u/PositionJournal

Toast is a sticky, vertically integrated platform for restaurants that is growing revenue at over 20% and has recently achieved GAAP profitability, yet trades at a reasonable valuation (2x forward P/S, ~20x forward P/E). The market has overly punished the stock for a slight growth slowdown, creating an attractive entry point for a high-quality compounder, especially with potential policy tailwinds. The current valuation is a reasonable price to pay for a business with a strong competitive moat and a 20%+ growth trajectory, making it a compelling long-term investment. A recession could significantly impact restaurant spending and Toast's growth. Fierce competition from players like Clover and Square could erode market share. Any slowdown in growth below 15% would make the current valuation look expensive.

Author calculates R2 COGS at ~$57,600 vs. realized ASP of ~$66,300, yielding ~$8,700 gross profit per vehicle, with additional savings from non-BOM and potential software revenue. R2’s launch and scaling (target 2026) can flip Rivian from burning ~$700M/quarter to positive automotive gross profit, reducing cash burn and enabling monetization of autonomy/software. If R2 succeeds, Rivian’s path to profitability and re-rating is clear; current stock price (-85% in 5 years) already prices in failure, offering asymmetric upside. R2 production delays, lower-than-expected demand, macroeconomic headwinds (recession, EV credit changes), or cost overruns could invalidate the thesis.

Hyperscalers are spending $600-700B on capex, and each data center requires >20,000 tons of steel. CMC has an 8.4% net margin, $2B in cash, and trades at an 11x forward P/E. CMC provides the foundational rebar needed before any tech is installed. Combined with 25% tariffs and federal infrastructure spending, CMC is positioned to win highly profitable contracts. Buy CMC shares or calls anticipating a multiple re-rating as it captures high-margin data center contracts. A slowdown in data center capex or intense price competition from larger players like Nucor.

Adobe's stock is down significantly (-35% YoY, -43% over 5 years), and its current strategy is to integrate AI into existing products (e.g., Firefly in Photoshop) rather than building new AI-native platforms. This "AI-integrated" approach is insufficient to combat the threat from nimbler, AI-native competitors. An internal CEO, the likely choice, will perpetuate this flawed strategy, leading to further market share erosion and stock underperformance. The author believes Adobe is on a path to "certain death" unless a radical, external-led pivot occurs. Betting on an internal, "safe" CEO choice implies the company will fail to adapt, making it a compelling short. The board could hire a visionary external CEO. The existing product suite's network effects and stickiness could prove more durable than anticipated. The "AI-integrated" strategy might be successful enough to retain customers and grow revenue.