

[A]

Okay. Yeah, my Internet's a little spotty, but I agree. So I think they will at least grow with inflation. At least the average sales per restaurant. I'm pulling up this chart from fiscal AI and shout out to their custom metrics feature just revenue divided by total restaurants. December of last year they got to about three and a half million dollars on average annual sales per restaurant. It's come down a little bit since I have doubts that they will be able to grow faster than inflation on an average sales per restaurant basis. It just feels, maybe it's me as a consumer changing my habits, but it feels like the concept and the uniqueness of the concept and frankly my consumer dining experiences there have just underwhelmed or petered out. Maybe it's more competitive now. But yeah, I agree, maybe they can continue to grow restaurant count, which will help boost sales and they'll grow with inflation. But I would be Surprised if you get comp store sales that are significantly higher than the inflation rate.

[B]

Yeah. I have one more thing to say about Chipotle, but I should mention we forgot to say this at the start. For anyone listening on Friday, we are recording this on Tuesday, September 9th. So if any big news hits Wednesday or Thursday, we're not talking about it. We're going to be at a conference that day and are recording this early. So if we get anything wrong, any numbers are wildly changed. If Chipotle has another E. Coli crisis and the stock is down 30%. That's why we are not talking about this again. We're talking about, we're recording the show on Tuesday, September 9th. But here's what I think has changed about Chipotle. They talk about store count expansion in the United States. I'm not sure how much longer they have to grow store count significantly. Given that they're a lot different than some of these other concepts where you're not going to really want the density, I don't think, as opposed to a McDonald's or a burger King, it's not going to make sense. It's going to become an international expansion story. And you know, today The PE is 36.4 EV to EBITDA 24 free cash flow ratio 36, right around the PE ratio. Their 10 year diluted earnings per share growth has been 13% a year over the last 10 years. Now they can expand internationally. They've started a little bit in Europe, a little bit the Middle East. They're planning one in Mexico City if they can. If the concept can succeed in Europe, the Middle East, Latin America. Even if it can succeed in Mexico, I think it can probably succeed everywhere. Anywhere. But then if it can also expand to other markets such as Australia or Asia, then the stock probably works here. Because they can keep quite growing this earnings per share, whether from a wholly owned model or from a licensing model internationally, if they can keep growing earnings per share at 13, the stock will work. I'm just not. I don't know if it's a good risk reward at this price.

[A]

I agree. I think if you're betting on unit expansion, you're betting that restaurants like that's the crux of your thesis. There's other bets to make. I mean, even Wingstop probably has a lot more headway to expand restaurant count. Portillo's has a lot more headway to expand restaurant count.

[B]

Hopefully for breadstock sales, look, they look just as ugly, but the stock is probably at 30% of the price even though it hasn't worked very, very well in my portfolio this year. It's probably been the one big dog.

[A]

Yeah. So short answer to has Chipotle peaked? Maybe, but I don't think it seems that attractive as an investment here. The second topic I want to talk about, unless there's any pressing ones that you want to get to. Brett, I want to mention Duolingo because some news came out today also which has created a little bit of controversy.

[B]

Didn't a new iPhone come out or was it announced?

[A]

I think maybe it might have been.

[B]

I think it's slimmer.

[A]

The news I saw was that AirPods are going to have live translation, so. And the stock dropped another 4%. The interesting thing for Duolingo is this stock has dropped like 1 to 3% seemingly every day for, for the last five months is what it feels like. The stock overall has been cut in half. I think it's minus 53% roughly over the last five months. And a couple things. So last week, basically the whole theme here, other than maybe a lofty valuation, is that people think Duolingo is going to get disrupted by AI. And there's a couple ways that it could do that. First of all, apparently the Google Translate app rolled out a feature called Practice that will apparently compete more directly with Duolingo. But I kind of shrug my shoulders at that. Like Google Translate itself is a competitor, but teaching someone a new language like Duolingo already has a ton of competitors on that ground. I don't think this is some revolutionary breakthrough for Google Translate to be trying to teach people new languages. I think most people that use Google Translate use it to not learn new languages. For the most part, they use it to translate. So I kind of think that's a little bizarre that the stock sold off so much on that. But that happened two weeks ago. And then today, as I mentioned, AirPods apparently came out with live translation, which sounds pretty cool in theory. We'll see how well it works. Google came out with these, with actually this exact same functionality and it's on its. What do they call it, Pixel Buds I think is their, their term. I think they came up with out. They came out with that product in 2017. So on one side you've got a whole lot of big tax coming to disrupt them type narrative. Not to mention apparently there's some third party data providers that are saying that app usage is down over the last couple weeks relative to last year. It's come down quickly. So I tend to say don't give too much thought to third party data providers, but it tends to have an impact with analysts because people don't want to be wrong in the short term. On the flip side, Duolingo is producing phenomenal results. They continue to grow users. More and more of those monthly active users are converting to daily active users and the percentage of users that are converting to paying users continues to rise as well. So as far as mobile apps go, this might be one of the best mobile app businesses out there right now in terms of how they're performing valuation wise. The app still has an enterprise value of $11 billion roughly. They're on pace for 1 billion in revenue this year and currently have 10% operating margins. So EV to EBIT is around 100x. There's they're probably going to see operating leverage from here. But I guess two part question for you. One, do you think Duolingo is truly at risk of disruption by AI and live translation type offerings? And then two, do you have any interest in Duolingo? Is this something you could ever see yourself owning?

[B]

I'm not sure. On the AI disruption with the thinking from these people that say, oh Look, Google Translator, AirPods or what have you are going to directly lead to people not needing to learn a new language and then they can directly converge with people, that's going to mean that everyone around the world is going to be wearing either AirPods or smart glasses or something that's going to be this interface in the real world between people. And I think that's either a never going to happen or take like 20 years to get to that level. Especially if you're traveling to a foreign country, which would be the point of training, you know, practicing on this thing. Another thing is it's more of a game. So the disruption from AI, there's potential for them to expand their offerings and make stuff more personalized within the Duolingo app. But there's also a risk of the commoditization of language training. I think there's an entirely different market of oh, I want to use Google Translate to converse with someone in a foreign country when I don't know the language versus I want to actually learn the language. So I don't think that's a risk. But am I interested? I know people love this management team. I think the founder's still running the business. There's people out there that know this business quite well. They've made some great calls on this stock. There's obviously the financial history has been phenomenal. I'm just not comfortable with, how would I say this you're going opposite of lethargy of people, laziness. And I think there's got to be pretty sizable churn here. Speaking personally, there's definitely sizable churn. I go off and on. I'm using the app and practicing and stuff like that. I put it into the too hard pile, maybe by mistake, but right now I guess it doesn't look like too bad of a mistake. And the fact that you mentioned the valuation, I'll use another way to go about it. EV to gross profit is 18. That's not dirt cheap, even for a company. As you mentioned 10% operating margins today, they could probably expand to 30. It still doesn't look overly cheap for my liking. But hey, this management team, they seem great.

[A]

And if there is this really like, if a lot of people are on the fence as to whether or not this is a business model that will be disrupted by Live Translation, you would think it deserves a bigger discount. Like it's down. Even if you assume that 100% of gross profit flows through to the bottom line, it's not dirt, dirt cheap. If there are some growth headwinds in front of it from Live Translation, I think it could work. There'll probably be a lot of operating leverage and there's probably more growth to be had. But I think I'm kind of with you. I. I do. People taking up learning on their own doesn't seem to be like a growing part of the population.

[B]

I don't want to bet on that. No, I don't want to bet on that. I'd rather buy Pepsi with declining volumes.

[A]

Maybe it's a pessimistic worldview, but I think you're right. The one thing I will say, oh, it's not pessimistic.

[B]

It's just how it is. Just. Just how you gotta. You gotta look at the world how it is, not how not. Oh, we're doing so good for the world. It's like those com. Those stocks that are certified B corporations. That's not going to get you to buy my stuff. Get me to buy your stock. It's actually going to make me less interested in buying your stock because 1% of your revenue is getting donated to charity and not me, a shareholder. Yeah, the same thing.

[A]

The only last thing I'll say on Duolingo, I personally feel that the Venn diagram of people who are going to Duolingo to learn a language and those that just want live translation is pretty small. I think the live translation, if you're going to Duolingo, you are at least proactively trying to learn. And I feel like the live translation audience is slightly different would be my guess, but who knows? Could be wrong on that. Let's get to some stocks that.

[B]

Well, listeners, we have, we have something we need to talk about. I just saw this after hours Oracle reported. I don't know if you saw. Can you guess? This is a market cap of before they reported $680 billion. Can you guess how much they are up in after hours? No. No.

[A]

100 billion.

[B]

More. 27%. This is going to lead into an AI topic I think is quite interesting. Let me. So they talked about their RPO and backlog. I'm not going to read through this whole thing, but they say they're going to detail a financial plan in the next month at their analyst meeting as a bit of a preview. And this is a quote. We expect Oracle cloud infrastructure revenue to grow 77% to $18 billion this fiscal year and then increased to 32 billion, 73 billion, 114 billion and $144 billion over the subsequent four years. Most of the revenue in this five year forecast is already booked in a reported RPO. Oracle is off to a brilliant start to fiscal year 2026.

[A]

How can they be so precise?

[B]

Yeah, that's true. I guess maybe if they think supply is so restricted and then demand is just going to match whatever they have. But it depends on what you price stuff at Ryan, the music is still playing and everyone's dancing.

[A]

I guess if it's all already booked then yeah, you can afford to be precise with your estimates as a management team. But on the flip side, why are you. If supply is constrained, why are you booking things four years out? You could raise prices, right? Like wouldn't. Wouldn't you want to keep the windows somewhat tight? Like you don't. That, that might. It's kind of like the Boeing thing where they have. They always brag about their backlog of planes but the delivery issues are the problem and now all of a sudden you've got a backlog that is going to be more of a liability.

[B]

Raise prices. Yeah, maybe they don't want antitrust stuff. Maybe it's inflation on stuff like this. They don't want issues with that. Either way, I mean that is quite impressive. We saw someone in the chat here. Thank you, Simon. Saying RPO is now $455 billion in quadrupled year over year. They could be the, the fourth horseman here in the cloud data center business. And speaking of, there are. Well, I have some of it in Bubble Watch. It kind of can relate all together here. There's two other things in AI infrastructure as well as one of the stocks we're going to hit later. OpenAI's cash burn projection According to the publication called the Information which follows, I think the Silicon Valley world Very well, OpenAI is projecting $115 billion in cumulative cash burn through 2029, up $80 billion from the previous estimates. Here's a quote from the article. The company's cash burn will more than double to $17 billion next year, $10 billion higher than the earlier projection, with a burn of $35 billion in 2027 and $45 billion in 2028. That's a lot of numbers. I'm just going to ask what point do we admit this is not realistic business? This is not a realistic business model or sustainable whatsoever.

[A]

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[B]

Cash burn? Yeah. Should the quotes lot clear. So this is what they're projecting based on their spending plans.

[A]

Yeah, I have worries about this. It's kind of the. I have the same worries.

[B]

Worries. That's okay. That's the understatement of the year.

[A]

Well, no, I mean, okay. On the one. I would venture to bet that the majority of analysts in the investment community are not worried about the cash burn, given that they're able to book it in remaining performance obligations.

[B]

OpenAI. This is open AI.

[A]

Oh, okay then. Yeah, obviously that's horrendous. That's a big issue. But I thought we were still on Oracle.

[B]

The Ryan's Internet is not great today. As you can see his videos stuck in.

[A]

It's been cutting, but I don't see how they turn that around unless they give one of those we work charts where it's just all theoretical. That's a little more of a real burn. Is there some sort of remaining performance obligations here where it's synced up to backlog growth or is this just pure.

[B]

I mean, where's OpenAI's backlog going to be from?

[A]

API, deals, licensing?

[B]

That's not backlog, that's usage. Well, there.

[A]

Oh, there's contractual agreements there that are banked out sometime, but people stop.

[B]

Usage has to keep growing. I want to know what the difference between this is and WeWork's business model, besides the fact that they actually innovated with a new technology because the actual business model is similar. You grow, you lose more. You grow, you lose more. Makes zero sense.

[A]

The one. If you're optimistic here that this is good, and I think a lot more people complain about OpenAI's cash burn because it's a private company. If they were a public company, I think you'd get a lot of investors that are just like, revenue growth, revenue growth, revenue growth. Who cares about the cash burn? But the one positive I'd say is that I think Microsoft will be more willing to push the brakes on this than if OpenAI were basically truly independent, which at this point it's not. Microsoft has significant say on what they do financially, so.

[B]

Well, they're already going to softbank. Oracle, Google and others. They're doing. Apparently a lot of this is in relation to they're building their own cloud infrastructure, that Stargate project, which I think is extremely risky. And what's funny is it probably relates a lot to this Oracle RPO. I think OpenAI, because that Stargate deal and whatever the contract is with them is getting funded by Oracle, Softbank and others along with OpenAI.

[A]

Yeah. Is it just meant to like take out some of their compute costs? I mean if they're trying to go the meta route where they own their own infrastructure, I don't know if it's terrible, but I would imagine that they have a lot of systems running on Azure. Gcp. I know that they announced a big deal with gcp. I don't know if they rely on AWS at all, but switching off of those systems and using solely your own infrastructure would be quite, quite a lift not only on the capex line but also on the actual business line. So if, I mean if the route is to go the meta way where they just want to own their own infrastructure and it can work out well for them, I'd say great. But I'm yet to find a very successful example of someone other than meta, someone saying we're going to run on our own cloud, we're going to run on our own infrastructure.

[B]

Well, I mean Google but yeah, I get what you mean.

[A]

Right, but they're okay outside of the hyperscalers.

[B]

I understand what you mean. Yeah, there's a couple out there, smaller that are niche. There's actually one, the stocks we're going to mention here, Fortinet, they have their own for like security purposes. But I understand what you're saying here and I agree it you got to worry about an Icarus situation here. This.

[A]

What do you mean?

[B]

Flying too close to the sun and just blowing up. Maybe they don't care. Maybe Altman, the Elon Musk of the world just want to take insane risk with this and is it going to create a lot of consumer surplus? Sure. But from a stock equity investor perspective, this has the ingredients to blow up magnificently. I mean just look at what they are saying.

[A]

I think the difficulty is that whenever you are competing on a big tam with big tech, you feel like you have to take insane risks to win because big tech doesn't have to do it like big for example. What I'm saying here is Google can spend an exorbitant amount on Gemini and have it not really affect. Well, it is affecting their financials, but not have it affect their bottom line in the same way that it would OpenAI because they have so many other business lines. I think we've seen this before. Coreweave even is probably an example here where if you want to get relevant in a big industry like that, you feel compelled to take these absurd risks when maybe you could just Build your business model out in a more conservative manner and still be fine. Maybe I'm wrong, maybe you can't. Maybe you do have to take those insane risks in order to compete with big tech. But I wouldn't want to be a shareholder in that case.

[B]

And guess what? OpenAI is still technically a non profit. This thing is a whole mess. It's a whole mess and I'll be fascinated to follow it from the sidelines. So let's do one more little thing within the AI stuff because then we don't need to talk about it forever. We can go to some of these stocks that people recommended. There was this one people wanted us to talk about because the stock was up, I think 100%, maybe, maybe 50%. It's a company called Nebius. You heard of this one, Ryan? Did you hear about it before today?

[A]

I've seen it floated around as a ticker.

[B]

I didn't. It's a hot ticker on Twitter. Yeah. Okay, so here's a quote that they tossed out. The Amsterdam based firm Nebbys announced it had struck a multi year deal with Microsoft worth up to $19.4 billion to provide cloud computing power for AI workloads. Nebbyous, which was spun out from the Russian Internet giant Yandex in 2023, provides graphics processing units or GPUs for training AI models. Just another 20 billion. Just another 20 billion, right? I'm going insane. I think we're going insane. This is another. This is not just a core. Like this is not just a competitor. This is just another core weave copycat of which there seems to be. They sprout up like. It's like. It's like a infectious disease of your garden. It's just, it's growing like wild. It's taking over. I can't. I don't even know what to say anymore about this stuff. What.

[A]

So is the whole.

[B]

What are these business models?

[A]

Business model. Just that they happen to have gpus in a world where a lot of people can't seem to get them.

[B]

It's going to end. Yeah, it's your. Your magic is going to end.

[A]

They know someone at Nvidia that was going to get them priority GPU access. The.

[B]

Yeah. Remember the company super microcomputer?

[A]

Can you be sustainable?

[B]

Oh, yeah. Yes, I do remember they have a hilarious about page two quote, AI is no longer a distant promise. It is becoming a defining force impacting every aspect of our lives. This is what Nebius builds. Vertically integrated AI infrastructure that accelerates AI innovation globally and at scale, lots of AI. Hey, they got. They signed a great deal with Microsoft.

[A]

So do you do anything with these? Do you actually ignore? Right, that's. That's how I feel. Like I see this stuff. People get so up in arms about it and as someone that doesn't short myself, I just toss it to the side. I do not care. Like maybe I should because maybe it has ripple effects elsewhere, but I'm yet to see that really. So I don't know. Like I see these business models popping up and I start to think, okay, markets feel frothy, but does it affect my holdings in any way? I hope not. Does it?

[B]

Yeah. I wouldn't want to short the AI infrastructure companies, especially smaller ones. Yeah. Like I have some, as we talked about, some very small shorts across my portfolio. Like some of the quantum computing startups I kind of think are all scams. Little Palantir and there. Which is larger. I don't think. Yeah, we have a comment here. Don't short Nebbyus. I agree. It's smaller and they could sign these large deals and it could easily go up 10x and become a total meme stock. I wouldn't want to touch that. But for something like today, Palantir, after the 10x growth into $400 billion market cap, I think if you have a diversified short portfolio, it is much less risky. Even if that stock doubles, it's not going to kill you.

[A]

Yeah. Also then you start to get into a like flows situation where it's like can't. Is there enough money? Like could. Could palantir hit a $2 trillion market cap? I don't know if there's enough money out there in the world to support that.

[B]

And even then if you have it. Yeah. And if it's a small short, it's not going to blow you up. Even in that case because I think their market cap is still like $400 billion.

[A]

So size matters when it comes to meme stocks. And do you just call these dogs later? Sorry, Ryan, can we just call these meme stocks at this point?

[B]

There's somewhat. We're going to talk about Opendoor later, but it's a little different. I guess Opendoor's business model is not too different. Buy a bunch of stuff, try to sell it, keep losing money. Selling dollars for 90 cents. It's. It's nice. It's nice money. It's nice when you can get it.

[A]

Let's take some of these stocks that listeners recommended. Where do you want to start?

[B]

Let's do Fortinet. This is one that I talked with a listener about. It's one that I struggled to maybe do a deep dive on because it's cybersecurity and not really something I'm gonna have much expertise on. But for anyone in that space and wants a stock to look at, maybe this is interesting because seems reasonable given their long term growth trajectory. So they're a cybersecurity company with its own cloud infrastructure. Their 10 year revenue growth annualized is 22%. So really impressive long term growth. They're in a bit of the stocks in a slight drawdown. They're three year revenue growth is 18% price to free cash flow of 30. Any interest here, Ryan? Or cybersecurity outside of your circle of competence as well? Because given the price, I feel like if I knew this industry that's something I would go okay, look at that historical growth, look at this reasonable valuation. If you think it can continue the stock and probably work.

[A]

Yeah, I would say cybersecurity outside my circle of competence. But how come every cybersecurity company has a revenue chart that looks like this? Am I sharing my screen properly? Can you see this? Every cybersecurity company, I swear everyone that I look at has a revenue chart. That's incredible. Crowdstrike Fortinet. I think Crowdstrike qualifies here. Palo Alto Networks. Zscaler, I think that's Zscaler's business sentinel. One I could be getting. I'm pretty sure all of those are either cybersecurity or cybersecurity ancillary on this.

[B]

List that I'm going to talk about.

[A]

Yeah, maybe it's just the industry to be in. Maybe it's. Maybe you should just take an ETF approach or something. But yeah, I would love to. Maybe when I. I hate saying that. Nah, no, it's outside my circle of competence because I feel like I miss out on a lot because of that. There's probably so much tailwinds for these businesses just in general like cybersecurity businesses. I'm talking about that it would be great to be a shareholder. And I wish I didn't just corner myself off and say oh no, I can't be a shareholder because it's outside my circle of competence. And typically the other thing, if you're like myself, you're not a dev, you're not a cybersecurity expert. These can be intimidating. But typically when you own the company and you read conference call after conference call and you read shareholder letters, maybe any sort of communications, it becomes more digestible you get to know management, you can still get a gauge on the performance of the business. Without knowing the specs of a product and the competitive dynamics for specific products, you can still gauge the progress of the business. So maybe I'm giving myself a little hype, pump up talk here to actually start researching these things. Yes, I would love these. I would love to own one of the businesses that actually has revenue that looks like this.

[B]

It's a good pond. Efficient. Yeah, yeah. Owning one of these companies that well and look, they're not losing money seems like they're profitable. It seems like they're a steady grower. As a comment here, commenter here said you have high, high switching costs and cyber security is getting more and more important every year.

[A]

Yeah. Do you want to be. If you're a cto, do you want to be the one that takes the risks and gets rid of their cybersecurity supplier or vendor and then has a big breach? Probably not. That's a fireable offense. So yeah, I imagine the switching costs are insanely high.

[B]

I agree. I agree. One to look at. Yeah. If that's an industry you're interested in. Let me address. We have some comments here that says a lot of people hyping up Nebbyous saying that they are. We need to get educated on it and that these are actually. They are the real deal. Maybe they are. Maybe we need to get an interview with someone that covers this name because looking at that deal, looking at what the stock has done, hey, you can't knock them so far. But first glance, to me it looked like an infra, a core weave copycat. Then someone asked this question.

[A]

Brett, you.

[B]

Know who are you saying?

[A]

God, Ryan, sorry cut you off there. My Internet sucks. You know who's a Nebia shareholder?

[B]

I do not.

[A]

Our good friend Ryan o', Connor, Crossroads Capital.

[B]

Ah, okay. Okay. Let's see. Well, we can't go through all today, but thank you. This commenter says heralded management team. They were forced out of Russia. I'm assuming part of the Ukraine stuff. Tons of experience in AI. Not just hardware, but also software. They own a European Uber. Okay, well, that's a surprise. And they have a subsidiaries. There's a JV with a Bezos investment group. Okay, well, lots of stuff. Maybe there's more than meets the eye there. If you didn't like us hating on Nebbys, we're just. The dollar amounts getting thrown around in AI today are just hard to fathom. I think that's what we can conclude.

[A]

So you're about to make a trade based on a friend's text but which you do you listen to is it.

[B]

We could buy a house in Tulum.

[A]

Get optioning those opt we could lose everything. Or let's do a little research. Get your head in the trade and make the investment decision that's right for you. Learn [e-mail] TradeSmart I'm Christian McCaffrey, pro running back and Abercrombie is an official fashion partner of the NFL. I'm not kidding when I say NFL by Abercrombie broke the Internet last year and I think this season season's lineup is even cooler and so does my wife who keeps stealing all my hoodies. Stay fit for the season and Abercrombie's newest arrivals shop NFL by Abercrombie in the app online and in store. Yeah, my gut reaction with a lot of these businesses is they're just getting caught up with all the excitement and fervor and AI. But yesterday when I saw Ryan o' Connor who we who I greatly respect as an investor having shares, it provides a little legitimacy in my opinion. Do we want to go through some of these other stocks? Brett, you've got one that interests me purely because of the name here. Your stock number three. You want to talk about this?

[B]

Sure. We can do this one. Yeah, we'll go to two after. It's called gambling dot com. Another listener recommendation. So thank a performance marketer for the online gambling industry. Feels like a pretty straightforward business. But is it a good business? I don't know. Maybe it's kind of a commodity. I'm not sure. I'd have to look into it further. Their 5 year revenue growth 51% EV enterprise value 370 million according to fiscal AI. Sometimes the aggregators can get that type of stuff wrong. So do you know deeper research on the balance sheet to get a true enterprise value? Market cap $294 million price to free cash flow of 6 EV to EBITDA of 8. Any interest here?

[A]

Can you elaborate on what they do? Are you able to do that?

[B]

Do you actually I think it's. They basically help like their.

[A]

It's just a marketing agency. Basically.

[B]

Yeah, I think. I think that's what it is. So an online gambling company goes to them and says get his customers. I believe that's what it is but I have not read the annual report. Again, these are first looks. If we get anything wrong, that's. I guess the whole point of the first look is hey, we want to decide whether we want to Research something further. And these are all, you know, listener recommendations.

[A]

Okay. I generated an AI report with fiscal AI shout out to them again. Gambling.com is a marketing and sports data services company in the online gambling industry. They deliver new depositing customers to online gambling operators and provide sports data services through their acquired odds jam and optic odds businesses. So yeah, I think you're basically right. It's sort of third party marketing agency that I'm guessing maybe the draft kings of the world rely on to attract new customers. Yeah, margins are phenomenal for advertising agencies. I think gross margins for gambling.com was like 95%. Yeah, 94%.

[B]

This commenter Simon, who I think is the one that recommended, recommended we take a look at this company says 75% of the business is affiliate marketing, 25% is sports data subscription services. So that could also be interesting. That's not bad.

[A]

I like. I've always okay sports gambling. There have been a lot of companies I've always wanted somehow a bet in this industry and it's been really hard to get behind sort of the draftkings of the world because that industry is just hyper competitive and you are paying absurd sums to probably companies like Gambling.com to go out and attract customers. Now maybe the lifetime value of those customers is worth it. But when. Remember in 2020 when they were giving you like first $200 of bets free, like just absurd offers to get people to come through that. That's not really a business I want to be in. Especially if you're a business where you have to pay to acquire customers twice. I mean it's kind of difficult when it's so competitive. But this seems like sort of a picks and shovels provider to an industry that I definitely would be happy to be invested in.

[B]

Yeah, it seems like a good industry. Profitable and lindy. So it's been a.

[A]

People love to gamble.

[B]

Yeah, people like to gamble. People like to bet on things. People like the excitement and I don't think it's going away. Whether legal or not. You know, this is one where regulation and regulatory and legal stuff can matter a lot. That kind of gets a wrench in the mix of some things but doesn't mean it's a terrible industry.

[A]

Shout out to whoever gave this recommendation because I am actually going to look at this further. I really like this. So thank you and if you have any further research on it, feel free to send it my way because I'd like a little shortcut on some of.

[B]

The research that should inspire you to join the substack Chat for the podcast, Ryan, because that's where we are discussing it. Let's see. He also says they have a revenue split with a lot of the operators. Okay, well, interesting. Maybe it's more than just marketing. And we have another guy that is not happy about your bad Internet, says it's. How do you have bad Internet in Austin? Well, he is traveling because we're at a conference. So this is the last week for that. Yeah, and the Internet will be perfect. Let's.

[A]

Yeah. My apologies for the Internet, but it will get resolved. Bear with us. I am not at my office, not at my regular studio. Do you want to talk about rubric?

[B]

Sure, sure. Let's do number two. Let's not skip number two before we get to number four. Yeah. Rubik's also cybersecurity, but this one I think I'm a little more interested in. It's called Samsara ticker IoT. It is an Internet of things connector, hence the ticker. And they take data that a company generates from an on site operation like a factory or even your car. I think they have a partnership with a lot of automotive manufacturers and then they upload it to the cloud, process it, help you analyze it. Founded in just 2015, but they already have a $24 billion market cap. EV to gross profit is 20, EV to sales is 16. They have pretty high margins, pretty high revenue, five year revenue growth rate of 60%. You know, clearly even a gross profit of 20 is fairly expensive. But I'm interested in this company. It seems, seems like a promising business. And I mean just look at that growth rate and I think it's something you can understand. Look, these companies want the data from these physical operations, but it's just really, really hard to manage. You probably need someone in there to do it.

[A]

Yeah, great ticker iot. That's, that's got to be always. So my only concern from the limited information that I have on this business now is it sounds like this is like very custom solutions on a per customer basis would be my guess. It's not like a one size fits all SaaS model, which isn't bad. I mean you can build a great business doing that, but operating leverage is typically somewhat capped when you have to create custom solutions for each customer. I could be totally wrong, but it sounds like that's kind of the model here. Given that they're going. Given that each business where going from on site to cloud data probably has different needs, different requirements, I could be wrong. But if it is a SaaS model here I'd probably be more interested.

[B]

Yeah, I think. Yeah. I'm not sure the exact business model. That's about what I got introduced with on the first glance. But the whole point of this is to say, should we research it further? I think this one for sure, for sure. All right, last one before we get to some other topics. Rubrik, another cybersecurity company. Their website says, at Rubrik, we help enterprises achieve business resilience against cyber attacks, malicious insiders and operational disruptions. We just secure data where it lives across enterprise, cloud and SaaS, making businesses unstoppable. If you told me that was the definition of any of the cybersecurity companies, I would not be able to tell you between any of them. Like, it just kind of shows, I don't know anything about this industry. But their market gap is $18 billion. EBITDA sales, 18.5. I feel like every single cybersecurity company trades at 15 times sales last quarter, which was out today. I think that's why someone wanted us to talk about it. Their ARR was up 36% year over year to $1.25 billion. 80% gross margins should probably have crowdstrike level margins at scale. Any interest in this one?

[A]

Yes. They went public recently too. I want to say maybe a year ago, two years ago. You're right. If you just gave that definition. We help enterprises achieve business resilience against cyber attacks. That, that's not super specific. It could apply to seemingly every cybersecurity business. I, I go back to the same thing. The one thing I will say is I knew a guy who worked at Rubrik and he gave me a bit of a. The investing ick, so to speak. But usually that's, that's. The employees are not always that indicative of what you can actually get returns from. So that was just a side anecdote. But I do, I go back to wanting to expand my circle of competence here because the tailwinds are huge and it feels like every cybersecurity company. Once again, if I pulled up the ARR chart, my suspicion is it's going to look a lot like the chart from Fortinet, which is just 20, 30% annual growth on the top line. And it's not like there's always going to be questions about profitability with these businesses. And people consistently look at it and think they're paying so much for that growth. Yeah, because they can. They know what the lock in is here. Like customers don't want to switch a. There's reputational risk when you're the person at the company that decides to switch these. I've got a. Nevermind, sorry. Something popped up for listeners when I did a thumbs up. Anyway, there's reputational risk.

[B]

Thumbs up on. On an Apple device. No thumbs up. That's the innovation that they have.

[A]

Yeah, thanks Apple.

[B]

The.

[A]

There's reputational risk, but also it's, it's a pain. It's just a pain to switch cybersecurity providers. It's not one of those things. It's like a direct revenue benefit. So there isn't necessarily this urgency to switch cybersecurity systems. It's more like insurance. So there's huge switching costs, which means, yeah, you can pay a lot in terms of development expenses and sales and marketing to get in front of customers today because that ARR is true ARR and it might be multi year recurring revenue. So I think with these businesses, yeah, the top line is probably the most important to pay attention to because they can manage a lot of the expenses without losing much of it. So yes, I want to look at this. I want to look at the entire cybersecurity industry. The only issue is seemingly everyone looks like it has kind of an insane sales multiple which is a little hard to digest.

[B]

And I describe themselves all the same as their businesses. Maybe we need to get a good interview on. If anyone has any recommendations for industry coverage, let us know.

[A]

Yeah, it's the basket approach. Maybe that's the way to go. Basket approach. I haven't taken a basket approach on anything in a long time, but it just feels like all these cybersecurity businesses are. They are unique. I get it. They're not all offering the same things. It feels like you are or they are if you're not in the industry. But they just grow and one of them is going to be. Probably many of them are going to be much bigger businesses. This would have to be one you kind of close your eyes on and put it in the 10 year bucket because it's going to be hard to pallet the valuation and multiple compression could be a real risk for a lot of these, especially in the short run.

[B]

Related to our David Gardner interview, I'm sure he has some cyber security stocks in his portfolio and just given that it's such a disruptive, not a disruptive industry, I guess. Listen to the interview or read his new book and you'll understand that that's an industry he would target. He wouldn't really worry too much about what we're worrying about right now. For better or worse, it's just how he invests. But we have a listener question that I want to get to some bubble watch topics. This one I think is fun. I was thinking about it for about a day, so maybe I can go first. If Ryan can't come up with something right away, what is the cheapest stock on your watch list and why haven't you pulled the trigger? Anything come to mind or should I go first?

[A]

Ryan, go for it. I do have some things that come to mind but I'm going to sort through one to sort through them to pick a single stock.

[B]

Well, what popped to mind is Lululemon. We already talked about it. It's definitely the cheapest on my watch list. I think you saw you posted from the fiscal AI account today their EV to EBIT, maybe a different metric is now below 8 trailing for it. It might be a slightly higher because of the earnings headwinds from tariffs and a few other things. I don't know. I feel like I should part of it feels like I should just own this. Plug your nose, buy it. It may not work. It may work, but if it does, it could be a multi bagger over a five year period. I don't own it because I have my rule about apparel and the farther it drops, the closer I get to breaking it. My gut tells me it's going to work.

[A]

Yeah. So I guess it depends how you measure cheapest. If we're doing it based on trailing figures, the cheapest for me, I don't have Lululemon on my watch list. I'm going through my watch list right now. The next cheapest, which technically is in my portfolio as well would be the Latin American airports, the corporation America Airports Cap. I think it's an EV to E bid of like 7 or 8 so.

[B]

Yep. And stock fell off after some political news yesterday.

[A]

Yeah, I don't see anything that's oh, the home builders are close to that level, but forward growth probably looks a little different for those than it does for the airports. Airports seem to have slightly more predictable earnings growth so it either it would either be the home builders or Cap Corporation America Airports. Why haven't I pulled the trigger? Well, I have. So unfortunately I cheated the question. But the it's only a small position at the moment so I could maybe the question still applies. I kind of get worried about some of the political risk even though maybe I shouldn't. The issue for me when it comes to a company like this where they operate primarily in Argentina isn't necessarily like I can get Comfortable with some of the geopolitical stuff. I just hate being so late to news. Like, it feels like I'm so slow getting information. Like, stock dropped 8% yesterday. It took me like quite a bit to figure out why, especially for stocks that aren't like super popular. Cap is kind of popular, but you kind of have to do some digging to figure out what's going on. I'm just not as in the know on a lot of the political topics which could impact the business. So I hate. It's not that it can't end up in my portfolio. It's that I just don't want to have a huge chunk of my portfolio where I'm constantly like, wait, what? What happened here? Like, what happened with the news? And yeah, that seems to be the case constantly with some of these international stocks.

[B]

All right, let's close out with bubble Watch. There's some ones that if you weren't worried about a bubble with AI and all this stuff before, maybe I can change your opinion with this press release that you could or could not have seen yesterday. Ryan, I have the link in here if you want to read it yourself. And it's about a company called eight Co Holdings, Ticker Octo, Octo Octo or AECO holdings today announced the pricing and signing of a private placement for the purchase and sale of approximately 171 million shares of common stock at a price of $1.46 per share for expected aggregate gross proceeds of approximately $250 million. Blah, blah, blah, blah, blah, blah, blah. Why am I saying this? Because they are implementing the first of its kind World Coin treasury Strategy. In addition, 13 million shares of common stock were issued to Bitmine for total proceeds of $20 million. Octostock currently trades at $40 a share as of this writing. And along with the announcement was a picture of Dan Ives and Tom Lee, say the two most bullish guys that go on cnbc, pointing to the orb of World Coin. If you don't know any about this World Coin orb stuff, just look it up. You'll know what I'm saying. They're pointing to it like it's a celebrity you see at some event. Like, hey, I just met LeBron pointer finger. This is something that, well, I worry about the morals of the investors in this. And maybe they don't care because they had, I think, a 50 bagger in eight hours. That's the world we live in.

[A]

They got to be getting paid for these promos. Or maybe they just know they'll make money.

[B]

Got a Deal at a dollar a share. They're getting paid.

[A]

Yeah. What is it? Can we still call this the golden age of fraud? This feels like golden age of fraud type topics.

[B]

I think it's more, I think it's transition from the golden age of fraud to the golden age of pump and dumps. Yeah, it's a renaissance of pump and dumps. 1910s, 1920s style. Speaking of which, you wanna, you wanna get an update on Open Door? We got about 20 seconds.

[A]

The ultimate dump.

[B]

Yeah, this is just pure clear pump and dump. People don't really care. There's that one guy going to Drake's house. If you're talking. If anyone listening to us thinks we've lost our minds and we have not lost our minds. These are things that have definitely happened that people are somehow doing in the investing world. I think the cost of capital needs to triple overnight. Open Door is now at $6 a share. 10 Beggar from a Lowe's a few months ago. I'm seeing people on Reddit bragging about seven figure open door portfolios and asking if they will go to $200 or $300 a share. I'm going to close things out. Is this a good short?

[A]

It makes me happy to think that Drake probably has no clue who this person is and he spends so much time outside his house trying to be relevant in some way. This is the most in. I almost hate the fact that we're giving it attention. This is the most insane guy in finance at the moment. Michael Saylor, you have been topped. Congratulations. This is.

[B]

What about Pulte? There's a lot of competition.

[A]

This guy's worse. This guy's worse. It's so, like he's so blatant about it too. Like he doesn't care that it's a pump and dump. And I, I think he ended up having to take posts down because he got, he said something incriminating online. So please, if somehow you've gotten to the end of this podcast and you are debating whether or not to own shares of Open Door, just know that there's, there's not a whole lot of legitimacy behind the business model. When they have to report earnings, it's always going to be a rough time. So maybe you can, you know, maybe. You know what, I take it all back. Maybe I should just have an emotional hedge and own the stock. Like because I'm so frustrated by the.

[B]

No to meme stocks. That's what I say.

[A]

Yeah, yeah. It's funny. Do you ever talk to people about this stuff in Real life. And they're like, what on earth are you talking about?

[B]

Yeah, it's that Breaking Bad meme for sure. Yeah. Did you see A Go Holdings? They're buying a bunch of World Coin. Tom Lee's involved. You just talk to me in Portuguese. But yeah, yeah, someone said close the door on Open Door. That's a good tagline. I like that. All right, we're going a little long. If anyone listening to this is at, well, this is going to be out after. We're going to be at a conference called fincon. If you're there, let us know. I'm sure we'll see you. Thank you everyone for listening. Thank you to our sponsors, Interactive Brokers, Fiscal AI. Check them out, use our link, tell them we sent you, get your discounts and all that good stuff. We got some maybe more exciting sponsors coming down the line next week or the week after, so we're excited to share that. And as a disclosure, we are not financial advisors. Anything we say on the show is not formal advice or recommendation. Ryan I or any podcast guests may hold securities discussed in this podcast, may have held them, held them in the past and may buy, sell, or hold them in the future. Thank you everyone for tuning in on the live show. Typically, these will be Thursday, 5pm Eastern Time and the recordings out Friday morning. We'll be back to our regular scheduled programming next week and we'll see you all then.

[A]

For a limited time at McDonald's.

[B]

Get a Big Mac Extra Value meal for $8.

[A]

That means two all beef patties, special sauce, lettuce, cheese, pickles, onions on a sesame seed bun and medium fries. And a drink. We may need to change that jingle. Prices and participation may vary.

[B]

Mike and Alyssa are always trying to outdo each other. When Alyssa got a small water bottle, Mike showed up with a 4 liter jug. When Mike started gardening, Alyssa started beekeeping.

[A]

Oh, come on.

[B]

They called a truce for their holiday.

[A]

And used Expedia trip planner to collaborate.

[B]

On all the details of their trip. Once there, Mike still did more laps around the pool. Whatever. You were made to outdo your holidays. We were made to help organize the competition.

[A]

Expedia made to travel.