Podcast Summary: The Synopsis with Drew Cohen – Monologue: CSU Comments, plus AppFolio, Meta & LVMH Updates
Date: February 5, 2026
Host: Drew Cohen

Episode Overview

In this monologue episode, Drew Cohen introduces a new solo format to deliver more timely business updates, mainly recapping recent fiscal results, business trends, and valuation thoughts on LVMH, AppFolio, and Meta. Drew also shares thoughts on Constellation Software (CSU) and explains Speedwell Research’s workflow and how podcast topics originate from their deep-dive reports and faster-paced YouTube and newsletter content. The episode focuses on evaluating these businesses as an informed owner/operator, with candor around cyclical trends, valuation methods, and how to think about capital allocation, especially in an AI-accelerating environment.

[00:06] Introduction & Format Explanation

• Drew introduces the “Monologue” format:
  • Quick, solo updates to get Speedwell’s research out faster.
  • Podcast covers companies with full research reports, in contrast to shorter-term YouTube/newsletter content.
  • Quote: "We're calling it Monologue because as you guessed it, it's just going to be me here... We wanted to be a little bit more timely on it." (00:06)
• Future plans: expanding beyond business updates, depending on listener interest.

[01:20] Constellation Software (CSU) – Comment on Recent Sentiment

Market Context

• Reference to Anthropic’s impressive legal software AI release causing a broad software stock selloff.
• Drew’s view: Such developments don't disrupt CSU’s moat.
  • "None of it stems from the fact that the software they make is hard to make. In fact, it is rudimentary software..." (00:43)
  • The value lies in their customer relationships and ownership of niche markets, not technical complexity.
  • Recommends a two-hour podcast or new YouTube summary for a deep dive.

Valuation & Performance

• CSU trades at ~17x free cash flow, almost back to where it was three years ago, but FCF has grown 150% since.
  • "Free cash flow has actually grown over 150% since then." (01:11)

[03:24] Content Creation Pipeline & Upcoming Research

• Drew explains how companies move from YouTube/Newsletter coverage to full Speedwell research.
  • “...after I've moved on and looked at enough stocks, maybe one will seem interesting.” (03:44)
• Announcement: Adobe is next for deep research after YouTube and newsletter coverage.

[04:26] LVMH – Performance, Trends, and Valuation

Financial Performance

• LVMH stock (LVMUY, US ADR) sold off 20% from $150 to $124.
  • “The business is not going through a great period. Luxury is somewhat cyclical...” (04:28)
• Revenue contracted 5% in 2025, with a significant 4% negative FX headwind.
  • "Currency was a positive tailwind of 3% at the start of the year, ended at -6%." (05:06)
• Five-year CAGR for revenue is still a healthy 13%.
• Segments:
  • Fashion & Leather Goods: ~€38B revenue, -3% in 2H’25 (better than -7% in 1H). Europe/Japan soft, Asia rebound faded.
  • Wine & Spirits: -5%, champagnes struggling except for niche high-end.
  • Watches & Jewelry (Tiffany’s): Some positive signs, leaning into gold.
  • Select Retailing (DFS): Sold Chinese operations for $400M; travel headwinds linger.

Profitability & Margins

• Profits down 9% YoY; half from FX.
• Operating profit: ~$17.75B (22% margin, down from 27% peak).
• Valuation: Current P/E ~27x, but normalized closer to low 20s; adjustment for dip.

Broader Takeaway

• Drew sees luxury’s cyclical rest as healthy after COVID-induced highs. Brand strength and margin durability remain, without AI risk.
  • “Definitely not an AI risk in Louis Vuitton and Tiffany’s. That’s probably a nice aspect...” (09:01)

[09:30] AppFolio – Business Model, AI Integration, and Valuation

Recent Financials

• Third straight quarter of accelerating revenue growth; ended year at 20% YoY (up to 22% exit rate, still trailing 28% in 2024).
  • “Another quarter of revenues re-accelerating... Third consecutive quarter of acceleration after a soft Q1.” (09:47)
• Serves property managers—primarily SMB, moving upmarket (“Max” product).

Platform Mechanics

• Charges per unit under management, not per seat. Currently: 9.4M units.
  • “It encourages everyone within the business to use the software because there’s no incremental price...” (10:43)
• Deep integration with external apps, strong engineering, no tech debt (unlike rival Yardi).

AI Leadership

• 98% of customers use some AI features; 45% plan to consolidate solutions, a key value add.
  • “They’ve been really good and quick at rolling out features... very, very AI forward.” (11:21)

Valuation

• Trades at ~7x trailing revenue.
• On a 30% mature margin, translates to ~25x forward steady-state earnings. Adjust down for payments revenue segment.
  • “...trading at 25 times forward mature steady state earnings.” (12:37)

[13:13] Meta – Growth, AI Spend, and the Free Cash Flow Puzzle

Core Business Strength

• Q4'25: Revenue up 24% (slight deceleration). DAU up 7% to 3.6B; ad impressions up 18%.
  • “Ad pricing increased less... suggesting the ad targeting is improving...” (13:45)
• Higher ad load, more engagement—Reels watch time +30% YoY in US, Facebook feed optimizations +7% lift, advances in AI-powered attribution.

Spending Surge

• Massive expense/capex ramp for AI:
  • Total costs +40%, operating income only +6% as leverage disappears.
  • Next year: Expenses guided +41% to $162–$169B; Capex $115–$135B.
    • "There won’t be free cash flow next year or stock buybacks." (21:13)
  • “DNA to capex ratio is 3.9x... If they keep going at the same capex rate, DNA is going to increase 3.9 times.” (16:27)
• Key concern: How much is true maintenance capex vs. growth investment? This distinction profoundly affects real owner earnings.
  • "If they can't turn [capex] off and if they're spending this every year, then a lot of their growth... is not quite as profitable as it looks now." (17:07)

Free Cash Flow Trends

• FCF conversion has dropped from 132% (2015) to 38% (2025), expected to fall further.
  • "A lot of the earnings that you're seeing on the income statement are not actually being converted to free cash flow..." (18:46)

AI & Reality Labs

• Meta's the clearest example of a company spinning AI capex into true revenue growth, but "normalized earnings" remain opaque.
• Reality Labs losses now “a drop in the bucket” given AI spend; peak losses expected in 2026, then declining.
  • "At this point they probably spent over $100 billion on this project..." (23:14)
• Meta targeting future closed hardware-software ecosystem; AR/VR outcome still uncertain, but unlikely to be an open-ended drag.

Valuation Thoughts

• At $690/share, ~$1.8T market cap.
• 29x TTM EPS, or 23x backing out Reality Labs losses.
  • "If you're pulling out the Reality Labs losses then you're getting closer to a 23 times multiple..." (24:18)
• Cautions against over-reliance on forward multiples, prefers trailing:
  • “It doesn't really make sense for you to mix future forward earnings with a multiple, which is essentially a shorthand for a DCF...” (24:32)
• Candid about capital allocation choices and investor lens on experimental spending.

Notable Quotes & Memorable Moments

• On Constellation Software’s moat:
  "None of it stems from the fact that the software they make is hard to make. In fact, it is rudimentary software..." (00:43)
• On luxury cyclicality:
  "They famously or maybe infamously had a huge growth boom in COVID... now, there was this cooling off." (05:32)
• On AppFolio’s pricing:
  "It encourages everyone within the business to use the software because there's no incremental price..." (10:43)
• On Meta’s capex question:
  "Is this capex they need to spend every year in order to sustain this growth or can they turn it off?... that's at the extreme." (17:07)
• On forward vs. trailing multiples:
  "It doesn't really make sense to me for you to mix future forward earnings with a multiple, which is essentially a shorthand for a DCF..." (24:32)

[27:20] Closing Remarks

• Drew encourages listener feedback on the monologue format.
• Recommends subscribing to related content (YouTube, Five Minute Money newsletter, Twitter).
• Next deep-dive: Adobe.

Timestamps for Key Segments

• 00:06 – Introduction & Monologue explanation
• 01:20 – Constellation Software update
• 03:24 – Research pipeline and upcoming Adobe report
• 04:26 – LVMH results, segment review, and valuation
• 09:30 – AppFolio: AI, platform, and multiples
• 13:13 – Meta: Operational excellence, AI capex, accounting caveats
• 18:46 – Meta: Free cash flow conversion discussion
• 24:32 – Valuation methodology, trailing vs. forward multiples
• 27:20 – Closing and call to action

Summary Takeaway

Drew Cohen delivers an unvarnished, owner-operator view of LVMH, AppFolio, and Meta, focusing on actual business fundamentals, cyclical realities, and the nuance of capex in AI-driven tech. Listen for a nuanced dialog on normalized earnings, true cash flow, and the pitfalls of relying on superficial multiple-based valuation shortcuts.