Stockchase Insights

EPS of $3.65 beat estimates of $3.37; revenue of $76.44B beat estimates of $73.89. EBITDA of $45.5B beat estimates by 15%. Microsoft's commercial remaining performance obligations of $368 billion in fiscal 4Q, more than $50 billion above 3Q, gives confidence in another year of mid-double-digit sales growth. Estimates for 13% gains next year will likely move up, led by Azure, which could expand 34-36% in 2026. Capital-spending consensus including leases is another metric that may see an upward revision, with analysis suggesting $118 billion for 2026, up 34%. AI workloads gaining scale and double-digit sales growth could help lift 2026 operating margin above 2025. In addition, tight cost control, particularly on head count, could offset any gross-margin pressure from a shift in sales mix to lower-margin cloud infrastructure and greater depreciation. We think AI is a big factor here, as the company, while spending lots of money, is getting good customer traction. But we think underlying customer growth is very much a part of the good results as well.
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EPS of 12c missed estimates of $1.30; revenue of $1.49B missed estimates of $1.59B. EBITDA of $512M missed estimates by 16%. Retail trading was much worse than expected. Coinbase might see better 3Q trading revenue after reaching $360 million in July. The company expects higher subscription and services sales at $665-$745 million, driven by growing stablecoin balances. Improving regulations are aiding adoption of digital assets, yet near-term growth could be nonlinear. Product building on Base, expansion of the payment ecosystem, new trading products and bank on-ramps, combined with US regulatory clarity, can aid growth. Core expenses may rise in 3Q, with $800-$850 million for tech and G&A expenses. Sales and marketing could be $190-$290 million, based on guidance. Reported 2Q costs were affected by $307 million related to a data-theft incident. Coinbase also benefited from a $1.5 billion pretax gain on investment in Circle, which will be carried forward at fair value. Revenue rose 3.3%. The outlook is a bit mixed, but the weakness is likely largely reflected in the stock decline today. Shares are up 52% this year so there is a lot of profit-taking on less-than-stellar results. We would not panic here. A crypo currency rally would like see investors forget these results fairly quickly.
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Investing 101: The Impacts of Inflation

Starting with cash, which in a savings or GIC accounts, can be termed as short-term interest-bearing instruments. As short-term interest rates adjust with expected inflation, such securities can earn a floating real rate. Such-term interest-bearing instruments are considered zero-duration and inflation-protected assets, and therefore are attractive in a rising rate environment.

Moving on to bonds; rising inflation leads to capital losses as bond prices decline. If inflation remains within an expected range, short-term yields rise/fall more than longer-term yields. However, if inflation moves out of the expected range, longer-term yields rise/fall more sharply. The inflation jump recently seen was out of the expected range, but expectations have adjusted quickly.

Coming to our favorite asset class, equities; if inflation stays within the expected cyclical range, there is little effect on stocks as the market prices in expectations fairly quickly and companies can raise prices in-line with inflation to some degree. Unexpectedly high inflation might make central banks take action to slow down the economy by raising interest rates, which is what affects valuations of high-growth and highly leveraged companies. High inflation benefits those companies that can pass on inflation, which generally tend to be of consumer staples, financial and industrial sectors.

Lastly, for real estate assets, if inflation stays within an expected range, rental income and property values rise with inflation. On a positive note, higher than expected inflation leads to high demand for real estate, and vice versa when deflation occurs (opposite of inflation).
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We would be comfortable today as long as an investor has a 3 year+ timeframe to hold. Funamental momentum is very positive and the recent quarter showed an acceleration of growth. 
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EPS of $55.40 beat estimates of $50.38; revenue of $6.79B beat estimates of $6.55B. EBITDA of $2.42B beat estimates by 10%. Booking's revenue view remains muted, with the US still the slowest-growing region despite some recovery in 2Q. Asia is now the fastest-growing market, and management predicts high-single-digit industry growth there over the medium term, making it central to the company's broader strategy. Gains in alternative accommodations outpaced the core hotels business, with listings reaching $8.4 million, up 8% year over year. Analysts expect 7.8% revenue growth for 3Q, in line with guidance of 7-9%, which is slightly below the company's gross-bookings view of 8-10% due to a higher mix of flight bookings and increased merchandise and contract revenue.  3Q adjusted Ebitda margin is 46.4%, as continued marketing expense leverage is offset by rising merchandising spending and sales costs. It is not the best outlook, but all things considered decent enough. The stock is still up 52% over the past year, and strong earnings growth is expected into 2026/27. The balance sheet also remains solid. It is 25X earnings. Note cheap, but in the lower part of its historical range. We would remain comfortable buying. 
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EPS of $1.52 beat estimates of $1.49; revenue of $1.37B beat estimates of $1.35B. EBITDA of $248M beat estimates by 13%. Sales rose 1.2% but operating income did fall year over year. Tariffs are causing some customer uncertainty, but investors seem to have taken this in stride and with these results we would not expect anything different. Good numbers, but not great numbers here. 
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Investing 101: Canadian consumer confidence

Canadian consumer confidence measures the personal financial situation and forward six-month financial situation of Canadian consumers as it relates to household or other purchases, job security, ability to invest, and others. An eventual return in consumer confidence would signal positive developments for the economy and financial markets. 
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HUT was traditionally a bitcoin miner, but like many other miners, it has pivoted some of its strategy toward high performance computing (HPC). It defines itself as an energy infrastructure platform, where it operates three main segments: 1) Power: acquiring and managing energy assets like powered land, 2) Digital infrastructure: purpose-built facilities for energy-intensive applications, and 3) Compute: specialized hardware for bitcoin mining and data center cloud GPU-as-a-service. It is a heavily-shorted stock, which has led to some of its high volatile moves, but it is also benefiting from the rise in crypto prices and increasing interest in AI compute. Analyst estimates are rising, and although it is not yet profitable and is cash flow negative, we could see its price continue to rise if its HPC segment grows and digital asset prices increase.
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NWC has had a very solid uptrend over the decades, but in eary 2024 it had a really strong run, which it is now consolidating from. Its forward earnings multiples ran up to a high of 17X in late 2024, and are now coming back to more reasonable levels. At 14X forward earnings, it is around its five year average, and below its 10 and 20 year averages of 15.3X and 15.6X, respectively. Its forward earnings growth is expected to be strong. We view it as a solid company, and while earnings could trade a bit lower, we think over the long-term it can continue to do well - we would be comfrotable averaging into a position here.
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ZST is a short term bond ETF, with a current indicated yield of 2.74% and one year return of 3.98%. We would consider it quite safe, at least as far as bond funds go, due to its short term nature. It is not perfect, and five year annualized is 2.82%. Still, it is likely better than a bank account, and can offer better returns if interest rates move the right way. We would be comfortable owning this for a place for cash.
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Counter arguments to a rising stock market: U.S. fiscal imbalances and government debt

There has been worry about government debt for decades, but the recent budget bill in the U.S. has taken this worry to peak levels. The U.S. federal budget deficit is now projected at US$1.9 trillion in 2025 (about six per cent of GDP), far above historic norms. Excessive government spending, without clear plans for reduction, could force higher Treasury yields, increase the cost of borrowing for the government and corporations and threaten confidence in U.S. financial markets. Higher fixed-income rates could see money flow from the market to savings accounts and GICs. Higher rates could lower corporate earnings. Yes, government spending can also provide a stimulus, but at some point, the piper needs to be paid. Countries cannot simply borrow trillions for all eternity.
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CGO reported an EPS of $2.40, beating estimates of $2.18, while revenues came in at $758 million, a 2.4% decrease compared to last year (3.9% on a constant currency basis) due to the decline in the subscriber base. Adjusted EBITDA decreased slightly by 0.5% to $367.8 million. CGO reported fine results, but the market is concerned with the fact that revenue declined by around 3.9% on a constant currency basis for the quarter, and the company also revised its projections, expecting revenue to decline by low single digits, compared to the previous 
projection of flat growth. CGO can be defined as a fairly cheap, stable cash cow with an attractive dividend yield. The company generates significant free cash flows, but the long-term growth prospects of the business are not attractive and are expected to gradually decline by 1%-2% over the next few years. For now, we think investors can give CGO some time to execute and be willing to sell if revenue continues its downward trend, but we think for investors who are seeking high dividend yields with a strong growth rate, we think there are better opportunities in the market elsewhere.
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COST is a large consumer staples name, but it trades at a high valuation of 49X forward earnings. Recently, we have been seeing large-cap names, particularly more stable and defensive names, being sold for higher-growth stocks, which helps to explain why the consumer staples, utilities, and healthcare sectors have been underperforming recently. We continue to like COST for a long-term holding, despite its high valuation, given its subscription model, consistency and execution. It may underperform in a strong bull market, but over a long-period of time, it has performed exceptionally. 
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Logan market cap is now $401M, with the stock down 3%YTD. It trades at 10X earnings, no dividend. It has no reported debt but not much cash either. Revenue is expected to grow more than 50% this year and next, hitting close to $300M in 2026. EPS 7c to 11c expected next year.  We do not see a cash flow projection, but with its production growth it should be decent, though offset by lower market prices somewhat. Production grew more than 30% in the Q1, to close to 10,000 B/d (34% liquids). We would consider management quite competent and insiders own 16% currently. It now has nine analysts following the company, all at BUYS. Average target price is $1.18. Considering its growth, balance sheet, management and valuation, it looks to be a very solid mid-cap in the sector to us.
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