Sam Badawi
Are Novo Nordisk and Meta CHEAP? | Hidden Edge Pod
11/6/2025, 1:08:13 AM
Economic Summary
- Toast (TOST) is described as a fast-growing software/POS company with ARR and gross payment volume growing (~24%), and a base case where sustained 20–25% growth plus margin expansion to ~30% would compound value materially.
- Fiserv (FISV) currently shows very high historical EBITDA margins (~44–45%) driven by price increases; management is dialing back pricing, which could reduce near-term guidance but still leaves scope for a normalized margin (~35–37%) and substantial enterprise-value upside given large EBITDA and high operating cash flow.
- High debt at FISV (~$28–30B) is manageable given low servicing cost (~5%) and limited near-term maturities, allowing potential debt paydown and continued buybacks that could materially lift EPS and share price if EBITDA recovers.
Bullish
- Toast (TOST) could grow ARR and locations 20–25% annually and reach ~30% EBITDA margin
- Fiserv (FISV) looks cheap on EV/EBITDA with potential margin normalization and debt paydown upside
- High operating cashflow at FISV could fund buybacks and reduce share count, boosting EPS
Bearish
- Fiserv's past price hikes drove customer churn and opened the door to competitors like Toast
- Toast's $28B market cap is not cheap given competition and uncertain margin realization
- Management short-term focus on buybacks over reinvestment risks long-term product competitiveness
- Timing risk: value names can fall further; 2026 may be a trough for some businesses
Bullish tickers
TOSTFISV
Bearish tickers
FISVTOST
FISV
1 price targets
140
Bullish
Cheap on EV/EBITDA with strong operating cashflow; can pay down debt and repurchase shares, enabling margin normalization to ~35–37%.
Bearish
Historic price hikes inflated margins and caused customer churn, forcing guidance cuts and risking long-term market share loss.
TOST
Bullish
High ARR and gross payment volume growth (~24%) with potential to scale to ~30% EBITDA and compound value over a decade.
Bearish
At a ~$28B market cap the stock may already price in growth; competition and margin execution risks remain.
SQ
Bullish
Mentioned as a competitive ecosystem (Block/Square) in payments; faces competition with FISV and Toast.
UNH
Bullish
Referenced as an example of a long recovery trajectory and a name where long-term investors (e.g., Buffett) drove large returns over time.
People mentioned
ElaineWarren Buffett