Constellation Energy Overvaluation Assessment
"So let's look at the granddaddy of them all. Constellation Energy ticker symbol CEG. So going to stock oracle straight off you can see that it's got uh a narrow economic mode which is okay pretty good right but you can see it is currently overvalued right the intrinsic value is 193 and currently it is uh selling at 354 so it's it's a bit overvalued right now if you want to calculate your own intrinsic value or use other valuation methods and not just rely on oracle value which is the uh proprietary elgo install oracle you can do that as well."
The speaker assesses Constellation Energy (CEG) and highlights an overvaluation concern. He notes that based on different valuation methods, the intrinsic value is around 193 whereas the stock is trading at 354. This commentary invites investors to perform their own analysis and suggests caution for long-term investments in the stock under its current pricing.
Ubisoft in Breach and Revenue Recognition Issue Raises Caution
"Um, they delayed their third quarter results last week without explanation, and released them this morning, so a week later than expected. And within that, they said they've been in breach of a loan agreement. So essentially auditors found that Ubisoft had improperly booked sales from a partnership and so postponed recognizing revenue from that partnership um within results. So they forced it to restate their 2025 financial accounts and those changes put it in breach of the loan agreement as I said. So they say that they will address those uh that issue by early repayment of loans. Um and as you say so shares initially fell on the news obviously not not great news but then rebounded. It kind of caps a week of speculation. people didn't know what was going on and essentially a bit of a relief uh potentially not as bad as expected."
The commentary on Ubisoft highlights significant issues including a delayed Q3 report, a breach of its loan agreement due to revenue recognition errors, and a forced restatement of its 2025 accounts. Despite an initial sell-off, shares rebounded, suggesting that the market may view the situation as not as severe as initially feared.
Constellation Software as a Long-Term Compounder
"Yeah. So, we'll talk about percentages. Um, the best stock, it's best for a few reasons, but it's Constellation Software. It's a fantastic Canadian business. It's been a it's been an incredible compounder in the market. Absolutely has dominated the S&P 500. On my position right now, I am up roughly 100% over the past 3 years, which may not be as exciting as what you see on social media today, but part of the reason why I call it my best investment ever, is because I believe it is pretty much the ideal business. It has the most ridiculous metrics I've ever seen and it's just been a fantastic winner over the long term."
Daniel Prong highlights Constellation Software as his best investment, emphasizing its impressive compound growth, no dilution in share count, and strong management alignment. He notes that the stock has delivered roughly a 100% gain over the past 3 years, underscoring its appeal as an ideal, high-quality business.
Exor Trading Discount Commentary
"Exor stock offers a very interesting situation. The market cap is 15 billion but the gross asset value is 40 billion. When we deduct the debt of 4 billion that's 36 billion compared to the market cap of 15 billion for a huge holding discount."
The speaker highlights that Exor is trading at a substantial discount relative to its net asset value, suggesting potential value due to the disparity between its market cap and the underlying asset base.
Trade Call: Constellation Energy Bounce Amid Recession Fears
"For example, in the August selloff of 2024, this is an example because it's well recorded. And that was Constellation Energy, which is a utility company that uh powers data centers. And I wrote investors forgot about AI data centers, clean energy transition because we're going into a recession. I hope it continues. That was not my mindset two years ago. My mindset was, 'Oh, we're going into recession. What stocks will do best in a recession? How can I buy put options to protect my portfolio against a recession?' I'm like, 'Now we're going into recession.' Okay, good news. What's going to come after the recession? How can I make the most amount of money after the recession? Buying something that people were loving a few months ago, but now they forgot about it because all they can pay attention to is the short term. So, I bought CEG at 167. The stock went up to $400 this year and now trading at $350. That's an example."
Ling illustrates an actionable trade by discussing his Constellation Energy (CEG) move during the August selloff, where he purchased CEG at 167. He emphasizes that while many investors simply dollar cost average, identifying true bargains is key. The example underscores his approach of waiting for significant selloffs to deploy cash, expecting strong recovery potential in a recession scenario.