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Chapter 1: What did we learn from this week's earnings reports?
We're in the heart of earnings season, so what did we learn? Motley Fool Money starts now.
Everybody needs money. That's why they call it money.
From Fool Global Headquarters, this is Motley Fool Money. Welcome to Motley Fool Money. I'm Travis Hoem, joined today by Jason Moser and Lou Whiteman. Guys, this is really when earnings season kicks into high gear for a lot of the companies that we follow. We're going to do a rapid-fire look at some of the popular companies, disruptive companies, and find out what we learned from the quarter.
Jason, what did we learn from Cloudflare? And maybe first, what in the world does Cloudflare do?
That's a good question. It's kind of like, hey, what does Salesforce do, right?
And I guess- Yeah, it's everywhere, but we don't necessarily see it.
The The proper answer, it does a little bit of a lot of stuff, but primarily, it's seen as a content delivery platform, focuses on application development, and most importantly, I think, in today's day and age, cybersecurity. There is a big cybersecurity dynamic to Cloudflare, and it's one we even talk a lot about with
in our Quantum Leap service, thinking about beyond classical computing and into that post-quantum cryptography stage of life that we will ultimately hit Travis. Cloudflare is a company that is working to protect us on that front as well. But that's the answer in a nutshell.
I think this was another good quarter that showed that the language we've been using over the last couple of years with Cloudflare, and with a number of enterprise software-type companies, the elongated sales cycle, the trepidation of their customers to commit to spending, Those days seemed to be well past us. It was another very solid report.
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Chapter 2: How is AI impacting trucking and logistics stocks?
If we see that tick down, we're going to absolutely see those shares pull back.
Lou, what did we learn from Airbnb?
Yeah. Narrative-busting week for Airbnb, because everything was down. Airbnb actually missed earnings, and the stock is up post. This week, that seemed really weird. A few things going on, though. For one, stock was already down 15% for the year. and we're still just in mid-February, so there weren't a lot of expectations baked in here.
Also, they see double-digit revenue growth in 2026, which I think is better than some had feared, especially with all the macro concerns where things are going. This was a good report from a good company. I think the funny thing is, though, is expectations. What should we expect from here? I don't know about you guys, but increasingly, when I look at Airbnb, I see Marriott.
I see a mature lodging business, asset-light, that can outperform but is not going to be a high-growth stock. I've given up on experiences as a new rocket ship.
That was supposed to be their thing that they launched about a year ago.
Yeah, they invented a concierge. I think it's tough to figure out how this is anything more than a Marriott from here. The good news is that Marriott has been a pretty good, solid company. I think it's all about expectations from here, but a good company, doing well. They went public so late. so much of the growth was gone.
I think now we're just waking up to this as more of a lodging company than it is a tech company, maybe. Well, correction, Lou, it was an AI-driven concierge.
There was a revolutionary concept there. That's tongue-in-cheek, of course. I'm with you there. I love Airbnb as a consumer. I like it as a company. It is difficult to see That tremendous growth going forward, just given how big the company is, and yeah, experience has just been underwhelming, to say the least.
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Chapter 3: What insights did we gain from Airbnb's recent performance?
I'm just going to let it go plan a trip for me without... No, you're not, Travis.
You're not. No, I'm not. It's not a mind reader. And I think that's kind of where we have to figure, okay, where's sort of that happy middle there? I mean, are we talking about just auto-filling delivery addresses and payment information? Because you know what? That's been happening for a while now.
So, yeah, I've read a lot of thoughtful pieces about agentic commerce, and a lot of them kind of talk about why that may be a little bit overblown. And And perhaps what we see with agentic commerce ultimately is, it serves more on the back end for these companies and is less consumer-facing.
I think that's a little bit of an easier leap to make there when we see these investments that businesses make in helping their merchants run more efficiently and making their actual businesses more efficient. Overall, I think we still look at Shopify. I'm a longtime shareholder, very happy shareholder, and happy to hang on to those shares.
I think when we see the company pull back like this historically, these have represented interesting times. I don't think that Shopify is the type of business that is going to be disrupted by AI, as many of these companies were discussing. That's the big question mark.
They seem to be necessary, because they're serving the long tail of companies. If you're going to build an online business that's going to plug into these AIs, you would think that Shopify would be the place you would do it.
It's going to be building on top of that layer of AI technology, ultimately helping reshape the commerce industry. Obviously, a very tech-forward company. Toby Lutke, I think, is clearly very dedicated to the business. I don't imagine that changing anytime soon.
Lou, my question here is, when does this company get really interesting? I'll give you some valuation metrics. Enterprise value to sales is about $13K still. Price-to-earnings ratio is $126K on a trailing basis, and on a forward basis, still $65K. Not really a good value argument here, but where do you get to the point where you go, man, this is just too cheap to pass up?
Yeah. I mean, I would echo almost everything you guys said about, I'm a shareholder, I'm not worried here, but valuation does keep me from buying. I think they're a long-term winner. And look, at the end of the day, valuation is your ability to grow over what timeframe, right?
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Chapter 4: What are the implications of Shopify's latest growth figures?
a powerful market position, however they got there. I think it'll probably be okay. As much as we talked about the TurboTax side, a lot of what's driving this business is the non-consumer side, and that's a whole lot more complicated. I'd be surprised if this business goes away. I've heard multiple reasons, predictions about why it was doomed over the years. So far, none of them have come true.
Yeah, it feels like it's a bit more of a, I don't want to say protected, but just the barriers to entry and finance and all the regulatory red tape that comes with it, whether it's helping someone run their business or someone do their taxes or manage their payroll. That's difficult to replicate reliably and then actually push out to a large consumer base.
It seems like the easier disruptor for this company would have been if our politicians could have simplified the tax code and made it easier just to file taxes. But as I think we all probably know, as we get older, that process just becomes inherently more difficult because we've accumulated more wealth and yada, yada, yada. It goes on and on and on. I use TurboTax every year.
Frankly, I find it to be a breath of fresh air knowing that I can log in, speak with a tax representative, have them do this stuff for me. I know that it's being done correctly to the extent that they're doing it. I just think most people hate the idea of having to deal with doing their taxes. Furthermore, it's understandable in many cases, unless you're just filing the simplest of returns.
I've felt the same way as I've gotten older, where paying $100, even $200 to get your taxes done, it's way more efficient than spending a whole bunch of time. My grandpa used to do these by hand. That was his hobby as he got older. They also seem like a company that could potentially leverage tools like artificial intelligence. Correct. To be much more efficient as a company.
You know, hey, Travis, here's your folder of documents. Just dump them in. We'll put them in the right place and we'll figure it out for you. And so now instead of having to go through, you know, 50 pages of yes, no answering questions, you can kind of. answer all that stuff for you. Is that a reasonable way to think about it, Jason?
I personally think so. I think the more likely scenario is essentially that application, that service being built on top of the AI foundation to make that business ultimately better and more intuitive. See what I did there, guys? But in all honesty, that does feel like it's going to be the more likely scenario. I mean, I could be wrong. But again, you talk about
well-established businesses that are very difficult to replicate at that scale.
This is one of those. All right. When we come back, we're going to get to the stocks on our radar. You're listening to Motley Fool.
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