The company…

Grab Holdings (GRAB) is Southeast Asia’s dominant superapp, offering a suite of services including ride-hailing, food and grocery delivery, digital payments, micro-lending, insurance, and in-app advertising — all integrated into one platform. Operating in eight countries, Grab has become a daily essential for millions of users in markets like Indonesia, Vietnam, Malaysia, and Singapore. What makes Grab unique is its role as both a consumer app and an economic empowerment engine for gig workers and small businesses. Over 44 million people use Grab’s services monthly (MTUs), yet this represents only 6% of the region’s population; leaving significant runway for expansion. The platform is deeply embedded in local infrastructure, from logistics to payments, which gives it strong competitive moats in fragmented and regulation-heavy markets.

Figure 1. Grab transacting users

Source. Grab website, May 2025

The business model…

Grab generates revenue through four main channels. Commissions: this is the core of its business. Grab earns a percentage from each transaction made on its platform, whether it’s a ride, a meal delivery, or a grocery order. These fees are typically charged to drivers, merchants, or both. Financial Services: GrabFin and its digital banks offer services like personal and merchant loans, insurance, and digital wallets. Revenue comes from interest income, loan fees, and payment processing charges. The loan portfolio grew 56% YoY in Q1 2025, with annualized disbursals reaching $2.5 billion. Advertising: Grab monetizes its merchant base with targeted ad placements. Its self-serve ad platform, mostly used by small businesses, has scaled quickly. Advertising now accounts for 1.7% of Deliveries GMV, up from 1.3% last year. Subscriptions & Fees: Other sources include cancellation charges, driver subscriptions, premium ride bookings, and merchant software tools.

Grab’s business model benefits from strong network effects: more users attract more drivers and merchants, which improves reliability and service quality, encouraging even more usage. The company’s ability to cross-sell products also raises average revenue per user at minimal acquisition cost.

The financials…

Grab posted strong results in Q1 2025: Revenue: $773M, up 18% YoY. Net Income: $10M, a $125M swing from a $115M loss last year. Adjusted EBITDA: $106M, up 71% YoY. Operating Cash Flow: $73M and Free Cash Flow: -$101M.

Deliveries and Mobility remain the largest segments, generating $415M and $282M in revenue respectively. Financial Services, while smaller at $75M, is the fastest-growing vertical. Gross margin expanded to 41.9%, and operating loss narrowed significantly from $75M to $21M. Grab’s balance sheet is strong: it holds $6.2 billion in liquidity and $5.9 billion in net cash. However, stock-based compensation remains high at $80M — 8x net income — and the share count rose 3.8% YoY, leading to modest dilution. Despite profitability, free cash flow remains negative due to heavy capex and working capital outflows.

Charly AI rating…

Overall, Charly AI rates Grab as a “HOLD,” broken down as follows: “HOLD” for its financials, short- and long-term outlook, and “Overvalued” for valuation. This is mainly because the stock’s current valuation appears stretched relative to fundamentals (Estimated Fair Value of $3.06 vs. current $4.97 price), and despite strong top-line performance, Grab’s thin profit margins (1.3% operating margin) and high stock-based compensation (8× net income) raise questions about sustainability.

Figure 2. Charly AI rating

My investment thesis…

Grab’s superapp model is working. Revenue is growing, profitability has arrived, and user engagement is high. The company is successfully deepening monetization while expanding into financial services and advertising — high-margin verticals with long-term upside. But challenges remain. Free cash flow is negative, share dilution is ongoing, and stock-based compensation is eating into profits. With the stock trading above its fair value, investors should be cautious. If you're conservative, wait for signs of stronger free cash flow before buying. If you're bullish on Southeast Asia’s digital economy — especially with a potential M&A catalyst on the horizon — a small position may be justified. For now, Grab is a HOLD — a strong business at a price that already reflects much of the good news.

Like what you read? Reach out at daniel@askcharly.ai for more emerging market tech insights.

The company…

In the past 12 months Nano Nuclear Energy (NNE) stock grew 7x (see figure 1). This is very impressive for a company created in 2022 and that IPO’d on the Nasdaq just a year ago in February 2024. NNE is an early-stage advanced nuclear energy technology company developing clean energy solutions. Its mission is simple yet bold: deliver smaller, cheaper, and safer advanced microreactors to the world. The firm’s vision is anchored in U.S. energy independence, national security priorities, and solving the energy demands of tomorrow from AI datacentres to deep-space missions.

Figure 1. NNE historical stock performance

The business model…

NNE business model revolves around being a vertically integrated micronuclear developer and manufacturer. This involves: 1) developing and manufacturing microreactors – to be leased or sold ; 2) nuclear fuel processing – produce fuel for its reactors; 3) nuclear fuel transportation and 4) providing consulting services on nuclear – regulation development, environmental impact assessment, waste management etc. NNE is developing four proprietary microreactor designs—Zeus, Odin, Kronos mmr, and Loki mmr—each tailored to niche use cases ranging from portable battlefield deployment to stationary industrial use and even extra-terrestrial applications (see figure 2 for use cases). The integration of supply (nuclear fuel production), hardware (reactors), and logistics (transportation) creates a moat and positions NNE as a full-stack nuclear solutions provider.

Figure 2. NNE microreactors end use applications

Source: NNE Investor Presentation, Feb 2025

The management…

Led by CEO James Walker (previously project lead for the construction of Rolls Royce’s Nuclear chemical plant) and an all-star technical team, including nuclear physicists (heads of nuclear departments at the University of Cambridge and the University of California, Berkeley) and former national lab executives, NNE has assembled a deep bench of talent. From Oak Ridge National Laboratory to the NRC (U.S. Nuclear Regulatory Commission), the company is plugged into the right networks—scientific, political, and industrial.

The market…

NNE operates at the convergence of multiple macro trends: AI-driven power demand, U.S. energy security, and global decarbonization. Big tech is going nuclear—Microsoft, Amazon, Oracle, and Google are all planning or piloting SMRs to power their datacentres. And the regulatory wind is favourable: the U.S. Department of Energy’s $3.4 billion LEU Acquisition Program, the ADVANCE Act, and HALEU incentives are all tailwinds. NNE also has first-mover advantage through its U.S.-origin partnership with LIS Technologies, the only American laser uranium enrichment tech company.

The Financials…

NNE remains pre-revenue, with growing losses (net loss of $3.1M last quarter) and significant share dilution (19.6% share dilution from recent fundraising) to fund operations. The strong cash position ($123m) and low debt ($4.1m) provide a runway for continued development, but the lack of revenue and ongoing cash burn are key risks.

What Charly AI says…

Overall, Charly AI rates NNE a HOLD broken down as follows: Financial statements “HOLD”, Valuation “Overvalued”, Short-term outlook “HOLD”, and Long-term outlook “BUY”.

Figure 3. NNE Charly AI rating

Source: Charly AI, May 2025

My investment thesis…

Overall, NNE is a pre-revenue, high-risk and high reward play in the emerging advanced nuclear energy sector. For long-term investors, NNE’s vertical integration strategy—developing reactors, fuel supply chains, and transportation—could position it well if the nuclear microreactor market gains traction. However, the risks are substantial: delays in approvals, technology setbacks, or failure to attract customers could erase value quickly. Existing investors with high risk tolerance might maintain their position to avoid missing potential upside if milestones are achieved, while new investors should wait for clearer signs of progress, such as regulatory approvals or early revenue from consulting services.

1. Five Point Holdings - FPH

The company

Five Point Holdings designs, owns, and develops mixed-use planned communities in Orange County, Los Angeles County, and San Francisco County. The company operates through three segments: Valencia, San Francisco, and Great Park. It sells residential and commercial land sites to homebuilders, commercial developers, and commercial buyers by providing development management services; operates and owns a commercial office, research and development, medical campus, and other properties; and provides development and property management services.

The investment rationale

Five Point Holdings presents a compelling investment opportunity driven by strong fundamentals and strategic positioning in California’s supply-constrained real estate markets. The company’s 2024 revenue growth (12.4% year-over-year) reflects a successful pivot to higher-margin management services, even as land sales dipped slightly. Improved cost controls boosted gross margins, while equity earnings from ventures like the Great Park surged, lifting net income to $68.3 million. With a robust cash position ($528.3 million in Q1 2025), reduced debt, and a credit rating upgrade, FPH is financially resilient. Valuation metrics (P/E of 4.2, price-to-book of 0.48) suggest the stock is undervalued, trading below a fair value estimate of $9.60 per share. Technical indicators like bullish moving averages and a neutral RSI signal room for upside, though macroeconomic risks (interest rates, regulatory delays) warrant caution.

The company’s focus on capital efficiency, recurring income streams, and strategic partnerships in high-demand markets positions it for long-term growth. While capital expenditures remain high, FPH’s disciplined spending and liquidity buffer mitigate near-term risks. Given its undervaluation, strong execution, and favorable market dynamics, the stock offers clear upside potential. BUY FPH for exposure to a well-managed player in a tight housing market, balancing growth prospects with prudent risk management.

2. Radware - RDWR

The company

Radware develops, manufactures, and markets cyber security and application delivery solutions for cloud, on-premises, and software defined data centers worldwide. The company operates in two segments, Radware's Core Business and The Hawks' Business. It offers cloud application protection service, cloud WAF, bot manager, API protection, web DDoS protection, client-side protection, threat intelligence, Kubernetes WAAP, and alteon integrated WAF; cloud DDoS protection service, defencepro X, cyber controller, firewall as-a-service; alteon, linkproof NG, SSL inspection etc.

The investment rationale

Radware has demonstrated strong momentum with accelerating revenue growth, particularly in its cloud business (cloud ARR up 19% year-over-year), signaling a successful shift toward recurring revenue streams that now make up 80% of total sales. The company’s profitability is improving sharply, with non-GAAP EPS doubling to $0.87 in 2024 and operating cash flow surging to $71.6 million—a testament to efficient cost management and disciplined execution. A rock-solid balance sheet ($420 million in cash, no significant debt) and stable gross margins (82.2%) provide a sturdy foundation, while strategic investments in AI-driven security and partnerships with giants like Cisco position it to capitalize on growing cybersecurity demand.

While competition from larger players and geopolitical risks in Israel are valid concerns, Radware’s focus on high-growth areas like cloud security and its reasonable forward valuation (forward P/E of 24.9) mitigate these risks. The stock’s technical indicators support a bullish trend, and despite a high trailing P/E, the company’s improving fundamentals and industry tailwinds justify optimism. For investors, the combination of recurring revenue growth, strong cash generation, and strategic positioning in a critical sector makes Radware a compelling BUY for both short-term momentum and long-term growth. The positives—accelerating cloud adoption, operational efficiency, and a war chest of cash—far outweigh near-term volatility or tax-related headwinds, offering a clear path for sustained value creation.

3. Unity Bancorp - UNTY

The company

Unity Bancorp operates as the bank holding company for Unity Bank that provides commercial and retail banking services. It offers personal and business checking, money market, savings, and retirement accounts, as well as time and noninterest and interest-bearing demand deposits. The company also provides commercial, small business administration, consumer, mortgage, and home equity and personal loans; and owner and non-owner-occupied commercial mortgages.

The investment rationale

Unity Bancorp presents a convincing investment case backed by consistent growth and prudent management. The company has demonstrated strong financial performance, with revenue up 14.8% year-over-year in Q1 2025 and net income rising to $11.6 million ($1.13 per diluted share). Key drivers include robust loan growth (3.74% quarterly increase) and deposit expansion (4.82% excluding brokered deposits), alongside improved profitability metrics like a 41% profit margin and a net interest margin of 4.16%. These trends highlight Unity’s ability to navigate rising funding costs while maintaining disciplined credit-risk practices, reflected in declining nonaccrual loans (0.58% of total loans) and a solid capital position (common equity Tier 1 ratio of 13.9%). Despite a challenging environment, Unity’s focus on commercial lending and technology investments positions it well for sustained growth, though risks like exposure to real estate (96% of loans) and interest rate sensitivity warrant monitoring.

The stock’s technical setup suggests consolidation after a 50% rally, trading slightly below short-term averages but above long-term support. Valuation remains attractive with a trailing P/E of 9.7 and a price-to-book ratio of 1.36, both below regional bank peers. Analysts see upside potential to ~$51 per share (10.5x forward earnings), offering a margin of safety. While rising deposit costs could pressure margins, Unity’s track record of expense control and deposit-gathering strength mitigates this risk. For investors seeking a stable, undervalued regional bank with growth potential, Unity Bancorp is a BUY. The combination of strong fundamentals, conservative management, and an attractive valuation supports both near-term appreciation and long-term value creation, making it a resilient pick in a volatile market.

3. MicroStrategy - MSTR

MSTR outlook hinges almost entirely on Bitcoin’s performance, making it a high-risk, speculative play rather than a traditional equity investment. The company’s core software business is struggling, with revenues declining (down 6.6% year-over-year) and profitability eroding due to higher costs and a shift to lower-margin subscriptions. Its aggressive Bitcoin acquisitions—funded by heavy debt ($7.2 billion in long-term debt) and shareholder dilution—have left it financially vulnerable, with negative cash flow (-$53 million in 2024) and minimal liquidity ($38 million cash). While Bitcoin’s recent rally has buoyed the stock, MicroStrategy’s valuation (4.98x price-to-book) appears stretched given its lack of earnings and dependence on volatile crypto markets. Regulatory risks, potential Bitcoin price swings, and the strain of servicing debt add significant downside risk.

For investors seeking Bitcoin exposure, MicroStrategy offers leveraged upside, but this comes with extreme volatility and financial fragility. The company’s fundamentals—declining software revenue, massive impairment losses ($1.79 billion in 2024), and unsustainable capital structure—are alarmingly weak. Even with new accounting rules reducing earnings volatility, the stock remains a bet on Bitcoin rather than a sustainable business. Given the high debt, liquidity risks, and overvaluation relative to traditional metrics, the recommendation is SELL. Investors should avoid unless they are willing to accept speculative, binary outcomes tied purely to Bitcoin’s price movements.

2. Southwest Airlines Co - LUV

Southwest Airlines (LUV) faces a mix of challenges and opportunities. The company has shown resilience with a 5.3% revenue growth in 2024 ($27.5 billion) driven by strong demand and strategic moves like assigned seating and international partnerships. However, profitability remains pressured by rising labor costs (salaries up 9.8%) and operational disruptions, such as the 2022 winter storm fallout. While the balance sheet is robust (cash of $7.5 billion exceeds debt of $6.7 billion), cash reserves have dipped, and free cash flow is negative due to heavy capital expenditures ($2.1 billion), raising liquidity concerns. Additionally, the decision to charge for checked bags risks alienating its cost-sensitive customer base, and Boeing delivery delays could slow fleet modernization.

Technically, the stock appears oversold (RSI 37.47) but remains in a bearish trend, trading below key moving averages. Valuation metrics like a P/E ratio of 31.65 suggest the stock is pricey compared to peers, despite recent declines. Short-term headwinds—including volatile fuel prices, competitive pressures, and negative market sentiment—outweigh the potential benefits of long-term strategies like redeye flights and premium seating. While Southwest’s strong brand and liquidity provide a safety net, the combination of high valuation, cash flow strain, and execution risks makes the stock vulnerable to further downside.

Given these factors, the recommendation is to SELL. The current risks, particularly overvaluation and operational uncertainties, overshadow the company’s growth initiatives. Investors should monitor Southwest’s ability to stabilize cash flow, execute its strategic shifts smoothly, and navigate industry challenges before reconsidering a position.

1. Joby Aviation - JOBY

JOBY is pioneering electric air taxis with promising partnerships and regulatory progress, but its financial health raises concerns. The company’s losses deepened to $608 million in 2024, driven by surging R&D costs (up 30% to $477 million) and stagnant revenue, which plummeted 87% to just $136,000. While its balance sheet remains solid with $933 million in cash and no major debt, cash reserves are shrinking, and reliance on stock issuance (12% dilution) to fund operations signals financial strain. The stock’s technicals reflect this uncertainty, trading below key moving averages (50-day: $7.05, 200-day: $6.42) with bearish momentum (MACD negative), though the RSI (40.65) hints it might be nearing oversold levels.

Long-term potential exists as Joby’s vertical integration strategy and partnerships (Toyota, Delta) position it to capitalize on the growing eVTOL market. However, near-term risks dominate: regulatory hurdles, high cash burn, and competition could delay profitability. The stock’s valuation (price-to-book: 5.54) appears stretched given its lack of revenue and widening losses. For investors with a high-risk tolerance and long horizon, holding might make sense to await market maturation. But for most, the combination of financial instability, dilution, and weak technicals suggests caution. Conclusion: SELL in the short term; consider HOLD only if you’re prepared for volatility and multi-year uncertainty.

Today we are focusing on two stocks out of Charly AI's last week's picks, which is composed of 11 stocks with strong fundamentals, attractive valuations, and solid growth outlook. What makes the two we are covering today stand out? Beyond their financial strength, they operate in sectors that tend to hold steady—even thrive—during economic downturns.

The first stock Cal-Maine Foods (CALM) sits within the farm products industry, more specifically—eggs. It’s a textbook example of recession resilience. Demand is inelastic, production is fast, and pricing power holds firm. In short, with stable supply chains and growing global demand, you’ve got a long-term winner. The second one PriceSmart (PSMT) operates in the discount stores industry. Players here are built for tough times. With a low-cost model and essential product mix, they cater to price-sensitive consumers, maintaining profitability even as wallets tighten. When uncertainty rises, value becomes king—and discount stores deliver. Cheap wins, always.

1. Cal-Maine Foods – CALM

CALM has shown impressive growth driven by high egg prices, strategic acquisitions, and efficient operations. The company’s revenue more than doubled in the latest quarter (101.6% year-over-year), fueled by soaring demand and reduced supply due to avian flu outbreaks (HPAI). This pushed gross margins to 50.5%, up from 31.1%, as higher selling prices offset lower feed costs. With $497.2 million in cash and no significant debt, Cal-Maine’s balance sheet is robust, allowing it to invest in cage-free production to meet regulatory trends and consumer preferences. These expansions, alongside recent acquisitions like ISE America, position the company to capture long-term market share despite risks like future HPAI disruptions or regulatory cost hikes.

While egg prices are volatile, CALM’s disciplined cost management and focus on high-margin specialty eggs (25.4% sales growth) add stability. Technical indicators like a rising 50-day moving average ($93.36) and positive MACD momentum suggest bullish sentiment, though resistance near $100 could test short-term gains. The trailing P/E of 4.46 highlights undervaluation based on current earnings, but the forward P/E (29.98) reflects expectations for sustained profitability. Legal risks and disease outbreaks remain concerns, but the company’s strong cash reserves and strategic investments mitigate these challenges.

Given Cal-Maine’s dominant market position, financial strength, and alignment with industry trends, the stock presents a compelling opportunity. Investors looking for exposure to a resilient agribusiness with growth potential should consider a BUY for both short-term gains and long-term growth, as the company’s fundamentals and strategic moves outweigh near-term risks.

2. PriceSmart – PSMT

PSMT demonstrates a resilient business model with steady revenue growth (5.6% year-over-year) and improving profitability, as net income jumped 11.4% last quarter. The company’s expansion into Costa Rica and planned openings in Guatemala highlight its strategic focus on scaling operations in Central America, a region with growing consumer demand. Despite a slight dip in gross margins (15.6%, down 0.1%), PriceSmart maintains a strong balance sheet, holding more cash ($145.5 million) than debt ($107.1 million), which provides flexibility to navigate risks like potential tariff impacts or currency volatility. Its valuation also looks attractive, trading at a P/E ratio (19.99) below industry averages, suggesting room for upside as growth initiatives take hold.

While rising costs for technology investments and geopolitical uncertainties pose challenges, these are balanced by prudent management. The company’s effective tax rate improved (27.2%, down from 30.5%), boosting net income, and its focus on digital upgrades and membership programs (like Platinum Membership) should drive customer loyalty and long-term sales. Although capital expenditures are high, they reflect necessary investments in distribution networks and new clubs, which could enhance future revenue. Technical indicators like a bullish MACD and the stock trading above key moving averages signal positive momentum, aligning with strong fundamentals.

Given PSMT’s combination of growth potential, financial stability, and undervaluation relative to peers, the stock presents a compelling opportunity. Risks exist but appear manageable, and the company’s strategic investments position it well for both near-term gains and sustained growth. BUY for investors seeking exposure to a steadily expanding retailer with a solid track record and upside potential.

The rationale…

When evaluating a stock, most investors focus on financial performance, the management’s ability to execute, and the broader macro environment. But insider buying deserves a seat at that table too. Why? Because when executives put their own money into the business, it’s a strong vote of confidence in the company’s future. These are the people who know the business inside out—their actions often speak louder than earnings reports. While insider selling gets attention, it’s not always bearish. Execs sell for many personal reasons—diversification, taxes, or large life events. But when they’re buying? That’s usually a sign worth watching.

The insider signal…

Two weeks ago, when Trump started rolling out tariffs, Sinclair's (SBGI) Executive Chairman, David D. Smith, bought 443,258 shares in a series of open market purchases. On April 3rd, he bought 258,113 shares for ~$3.7 million at prices between $13.20 and $14.98, and on April 8 & 9, another 185,145 shares, taking his total spend for the month north of $6 million. Given Sinclair’s struggles in the past few years with the cord-cutting trend and sports media rights drama, this kind of conviction from the top is worth noting. In addition, Sinclair has become the first broadcast company granted FAA authorization to fly drones over people and moving vehicles for newsgathering — no waiver required. This milestone positions Sinclair at the forefront of drone journalism.

The company…

Sinclair, Inc. is a U.S.-based media company delivering content through both local television stations and digital platforms. The business is split into two core segments: Local Media and Tennis. The Local Media segment runs a portfolio of broadcast TV stations and original networks, offering free, over-the-air programming—including live local sports—and creates original and local news content. It also earns revenue by distributing its programming to multi-channel video providers in return for fixed contractual fees. Meanwhile, the Tennis segment revolves around the Tennis Channel, a cable network featuring premier tournament coverage, original sports programming, and lifestyle shows focused on the tennis world.

What Charly AI says…

Figure 1. Charly AI rating of SBGI

Source: Charly AI

Sinclair presents a mixed but intriguing outlook. The company has made notable strides in 2024, with revenue jumping 13% year-over-year ($3,548 million vs. $3,134 million) driven largely by political advertising during the election cycle. This boosted profitability, turning a net loss of $291 million in 2023 into a $310 million profit. Strategic moves like its media-for-equity initiative and investments in next-gen broadcast technology (ATSC 3.0) signal a push toward diversification and innovation, which could open new revenue streams in the long-term. However, challenges remain: core advertising dipped slightly due to political campaigns crowding out other ads, subscriber numbers are declining amid cord-cutting trends, and debt remains elevated at $4.1 billion—though stable cash flow ($697 million in reserves) helps mitigate this risk.

Technically, the stock appears undervalued with a low P/E ratio (3.10) and price-to-book ratio (1.64), suggesting potential upside. But short-term indicators like the bearish moving averages and negative MACD hint at continued volatility. While operating cash flow ($98 million) lagged net income ($319 million), raising questions about cash generation efficiency, the balance sheet improved with rising cash reserves and positive retained earnings. For investors with a 3+ year horizon, Sinclair’s strategic bets on digital transformation and undervaluation create a compelling case. A BUY for long-term investors who can stomach some near-term volatility. The company’s strategic shift toward tech-enabled growth and strengthening fundamentals suggests real upside for those willing to be patient. For short-term focused investors, it may be a HOLD, but the long-term opportunity far outweighs the current challenges for anyone with a higher risk appetite.

Every winning stock starts with one thing: strong financials. Forget the hype and glossy growth stories—if the financials don’t hold up, neither will the stock. History backs it up: companies with solid fundamentals consistently outperform. That’s why today we’re going to focus on the top 3 undervalued large caps (above $10bn market caps) with the strongest financials.

To do this, we first identified large-cap companies that are undervalued, have a strong outlook, and that we believe are currently a BUY. This means that companies like Meta, NVIDIA, Apple, etc. are automatically eliminated, as they are overvalued based on their high P/E ratios. Next, we used three criteria to refine our list: i) free cash flow margin—because cash is king, as we all know, ii) debt-to-equity ratio, to see how leveraged the companies are, and finally, iii) return on equity (ROE), to show how much is generated per dollar of shareholder equity. Below are the 3 large caps with the strongest financials.

3. Merck Co — MRK

MRK has demonstrated solid revenue growth of 7% in 2024, driven by its oncology and cardiovascular segments, which are crucial for its long-term growth strategy. The improvement in gross margin to 76.3% indicates efficient cost management and a favorable sales mix. Despite challenges such as pricing pressures and competition, Merck's strategic acquisitions and collaborations, particularly in oncology, position it well for future growth. The company's net income has significantly increased to $17.1 billion, reflecting strong operational performance and reduced R&D expenses. MRK delivers a solid 28% FCF margin, reflecting strong cash generation. It underperforms in capital efficiency with 0.41 ROE, suggesting room for improvement in profitability relative to equity. Its high debt-to-equity ratio of 0.83 signals elevated financial risk. Although Merck has a high debt level, its cash reserves have increased, enhancing liquidity. The absence of significant share dilution and goodwill impairments further supports its financial health. Given these factors, along with a favorable valuation and strong cash flow generation, Merck is well-positioned for long-term growth, making it a BUY recommendation.

2. Williams-Sonoma — WSM

WSM has strengthened profitability through higher gross margins (46.5%, up from 42.6%) and operational efficiencies, even as revenue dipped slightly (-0.5% year-over-year). The company posts a high ROE at 54%, showcasing exceptional profitability and efficient capital use. It records FCF margin at 14%, which may limit growth investments or shareholder pay-outs. With a moderate debt-to-equity ratio of 0.63, leverage remains within a manageable range.

Strategic moves like the West Elm collaboration and focus on non-furniture categories show adaptability to shifting consumer preferences. While short-term headwinds like declining furniture demand and macroeconomic uncertainty (evidenced by recent stock volatility and bearish technical signals) warrant caution, these challenges appear priced in given the stock’s undervaluation (trailing P/E of 15.72, below industry averages). The improving housing market and WSM’s vertical integration (controlling design and sourcing) position it to capitalize when consumer confidence rebounds. While SG&A costs rising to 27.9% of revenue needs monitoring, the company’s strong cash flow ($1.4 billion operating cash flow) and disciplined capital allocation (managing inventories, reinvesting in growth) provide room to navigate turbulence.

For investors with a multi-year horizon, the current valuation and strategic initiatives create an attractive entry point. The overall recommendation is a BUY. The company’s financial health, margin expansion, and long-term growth strategies outweigh near-term volatility. While patience may be required as macroeconomic pressures ease, WSM’s fundamentals and undervaluation suggest meaningful upside as its initiatives gain traction and housing trends stabilize.

1. Qualcomm — QCOM

QCOM is firing on all cylinders in key growth areas: automotive and IoT revenues surged 61% and 36% year-over-year, driven by its Snapdragon platforms, while overall revenue jumped 17% to $11.7 billion last quarter. Its net income rose to $3.2 billion (EPS of $2.83), supported by solid demand for premium-tier chips in smartphones and PCs. QCM has a high FCF margin of 32% which highlights strong cash generation, giving the company flexibility for reinvestment, dividends, or debt reduction. Its low debt-to-equity ratio of 0.54 reflects prudent leverage and lower financial risk. With a solid 42% ROE, the company demonstrates efficient use of shareholder capital to drive profitability.

Strategically, Qualcomm is well-positioned to capitalize on long-term trends like AI and edge computing, with partnerships with Samsung and Google likely to strengthen its foothold in mobile tech and PCs. However, short-term risks loom. The stock’s recent drop reflects market jitters around geopolitical tensions (especially U.S./China trade relations) and semiconductor industry cyclicality. These factors, combined with competition from Apple and Samsung’s in-house chips, suggest volatility could persist in the coming months. Overall, Qualcomm is a BUY for long-term investors willing to ride out near-term turbulence. Its undervalued P/E (13.62), leadership in high-growth sectors, and $22 billion non-handset revenue target by 2029 offer compelling upside. While short-term holders might HOLD until market sentiment stabilizes, the company’s strategic bets on AI, automotive, and IoT—paired with robust cash flow—make it a strong candidate for sustained growth over the next 3+ years.

0. The context

Back in early March, I wrote a quick piece that I posted here and on Blind, spotlighting two undervalued stocks that weren’t getting the attention they deserved (Fresh Del monte Produce and Upwork). While the feedback overall was positive, a comment really stuck with me (Figure 1). It got me thinking — are we entering an era where strong, stable, cash-generating businesses are being overlooked simply because they don’t scream “tech” or “AI”?

Figure 1. Teamblind.com user’s comment on FDP

The market's obsession with innovation has left traditional “boring” companies — those in capital-intensive, interest-dependent sectors — largely ignored. But here’s the thing: these businesses often act as the ballast in a portfolio, especially during downturns. They may not 2x in a quarter, but they do offer something invaluable: resilience. And in today’s environment of fear and macro uncertainty, that matters more than ever.

In this piece, I’ll highlight two such “boring day” stocks — that are navigating the current turmoil with surprising grace. Think: stable fundamentals, smart capital allocation, and a business model that thrives even when the macro gets messy. These aren’t the stocks you'll hear hyped on social media, but they might just be what your portfolio needs to stay grounded.

1. Progressive Corp — PGR

Description: The Progressive Corporation operates as an insurance company in the United States. The company writes insurance for personal autos and special lines products, including motorcycles, RVs, and watercraft; and personal residential property insurance for homeowners and renters.

Figure 2. PGR stock rating card by Charly AI

Investment thesis: Year to date PGR is 7% up vs S&P 500 which is 14% down. PGR has demonstrated strong financial performance with significant improvements in profit margins (from 6.2% to 11%) and earnings per share (EPS increased from $6.61 to $14.45). The combined ratio, a key profitability measure in the insurance industry, improved to 88.8%, indicating better cost management. The company's strategic investments in technology and product innovation, such as usage-based insurance programs, position it well for future growth. Despite some concerns about operating cash flow being lower than net income, the overall financial health is robust, with stable cash balances and minimal share dilution. The stock is currently undervalued based on a DCF analysis, with an intrinsic value suggesting a margin of safety. Given the strong short-term and long-term growth prospects, along with a bullish technical trend, a BUY recommendation is appropriate. The potential risks, such as competitive pressures and regulatory challenges, are mitigated by Progressive's strong market position and strategic initiatives.

2. Verizon Communications — VZ

Description: Verizon provides communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide.

Figure 2. VZ stock rating card by Charly AI

Investment thesis: Year to date VZ is 8% up vs S&P 500 which is 14% down. Verizon’s stock outlook is cautiously optimistic, balancing its strategic growth initiatives with lingering financial risks. The company is making strides in expanding its 5G network, IoT partnerships, and fiber infrastructure, which should drive long-term growth. These efforts are already showing results, with the Consumer segment growing (1.3% revenue increase) and net income rising sharply to $17.95 billion in 2024, supported by cost reductions and tax efficiencies (effective tax rate down to 21.9%). Additionally, Verizon’s high dividend yield (6.13%) and undervaluation (P/E of 11.13) make it appealing for income-focused investors. However, challenges remain, including a declining Business segment (-2.0% revenue) and a high debt load ($144 billion), though debt is decreasing and cash flow remains strong (operating cash flow of $36.9 billion).

The stock’s technical indicators suggest positive momentum, with bullish MACD signals and a recent price uptrend. While the Business segment’s struggles and past goodwill impairments ($5.8 billion in 2023) warrant caution, Verizon’s focus on high-growth areas like IoT and cybersecurity partnerships positions it to offset these weaknesses. For investors with a moderate risk tolerance, the combination of reliable dividends, strategic investments, and improving financial health (free cash flow up to $19.8 billion) supports a BUY recommendation. The stock’s current valuation and growth potential outweigh near-term risks, making it a compelling choice for both income and growth-oriented portfolios.

The S&P 500 is down 14% year-to-date — no surprise given the wave of tariff fears and a market clearly in correction mode. In this kind of environment, finding a stock that’s not just holding its ground but actually growing feels nearly impossible. And yet, here comes Harmony Gold Mining (HMY), quietly defying the trend — up 60% YTD (see Figure 1). HMY’s performance is driven by two key factors: the tailwinds from the sector the company operates in, and its solid operational performance.

Figure 1. HMY stock performance year to date

1. HMY - Sector Tailwind

HMY operates in the mining sector, engaging in the exploration, extraction, and processing of mineral properties in South Africa, Papua New Guinea, and Australasia. The company primarily explores for gold, as well as other minerals such as uranium, silver, and copper. We all know that gold is historically viewed as a "safe-haven" asset. During periods of stock market volatility, economic uncertainty, or geopolitical tension — like now — investors typically shift capital to gold to preserve wealth. This leads to higher gold prices, benefiting mining companies like HMY. However, the full 60% growth in HMY isn’t solely explained by gold’s 16% increase year-to-date (according to Trading Economics).

2. HMY - Solid Operational Performance

Figure 2. Charly AI HMY stock card

HMY has delivered impressive results, with revenue jumping 19% and net profit surging 33% over the last six months, fueled by higher gold prices and smarter operations. The company generated record free cash flow (R10,392 million), allowing it to reward shareholders with its highest-ever interim dividend. While gold production dipped slightly, Harmony’s strategic focus on high-grade projects like Mponeng and its upcoming copper production signals a shift to diversify revenue and reduce risk. Harmony’s balance sheet is rock-solid, boasting a net cash position of R7,283 million—giving it flexibility to invest in growth without relying on debt. Risks like gold price swings and operational hiccups remain, but Harmony’s disciplined cost management and strong cash generation provide a cushion against volatility.

Technically, the stock has seen wild swings (52-week range: $7.97 to $15.22), but recent indicators like the MACD hint at upward momentum. While the RSI suggests the stock isn’t oversold, the recent pullback could be a chance to buy into a company trading at reasonable valuations (P/E in line with peers) with clear growth catalysts. The push into copper adds a long-term tailwind, complementing gold’s role as a safe-haven asset. With gold prices staying elevated and Harmony’s operational improvements gaining traction, the stock looks poised for growth. BUY for both short-term upside and long-term value, as Harmony’s mix of financial strength, strategic diversification, and high-grade projects positions it to thrive in uncertain markets.

3. How do you build your portfolio

Beyond the BUY, HOLD, or SELL question, HMY’s performance raises a key question for investors: “How do you build your portfolio?” For me, a balanced portfolio blends growth and defense: equities (~50%, e.g., dividend stocks), bonds (~30%, income stability), gold (~10%, crisis insurance), and cash (~10%, liquidity). Warren Buffett, though critical of gold’s non-productivity, acknowledges its psychological allure: “People… feel gold has some magic stability.”

This market turmoil presents an opportunity for investors to get things right by building a diversified portfolio. Charly AI is here to provide accurate recommendations and help with this process. Additionally, stock portfolio assessment is a feature we have in the pipeline to enable all investors to thrive. So stay tuned and join the community before it is too late.

Like most investors, I’m currently watching a few names — and if they somehow drop to pre-COVID levels? I’m backing up the truck. That’s a stretch, sure. But in this market, never say never. Now, while most investors are closely monitoring the usual suspects — the hype names, the trendy picks (META, GOOG, NVDA, AVGO, AAPL, and AMZN) — there are a few overlooked gems. These aren’t your typical “meme stocks.” They’re solid businesses. Category leaders. Executing well. Just... too expensive right now. But at the right price? Absolute steals. In this piece, we’ll highlight three of them — and why they should be on your radar.

Quick note before we dive in — I hope we all agree that this market pullback is not about some AI bubble popping. This is about tariffs, global tension, and a natural correction. Let’s not confuse headlines with fundamentals.

1. Vertiv Holdings - VRT

Investment thesis: VRT presents a compelling mix of strong fundamentals and near-term challenges. The company has demonstrated robust revenue growth (16.7% year-over-year) and improved profitability, driven by higher sales volumes, better pricing strategies, and operational efficiency. Its gross margin expanded to 36.6%, and operating profit surged by 56.8%, reflecting disciplined cost management. Vertiv’s strategic focus on AI and high-performance computing, including new product launches like Vertiv Unify Software, positions it to capitalize on growing demand for digital infrastructure. Additionally, the balance sheet shows positive trends, with rising cash reserves ($1.2 billion) and reduced retained earnings deficits, signaling stronger financial health. These factors underscore Vertiv’s potential for long-term value creation.

However, short-term headwinds are notable. Market volatility is high due to trade tariffs, and Vertiv’s price has dropped 56% year-to-date, underperforming peers. There are concerns about overvaluation, given its high P/E ratio (52.40) relative to peers. While debt levels ($2.9 billion) remain a concern, manageable interest expenses and stable cash flow generation mitigate this risk. Investors should also weigh geopolitical uncertainties and supply chain vulnerabilities, though Vertiv’s investments in capacity expansion and innovation aim to address these challenges.

For investors with a long-term horizon, Vertiv’s strong fundamentals, strategic positioning in high-growth sectors, and improving financial metrics justify a BUY recommendation. The company’s ability to convert profits into cash (operating cash flow of $1.3 billion) and its focus on AI-driven solutions provide a solid foundation for sustained growth. While short-term volatility may persist, the long-term outlook remains promising, making Vertiv an attractive hold for those willing to navigate near-term fluctuations.

2. ASML Holding - ASML

Investment thesis: ASML’s long-term outlook remains strong due to its leadership in semiconductor technology, stable profitability (gross margin of 51.3%), and strategic investments like High NA EUV systems, which position it to benefit from growing demand in AI and advanced chip production. The company’s financial health is robust, with a fortified balance sheet (cash up 81% to €12.7 billion, debt down 20%) and strong cash flow generation (operating cash flow of €11.2 billion), enabling continued innovation and resilience. However, short-term challenges like geopolitical tensions, a cyclical industry, and a high valuation (P/E of 29.98) create near-term uncertainty, reflected in recent stock volatility and a bearish technical trend.

For investors with a horizon of three years or more, ASML’s dominance in critical semiconductor equipment and its capacity to drive future tech advancements make it a compelling BUY. While the stock may face pressure from export restrictions or market sentiment in the coming months, the company’s fundamentals and strategic positioning suggest it will outperform as semiconductor demand rebounds. Short-term traders might exercise caution, but long-term holders should view dips as opportunities to build exposure to a company central to global tech infrastructure.

3. Arista Networks - ANET

Investment thesis: ANET presents a compelling but nuanced case. The company’s fundamentals are strong, with revenue growing 19.5% year-over-year (driven by demand for AI and cloud solutions) and gross margins improving to 64.1% due to better cost management. Its balance sheet is rock-solid, boasting $8.3 billion in cash with no significant debt, and retained earnings surged to $7.5 billion, reflecting profitable reinvestment. However, recent challenges like Microsoft’s contract cancellations, tariff concerns, and broader market volatility have pushed the stock down nearly 45%, with technical indicators like the bearish MACD and price below key moving averages signaling short-term pressure.

While the stock appears overvalued (P/E of 32.02) relative to peers and faces near-term headwinds, Arista’s strategic focus on AI-driven networking and cloud infrastructure positions it well for long-term growth. For those with a horizon beyond three years, the company’s innovation, financial health, and market leadership outweigh short-term risks. BUY for long-term investors willing to ride out volatility, as Arista’s fundamentals and strategic bets on AI and cloud networking are likely to drive sustained value creation.

This is to remind you that…

…Millionaires will be made in the next few months, and the more the market drops, the bigger the opportunity, especially if you know which stocks to buy and how to be greedy when others are fearful, as that’s the best way to get rich without getting lucky.

First of all, being greedy when others are fearful does not mean blindly buying the dip. If you think “buy the dip” is a solid investing strategy, you need to continue reading.

1. The first step to being greedy when others are fearful is understanding what investors are afraid of in the first place.

2. Step two is finding the mistakes that they're making by being so fearful. Specifically, the mismatches between a stock’s price and the underlying company’s value.

3. Step three is making a plan to take advantage of those mistakes. If everything is on sale, which stocks am I actually going to buy?

4. Step four is updating the plan because things are always changing. Which brings us right back to step one. That means long-term investing isn't just something to rush into as prices keep falling; it's a process that starts with understanding the overall market landscape.

This is why you should use Charly AI! It provides stock investors with market opportunities in the form of real-time recommendations on whether to BUY, HOLD, or SELL by tracking stock price changes and running additional analysis when needed, using financial reports (10-K, 10-Q), earnings calls, news, company announcements, market sentiment, and more. With Charly AI, you can also create a watchlist and receive alerts (this feature is currently being tested) whenever a stock on your list experiences a big change.

We have more exciting features brewing in the pipeline that we know you are going to love. Join us at https://www.askcharly.ai to try the platform out.

Unless you’ve been living under a rock, you’re likely aware of Tesla’s recent struggles—slowing sales growth, intensifying competition, and the ongoing controversies surrounding Elon Musk, from his vocal political stances and leadership of DOGE (Department of Government Efficiency). With Tesla facing so many issues, investors should look at other options. Chinese brands like BYD are doing well, but are there any American EV stocks that could actually replace Tesla in your portfolio or represent a BUY opportunity? In this piece we will review three U.S. Tesla challengers based on their latest financial reports.

1. Rivian - RIVN

Rivian’s story is a mix of promising growth and significant hurdles. The company is growing revenue (up 12% year-over-year) thanks to stronger EV sales and regulatory credits, and its partnership with Volkswagen could turbocharge its software and tech capabilities, which are critical in the EV race. Costs are also improving—gross margins are less negative as raw material expenses drop and production gets smoother. But Rivian isn’t out of the woods yet. It’s still burning cash, with a $4.75 billion net loss in 2024, and its cash reserves are shrinking, down nearly 30% year-over-year. Shareholders are feeling the pinch too, as the company diluted shares by 17% to raise funds, a risky move if growth doesn’t accelerate fast enough. While the balance sheet looks stable today (more cash than debt), the path to profitability remains steep, especially with heavy spending on new models like the R2 and ongoing supply chain risks especially on tariffs.

For now, the stock’s volatility and uncertain short-term outlook make it a HOLD. Technical indicators like the bearish moving averages and oversold RSI suggest turbulence ahead, and Rivian needs time to prove it can turn its ambitious plans—like scaling production and leveraging its Volkswagen deal—into consistent results. Long-term investors might see upside if Rivian executes well, as its brand and tech partnerships position it as a potential EV leader. But until there’s clearer progress on cutting losses, stabilizing cash flow, and avoiding further dilution, caution is warranted. The company’s potential is real, but so are the risks—patience is key here.

2. Lucid - LCID

Lucid Group is experiencing strong revenue growth (36% increase) and improved gross margins (31% improvement), which are positive indicators of operational performance. However, the company faces important financial challenges, including a substantial net loss of $2.7 billion and a growing accumulated deficit of $12.9 billion. The high cash burn rate and significant share dilution are concerning, as they could impact shareholder value and financial stability. Additionally, the recent resignation of the CEO adds uncertainty to the company's strategic direction. Despite these challenges, Lucid has a strong balance sheet with more cash than debt, which provides some financial flexibility. The company's strategic investments in technology and production capacity could drive future growth if managed effectively. Given the mixed outlook, a HOLD recommendation is appropriate, allowing investors to monitor the company's progress in addressing its financial challenges and executing its growth strategy.

3. General Motors - GM

General Motors (GM) presents a mixed but cautiously optimistic outlook. On the positive side, the company delivered strong revenue growth (9% year-over-year) in 2024, driven by its core North American market where pickup trucks and SUVs continue to perform well. Strategic shifts toward electric vehicles (EVs) and advanced driver-assistance systems like Super Cruise position GM for future growth in evolving automotive trends. The balance sheet also shows improvement, with cash reserves rising to $14.5 billion and debt reduced slightly, signalling better liquidity. Share buybacks further highlight management’s focus on returning value to investors. However, challenges persist: international markets like China remain a drag (12.9% revenue decline in GM International), rising costs are squeezing margins (gross margin decline as costs grew faster than sales), and net income fell sharply to $6.0 billion from $10.1 billion in 2023. High capital expenditures (178% of net income) for EV development could strain cash flow in the near term, while regulatory hurdles and competitive pressures add uncertainty.

The stock’s technical indicators suggest short-term caution, with prices below key moving averages and bearish momentum signals (MACD crossover). Yet, GM’s valuation appears attractive with a low P/E ratio (7.41), implying the market may be undervaluing its long-term potential. For investors with a 3+ year horizon, GM’s strategic bets on EVs and autonomous tech, coupled with its strong North American foundation, could deliver growth as these initiatives mature. Near-term volatility is likely, though, given geopolitical risks and execution risks in its EV transition.

In conclusion, GM warrants a HOLD for now, as the stock’s current headwinds balance its long-term promise. Investors should monitor progress on cost management and EV margin improvements. Those with patience and higher risk tolerance might consider gradually accumulating shares for a BUY opportunity in the long run, betting on the company’s ability to navigate industry shifts and capitalize on its investments.

3. Weyerhaeuser Co - WY

Description: WY is one of the world's largest private owners of timberlands, the company owns or controls approximately 11 million acres of timberlands in the U.S. and manage additional timberlands under long-term licenses in Canada. WY manages these timberlands on a sustainable basis in compliance with internationally recognized forestry standards, and is one of the largest manufacturers of wood products in North America.

Key financials: Market Cap $22bn; P/E ratio 54.5; Operating Margin 10%; Cash Flow $341m, and Debt to Equity ratio (mrq) 0.54.

Bearish Thesis: WY is currently facing significant financial challenges, as evidenced by a 7% decline in revenue to $7.1 billion and a 53% drop in net earnings to $396 million for 2024. The company's operating income also fell by 42% to $685 million, indicating reduced profitability. The high P/E ratio of 54.5 suggests the stock is overvalued compared to industry peers, and the bearish technical indicators, such as the MACD and RSI, point to downward momentum. Additionally, the company has more debt ($5,076 million) than cash ($684 million), which is a negative indicator of financial health. The decrease in cash from $1,164 million in 2023 to $684 million in 2024 further highlights potential liquidity issues. Despite strategic investments in climate solutions and engineered wood products, the short-term outlook is negative due to declining revenue, profitability, and cash flow, along with high market volatility. Therefore, the recommendation is to SELL the stock, as the negative financial trends and overvaluation outweigh the potential long-term benefits of strategic investments.

2. Microchip Technology Inc - MCHP

Description: MCHP engages in the development, manufacture, and sale of smart, connected, and secure embedded control solutions in the Americas, Europe, and Asia. The company offers general purpose 8-bit, 16-bit, and 32-bit mixed-signal microcontrollers; 32-bit embedded mixed-signal microprocessors; and specialized microcontrollers for automotive, industrial, computing, communications, lighting, power supplies, motor control, human machine interface, security, wired connectivity, and wireless connectivity applications.

Key financials: Market Cap $26bn; P/E ratio 89.6; Operating Margin 13%; Cash Flow $970m, and Debt to Equity ratio (mrq) 1.12.

Bearish thesis: MCHP is navigating a tough period marked by sharp declines in revenue (down 41.9% year-over-year) and profitability, driven by weakened demand in key sectors like automotive and broader economic headwinds. Customers are trimming inventories, and higher interest rates and inflation have squeezed spending, leading to a net loss of $53.6 million last quarter. Gross margins (54.7%) also contracted due to lower sales volume and unfavorable product mix, while rising debt ($6.75 billion) and a cash balance ($586 million) that’s insufficient to cover obligations add financial strain. The balance sheet looks fragile, with intangible assets making up over half of total assets, limiting liquidity, and retained earnings shrinking as profitability falters.

Despite these challenges, there are glimmers of strategic adjustment. The company is cutting costs by closing facilities and repurchasing shares, which could support long-term efficiency. Technically, the stock is nearing oversold levels (RSI ~30), hinting at a potential short-term bounce, but the MACD signals a persistent downward trend. While management’s focus on new technologies and product expansion might eventually stabilize the business, the near-term risks—overvaluation, high debt, and uncertain demand recovery—overshadow these efforts. For investors with a longer horizon, holding could make sense if the turnaround gains traction, but the current combination of weak fundamentals and bearish momentum tilts the scale. The recommendation is to SELL, as the immediate risks outweigh the potential for recovery, and patience here could mean further downside before any meaningful rebound.

1. Boeing - BA

Description: BA, together with its subsidiaries, designs, develops, manufactures, sells, services, and supports commercial jetliners, military aircraft, satellites, missile defense, human space flight and launch systems, and services worldwide. The company operates through three segments: Commercial Airplanes; Defense, Space & Security; and Global Services.

Key financials: Market Cap $130bn; Operating Margin -16%; and Cash Flow -$14m.

Investment thesis: BA is currently facing important financial and operational challenges. The company's revenue has decreased by 14.5% year-over-year, and it reported a substantial net loss of $11.8 billion in 2024. The gross margin has also declined, indicating increased production costs and inefficiencies. Boeing's debt levels are high, with $53.9 billion in total debt compared to $13.8 billion in cash, which is a negative indicator of financial health. Additionally, the company has issued a large number of shares, leading to potential dilution of shareholder value. The technical analysis shows that the stock is overvalued, and the stock price is volatile. The short-term outlook suggests a SELL recommendation due to ongoing production challenges and geopolitical risks, while the long-term outlook suggests a HOLD due to potential strategic improvements. However, the financial statement analysis strongly supports a SELL recommendation due to the overall negative financial health and high risks. Therefore, the overall recommendation is SELL, as the negative financial indicators and risks outweigh any potential positive developments.

Millionaires will be made in the next few months, and the more the market drops, the bigger the opportunity, especially if you know which stocks to buy and how to be greedy when others are fearful, as that’s the best way to get rich without getting lucky.

First of all, being greedy when others are fearful does not mean blindly buying the dip. If you think “buy the dip” is a solid investing strategy, you need to read the rest of this email.

1. The first step to being greedy when others are fearful is understanding what investors are afraid of in the first place.

2. Step two is finding the mistakes that they're making by being so fearful. Specifically, the mismatches between a stock’s price and the underlying company’s value.

3. Step three is making a plan to take advantage of those mistakes. If everything is on sale, which stocks am I actually going to buy?

4. Step four is updating the plan because things are always changing. Which brings us right back to step one. That means long-term investing isn't just something to rush into as prices keep falling; it's a process that starts with understanding the overall market landscape.

This is why we are today introducing Charly AI Agent. We are adding more timeliness to our rating approach. Over the past few weeks with Trump’s tariffs fears, the stock market has been extremely volatile to say the least. This prompted some of our valuable users to reach out to us and give us strong feedback about the discrepancies in our entry/exit prices, valuation, and rating, as stock prices keep moving either down or up. Our data became out of sync with the market reality, and our most active and faithful user did not waste time to point that out and give us suggestions. We were extremely grateful for the feedback. This is why we have been working hard to make ratings more accurate and more timely, regardless of the market conditions, whether it’s a new tariff policy fear or another black swan event like COVID.

Our AI now monitors every rated stock price on our platform that falls out of bounds with either its entry price (support) or exit price (resistance). Once this difference is over 5% in either direction, after market close, the AI starts re-analyzing the 100 different data points of the stock, like news, company announcements, stock price, market sentiment, financials, etc. After the new analysis is conducted, the rating, valuation, and other data points we provide on our platform are updated as needed. What this will do for our users is to provide even more accurate and data-driven information to improve their investment journey through our platform.

But wait, there is more. We are also launching Charly AI Watchlists/Portfolios. You can now follow rating, valuation, and price changes of stocks you have added to your watchlist. As the AI Agent keeps updating data of stock ratings that you added to your watchlist, you can start getting alerts on them and reading about what or why things are changing. Both Charly AI Agent and Watchlist are currently live on the platform. We are currently testing the Alert feature, which is set to release in the next few weeks as our users keep building their watchlists. 

If you have read till this point, I really want to thank you for being a valuable user of our platform. We have more exciting features brewing in the pipeline that we know you are going to love. Thank you for being a valuable user of our platform.

If you are not yet a user, join us at https://www.askcharly.ai.

If you have any suggestions for us, feel free to reach out to me directly at yao@askcharly.ai.

Best regards,
Yao
Founder of Charly AI

The company…

A lesson that the recent stock market tumult (including DeepSeek's shake-up) has taught a lot of investors is to diversify their portfolio not only across sectors but also across locations. This has been showcased by the growing interest in Chinese stocks. Traditionally viewed negatively by Western investors, Chinese stocks currently offer comparatively lower valuations. Today's deep dive will focus on one of those underappreciated companies, which could arguably be considered one of the cheapest large-cap stocks on the market. I’m talking about JD.com (JD).

JD is the largest online Chinese retailer by revenue ($160bn in 2024), followed by Alibaba ($131bn in 2024). JD serves 600 million active customers and has built a reputation for authentic products and strong customer service. JD core focus has remained on leveraging technology and supply chain capabilities to improve retail. The company’s portfolio now extends beyond e-commerce into areas like logistics, healthcare, fintech, and cloud computing. As a side note, Walmart and Tencent used to own 10% and 17%, respectively, of JD in 2016. However, both reduced their holdings to insignificant levels of below 2% in 2021.

The business model…

JD operates as a direct retailer – sourcing goods from brands and distributors to sell them to customers – and as an online marketplace where other sellers list products. JD is different from Alibaba (BABA) and Pinduoduo (PDD), which are online marketplace providers only, and is more like Amazon Retail (excluding AWS). The company has built an extensive in-house logistics network of warehouses (including robotic warehouses), fulfilment centres, drone delivery pilots, and last-mile delivery capabilities across China. This enables the company to deliver 90% of its orders within 24 hours across the country.

JD offers a high-quality shopping experience with; a generous return policy, AI-powered customer support, installation services (for furniture), and more. JD expanded its services to offer logistics (providing fulfilment to other businesses), payment (JD Pay facilitates payments on the platform), cloud (JD’s cloud) and AI initiatives that support functions like personalized recommendations and supply chain optimization.

The downside of owning its logistics and controlling its supply chain is that JD is more asset-heavy and service-driven, which means higher operating costs and thus lower margins. However, this creates high entry barriers for competitors and a difficult-to-replicate positioning, forming a competitive moat.

The financials

Here are some metrics as of the time of writing (all figures in ttm unless stated otherwise): Market Cap $59bn, Gross Margin 16%, Operating Cash Flow 3%, Free Cash Flow $6bn, P/E 10.9, Price-to-Sales 0.39, and Debt-to-Equity 0.38. The financials reveal three key insights: a low valuation indicating undervaluation, low debt highlighting a lower-risk company, and low margins driven by the costs of building and operating an inhouse logistics network.

JD's revenue growth declined from double-digit growth per year in the 2010s to a high single-digit growth in recent years. In 2024, the company revenue grew by 7%, similar to the Chinese e-commerce market. However, JD's revenue mix is changing, with an increase in revenue from its higher-margin segments (logistics services, marketplace fees, and advertising), though the revenue size of these segments remains small compared to its main retail segment revenue. This trend is expected to continue, with the decline in CapEx (downward trend since 2022) and an improvement in operational efficiency which are likely to improve margins.

Both BABA and PDD generate higher margins than JD because their business model is based on providing an online marketplace for sellers, with no logistics to own or manage. BABA has a higher P/E ratio (20.09 ttm), a higher debt level, and a declining cash balance. PDD’s financial sustainability could be questioned as the company focuses on a low-price strategy and has reduced merchant commissions and fees to maintain price levels.

What Charly AI says…

Overall, Charly AI rates JD as a “BUY,” broken down as follows: “BUY” for its financials, “Undervalued” for valuation, and “BUY” for both its short- and long-term outlook. Simply put, JD ticks all the boxes for a value investor in terms of the solidity of its fundamentals and future prospects.

Figure 1. Charly AI rating of JD

Source: Charly AI, March 2025

My investment thesis…

For me this is an easy one; i) JD has a competitive moat—its own logistics network, which enables it to control customer experience— ii) JD is the largest retail player in China iii) and JD has great fundamentals with an attractive valuation. Charly AI's entry price for JD is $42, with the stock trading at $41 at the time of writing— this is the right time to get a piece of this company.

Please let me know your thoughts in the comment, a bit of feedback would mean the world to me (Daniel). Thanks again.

Description: FDP through its subsidiaries, produces, markets, and distributes fresh and fresh-cut fruits and vegetables in North America, Central America, South America, Europe, the Middle East, Africa, Asia, and internationally.

Key financials: Market Cap $1.5bn; P/E ratio 10.3; Operating Margin 4%; Cash Flow $129m, and Debt to Equity ratio (mrq) 0.21.

Investment thesis: FDP has demonstrated significant financial improvement, transitioning from a net loss in 2023 to a net income of $142.2 million in 2024. This turnaround is supported by strategic operational enhancements and a focus on high-margin products like pineapples and avocados. The company has also successfully reduced its long-term debt by 39% to $244 million, indicating strong cash flow management. Despite a slight decline in revenue, the company has improved its gross margin from 8.1% to 8.4%, and its operating income has increased significantly. The strategic initiatives, such as the licensing agreement with The Nunes Company and the focus on specialty ingredients, align with long-term growth prospects. Despite risks like competitive pressures in the banana market and adverse weather conditions, the benefits outweigh the challenges. To learn more about FDP click here.

2 - Upwork (UPWK)

Description: UPWK operates a work marketplace that connects businesses with various independent professionals and agencies in the United States, India, the Philippines, and internationally. The company's work marketplace provides access to talent with various skills across a range of categories, including administrative support, sales and marketing, design and creative, and customer service, as well as web, mobile, and software development.

Key financials: Market Cap $1.9bn; P/E ratio 9.3; Operating Margin 8%; Cash Flow $139m, and Debt to Equity ratio (mrq) 0.64.

Investment thesis: UPWK has demonstrated strong financial performance in 2024, with a significant increase in revenue (12% increase to $769.3 million) and net income ($215.6 million from $46.9 million in 2023). The company's strategic initiatives, such as the acquisition of Objective AI and restructuring efforts, are expected to enhance its platform capabilities and drive future growth. Despite a 3% decline in Gross Services Volume, the company's improved gross margin (77% from 75%) and reduced sales and marketing expenses (16% decrease) indicate effective cost management and operational efficiency. While there are concerns about high stock-based compensation (32% of net income) and lower operating cash flow compared to net income, the company's strong cash position ($305.8 million) and lack of new debt issuance provide financial stability. The reduction in accumulated deficit and share repurchase further enhance shareholder value. To learn more about UPWK click here.

Let me know in the comment, if you are familiar with these stocks and whether they are already part of your portfolio or not. If you have any questions, drop me an email at daniel@askcharly.ai.

I’m Yao, the founder of Charly AI, and this is a long-awaited introduction to something that’s going to change the way you invest!

My journey

I know first-hand how overwhelming investing can be. When I started, I struggled with information overload—conflicting analyst ratings on CNBC and Yahoo Finance, endless debates on Reddit, and complex financial reports that felt impossible to decode. Coming from a non-finance background, I had no idea how to pick the right stocks, when to buy, or when to sell. I felt lost, and frankly, it was frustrating.

Determined to find a better way, I used my software development expertise (as a former Microsoft engineer) to create a system that leveraged AI to analyze stocks, identify opportunities, and make smarter investment decisions — Charly AI. It worked!!! Click here to see some of Charly AI recent wins. Now, you too can leverage the same tool I used — Charly AI.

How Charly AI Helps You Invest Smarter

Think of Charly AI as your personal AI-powered investing assistant.

• Clear stock recommendations – BUY, HOLD, or SELL on every stock

• Entry and Exit prices – Know what price to buy and sell every stock

• Short-term vs. Long-term – Know whether a stock is for a quick trade or long-term

• Data-driven analysis – Rating based on financial reports, market trends, and stock price movements.

Watch how to use Charly AI by clicking here.

Thanks for taking the time to read this and see you on the platform. If you have any questions please don’t hesitate to reach out to me directly at: yao@askcharly.ai.

1. OKTA (OKTA); Rating date: Dec 4, 2024 - Growth since rating: 29%

2. Abbott Laboratories (ABT); Rating date: Nov 15, 2024 - Growth since rating: 18%

3. Twilio (TWLO); Rating date: Nov 13, 2024 - Growth since rating: 15%

4. Progressive Corp Oh (PGR); Rating date: Feb 11, 2025 - Growth since rating: 13%

5. Interdigital Inc (IDCC); Rating date: Nov 15, 2024 - Growth since rating: 12%

The company…

This is the story of a young public company, Hamilton Insurance Group (HG), which went public in November 2023. HG is a specialty insurance-focused and reinsurance company. Its specialty insurance segment includes space, cyber, marine, environmental, fine art & specie, kidnap & ransom insurance, and more. The company stands out with its strong performance over the past years (Figure 1), having grown gross premiums written (GPW) by 28% per year between 2018 and 2023 in an industry growing at a high single digit rate per year. HG's combined ratio (CR) decreased from 126% to reach 90% during the same period, which is lower than the U.S. property and casualty insurance industry average of 95%.

For those unfamiliar with the insurance industry, GPW is the total money an insurance company collects from selling policies before paying any expenses. You can think of it as a store’s total sales before deducting costs. CR measures how much an insurance company spends on claims and expenses compared to the money it earns from premiums. You can think of it as a store’s total costs (rent, wages, and inventory). If it's below 100%, the company makes a profit. If it's above 100%, it loses money on insurance operations.

Figure 1. HG historical gross premiums written and combined ratio

Source: HG investor presentation, Nov 2024

The business model…

HG is predominantly a B2B insurer, serving businesses, reinsurance partners, and institutional clients globally with tailored solutions. HG’s products are broken down into insurance (57%) and reinsurance (43%) of GWP. Its specialty products cover both insurance and reinsurance segments, representing 31% ($620m) of total GWP.

HG emphasizes on its: i) specialty market focus – to target only high-margin specialty lines, where enhanced data analytics provide a greater competitive edge; ii) data-driven and disciplined underwriting approach – to price and structure products using proprietary risk assessment models such as HARP, its proprietary catastrophe modelling and portfolio management platform; and iii) flexible risk capital allocation – to maintain a balance between underwriting profitability and investment returns, with a focus on liquidity to meet claims obligations.

HG sets itself apart in asset investment through its partnership with Two Sigma, a top-performing hedge fund renowned for leveraging artificial intelligence, machine learning, and distributed computing to drive its trading strategies. As of September 2024, HG had $4.6bn in invested assets: i) 61% in a fixed income portfolio for capital preservation and high liquidity, which generated 4% in Q3 2024; and ii) 39% in Two Sigma Hamilton Fund, which has generated a 13% return per year since its inception in 2014.

The financials…

HG shows strong fundamentals with a low debt, high cash generation and low valuation. As of the time of writing, HG has a market cap of $1.9bn. Here are some of the key financials (all are ttm unless specified) – Operating margin 32%, Free cash flow $511m, P/E ratio 4, Debt to equity ratio (mrq) 0.06, Return on equity 0.24.

What Charly AI says…

As expected, Charly AI rates HG as a BUY across all metrics driven by its strong financial performance and market positioning. HG has delivered robust revenue growth, enhanced profitability, and efficient cost management, reflected in a significant rise in gross premiums and a favourable combined ratio. With a solid balance sheet and a strong foothold in the specialty segment, the company is well-positioned for sustained success.

Figure 2. Charly AI rating of HG

Source: Charly AI, Feb 2025

My investment thesis…

Niche market, fast-growing revenue, cost efficiency, and profitable – HG seems to have it all. However, there might be some risks involved in investing in HG.

The first risk is around the company’s GPW outlook. Two analysts (specifically, two non-Wall Street analysts) expect HG's revenue to grow at the same level as the industry (approximately 5%) compared to its historical 28% due to increased competition, especially in the cyber space, and market saturation. Personally, I think this is far-fetched, but a perfect way to address this would be to dissect the next earnings call (Q4 2024) on February 27th for clarity on growth prospects or guidance.

The second risk is the introduction of corporate tax in Bermuda. HG is headquartered in Bermuda (the insurance hub with no corporate tax for global insurance players), and the island is introducing a corporate tax of 15%, effective January 2025. HG has been exempted from this new corporate tax rate until January 2030 due to its group structure and level of tangible assets.

At the time of writing, HG is trading at $18.4, which is below Charly AI’s $18.5 entry price. Based on everything discussed above, HG is a good BUY for anyone like me who wants to make their first investment in insurance or for experienced insurance investors. Personally, I bought a few shares and will add more once I have additional clarity on the GPW growth outlook.

Let me know what you think of this piece in the comment or drop me an email at: daniel@askcharly.ai, happy to discuss anytime.

The company…

In the past year, Total Site Solutions (TSSI) stock price has grown by nearly 54x (see Figure 1) by transitioning from being an over-the-counter (OTC) stock to being listed on the NASDAQ stock exchange on November 12, 2024. TSSI helps businesses set up, manage, and maintain their IT systems and infrastructure (servers, data centers, and related hardware). They are a smaller Supermicro that doesn’t manufacture any hardware but focuses on designing, setting up, and managing IT infrastructure and systems for its customers.

Figure 1. TSSI stock price in the past year

Source. Charly AI, Feb 2025

The business model…

Simply put, TSSI is a middleman between IT infrastructure OEMs and their customers. TSSI services are organized into three segments: i) Procurement – purchasing the necessary hardware to build IT systems and infrastructure on behalf of its customers. ii) Facility Management – providing maintenance services for facilities, including modular data center applications. iii) System Integration – integrating IT equipment for OEM vendors and customers, particularly in data center environments, including AI-enabled computing racks.

The financials…

TSSI significant jump in stock price has been driven by a 689% growth in revenue year-over-year in Q3 2024, which generated $7.9 million gross profit (11% gross margin) for the quarter. This growth was due to an increase in federal government procurement services and the integration of AI-enabled computing racks into TSSI services. Procurement is a low-margin (6% in Q3 2024) and seasonal segment, unlike the integration of AI-enabled computing racks services, which has a 45% margin in Q3 2024 (see figure 2).

The addition of AI-related services is due to TSSI recently signing a multi-year agreement with its main customer, Dell. This contract has enabled the company to expand its footprint with a larger factory, thanks to a $20 million credit facility and Dell’s support. TSSI has a strong relationship with Dell, which generates over 90% of its revenue, with its current CEO being a former Vice President of Global Sales and Field Marketing at Dell.

Overall, TSSI has strong financials, with its cash flow from operations increasing by 331% last quarter to reach $37 million, and a debt-to-equity ratio of 0.51. However, TSSI is currently overvalued, with a P/E ratio of 80, which, given the current state of the stock market, is not surprising.

Figure 2. TSSI Revenue, Gross margin, EPS, and EPS Q3 2024

Source. TSSI 10Q, Sep 2025

What Charly AI says…

Overall, Charly AI rates TSSI a BUY broken-down as follow: Financial statements “BUY”, Valuation “Overvalued”, Short-term outlook “HOLD”, and Long-term outlook “BUY”. The “HOLD” on the short-term outlook is explained by the high valuation of TSSI and the volatile nature of the stock.

Figure 3. TSSI Charly AI rating

Source. Charly AI, Feb 2025

My investment thesis…

TSSI footprint expansion, its increase in headcount, and the expected increase in spending on AI infrastructure in 2025 by hyper-scalers (more than $300 billion projected to be spent on AI infrastructure) suggest that TSSI top-line will continue growing. In addition, the company has been working on cost reduction initiatives, which are likely to further improve its margin. Moreover, Supermicro financial issues could work in TSSI's favor, as TSSI may potentially steal some market share.

While the outlook sounds promising, TSSI dependency on Dell is a major issue, as a breakdown in their relationship could send the company into bankruptcy. At the time of writing, TSSI is trading at $14, with a market cap of $330 million. This price is significantly higher than the $9 entry price suggested by Charly AI. I genuinely think that most investors who know about this company are very bullish on it, driving its price up.

If you are bullish, I would suggest acquiring some shares because of the company’s low market capitalization. If you are risk-averse, I would advise buying a few and monitoring the price to buy more when it drops. Personally, I bought some a few days ago, and I’m impatiently waiting to listen to their next earnings call on March 27.

It is worth reiterating the fact that this is a small-cap stock, so you should expect a lot of volatility if you were to invest in it.

Please if you like this piece drop a comment below or reach out directly to me at daniel@askcharly.ai.