Joseph Carlson

Buy Mastercard at Dip Levels

-0.71%final return

"But then we also have kind of the average peaks we have right here. That's around a 40 trailing PE ratio. And then we had where Mastercard was just a week or two ago. Just a couple weeks ago, it traded down to the low end of its historical PE ratio. Now, what happened in this time period? Well, I made multiple videos in a short amount of time saying, 'I'm buying Mastercard.' And I did buy a lot of the company right at that specific point. I bought $30,000 of Mastercard, then another 20, then another 15, and another 12. And I bought all of this within a 4-day period. Most of my buys were around the range of $536. $536 is right there during that dip."

The speaker emphasizes an actionable trade call for Mastercard, describing how he executed multiple buying rounds during a dip in the stock's valuation. He bought in several chunks around the $536 level after noticing the stock traded at the low end of its historical trailing PE ratio, indicating a deliberate entry point for long-term compounding.

Netflix Remains a Buy Despite Premium Valuation

-91.94%current return

"Now, finally, in number six, the last stock that I'll highlight that I believe is a buy today is in the Story Fund. In this portfolio, I have a more concentrated look on a few companies, and one of them that has been an incredible winner in this portfolio, of course, is Netflix. It was as high as $1,300 per share, and now it's below $1,100 per share. While some investors will interpret this as an overpriced company coming back down to a more realistic valuation, I see it differently. I think that this is an opportunity for investors that have missed out on Netflix to finally take a bite. And the reason why is because I believe that Netflix is not overvalued. I've studied this company for a long period of time and I still believe there's far more to come that's not being priced in for Netflix."

The speaker explicitly recommends buying Netflix despite its premium valuation, arguing that the company's strong operating leverage, robust revenue growth, and long-term free cash flow expansion present a significant, underappreciated upside over the next five years.

Controversial Buy Call on Duolingo (DUOLINGO)

-46.89%current return

"Number five is a more controversial pick... I believe this company could represent one of the best investments over the next 5 years, and I believe that it's a buy under $400 per share. ... Even though there are criticisms that Dualingo is just an app using other people\'s technology, the fact that it is the top customer using OpenAI\'s API shows its leverage in artificial intelligence."

Despite skepticism about its simplicity and dependence on third-party AI models, Carlson argues that Duolingo is uniquely positioned with strong user engagement and subscription growth, making it a promising long-term investment if acquired under $400.

ASML as a Solid Buy Despite Volatility

+29.93%current return

"Number three of companies that will continue to lead in this AI revolution is ASML. This is a company that I believe will continue to compound above 15% over the next 5 years. I think that you could safely buy it under $1,000 and expect positive returns. But note that there could be a lot of volatility after every quarter."

Carlson highlights ASML as a strong long-term play given its predictable install-based management revenue growth and long-term compounding potential, cautioning investors about short-term quarterly volatility due to geopolitical and macro concerns.

Amazon Remains a Buy Below $300

+14.28%current return

"And this one's Amazon. This is another one that I believe is just lowhanging fruit, meaning it's the easiest to pick... Amazon is a buy today. And it's a company that I believe will continue to be a buy under $300 per share."

Carlson argues that despite anchoring bias based on past prices, Amazon is a compelling buy due to its continued revenue growth, dominant cloud (AWS) performance, and broad ecosystem that provides downside protection, recommending investors consider purchasing it under $300.

Buy Call on Google (GOOGL)

+33.90%current return

"The first one's Google. This is a company that I believe just has it all. It has the low downside and high upside. When I look at Google, of course, it's not the same deal today that it was earlier this year. ... I believe that Google is about $100 undervalued today. So, if you can buy this company below $340, I think it's a buy."

Joseph Carlson presents Google as one of his top picks due to its diversified assets, strong AI capabilities, and multiple revenue streams, suggesting that if purchased under $340, it is undervalued by about $100 relative to its intrinsic value.

Caution on EA Leveraged Buyout Increasing Risks in Gaming

+0.79%current return

"Whenever I see LBO, I just immediately believe this is bad news. The heavy debt from EA's $55 billion leveraged buyout is likely to amplify the need for aggressive monetization through microtransactions."

EA Electronic Arts is going private via a massive LBO, which raises concerns over increased debt and pressure to generate revenue through microtransactions. This development could pose risks not only to EA but also to the broader video game industry.

High-Quality Opportunity in Copart After 20% Sell-Off

-11.86%current return

"Copart stock price is down 20% year-to-date, but over the past 10 years, it has surged nearly 1,000%. With a dominant position in online vehicle auctions, this sell-off represents a potential entry point."

Copart remains a compounding machine with a robust business model; the recent 20% decline provides a tactical entry opportunity for investors seeking exposure to a niche market leader.

Buy Constellation Software Amid Recent Sell-Off

"Constellation is down 17% year-to-date, yet over the past 10 years, it has delivered a staggering 560% return. Consistent revenue growth of around 16% and strong free cash flow generation make it a compelling opportunity."

Constellation Software presents a strong compounding opportunity; despite a recent sell-off, its consistent historical performance and revenue growth suggest that it is undervalued and a potential multi-year winner.

Adobe Trading at Discounted Valuation with Aggressive Buybacks

-1.72%current return

"At a 15p ratio and a 6% free cash flow yield, this company is uniquely cheap in an expensive market. Management is aggressively buying back stock as the valuation falls."

Despite competitive pressures from innovative players like Canva and advances in AI-driven tools, Adobe is trading at a significant discount relative to its historical multiples, bolstered by strong fundamentals and aggressive share repurchases.

Amazon Remains a Buy Despite Flat Short-Term Price Action

+4.63%current return

"I have a big position in Amazon and bought a lot during the big sell-off in 2022. Despite being completely flat from the beginning of the year, the company has doubled its revenue and shown explosive growth in AWS and free cash flow."

Amazon is presented as an attractive buy based on its strong revenue growth, robust cloud segment expansion, and impressive free cash flow turnaround, even though its short-term price performance has remained flat.

Buy S&P Global at Attractive Valuation Amid Sell-Off

+7.85%current return

"The first one is a company in my financial category. The stock price is now below $500 per share and, trading at a 27 forward PE with a free cash flow yield of around 3.6%, it is one of the lowest valuations the company has seen."

S&P Global is trading at a historically attractive valuation with healthy free cash flow yields and a sell-off that has left it undervalued. The speaker indicates it represents a good entry point for investors amidst a broadly elevated market.