저자: IshfaaqPeerally · 외국인
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레이 달리오의 버블 게이지 6개 항목으로 볼 때 시장 전체는 버블이 아니라 '거품기(frothy)'이며, 매그니피센트 7 중 구글·메타는 저평가, 테슬라는 가장 고평가로 봄. 엔비디아는 AI 성장 지속 가능성이 있다고 봄. 발언자는 메타를 2년 전 매수해 2배 이상 수익, 보유 중이나 추가 매수는 안전마진 부족으로 하지 않겠다고 함. 구글도 현재 적정가로 평가. 이 영상은 자신의 가치투자 견해 요약이며 유료 클럽 홍보 포함.
다듬은 글
I had the privilege to listen to Ray Dalio speak a couple of months ago at the Abu Dhabi Finance Week. He always has these gauges, to look at changes in the economy or the market. Last Friday, he posted an article titled Are We in a Market Bubble? And there he showed us. his bubble gauge to see if the current market is in a bubble or not.
In that article, there was a chart showing the top seven companies in the United States, the magnificent Seven, ranking them from cheap to most overvalued. And we can see on this list that Google, according to him, is the cheapest one followed by Mehta and the most expensive one is Tesla. To understand this chart.
We first need to understand what Ray Dalio means by a bubble, becuase everyone has a different definition of what constitutes a bubble. According to Ray Dalio, they are 6 points 6 items that we need to look at when there is a bubble and a bubble is when a combination of these six are happening at the same time.
Number one is high prices related to traditional measures of value, and he uses the example of discounted cash flows. Let's say you're discounting cash flows at a certain rate today, and usually most stocks you're discounting is overvalued. This is one sign that we may be in a bubble. number two, unsustainable conditions.
For example, if a company is growing earnings by 25% year, that does it mean that it will keep happening at some point and growth is going to slow down? This is something that it happens to every business. Third point point is many new and naive investors are in the market. Usually retail investors are not that active.
Maybe they're investing for their retirement. But when we see retail investors watching YouTube videos a lot not my channel other people's channels or posting on Reddit about investing on Twitter, that's when you do that. Maybe we are in pop up. Number four is that there is a broad bullish sentiment.
Everyone thinks that we are in the best of times and that stocks are just going to go up. Number five is a high percentage of investments are being financed by debt. That's what we call leveraged. That's what I would call margins. You take a second mortgage on your house and you're investing. So this maybe a sign that we are in a bubble and number six is a lot of forward and speculative purchases and here it's more specific about companies that increase their capital expenditures.
Usually this happens in companies when there is a bull market. Let's say, oil. Everyone is going to invest in oil so those companies, increase their capital expenditures, and then there is an oversupply and the market crashes. According to Ray Dalio if there is a combination of these six points, then probably we are in a bubble.
I somewhat agree with his definition of a bubble, and especially because it takes into consideration retail investors that is not just about prices. It's also the actions and psychology of retail investors. And based on these six items, according to Ray Dalio we are not in a market bubble but the magnificent Seven stocks.
are somewhat frothy. So frothy meets a little bubbly but not really a bubble. Things are getting overvalued but we cannot really call. it a bubble we need to see if this gauge really works And it has worked in the past. It was able to predict the dotcom bubble. It was able to predict even the crash.
that happened in 2022, because the market got overvalued and really was a crash that followed. But it failed to predict the crash in 2008. So it is not always accurate. You can look at it, you can use it, but of course it is near impossible to predict when the market is going to burst. And maybe like that, that we were in a bubble for a long time.
So you missed most of the gains. You are waiting on the sideline coming back now to the Magnificent Seven. Are they really how we got this? Is that according to Ray Dalio, the Magnificent Seven is in a frothy market and I suggest you go through the articles. You look at all the different six items he talks about.
I posted a summary of that article with my own views on The Superinvestors Club there you can find everything in more details. On The Superinvestors Club, You have different courses you can learn if you are completely new to investing. Investing for beginners. You also have one course that goes to financial statements and how to read them.
For example, what is amortization? You know what is amortization? They are 150 lectures like this explaining all the steps and how to eventually calculate the intrinsic value of a company. This is a club where you can also communicate. There's also the mobile app. You can chat with other value investors and there is a special launch price if you are interested.
You have the link in the description and somewhere up there number six and then we are going to move with point number one. But we're looking at the Magnificent Seven for point number six. That is companies investing in future profit spent a lot of money and here you get the Magnificent Seven. We can see that Nvidia even better.
They are investing a lot in the future. I won't say that this is a bubble, because they are the most innovative companies in the world, when we look at Meta investing in the metaverse, in AI, in AR/VR. So these are good investments when Walmart was trying to to create a store in the metaverse. This is stupid.
This is not a good investment. This is not a good use of your money. But what Meta is doing, I believe that this is a good investment. It's one of the most innovative companies in the world point number five and looking specifically at their businesses, they are not using a lot of leverage to make that on.
We recently started taking debt. Apple has so much cash on its portfolio. All these companies have good balance sheet most of them and none of them near bankruptcy. For number 3 and number 4 it's not really applicable to looking at the Magnificent 7, so we can skip that. Number 2. Here, he compared Nvidia with Cisco You will see that the stock price gains look about the same.
But once again, if you are thinking about AI being the future and how much money Nvidia is making today may be, it can be in a bubble maybe at some point it is going to crash. But ten years from now, it's still going to be making great business. The growth in AI is really here. This was not the case during the dotcom bubble companies were trading at 100 times earnings this is not really the case with Nvidia.
So even though the stock prices have taken the same trajectory. that doesn't mean that it is going to be the same. And finally coming to number one, this famous chart, I somewhat agree to what Ray Dalio say looking at Google. It is undervalued. Looking at Meta, it is undervalued. And I will agree that Tesla is the most overvalued one.
However, we should understand and Ray Dalio mentions this, this is outside his circle of competence. He looked at these companies based on his gauge, maybe he discounted cash flows. I don't know which method he used As a value investor, It's more in my circle of competence. When I look at these companies, I somewhat agree with his ranking, but that doesn't mean I'm going to invest in these companies.
Even Google today it is fairly valued according to me. But you always need to take your margin of safety because you don't know what is going to happen next. And you also need to look at alternatives. It's not just these seven stocks. There are other stocks in the market. Maybe there are stocks that are more undervalued.
There is a margin of safety. The potential reward is bigger compared to these one. But definitely if the stock price of Google keeps crashing, I would be interested to make an investment because it is quite a safe company even with all the things happening with its latest AI Still Google is a good business for the long term.
The business is still going to be here. Same for Apple, same for Meta. And this is exactly what I did with Meta two years ago. I invested in the company when everyone was selling and today I already more than double my money on Meta and I'm still holding. But that doesn't mean I'm going to buy more because there is no margin of safety on Meta.
And I'm not going to say that Meta is in a bubble. because it is investing that in growth, I can see the growth potential. It is useful capital expenditures. The multiples are not that high. If you are thinking about the growth, they are buying back shares, they have a good balance sheet and now they are paying a dividend.
These are all positive things about Meta. I'm very bullish on the company. That's why it's the largest position in my portfolio But that doesn't mean I will. add more to my position today Two weeks ago I made my own video about whether the market was in a bubble or not. I will recommend you watch it. Have a nice day and goodbye.
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