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Showing posts from January, 2021

What's going on with GameStop?

As I write this, GameStop's pre-market stock price is around $140. It seems baffling that a brick-and-mortar company in steep decline would receive such strong support in the stock market. Even when you look at their financial statements, it is clear that they have been operating with a net loss for years. So, why is this happening? Simply put, GameStop's stock is in a short squeeze. It should be known that all short positions are publicly available information, so soon enough r/wallstreetbets found out about the GameStop situation in around the Spring of 2020. As a community they believed the stock was over shorted, and thus putting their money were their mouth is bought the stock. One user of note is u/deepfuckingvalue, who invested $53,000 in the Spring of 2020. They have now seen astronomical gains and as of 26th January 2021, have made around $23,000,000. During Spring 2020, GameStop was still a murmur that was mostly contained in the subreddit, but by November 2020, GameS

Unilever Multiples Valuation

  This is going to be my last multiples valuation for now. The reason being is that I fell like my level of analysis when using multiples as a means of valuation isn't satisfactory. However, I will still do my best in giving a sufficient analysis of the Unilever stock.  Let's start by looking at one of the most important ratios, the P/E ratio. As we can garner from the table Unilever's P/E ratio is moderately smaller in comparison to it's competitors. As it has a P/E ratio of 23.5x in comparison to it's competitors' average of 29.6x and its' median of 26.4x. However, this seems to be the case mostly because of how much Nestle stands out as an outlier, with a P/E ratio of 42.4x, whereas the rest of the firms used had values ranging from the mid to late 20.0x range. I chose Nestle as a comparable company to Unilever because they both compete in the food and beverages industry to a certain extent with brands like Knorr (Unilever) Vs Maggi (Nestle) and Breyers (

PepsiCo Multiples Valuation

  This time around I decided to change industries completely from big-tech to food and beverages. I was eating a bag of Cheetos while thinking of which company I should do my next valuation for and then it came to me. Let's do PepsiCo.  For the comparable companies, I decided to use Coca-Cola, Dr-Pepper, Monster Energy, Nestle, and National Beverage Corp. ( mainly known for manufacturing La Croix). It's obvious that Pepsi's biggest competitor in the soft drink market is Coca--Cola, so it makes sense that Coke would be my first choice. Dr-Pepper is also a rather prominent soft drink brand in the world, so I chose it as another competitor to compare Pepsi with. Monster Energy, even though it is known for making energy drinks, is still big in the beverages industry, thus a perfect choice to chose as a competitor to compare Pepsi with. On the other hand, Nestle is a much more balanced competitor with Pepsi, as it competes with Pepsi in terms of both food and beverages. Whether