r/ValueInvesting

The core business is doing everything right. Bookings have grown over 20% YoY for four straight quarters, EBITDA is up 33% YoY, margins keep expanding, and membership plus cross-platform engagement are both at all-time highs. Management is even guiding toward reaccelerating buybacks. Yet the stock is stuck trading at just 12-15x forward earnings , a discount that has nothing to do with the fundamentals and everything to do with the market still waiting for clarity on the AV transition.

I believe that the AV overhang is overstated. Look at the most mature robotaxi markets, LA, SF, Phoenix , and Uber's own category share is actually rising, not falling. That's the opposite of what you'd expect if AV were about to eat their lunch. My read is that Uber ends up being the AV commercialization and demand-aggregation layer, not the company that gets disrupted by it. They're not betting on one AV horse either , the partnership roster keeps growing (Waymo, Nvidia, Rivian, WeRide, and now Pony.ai for Europe), which tells me they're building themselves into the platform every AV operator needs to actually reach riders, regardless of who wins the underlying tech race.

There's also optionality here that I don't think is priced in at all: Uber for Business, advertising, grocery/retail delivery, and the pending Delivery Hero stake.

The relative valuation is what really makes this compelling to me. Uber does 8x the revenue of Lyft, the #2 player, and yet it trades at a steep discount , 23x '26 earnings, 17x '27 earnings. Breaking it down: ~55% of revenue is ride-hailing, ~35% is Uber Eats, ~10% is freight. DoorDash trades at 31x '27 earnings. If I value Uber Eats anywhere close to DoorDash's multiple, that implies Uber's ride-hailing business alone is trading at way less than 17x earnings , materially cheaper than Lyft's 31x, for a company that's bigger, more diversified, and gaining share in the exact markets where AV is supposedly the biggest threat. That mismatch is the crux of the thesis: the market is punishing Uber's strongest segment like it's the one at risk, while paying up for a smaller single-line competitor.

Taking all factors into account, please rank your favorite MAG 7 in order of preference from 1 to 7.

Mr Market going crazy again, but doubling (almost tripling) its valuation of Moderna OVERNIGHT.

I’m amazed to not see a large scale discussion of this, on this sub.

Edit: Clearly super crazy with me calling Mr Market Mr Crazy haha! Sorry about that

I am wondering what we can expect to see in the coming months with the technology boom we have seen these past couple of years. AI has clearly dominated the landscape and many technology companies are up several hundred percent in the past year or two. It seems unsustainable from a layman like me.

We have all heard of circular investing in the tech field with companies like Nvidia and their competitors and friends. So much money is being invested almost blindly in the hopes they are the big winners with AI.

What happens when some of these earnings miss or are under expectations with a large company like Nvidia? It is inevitable and all this Capex AI spending will show a poor early return on investment in my opinion.

Now I heard yesterday that the biggest short to ever be placed on the Nasdaq to the tune of 16-20 billion.

Although the times seem incredible with AI it has introduced some fear in to me as of late with potential issues with these companies as well as the status of the United States government and geopolitical issues abroad. I am rambling but there's a lot of negative winds I am feeling. I think we can see a major correction or crash in the coming months but again that's a layman's gut feeling talking.

Robinhood Gold ended their partnership with Morningstar earlier this month, and I’m trying to decide if I should pay for a subscription or not. As a 50/50 value/growth investor, I really appreciate their valuation method and am already familiar with many of their sector analyst’s biases, which is why I’m leaning toward Morningstar over anyone else.

A decent amount of Morningstar content can be accessed for free through Apple News, YouTube, etc. but I’m really missing being able to read their full reports. While not a replacement for DD, they were a great tool for comparing against my own research.

That said, I’m really interested to hear feedback on the tools that other investors use - Morningstar or otherwise. Please consider that do not trade options or get into much technical analysis. I manage numerous IRAs with a 20 year + horizon. Thanks!

Ozempic and Wegovy (same thing more or less I know) look to be wonder drugs. I know of people who are for the first time in their lives seeing astonishing improvements.

Most importantly they are starting to be trusted by GPs and Doctors. Medic's dont prescribe what is flashy or new or over the counter they prescribe what has clinical evidence on what they trust. It is starting to be freely prescribed.

It is likely these types of drugs for most people will never be over the counter ever. Maybe in some very diluted dose but that remains to be seen. The market is too focused on irrelevant things.

Statins not over the counter and they are around since the 1970s.

Once it passes the hurdles in that it demonstrably reduces healthcare inflation (that is a huge sticky hurdle requiring the best part of a decade to clear). It will see mass adoption. Its locked up in private insurance as a optional extra and once the bean counters at the massive insurance companies calculate that by prescribing it you will pay less on premiums it will trigger vast volumes. Even if it becomes generic they are well placed to maintain leads.

There are not many businesses that actually have a strong moat in their own category.

Look at some of the companies the market is willing to value at huge premiums:

Company	Market Cap	Latest Q Revenue	YoY Growth	GAAP Net Margin	Competition
Cloudflare (NET)	$107B	$696M	+36%	-24%	AWS, Akamai, Fastly
Roblox (RBLX)	$27B	$1.5B	+36%	-12%	Fortnite (Epic), Minecraft
Spotify (SPOT)	$103B	€4.78B	+14%	+11%	Apple Music, YouTube Music, Amazon Music
Unity (U)	$20B	$546M	+24%	-4%	Unreal Engine (Epic), Applovin
Snowflake (SNOW)	$112B	$1.39B	+33%	-21%	Databricks, AWS Redshift, Google BigQuery, MSFT Fabric
Reddit (RDDT)	$32B	$805M	+61%	+31%	TikTok, Meta, Google Search/YouTube

Aug. 18, 2026.

I'm not saying these are bad companies. My point is simply: look at what the market is willing to pay for them, then look at Reddit.

Reddit just reported $805M revenue, +61% YoY — its 8th consecutive quarter above 60% growth. Gross margin was 91.3%, net income $253M / 31% margin, adjusted EBITDA $343M / 43% margin, and FCF $261M. It also has $2.8B cash + marketable securities, with no debt showing on the balance sheet.

Meanwhile NET is valued at ~$107B while still GAAP unprofitable. SNOW is ~$112B while growing roughly half as fast as Reddit and still GAAP unprofitable. Spotify is ~$103B growing 14%.

Yet Reddit is sitting at only ~$32B.

And Reddit's moat is something I think people continue to underestimate. It isn't just another social media app. TikTok is short-form video, Meta is influencer business, Google/YouTube is search and video discovery; Reddit is different — its users are discussion-heavy and community-focused, often coming to research, compare, ask questions and hear real human opinions. There is basically no scaled direct competitor offering the same forum/community product with Reddit's reach.

Users are sticky. Content compounds. Advertising is scaling. Data licensing is still very early.

The only company really comparable to Reddit right now is Palantir.

Palantir (PLTR)	Reddit (RDDT)
Market Cap	~$420B
Latest Q Revenue	$1.94B
Revenue Growth	+92.8%
Operating Income	$912M
Gross Margin	~85%
Core Moat	Enterprise software

Palantir is an incredible business, but the market is valuing it at ~$420B — more than 13x Reddit's valuation, while revenue is only 2 times that of Reddit.

And PLTR is still fundamentally a software company. Risk involves AI agents like Claude Cowork could still compete with parts of what enterprise software does.

Reddit is different. Claude can build software. It cannot recreate decades of human communities, discussions and user habits.

If PLTR deserves $420B, RDDT at ~$32B looks extremely cheap.

At market cap of 32B and $160, I think Reddit is a steal and market is mispricing this stock.

Reddit is a Strong Buy (PT $550).

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Added on 08/19/26:

Everyone agrees that Reddit advertsing business is not as matured as Meta.

In 2025, Meta advertising business generated 200B and will be hitting 250B this year (2026).

On the flip side, Reddit advertising revenue is expected to reach 3B+ this year, just assuming Reddit to reach 5% of Meta advertising of 2026, which is 12.5B, with a conservative net margin of 30%, thats makes 3.8B net income, give it or take 20-30PE, equivalent to 78B-114B market cap. But the reality is that advertising net margin is usually 50%+, so a slightly bullish case make Reddit 125-190B market cap.
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New piece, please have a read:
Reddit vs AppLovin vs Palantir

All three stocks have been undergoing a hypergrowth stage of business. I want to go through each of their business models because many people in this subreddit seem not to really understand what they do, how they make money, and most importantly, what their edge actually is.

Name	Reddit	AppLovin	Palantir
Q2 2026 Revenue	$805M	$1.92B	$1.94B
Revenue Growth	61%	53%	93%
GAAP Net Income	$253M	$1.27B	~$1.06B
Core Business	Advertising	Performance advertising	Enterprise/Gov software
What I like	Community + intent	AXON	Deeply embedded software
Main concern	Execution	Algorithm risk	Valuation / competition

Reddit

First, let us start with Reddit. Reddit's primary way forward really is the advertising business. This is the core lifeblood of the company, and they have now proven themselves with the 8th consecutive quarter above 60% revenue growth YoY. EPS also grew more than 150% in the recent quarter.

One thing I think many people misunderstand is how advertising actually works. Many people just assume that someone has to purchase the product before the advertiser pays, but that is not how most advertising businesses work. Typical advertising is charged by impression, click, or in some cases actual conversion.

• CPM (Cost Per Mille / 1,000 impressions): advertisers pay for every 1,000 times an ad is shown
• CPC (Cost Per Click): advertisers pay each time someone clicks on the ad
• CPA (Cost Per Acquisition): advertisers pay only when a specific action happens (install, signup, purchase, etc.)

The main models are quite simple. CPM means paying for impressions, CPC means paying when somebody clicks, while CPA is more performance-based and depends on an actual action such as an install, registration or purchase. This difference matters because an advertisement does not necessarily need to immediately convert somebody into a buyer. Sometimes the most valuable thing is simply putting the impression in front of exactly the right person. Converting that impression into a purchase is ultimately the seller's job.

For instance, say you developed a game or have a clothing website. You pay a publisher like Reddit to get users to see your product or visit your website. Once they land on your website, whether they eventually purchase something is largely between you and that customer. Reddit has already provided you the traffic.

Simply to improve brand exposure (CPM).

This is where I think Reddit advertising is one of the most unique in the industry. The audience is massive, but more importantly the audience has already separated itself into very specific communities. Look at u / bloomberg. They have been publishing a lot on Reddit recently, but they are not just posting anywhere. They are actually quite smart and picky about finding the right community for each article.

For instance, Bloomberg publishes a piece about drones or some new military technology. Most broad readers probably don't care how sophisticated that weapon is, but put it into r/army or r/Military and suddenly you are putting that story in front of a large group of people who already care about the subject. Next they publish something about food prices or household finances and put it into subreddit r/MiddleClassFinance  r/farming or r/food. On inflation, you can post it to r/inflation. Obviously these Bloomberg posts are organic content rather than paid ads, but my point is that this shows exactly why Reddit's structure is so valuable for advertising.

Another example is a game developer who recently developed his own game and wants to make some passive income. Usually it is quite difficult for a new developer to make money because there is no precise way to find the first group of users. Reddit offers them a unique solution through communities such as r/gamedev. You already have people there who are game developers or serious gamers. Sometimes developers can offer vouchers or access to the game and receive feedback. These are not random people. Some of them are hardcore developers, so their feedback can actually be quite valuable.

The same logic works everywhere. There are people looking for advice on divorce, so a divorce lawyer can advertise r/Divorce. There are new moms looking for advice about being a new mom, so businesses selling related products can advertise r/Mommit. r/beauty is now a very hot community where mega brands such as L'Oréal naturally want to be part of the conversation. Communities around brands like Victoria's Secret can be used to energize their most loyal customers r/victoriasecrets. The power of Reddit advertising is really underestimated here.

And actually, this post itself gives a pretty good example. Suppose I have a book on fundamental analysis. Open this comment section, 30mins later, I will find the first 10 users arguing with me and check their Reddit account ages. I would not be surprised if 9/10 have already been on Reddit for more than 3 years. Most of you read investment communities, talk about stocks and probably have brokerage accounts. If I wanted to advertise some investment research product, all of you would already be my extremely precise target audience. That is what I mean when I say advertising is not always about immediate purchase intent. Sometimes getting the right impression in front of exactly the right group is already extremely valuable.

Then there is data licensing. To be honest, I really do not view this as seriously as many other Reddit investors do. It gets hyped because Reddit owns an asset that most other companies simply don't have: a huge amount of fresh human discussion. There could be setbacks from lawsuits or companies refusing to pay for data access. Reddit can update policies, create stronger technical restrictions, continue fighting scraping, and fix legal loopholes. But ultimately this data is hosted and controlled by Reddit. As long as AI companies want fresh Reddit data for training, retrieval or inference, I think Reddit will continue to have leverage. I just don't need this part of the business to make the investment thesis work.

AppLovin

I have been a very early investor in AppLovin. I first became interested when they failed to stop the merger between Unity and ironSource. AppLovin looked pretty hopeless at the time. They owned a few dozen popular mobile games and a lot of the market treated them like a gaming company without much future.

It happened that I was not lazy when researching their financial statements. What caught my attention was management aggressively buying back their own shares when the market had almost given up on the company. I started a small position there, although I have to admit I never fully understood how powerful their advertising business could become until much later, especially after they eventually sold the entire gaming department.

Their transformational change really came from technological innovation, particularly AXON. AppLovin had accumulated enormous amounts of internal data through its portfolio of mobile games. They had years of information about gamer behavior, advertising, installs, purchases and monetization. Then machine learning (AI) used all of this information to make their advertising engine much better.

One person I think is worth paying attention to is their recently prompted CTO Giovanni Ge, who previously worked as a machine-learning engineer at Meta. Obviously I am not saying AXON is the work of one single person, but I do think AppLovin today is much more dependent on its technical advantage than Reddit is.

AppLovin is primarily a performance advertising business. The important thing here is that the advertiser cares about actual return. If AppLovin can identify exactly which users are likely to download an app or spend money, its customers make more money and therefore AppLovin makes more money. In some sense their interests are very closely aligned: if the customer earns more from the advertising campaign, AppLovin earns more as well. So far they are the best in the business, which is why their profit margin is so insanely high.

But this is also where I see the risk. If their algorithm stops being the best and another much better algorithm comes onto the market, AppLovin could be left scrambling. If important technical people leave and eventually create a better advertising system, advertisers have no reason to remain loyal to AppLovin just because it is AppLovin. They care about which platform gives them the best return. This does not mean AXON is easy to replace, but I think AppLovin's moat is much more dependent on continuing to stay technologically ahead.

Palantir

Palantir is basically a defense/government and enterprise SaaS company. I actually like the company (insane growth) but I have never invested in it because it has always been expensive.

The government side of Palantir is obviously very important, particularly Gotham and its work with defense and government agencies. At the same time, its commercial business has now become much larger than it used to be, so I would not describe Palantir as simply a defense company anymore. Its U.S. commercial business is now growing extremely quickly as well.

My concern with Palantir is more about how much future success is already priced into the stock. The company is being valued as one of the major winners of the AI/software era, so the market is already expecting extremely strong execution for a long period of time.

I also think there is a real long-term question around general AI systems. Claude, OpenAI and other AI platforms are becoming increasingly capable of working with company data, building software and automating workflows. Maybe Palantir becomes the company that controls this layer and becomes even more powerful. But there is also a possibility that increasingly capable general AI makes some traditional SaaS work much easier and cheaper. Then there come the issues with political backlash when Trump leaves office. 

Overall

Overall, I think both AppLovin and Palantir can continue doing very well in the short-to-medium term, probably the next 1-2 years.

But Reddit is still the one I prefer as the real long-term investment.

The reason is that AppLovin's advantage depends heavily on remaining technologically ahead, while Palantir is already priced for enormous future success.

Reddit, on the other hand, already owns the asset I care about: the communities themselves and user habits. You can build another website that looks like Reddit, but recreating subreddit like gamedev, army, MiddleClassFinance, beauty, valueinvesting and thousands of other communities with years of posts, users and accumulated discussion is much harder.

That is why, out of these three, Reddit has my strongest long-term conviction on.

____

Read my piece:

I Still Don't Understand Why Reddit Is This Cheap Compared to Everything Else.

​

The whole lawsuit and capex deal are driving the price down so much, im going to keep on buying the dip as im just building up the position and i think it is also a great long term hold, hoping to get my average shares into the low 500s. What do you guys think its share price will reach, or when do you think its could bounce back? I've seen people say as low as 300, or even has high as just 500.

I am based out of India. We have quite a few companies in pharmaceutical and chemical space.

Pharmaceutical companies are more into generics or branded generics, CDMOs, APIs.

Chemical companies more so of commodity, specialty, agri based.

To me they all seem like commodity type companies. But since they keep growing, the multiples are quite high.

How does one value such a company. I understand every sector or category of companies grow one point in time. How to identify? Were you able to find value in a company which grew a lot? How did you do that? How much was it on chance or luck?

Some investors argue that Nvidia is beginning to look like a value stock at its current valuation, an unusual claim given its enormous market cap and extraordinary growth to date.

Do you think Nvidia genuinely represents great value at its current price, or has the market already priced in too much of its future growth?

Passive doesn't mean neutral; it means you’ve outsourced your allocation to a methodology. That methodology has turned a supposedly diversified portfolio into an increasingly concentrated bet on duration-sensitive, high-multiple assets.

Curious how you guys are thinking about this in your own allocations: Are you sticking with cap-weighted index funds to make sure you don't miss the right-tail compounding, or are you tilting toward equal-weight and individual stock selection to avoid the valuation sensitivity?

Constantly reporting net losses while reporting massive revenue growth Y/Y. It’s a growing company that needs funding but it’s not diluting instead it’s grabbing funds from its subsidiaries to fund growth and share repurchases.

$1.71 in shareholder equity book value.

Fair value ranges from $-5/+$18

This is a deep value turnaround play. If they convert gross revenue to net revenue we’re in this thing.

Catalyst would be the Ultranet acquisition by the end of qtr 3 .

None of this means diddly . But grab your diddy lube because I think this will be interesting.

NFA. Just like to gamble.

Stock loves to quickly rebound after a drop like this. It’s consolidating as we speak.

The play is right but I have no clue on timing considering they need capital to grow but this is standard for their field . It’s all about timing with this one .

Hi everyone, I hope everyone is doing well on their ends. Hi I'm a swing trader and generally I trade gold and stocks. Just started to learn how to do fundamental analysis on stocks and gold. So can anyone suggest good youtube channels for going deep down and understand macro deeply in the stocks and metals.

What do you think of Meta's current trial, and how do you think it will impact their stock price?

The only thing keeping this market alive is AI CapEx spending. THATS IT! I’ve done tons of research and someone correct me if I’m wrong but all the quality, wide moat business are FULLY PRICED OR OVERVALUED. I personally find long bond yields continued rise troubling because the bond vigilantes are essentially forcing the Feds hand as well as the government’s hand when it comes to fiscal policy. Can stocks continue to be at all time highs with these dynamics at play? It is tricky environment for sure because on one hand the AI CAPEX spending is REAL. On the other hand rising yields will eventually slow the economy. Also, money will eventually come out of the best performing stocks and go into bonds if yields become attractive enough.

Basically, in my opinion, I see bond vigilantes emerging after decades of easy monetary and fiscal policy has resulted in inflation that isn’t going away. Nobody in government has the guts to tame the inflation beast so the bond vigilantes are forcing their hand.

Timing the market is a fools errand but every day that passes I’m thinking it’s best to be mostly in cash. Of course most don’t want to do this because it’s been a losing bet for almost 2 decades now. Look at the VIX. It’s at extreme lows which to me is also another RED FLAG. It seems that people are not really in the market because they want to be but just because they feel like they have no choice. They must invest to continue beating inflation.

As I stated though, the bond vigilantes are now changing the dynamics. We all know that the Fed and US government has no intent to solve inflation so we invest in order to beat inflation since the government won’t do it. However, now we have the bond vigilantes doing the job the Fed and government has refused to do.

Of course it’s all very complex but I think the questions to ask are WHY DO LONG BOND YIELDS KEEP RISING EVERYDAY and WHAT DOES THIS MEAN?

What do you guys think of buying stocks in a large selection of companies that have high profit margins as opposed to just index funds? Not everything in index funds is highly profitable, so why not narrow it down a bit?