00:00
Speaker A
I want to start with this one. and this is a really, really good chart. I just came across this this morning as I was getting my day going, prepping for a lot of stuff, and it's from the team over at Boring Biz and and they're using data from S&P Global Market Intelligence.
00:15
Speaker A
And this just shows some of the valuation disparities. And I'm just going to point to this. I'm going to try to break it down in real time.
00:22
Speaker A
The revenue growth for the hyperscalers, that's Microsoft, Amazon, Alphabet, Meta, Oracle. Hyperscaler uh average revenue growth latest 12 month last 12 months, or latest 12 months, I should say, 20.9%, very, very strong.
00:36
Speaker A
But you look at the average PE ratio for the hyperscalers now after the major sell off, 20.7 times. Now, that is higher than the S&P 500 at about 19 times like I just mentioned, but still,
00:48
Speaker A
look at where some of these other names are trading. I have to put down my notes because this is I'm getting a little animated here. Look at this chart.
00:54
Speaker A
Costco, trading at 44 times forward estimated earnings. They sell the big hot dogs. They're not out there selling AI CAPX.
01:03
Speaker A
They're a hot dog seller. Look what Costco's trading at. Walmart? All right, Walmart's an absolutely amazing business. 41 times estimated forward earnings. Starbucks.
01:12
Speaker A
No, I think Starbucks is a is a is a growth jugge at this point under CEO Brian Nickel. I just talked to him last Friday. I mean the company's back, so I kind of understand that one.
01:19
Speaker A
Coca-Cola valued at a higher multiple than Meta and Oracle? Like this is crazy stuff, guys.
01:26
Speaker A
Home Depot in the midst of the housing market in the United States being frozen. Are you kidding me? Home Depot trading at a PE ratio forward of 21.4 times and Oracle, 15.3 times, Meta, 18.7 times.
01:41
Speaker A
This shows this chart here and shout outs again, boring business, S&P Global uh market intelligence for compiling this. This just shows how fast the valuations on these tech stocks have compressed uh as concerns about free cash flow have intensified.
01:54
Speaker A
But again, you're seeing a little bit of a flight to safety in these names, the Costco and Walmart. But again, uh the valuation disparity is just it's so high. I mean, it's almost hard to believe guys. I I had to do a double take and I checked a lot of these numbers, of course, uh with Yahoo Finnds Alpha space, they all check out.
02:07
Speaker A
Always check the numbers, make sure they're right. Not that I don't trust their work, but I want to make sure everything's okay.
