1) In the aftermath of Election Day, I want to give a warning to my readers...
No matter how you feel about the results – whether euphoria or despair – don't let it affect your investment decision-making!
In my September 7, 2023 e-mail, more than three years ago, I shared the below charts. The first one shows how a $1,000 investment in the S&P 500 Index would have done over the 70 years prior had it been invested only when a Republican versus a Democrat was president.
The second chart shows what would happen to that same amount being fully invested the entire time – no matter who was in the White House. As you can see, the latter has historically been the winning strategy:
I regularly hear from readers who tell me how terrible the economy is – and blame President Trump for it. I heard the same thing from Republicans when Biden was president.
It's especially easy to make this mistake in light of today's extremely polarized political environment. Americans used to have roughly similar views on the economy, but that has increasingly disappeared, especially in the past two administrations.
Consider these next two charts a friend sent me three years ago...
In 2023 under Biden, most Democrats thought the economy was good – a view shared by only 20% of Republicans. But the inverse was true during Trump's first term:
The next chart explains why – it's the media they're consuming. And this phenomenon exists in both directions, depending on who's president:
There are three key lessons here...
Try to read, watch, and listen to a wide range of media so you hear both sides of issues.
Stick to high-quality news sources. For example, I rely heavily on the Wall Street Journal, the New York Times, the Washington Post, and the Financial Times.
Finally, and perhaps most importantly, don't let your political viewpoints affect your investment decision-making.
2) I've written about payment processor Global Payments (GPN) many times in my daily e-mails, most recently on August 6 after it reported earnings:
The stock hit a more than 10-year low of $61.16 in June. But it has taken off since then, soaring more than 40%.
Second-quarter earnings weren't spectacular... But for a stock this cheap, they didn't have to be. Adjusted revenues grew 4%, and adjusted [earnings per share ("EPS")] rose 12%.
The company also bought back $550 million of stock last quarter and plans to buy back $2 billion this year – a huge amount in light of its $24 billion market cap.
At yesterday's close of $87.48, the stock trades at a mere 6.4 times this year's EPS guidance midpoint of $13.70.
I think an appropriate multiple for the stock of this high-quality business is closer to 20 times, which is why I think the stock could triple from here.
The stock was basically flat until last Friday, when it popped 13% on this report by the Financial Times...
Private-equity firms Clayton, Dubilier & Rice and GTCR are exploring a buyout that could give Global Payments an enterprise value of about $40 billion. That would make it one of the largest leveraged buyouts ever.
Talks are in the early stages with no guarantee of a transaction. But investment bank William Blair said a deal looks credible because GTCR already owns about 15% of GPN, at around the current price of $98. Another bank, B. Riley, floated a take-private value as high as $190 per share.
Global Payments reports third-quarter earnings before the markets open tomorrow. Analysts expect adjusted EPS of $3.57, up 9.5% year over year ("YOY"). Any comment from management on the buyout reports, or a lack of one, could move the stock as much as the quarterly results themselves.
My team and I recommended Global Payments at $76.02 in the June 2025 issue of our flagship newsletter, Stansberry's Investment Advisory. Since then, it's up 31%. And we continue to like the stock a lot.
Only subscribers can read our full write-up on the company and receive updates on it, as well as access our archive of past ideas and portfolio of open recommendations. If you're not already subscribed, you can do so by clicking here.
3) I've also written many times – though negatively – about software firm Palantir Technologies (PLTR), which is on my list of "Stinky Seven" stocks to avoid.
The company reported a blowout third quarter on Monday (see the earnings release and presentation). The numbers were impressive...
Revenue grew 96% YOY and 20% from the second quarter. This was the 13th consecutive quarter of accelerating revenue growth and 7% above expectations.
Net income and cash flow from operations both rose 137%. And revenue guidance for the fourth quarter was 8% above expectations.
CEO Alex Karp's letter was filled with over-the-top puffery, as usual – which I hate. It begins:
It would be an understatement to say that our results this past quarter were extraordinary.
There has seldom been another enterprise in postwar America that has grown at the scale and speed of our own.
Our company generated $2.3 billion in revenue in the third quarter of the year, representing an absolutely striking 96% growth rate over the same period the year before.
We have been at this for more than two decades now, and none of us has ever seen a business at this scale growing at this pace and with this level of sustained ferocity...
Such results as ours come as little surprise to those sensitive and curious enough to listen. But the most profound shifts in technology cannot be understood without reflection. Whoever has ears ought to hear.
"Sustained ferocity?" "Whoever has ears ought to hear?" What an arrogant blowhard! I've seen a handful of CEOs like this in my career, and their stocks always eventually blow sky-high...
And Palantir's stock was down 1.6% yesterday despite the strong earnings – mainly because bookings fell off sharply.
Total contract value grew just 6% YOY, a sharp slowdown from 49% YOY in the second quarter. And "U.S. commercial remaining deal value" was up 79% YOY, but only 4% from the second quarter. Given the 20% quarterly revenue growth, this means that Palantir's commercial pipeline is shrinking.
This wouldn't be a huge deal for most companies... But with Palantir's stock trading at an absurd valuation, investors won't forgive even small flaws.
Its current market cap is around $425 billion, equal to 58.3 times trailing-12-month revenue of $7.3 billion. Even using analyst estimates of $13 billion in revenue for 2027, it's trading at 32.7 times forward revenue – not earnings, revenue!
Its earnings multiples are equally ridiculous. At yesterday's closing price of $175.40, the stock is trading at 103.8 times this year's estimates of $1.69 per share and 71.3 times 2027 estimates of $2.46 per share.
Since I added Palantir to my list of stocks to avoid a little over a year ago, it's down 7% versus a 10% gain in the S&P 500. I continue to think it's the second-most-overvalued large-cap stock of all time, after SpaceX (SPCX).
Best regards,
Whitney
P.S. I welcome your feedback – send me an e-mail by clicking here.
P.P.S. I continue to be amazed by what AI can do... Check out this song that one of my former Kase Learning students, Angelo Martorell (on the right in the picture below), created for my 60th birthday. It's really catchy, and the lyrics are brilliant. They mention the New York City Marathon, tennis, my daughter's engagement, Ukraine, and my calling the peak of the AI bubble!
