u/jurdyshore

WEB is one of those stocks where the earnings look horrible on paper, but the cash flow underneath is still holding up alright.

Why it’s been smashed:
Travel stocks get hit hard when uncertainty rises
Earnings got dragged down by write downs and restructuring
Revenue still isn’t back to old highs
Everyone’s been piling into AI and growth instead

Positives:
Around 264M net cash
Strong free cash flow
Share buybacks reducing shares on issue
Trading pretty cheap compared to historical levels

Negatives:
Travel demand can fall off quickly
Could stay cheap for a while
Risk it turns into a value trap if growth never comes back

Personally I see this more as a shorter term recovery play than a forever hold.

Could be one to watch once the Iranian conflict settles down and market sentiment improves a bit, but I’d still wait for signs of a proper bottom before jumping in, if at all.

This would only be a small speculative position for me, maybe 1 to 3% portfolio exposure max, and I’d be staging entries on confirmation rather then trying to catch the falling knife

My buy zone was under $2.60
Currently $2.23 but don’t rush in

Again not financial advice

What’s your opinion

I’ve been watching Xero for quite a while. I actually think it’s a terrific business.

The company has moved into strong profitability, cleaned up its balance sheet, and I believe it may have built a genuine long term moat if it incorporates AI. But like a lot of SaaS companies, it became heavily overpriced during the hype cycle.

That’s the thing people confuse in markets:
A great company doesn’t always mean a great buy at any price.

With a P/E around 97, it’s expensive

It has hit a historical support level on my charts, but personally I wouldn’t really start looking seriously unless it got back closer to the $45 to 50 range.

Some SaaS companies will probably still do well long term, but valuation still matters.

I’ve been watching Xero for quite a while. I actually think it’s a terrific business.

The company has moved into strong profitability, cleaned up its balance sheet, and I believe it may have built a genuine long term moat if it incorporates AI. But like a lot of SaaS companies, it became heavily overpriced during the hype cycle.

That’s the thing people confuse in markets:
A great company doesn’t always mean a great buy at any price.

With a P/E around 97, it’s expensive

It has hit a historical support level on my charts, but personally I wouldn’t really start looking seriously unless it got back closer to the $45 to 50 range.

Some SaaS companies will probably still do well long term, but valuation still matters.

Last post for the weekend.

My last pick is Super Retail Group. They own brands like Supercheap Auto, rebel, BCF. They also own Macpac but that doesn’t interest me 😂

They’re currently trading in what I consider a buy zone, although that definitely hasn’t stopped the stock from continuing to fall lately, so be careful with entries and stage in if you’re buying.

I’m generally not a huge fan of retail businesses, but I still like the quality of these brands and the fact they’ve built strong positions in their niches. Supercheap Auto especially has a pretty sticky customer base and a strong loyalty ecosystem even with competition like repco.

Some of my rough numbers/thoughts:

Market cap around A$2.8 to 3.0B
FY25 revenue around A$4.1B
FY25 normalised NPAT around A$232M
Trading around roughly 14 to 15x earnings
EV/EBITDA roughly 5.5 to 6x
FCF yield still attractive relative to a lot of the ASX
Strong balance sheet with low drawn debt historically

Buy Below: $11.50
Hold Range: $11.50 to $14.50
Sell/Trim Above: $16 to $18+

Biggest risks in my opinion are margin pressure from discounting, weaker consumer spending, retail theft and rising operating costs. But long term I still think the brands themselves have value and decent staying power.

I understand every company I have posted is in a current decline, these aren’t get rich quick stocks, these are just companies in my opinion that can be long term defensive stocks

Not financial advice obviously, just my own opinion and research going into next week. Cheers everyone. Until next time.

Another one of my evaluations, Personally I think Wesfarmers is slowly entering buy territory.

With businesses like Bunnings and Kmart being the major hitters here, I still think the long term quality of the company remains strong even though retail is currently getting smashed by inflation and cost of living pressures.

Personally my buy range is under $70, but I’m not saying go all in tomorrow. If anything, this market has taught me the importance of patience, staging entries, and waiting for proper bases to form before getting too aggressive.

This could easily be a long hold and there may still be more downside short term, but eventually I think setups like this are where long term opportunities start appearing.

Always do your own research.

Personally I think Wesfarmers is slowly entering buy territory.

With businesses like Bunnings and Kmart being the major hitters here, I still think the long term quality of the company remains strong even though retail is currently getting smashed by inflation and cost of living pressures.

Personally my buy range is under $70, but I’m not saying go all in tomorrow. If anything, this market has taught me the importance of patience, staging entries, and waiting for proper bases to form before getting too aggressive.

This could easily be a long hold and there may still be more downside short term, but eventually I think setups like this are where long term opportunities start appearing.

Always do your own research.

Welcome to ASX Value & Moats.

A page focused on valuation, economic moats, margin of safety, long term investing, and avoiding hype driven speculation.

Whether it’s blue chips, miners, compounders, cyclicals, or beaten down sectors, the goal is simple:
buy good businesses at reasonable prices and survive long enough for compounding to do the heavy lifting.

Always take caution when investing. These are opinions and discussions only, not financial advice or how any one person should invest.

Patience > hype.

People forget the dot com boom in the 90s.

Back then investors thought tech could only go up. Valuations became detached from reality, companies with little profit traded at insane multiples, and everyone believed “this time is different.” Eventually the cycle ended, sentiment reversed, and a lot of people got wiped out chasing hype.

You can even see similarities today across parts of tech and SaaS. Some businesses are still fantastic companies, but fantastic companies can still become terrible investments if you massively overpay for growth.

That’s why I think the market is becoming too pessimistic on CSL Limited while simultaneously becoming too optimistic elsewhere.

CSL is a century old biotech company with massive barriers to entry, critical healthcare products, strong global revenue, real profitability, huge R&D capability, and dominant market positions.

Yet because of short term issues like the Vifor concerns, slower earnings growth, margin pressure, and weaker sentiment, people are acting like the business is permanently broken.

I don’t think the core thesis has collapsed at all.

Meanwhile capital continues flowing into hype driven sectors like AI momentum stocks, speculative lithium names, cyclical oil plays, and high multiple SaaS companies.

Some of these companies don’t even have stable earnings, meaningful ROIC over WACC spreads, or reliable P/E ratios because profits are so volatile.

My original CSL buy zone was around $150 to $165 based on the information available at the time. Clearly the market became far more bearish than expected and I was early. I can admit that.

But reevaluating the business at current prices, I still struggle to justify the level of pessimism relative to the quality of the company itself.

Short term market sentiment and long term business quality are not always the same thing.

Temporary problems happen. Market cycles happen. Fear happens. But quality businesses with real moats and long operating histories tend to survive.

The market eventually humbles every hype cycle. Discipline, valuation, and patience still matter.

I’ll add my reevaluation and og valuation as well if anyone’s interested.