I Ranked 6 Stocks After Earnings — Only 1 Makes My Buy List

Summary

The presenter reviews six companies after earnings, combining operating results with valuation and downside scenarios. The central point is that strong earnings do not automatically make a stock attractive: the decision depends on price, cash-flow assumptions, and business-specific risks. SoFi is the presenter’s leading candidate for a cautious, small initial position; the other five are watchlist or wait-for-a-better-price ideas.

Market context

• The presenter says the equal-weight index is outperforming the S&P 500, suggesting investors may find opportunities beyond the largest technology companies.
• 72 companies reportedly issued positive third-quarter earnings forecasts, versus a 10-year average of 40.
• A Fundstrat note from Tom Lee anticipated less-hawkish Fed messaging. The presenter treats this as a forecast, not a reason to assume cheaper money.
• Jenny Harrington’s comments on Coca-Cola and S&P Global are cited in support of broadening research as AI-related economic activity may spread beyond the biggest technology firms.

Stock assessments

1. SoFi (SOFI) — leading candidate, but higher risk

• Shares rose 13% after earnings, but the presenter said they were still down 37% in 2026 and near their 52-week lows.
• Adjusted revenue grew 44% to $1.4 billion; adjusted EBITDA rose 70% year over year.
• Management expects adjusted EPS of $0.61 this year and $0.90 next year. At $16.40, the latter implies a little over 18× earnings.
• SoFi reported 17.1 million members and 26.7 million products, with annual growth of 35% in members and 44% in products. Products per member reached 1.56; 51% of new products were taken up by existing members.
• Commission income was about $571 million, up 40%, or 42% of adjusted revenue.
• Personal-loan charge-offs were about 2.3%, or 3.4% excluding sales of late-stage non-performing loans. The presenter says credit quality needs close monitoring.
• Valuation is highly dependent on future cash flow turning positive. The DCF estimate was just under $22, but the presenter cautions that SoFi’s negative operating and free cash flow, along with lending-related financing needs, complicate the model. DCF scenarios ranged from about $15 at 10% growth to $30 in an optimistic case; the average was about $22.
• View: Candidate for a small, higher-risk position. Preferred entry is around $15; $16–17 could justify a cautious start rather than investing the full intended amount at once. The thesis depends on earnings approaching $0.90 and credit losses staying controlled.

2. Visa (V) — quality business, limited margin of safety

• Shares were up about 15% year to date and roughly 400% over 10 years.
• Quarterly revenue rose 13% to about $12.1 billion; adjusted EPS was $3.48.
• Payment volume increased 9%, processed transactions 10%, and cross-border volume (excluding intra-Europe transactions) 14%.
• Reported margins were exceptionally high: 98% gross, 67% operating, and 51% net.
• Management expects low-double-digit adjusted revenue growth in constant currency. Analysts estimate EPS of about $15 in 2027, rising to $17.12 thereafter.
• At roughly 26–27× earnings, the stock trades at a premium. Visa raised its quarterly dividend 16% to $0.78; the initial yield remains modest.
• DCF value was about $405, implying only around 3% upside and a 2–3% margin of safety. A lower-growth case was $347, versus $473 in a more positive case. Reverse DCF implied about 11.7% growth is needed to support the current price.
• View: Hold/watchlist; wait for roughly $345–360 rather than adding new money at the current price.

3. Waste Management (WM) — solid operations, price already assumes good results

• Shares were down about 3% after earnings, up only 4% year to date, but up 261% over 10 years.
• Adjusted EPS was $2.15, versus $2.18 expected; revenue was slightly above expectations. Revenue grew about 6% and adjusted profit about 9%.
• Capital expenditure is about 11–12% of sales. Adjusted EBITDA margin was 31%, versus 31.1% a year earlier—evidence of stable, not expanding, margins.
• Analysts expect EPS of $8.13 this year and $9.90 in 2027; the forward multiple is about 26×. Dividend yield was around 1.7%.
• Net debt/EBITDA improved from 3.6 in 2024 to 2.74, but leverage remains relevant.
• DCF valuation was $196; a blended valuation was about $242. DCF scenarios were weak at 8% and 10% growth, while 12% growth implied only about 3% upside. Reverse DCF was about 11.7%.
• View: Prefer around $180–195 for new investments. Waiting to buy does not, by itself, mean existing holders should sell.

4. Coca-Cola (KO) — strong quarter, unattractive valuation at current price

• Shares had gained about 31% over the year and were near a 52-week high of $95.
• Revenue reached about $13.4 billion, up 7%; comparable EPS was $0.91, up 11%.
• Sales volume increased 5%, with 1% growth from price and mix. Operating profit rose 12% to about $4.5 billion.
• Year-to-date free cash flow was about $11.4 billion. Net debt/EBITDA was 1.4.
• The presenter’s model used $13 billion of free cash flow and assumed about 10% future growth, which the presenter describes as a strong assumption given historical growth.
• At around $90, the forward P/E was about 26× versus a five-year average of 23×; yield was 2.3% versus a historical 2.9%.
• Valuation estimates were below the share price: DCF and dividend-model estimates around $74, multiples around $87, and a blended estimate around $78. Reverse DCF implied 12.6% growth; analysts’ expected upside was about 6%, with a target range of $80–106.
• View: Keep it on the quality-assets list, but wait for roughly $70–75. Around $90, the presenter considers it a hold/wait despite the strong results.

5. S&P Global (SPGI) — quality and relatively attractive, but not enough discount yet

• Shares were down 14% year to date but up 266% over 10 years.
• Revenue grew 7% to about $3.7 billion; adjusted profit rose about 9%. The presenter compares adjusted EPS of $4.58 with $4.20 from ongoing operations, warning that comparisons must account for the Mobility separation.
• Business lines—including Market Intelligence, Ratings, Energy, and Indices—have different growth drivers and sensitivities. Indices were highlighted; Ratings is larger but had more subdued growth.
• Gross margin was 71%, versus 61% for the sector and a five-year average of 69%. Net margin was 31%. Cash generation was about $6 billion, above the five-year average of $4.3 billion.
• Management expected adjusted EPS of $17.70–17.95 this year, about $20.20 in 2027, and later growth to $23. At the current price, the 2027 forward P/E was about 22×; the historical five-year average was about 29×. Net debt/EBITDA was around 1.3.
• The model used $4.9 billion of expected free cash flow and assumed 12% growth with a 9% discount rate, producing a value of $474, about 7% upside and a 6% safety margin. Scenarios ranged from $304 at 6% growth to $632 at 16%.
• A potential Capital IQ review or separation could change the business structure; the presenter says not to include speculative profit assumptions until the terms are clearer.
• View: Preferred entry around $400–420. Existing owners could continue investing, but new money needs a larger margin of safety.

6. SK hynix (000660.KS) — greatest modeled upside, but extremely assumption-sensitive

• Shares had fallen about 12% in the prior 30 days, then rose 12% after earnings, while remaining in the lower part of their 52-week range.
• The transcript reports quarterly revenue of about 105 trillion won and operating profit of about 83 trillion won, with operating profit more than seven times the year-ago level and an operating margin around 80%. These figures may contain a decimal or unit error in the auto-generated subtitles.
• Revenue reportedly grew about 32% quarter over quarter. DRAM contributed roughly three-quarters of revenue and NAND about one-quarter, making results sensitive to memory prices, product mix, and customer demand.
• Analysts saw about 53% upside over the next 12 months, with an average target near $250 and a range of $150–320. The presenter also cited more than $1 trillion in expected industry capital expenditure, while cautioning that this does not guarantee orders for SK hynix.
• The presenter noted very strong reported margins and a net-cash position, but stressed that balance-sheet cash and recurring free cash flow are different measures.
• The DCF’s key input was $80 billion of 2026 free cash flow, against historical 2025 cash flow of $18.2 billion. With 5% future growth and a 9% discount rate, the model produced $221, roughly 96% upside and nearly a 30% safety margin.
• The valuation changed sharply when the starting cash-flow assumption changed: $60 billion produced about $167; $40 billion eliminated the discount and indicated overvaluation. The presenter also cited a wide next-year earnings forecast range of about $23.45–46.
• View: The highest-potential research idea, but not a purchase based solely on the $221 model estimate. The presenter’s notional value was around $156 and emphasizes verifying whether cash flow and unusually high memory profitability can persist.

Ranking and valuation framework

The presenter’s preference order for new money was:

1. SoFi — small, cautious position; preferably near $15.
2. SK hynix — high potential, conditional on cash flow holding up.
3. S&P Global — most appealing of the more stable names; preferred at $400–420.
4. Visa — strong business, but insufficient safety margin; preferred at $345–365.
5. Waste Management — preferred at $180–195.
6. Coca-Cola — preferred at $70–75; considered too expensive near $90.

The valuation approach emphasized in the video:

• Compare reported results with expectations, and distinguish operating growth from the market’s reaction.
• Assess business drivers and segment mix, not just headline revenue or EPS.
• Review margins, debt, capital expenditure, free cash flow, and—where relevant—credit quality.
• Use DCF, multiples, dividend models, and reverse DCF where available; compare estimates with historical valuation and analyst forecasts.
• Stress-test key assumptions with lower, base, and higher scenarios. The presenter cautions that a DCF output is only as reliable as its assumptions, especially for SoFi’s future cash generation and SK hynix’s 2026 cash-flow base.
• Require a margin of safety and size positions in light of uncertainty. For SoFi, the presenter specifically favors a cautious initial position rather than investing the full amount at once.

Other companies mentioned: Microsoft and Alphabet were flagged for a follow-up analysis of earnings, spending plans, and the broader AI investment case.

Disclosure: The presenter repeatedly characterizes valuations as assumption-dependent and does not present the forecasts as guaranteed outcomes. No explicit “not financial advice” disclaimer appears in the supplied subtitles.

Presenters and sources mentioned: The presenter from Dividend Talks; Tom Lee of Fundstrat; Jenny Harrington; Seeking Alpha; Simply Safe Dividends; Capital IQ; and Wall Street analyst estimates.