1.
$Morgan Stanley(MS)$ says $Hims & Hers Health Inc.(HIMS)$ app download was up 47% YoY and web traffic was up 18% YoY in February.
The stock is currently trading at just 22 times 2027 earnings.
They haven’t even launched menopause, testosterone and home testing yet.
Very long runway, very attractive risk/reward.
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2.
$Uber(UBER)$ is a 2x opportunity.
Revenue is still growing fast, earnings are booming and it's set to dominate the age of autonomous driving.
Here is my UBER investment thesis: 🧵
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Uber is one of the most misunderstood companies...
People think it's a ride sharing and delivery business.
No, it owns the largest distribution network in the whole mobility industry. It can infinitely leverage this distribution.
People only know ride hailing and delivery, but it also leverages this distribution to offer freight services and a scooter network.
It's planning to expand into air-taxi business with Uber Air.
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Ride hailing and delivery are currently its cash-cows.
In the last five years, it grew mobility revenue 32% and delivery revenue 43% annually.
It also expanded EBITDA margin for mobility from 21% to 25% and from -35% to 18% for delivery in the same period.
And it still has many growth drivers ahead...
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UBER is the dominant ride-hailing and taxi app in 108 countries.
In other countries, ride-hailing market is either strictly regulated and exclusive to local taxies or it's dominated by local players.
Given that deregulation is inevitable, $UBER still has immense untapped opportunity for growth.
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Its user growth proves that it hasn't saturated its market.
Monthly active platform users are increasing without a material sign of slowdown.
This is even more impressive given that trip per monthly active customer increased by 20% last year.
Growing user count + more trips per user = Strong top line growth.
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People consider autonomous taxis as the biggest risk to UBER.
I don't agree. I think it'll be a very capital light revenue source for UBER.
The thesis here was $Tesla Motors(TSLA)$ would commercialize robo-taxi at scale way earlier than other providers, the market would tip and then it would collect monopoly rents.
This is not happening...
Waymo has already started and $General Motors(GM)$ has partnered with $NVIDIA(NVDA)$ to develop its autonomous cars 👇
This is why I think autonomous vehicle market will progress much like computers.
There will be one dominant operating system provider with many OEMs. NVDA positions to be the operating system provider.
In such fragmented industries, the biggest winner is who owns the distribution.
In ride hailing, UBER owns the distribution.
It's already positioning itself to take advantage of this distribution.
It has partnerships with Waymo, WeRide and Avride, three of the most advanced autonomous driving providers in the world.
They will act like competing providers and UBER will act as a marketplace, just like the third party sellers on Amazon.
This is going to be way cheaper revenue source for UBER, 100% gross margin.
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Its balance sheet is also rock solid.
It has $21.5 billion equity against $11.4 billion debt.
If you deduct $3.5 billion cash, it's EBITDA can pay all the debt under two years.
It can weather any financial storm and keep thriving.
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Valuation is amazingly attractive.
It currently trades just at 19 times forward free cash flow.
Even if it just grows free-cash-flow 20% annually in the next 5 years, we will have $9 FCF per share in 2030.
Attach it a conservative multiple of 15, we will get $135 per share stock price, nearly double from today's valuation.
Given the low-bar that the business needs to jump to get there, I think this is a very attractive opportunity.
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