I Can’t Believe How Cheap These MegaCap Stocks Are Right Now!

The largest businesses in the world have recently sold off very hard. Now, they're starting to bounce back rather quickly. But here's the question you need to be asking. Are they real opportunities right now? Will you be set up for strong returns over years to come? Today, I want to find out which of these tech giants actually offer a great entry point right now and which ones are just riding the wave back up. Guys, when a business sells off, not because the business is broke, but because the market got scared, that is when you want to be paying attention. Fear creates potential mispricings and mispricings are where long-term wealth gets built. That's how great investors like Warren Buffett and Charlie Mer have built billions of dollars in wealth. The sell-off we saw in big tech earlier this year happened very quickly. The Iran war, rumors around elevated interest rates, AI spending concerns, stocks like Meta, Google, and Amazon all hit correction territory from their all-time highs. For investors who understand these businesses, they can assess whether this was a potential opportunity. But here's the honest truth you need to realize. Just because a stock fell does not make it a buy. And just because it's bounced back in recent weeks does not mean the opportunity is gone. The only thing that matters is the relationship between price and value. Our job today is to figure out what is the value and compare it to the price the market gives us. We do that same thing every single time. And we marry the story and the numbers together and we figure out the price that makes sense to us. Stock number one, Meta. Guys, they own Facebook, they own Instagram, they own WhatsApp. Nearly 4 billion people open one of their apps every single month. Nearly half the planet. And guys, if you're like me, you open multiple of those apps every single day. Businesses pay to show ads to those people while they scroll. The more people use the apps, the more valuable those ads become. It is one of the most powerful advertising businesses ever built. Meta went through a brutal 2022 down nearly 65% as Zuckerberg poured money into the metaverse. But what followed would have been one of the greatest recoveries in recent memory. Costs were cut, focus restored, and results were extraordinary. Now AI is making their ads far more effective, which means businesses pay even more to advertise. The stock sold off again this year as part of the broader tech correction, but the business has not fundamentally changed in my opinion. So, let's see if the stock price still makes sense after the bounce. And guys, this is exactly why I'm here to teach on YouTube. I'm here to show people that a story is very important, but what you pay for that story is probably more important than that. If you pay the wrong price for a great story, you will make a bad investment. If you pay the right price for a bad story, you can end up making a lot of money. The example I always give was when Buffett and Munger bought Blue Chip Stamps that was doing $120 million in revenue. 12 years later, the business has basically gone to zero. They were doing 100,000 in revenue and they still made 15% of their money because they paid the right price. So, let's look at Meta here and figure out what is going on there. Guys, Meta's current price is 671. This is not the actual price of the company. The real price is their market cap, $1.72 trillion. This is if you bought every share outstanding on the market. Now, enterprise value is $ 1.79 trillion. That difference of 70 billion is essentially their debt. Is that a lot? It sounds like a lot, but compare it to their free cash flow. It's not a lot. Guys, this is essentially like you taking your savings and in a year and a half you can pay off all your car loans, your house loans, your student loans, your credit, everything. getting paid off at a year and a half of your savings rate. That's it. That's an incredible number. Now, as we've said, they're spending a lot of money on AI, so the difference between their free cash flow and net income is easy to explain. They pay a dividend. I don't know why, but it it's.3% and eats up only 5 billion of their free cash flow. Now, one good way to compare companies is look at their price to sales ratio. It's 8.56. What does that mean? It means for every dollar of sales, you got to pay $8.56 for that. Is that a lot? Depends on the kind of business you're in. Car companies are between 0.5 and one, but a company like Microsoft to compare is at 10. This is just a nice way to compare companies within an industry to see why is this more expensive than that one. So, right here, I see, okay, it's about it's about 15% cheaper than Microsoft, but the interesting part is has pretty good gross profit here, 82%. So, what does that mean? It means every dollar they bring in of revenue, 82% of that goes to the bottom line before taxes and overhead. Now, their profit margin is pretty steady around 30%. I'm actually surprised that it hasn't gotten higher over time. It's actually a little bit lower, but guys, one of the things I love about Meta is they've barely tapped into the potential overseas on their marketing. I think it's something like $45 or $50 per user in the US in revenue per year, but overseas it's like five or six bucks. they have a lot more potential there. And guys, another great metric, returns on capital. This is a sign of quality for the business. Do they get high returns on the money that's invested in the business? 17.5% a year for the last 5 18% last year. This is a quality business. Now guys, I've thrown a lot at you and this can be very confusing, but don't worry. It was very confusing and overwhelming for everybody in the history of the world who started investing, including Buffett and Mer. Do not feel like that means you're not smart. You're absolutely capable of learning all of this. I guarantee you. I'm here to simplify all of it for you. Now, the good news is all of these metrics here, I've put in a very easy PDF. Click the link in the description below or it's also tagged in our first comment. Click that link. You will be sent the PDF immediately. Keep it in front of you. That way, we're all speaking the same language. And trust me on this one, you will be much smarter and you can understand this better very quickly if you just pay attention to these metrics. And in a couple minutes, I'm going to find out what price I want to pay for this company based on my assumptions. But let's go check out. And by the way, the community stock rating right now is a buy from our community members. Let's go check out the eight pillars, guys. Eight pillars. Everything is a check except for the valuation metrics. But again, it doesn't mean that this means they're expensive. If Facebook and Meadow was going to double its profit every year for the next 20 years, this is beyond cheap. Probably the cheapest thing out there. So, you've got to put it in relation to that. Now, let's see what analysts do think about the future. Well, guys, they have $3055 in profit this year going to $56 per share in profit in the next four years. That's a lot of growth. That's pretty much 15 or 20% a year for the next four years. And in terms of revenue, also about 15 or 20% a year, growing to $450 billion in revenue five, four years from now. That's incredible, guys. Now, we have some of the story. We have some of the numbers. That's what we're doing here with Stock Analyzer. We put it all together. We use the story to make assumptions about the future. And that future, once we have those numbers in there, will tell us what's the right price to pay today. So, let's pull up Meta. the last time I did it. Guys, I'm doing a 10-year analysis. You can do anywhere between 1 and 20. First thing is here shows high returns on capital quality business here. That's going to matter a little bit later. First off, what revenue growth for the next 10 years? Guys, I did 69 and 12 significantly lower than the next 5year assumptions according to analysts. And I get that. So, I can understand if you went higher and I probably should go higher here. I probably should do something like 7, 10, or 13 if not higher. Next, profit margin and free cash flow. And even though it's different now by a lot, it's because of their AI capital expenditure spend. As that tailor back, it'll all equate out. I put in 28, 32, and 36 because I do think that their profit margins will get better over time. PE and price of free cash flow. Now guys, this is where the return capital matters. What is the PE that I'm going to assign to this company 10 years from now? Not today, not five years from now, 10 years from now. Well, guys, I always tell people the market average over long periods of time is 15 or 16. You got to go higher for good companies, lower for bad companies. I consider Meta a great company. So, I'm going to put in 20, 23, and 26. And then finally, my 9% no margin of safety desired return. Now, guys, this does not mean this is a stock price I'm going to pay for it. I'm using it to figure out what is this company worth? What is the intrinsic value of the company? Once I determined that, then you put in your own margin of safety. But again, guys, if you have our software, you probably disagree with a lot of these things. So, go put your own assumptions in. So, I hit the analyze button. The stock is currently selling for $672 per share. I have a low price of 5.45, a high price of 1358, a middle price of $870. Guys, that means based on my middle assumptions, my potential discounted cash return is 12.3%. If my middle assumptions occur, is that enough for you? That's the question to ask yourself. I cannot tell you what the right price for you is and what the right desired return is, but I know a lot of great investors who buy based on a 12% return and that could work for them. Is that the case for you? Now, before we go to the next company, I want to remind you guys, don't take our titles literally. We're here playing the YouTube game. We're here to grab your attention and then teach you a much deeper and more important point as you watch the video. Stock number two, Alphabet. The parent company of Google and YouTube, the top two search engines in the world. So, let me break it down. Incredibly simple. Google search. When you want to find something online, almost 90% of people on Earth use Google. Businesses pay to show ads in those results. That's where most of Alphabet's money comes from. In addition, YouTube, like I said, the largest video platform in the world and the second largest search engine in the world, used by over two billion people every month, even more advertising revenue. Then on top of that, you have Google Cloud, which rents computing power to other companies, growing fast, and is now a key AI infrastructure platform. And the final piece of the puzzle, very early stages, but going well, Whimo. It's their self-driving car business already operating robo taxis in US cities. Guys, I've personally used Whimo in Phoenix. And apart from the weed smell and the dirty car I was in, I loved it. A lot of investors forget that Alphabet owns this. It could be enormous one day. Alphabet sold off this year on AI competition fears and the broader tech correction, but Google search still remains incredibly dominant and people are using Gemini consistently. Google Cloud is accelerating as an AI platform and I want to remind everybody when the whole AI thing came people were saying people are going to stop going to Google and they keep growing. The question is whether the recent bounce still leaves room for us value investors to step in and I want to remind everybody remember a few years ago Tik Tok there people were saying about Tik Tok it's going to replace YouTube that did not happen. Now, keep in mind, Tik Tok is still incredibly popular, but it is not the replacement that everybody thought it was. So, guys, we have Google. We have another very strong balance sheet. 4.11 trillion market cap, 4.16 enterprise value, $50 billion debt essentially. Guys, look at their cash flow for the last one year. 73 billion. So, basically, after eight months, they could take their cash flow and pay off all of their debt. Now, what's interesting is net income is 132 billion, free cash flow 73. That's $60 billion difference is all that capex we're talking about. So, again, not one I'm concerned about. Uh, small dividend a.24% eats up 4, sorry, $10 billion of their cash flow. Price to sales ratio pretty much in line with Microsoft with a lower profit margin, 60% than Microsoft. Um, and look at this growth rate. But look at this, guys. is and this is what I talk about revenue growth 10 years 18.3% 5 years 17.1 3 years 12.5 it's getting slower it's a big company it already does 403 billion in revenue now just remember though just because a company's growth rate is declining does not mean the business is getting worse I cannot repeat that enough does not mean the business is getting worse so oh and by the way um return on capital 5year average of 18% one year of 16 1.5%. Uh let's go to the eight pillars and look same thing six checks two X's on the valuation metrics but as we talked about before we don't necessarily know that's expensive or not. So here's where I'm going to go first. Instead of going to earnings per share by analysts I want to go to revenue growth. 17.8 15 14 eight and a half and 12. That's a lot. Remember, they did 18 and a half for the last 10 years, 17 for the last five or whatever it was, and 12 and a half% for the last three. This is higher than that 12 and a half percent. Can it still grow at a much higher rate than the last three years? Of course, it can. The question is, do you want to bank on that? I don't know. That's a tough pill for me to swallow. But look at this earnings per share doubling in the next five, four years, according to analysts. Doubling almost. So again, we're stuck back to our stock analyzer tool where we pull up the last time that I did Google. So again, I did a 10-year analysis, increasing returns on capital over the last five and 10 years. I'm going to ignore this last one year because free cash flow is down a lot. I did revenue growth of 5, nine, and 13%. To me, I'm willing to bank on that in the sense of if it did 7%, I wouldn't be that floored. If it did 11%, I wouldn't be that crazy excited. If it did 13%, I'd be like, "Holy they freaking crushed it." Those are the differences that make me go That's when I That's when I use my feels to go, how do I feel about these? If it did 5%, I'd be like, "What the hell happened there?" So maybe what I should do is more like 7 911 or 7 9 and 13 because I don't think they're going to do 5% revenue growth. So let's actually make that seven. Now profit margin and free cash flow getting better. I did 25 30 and 35% and I matched the free cash flow to the profit margin. And then again PE and price of free cash flow. I did 20 23 and 26 and my 9% intrinsic value return. Now, most people don't fail at investing because they lack information. They fail because they freeze. Because the stakes feel high, the market feels unpredictable, and every decision feels like it could be the wrong one. That anxiety, it's costing people more than bad trades ever could. And misunderstanding creates fear. And fear creates costly mistakes. Imagine knowing the right price to pay for a stock based on your assumptions about the future like we just did here, not someone else's guess. Imagine having eight clear pillars that tell you the story of any business. You're always you always know the next right question to ask. And imagine having a screener that quietly watches the market for you so you can sit back and wait with confidence until the perfect price arrives. That's what we've built here at Everything Money. A place where clarity replaces confusion. Where your next step feels far more obvious instead of overwhelming. And when you're never making decisions in isolation, you have that group of like-minded investors behind you, the second guessing decreases significantly. You're going to start trusting yourself a lot more because you're finally going to be backed by the right tools and the right people inside the community. Guys, this isn't just about growing your money. It's about becoming someone who's in control of their financial future and understands what they're buying. So my question is, what's that feeling worth to you? So here's what I want you to do right now. Start a 7-day trial for just $7. That's $1 per day. Click the link in the description to get full access. It's also pinned in our first comment below. Run whatever stock you've been thinking about buying. One stock, 20 stocks, it doesn't matter. See what the numbers actually tell you before you spend a single dollar on it and before you spend one extra minute analyzing it. So, back here, I hit the analyze button. Google's currently at 335. I have a low price of 200, high price of 554, middle price of 316. Now guys, I have it on my watch list at 225, but I'm probably going to increase that here because I'm going for a 15% return. And the reason for me, it shouldn't be for you, is because I can afford to be picky. I've got businesses, I've got real estate, I've got all these ways of generating income. Only 30% of my net worth, even less now, only 20 or 25% of my net worth can even grow in the stock market. The rest of it's all in real estate and businesses. So for me, I'd rather be picky. I dollar cost average and lowc cost ETFs and I want to buy individual stocks that I'm picky on. So I have recently increased my return requirement to 15%. So guys, 132 to 346 with 200 in the middle. I'm actually going to keep that 225 number because now I can be notified if the stock has gotten better. I can buy at that price or I can sell cash secured puts at much lower prices. All right, guys. Our final stock, a company that nobody in this world's ever heard of. It is called Amazon, a $2.7 trillion business. And guys, it isn't just one business anymore. It is three businesses. First, we all know online shopping. Today, my wife and I have probably already bought seven things from Amazon. Not just buying to buy, we're buying the things we need at home. It's the biggest online store in the world. Second, AWS, Amazon Web Services. Instead of companies buying their own expensive computing, they rent computing power from Amazon over the internet. Think of it like running a storage unit instead of building your own warehouse. AWS is the number one cloud platform in the world and is growing fast because of AI. And guys, you want to hear something funny? Everybody at Amazon was against it except for Jeff Bezos. Jeff Bezos was the one pushing we need to do this kind of cloud computing. He was that visionary. Every company building AI infrastructure needs computing power. Amazon is one of the main places they get it. Third, and this one's relatively new in the sense of big money maker advertising. Guys, when you search for a product on Amazon, you see sponsored results. And a lot of people don't even notice that it says sponsored. Companies pay for those spots. That business now generates billions of dollars every year. and CEO Andy Jasse is forecasting multiples of that all in good time. Now, Amazon sold out this year on concerns about roughly $200 billion in planned AI capbacks. A lot of cash going out the door without an immediate short-term return. But Amazon, they're very good about making big bets, and they do it all the time. AWS looked like a money pit for years before becoming one of the most profitable businesses, not within Amazon, but ever built. Retail margins are finally getting better. Advertising growing fast. How do they do it? Amazon sacrifice short-term gain to get people attached. So the question is, does today's price after getting really close to new highs still offer a real margin of safety? So let's take a look at this. So the real price 2.7 trillion 2.98 trillion in enterprise value. That's two, let's call it $300 billion in debt. Now, with that said, look at this free cash flow. It's abysmal. 7.7 billion. Look at this net income. 77.7 billion. It's 10x the net income. Just go. This is the most drastic difference we see between net income and free cash flow in a lot of companies. And this is, in my opinion, probably not a manipulation. This is Enron style difference. But you might be wondering, well, Paul, you just said Enron, the biggest scam, one of the biggest scams ever. Pump the brakes. They were doing it as a manipulation. If you go to their capital exp their free cash flow statement on Amazon and you see them look at the explosion in free in capital expenditures. It was 16 billion in 2019. It's 130 billion today. That's a huge difference guys. Just look at the growth. 17 40 61 64 53 83 and 138. 132. Big explosion there. All right. Let's go to their eight pillars here. a lot of X's. This is adorable, guys. I don't even care. I don't even care. You don't have to justify to me Amazon on these levels. To me, it's just, okay, can I buy it for the right price based on the future? That's really what I'm looking at here for Amazon from my standpoint. So, let's go see what analysts think. 816 to 732 in earnings per share. Over 2x in the next four years, over double. That's incredible. and revenue growth. Guys, for a company that's going to do a trillion dollars in revenue soon, look what analysts think. 12 and a half, 11 and a half, 12, 9 and a half, 10% revenue growth, guys. I know people who have half million dollar businesses who aren't getting 10% revenue growth a year. That's incredible. So again, all that matters to me is what's the right price to pay for this company stock analyzer tool. Now guys, I will be telling you here that the interesting thing to me is look at the difference between profit margin and free cash flow here. I mean massive differences. If you don't have the belief these are going to equate out at some point, I don't even think you should waste your time with Amazon. I believe eventually it'll come together. When? That's the unknown. But as long as they're able to make high returns in the money they invest in their business, I want them to keep reinvesting to get those big returns. So, revenue growth, I did 4, 8, and 12%. Profit margin and free cash flow, I kept them the same, guys. I did 8, 12, and 16. And look at this. My middle assumption, they've never even done that here. So, I'm giving them a lot of potential on their profit and their free cash flow. I'm giving them a lot of potential there. You've got to remember that. Now, what PE and price of free cash flow 10 years from now, 22, 25, 28. I mean, it's a big number. I think I did this for an example before. I'm going to go back to 2023 and 26. Guys, I just don't think that Amazon's a 15 or 16 PE business. You got to pay a premium for it. How much of a premium? Guys, I'm going to use the Warren Buffett way of talking about the iPhone. If you told somebody right now, hey, you can't have a car or you can't have Amazon for a year. Which one would they pick? How many people would pick, yeah, I'll sacrifice the car. I'd rather have Amazon. I mean, if you ever met somebody today that's never used Amazon, you you're basically gonna ask them, "Did you just come out of a cave? Where have you been? How have you not used Amazon?" So, these are the assumptions I'm making with my 9% desired return. I hit the analyze button. The stock's price is currently 247. Guys, it's actually not that bad. I have a low price of 103, high price of 470, middle price of 230. But remember, this is based on 12% margin, something they've never hit before. So, the question you have to ask yourself is, are you willing to bank on my assumptions here, which you never should, you should never do any sort of assumption here that you don't fully agree with on your own. But I look at this 12% going, could I see that happening? Yes. Does that mean I'm buying Amazon here? No. I actually have my watch list at 200 to re-evaluate and see how they're looking then. I really want to see what this company looks like as I sell puts at much lower prices. So, guys, these are three of the most dominant businesses ever built. Meta with nearly four billion active users and AI making its ad far more powerful. Alphabet owning the two largest search engines in the world, having the biggest video platform as one of them, and a self-driving car company most people don't even think about. And then of course, Amazon, the number one cloud platform, the number one store in the world, and a fast growing advertising business on the side. The sell-off gave us a chance to look at all three at much lower prices. But remember, cheaper does not mean cheap. I know many of our community members who are focused on owning highquality businesses they understand at the right price are getting very excited about these companies. It is so important during market pullbacks and bounces to have a group of like-minded investors to bounce your thoughts and ideas off of. That is what our community is based all about. That's why it's so incredibly valuable. So guys, three of these companies are in Magnificent 7. And guess what? I have my own Magnificent 7 that I started about a year and five months ago to go head-to-head for years to come. Not just a three-month thing, not a one-year thing. Head-to-head for years to come. And I think mine's going to do pretty well. But if you want to see what's been happening so far, check it out. The video that's attached below. The results, I think, might surprise you. Thank you for your time.