Solid take on the market environment right now. The credit spread tightness combined with high valuations really does set up a situation where quality matters way more than growth velocity. I ran into this last quarter when some of my higher beta positions got wrecked despite the market only dropping slightly. The boat analogy captures it well tho, it's easy to confuse a rising tide with good swimming.
Isn’t Netflix the perfect example of the company that’s lost its moat? Netflix remains the streaming industry leader, and at one time, Jen seem to possess a reasonable mode and have a largely unassailable position. However, with the rapid expansion of its chosen industry for a number of reasons, but with Covid being one of the foremost catalysts tht most effectively dried up as Netflix found itself with a multitude of competitors jmarguavkynust as capable as it was of providing identical services if they should desire (and sometimes did). That is, of course, the curse of competent competitors and an issue for a mature business that is seeing its industry go through a notable consolidation cycle due to the presence of far too many players raw offerings for a new ones growing customer face or at least sufficiently growing customer base.
That’s like saying Uber is gonna fail from competition. No one has a most but cost of entry and Netflix has been investing tons into original series, Apple TV can’t keep up.
Solid take on the market environment right now. The credit spread tightness combined with high valuations really does set up a situation where quality matters way more than growth velocity. I ran into this last quarter when some of my higher beta positions got wrecked despite the market only dropping slightly. The boat analogy captures it well tho, it's easy to confuse a rising tide with good swimming.
5% pull back in the market and many 90% of the growth portfolios will swing to negative.
What are your thoughts on Netflix and if it has a MOAT and if it is fairly valued? I’m very very curious about your opinion on that?
Isn’t Netflix the perfect example of the company that’s lost its moat? Netflix remains the streaming industry leader, and at one time, Jen seem to possess a reasonable mode and have a largely unassailable position. However, with the rapid expansion of its chosen industry for a number of reasons, but with Covid being one of the foremost catalysts tht most effectively dried up as Netflix found itself with a multitude of competitors jmarguavkynust as capable as it was of providing identical services if they should desire (and sometimes did). That is, of course, the curse of competent competitors and an issue for a mature business that is seeing its industry go through a notable consolidation cycle due to the presence of far too many players raw offerings for a new ones growing customer face or at least sufficiently growing customer base.
That’s like saying Uber is gonna fail from competition. No one has a most but cost of entry and Netflix has been investing tons into original series, Apple TV can’t keep up.
https://open.substack.com/pub/absolutetoal/p/neflix-fy2025?utm_source=share&utm_medium=android&r=5g11d4
I already have invested in #4 (Mercado Libre) and 3,2,1 all look really interesting.
As to the airport operators, the three Mexican airport operators have been solid for years.
Thanks!
https://open.substack.com/pub/absolutetoal/p/moat-on-assettotal-moat-competitive?utm_source=share&utm_medium=android&r=5g11d4
Amazon's ROA FY2025
= 9.4946225255 %
.
PDD's ROA 2025.Sep.Q3.TTM
= 16.6638511789 %
.