The Stock Market Is Overvalued, Here's What I'm Doing Now

Name: The Stock Market Is Overvalued, Here's What I'm Doing Now
Uploaded: 2025-09-29T20:47:42.000Z
Duration: 33 min 8 s
Channel: Joseph Carlson

Joseph CarlsonSeptember 29, 202533m

Topics11

Portfolio Gains and Market Performance0:00 Other News Topics1:31 Market Rally and Valuation Expansion2:30 1. S&P Global (SPGI) - In Portfolio7:31 2. Amazon (AMZN) - In Portfolio9:01 3. Adobe (ADBE) - Not Owned11:02 4. Constellation Software (CSU) - Not Owned16:00 5. Copart (CPRT) - Not Owned17:01 Credit Market Concerns19:30 EA Going Private in Record $55 Billion Leveraged Buyout23:40 Fail of the Week: $30,000 Baby Naming Consultant in San Francisco28:00

AI-Generated Notes

These notes were generated by AI and may contain inaccuracies.

Portfolios are gaining in value, making tens of thousands, if not hundreds of thousands of gains. In the portfolio this year, up a combined $100,000 plus between the passive income portfolio and the story fund. Both are compounding steadily at different rates. Overall markets are up with the S&P 500 up 13.4%. That's far above average, showing a massive bull market. Concerns about tariffs erased, replaced by investor enthusiasm. Investors swung from depressed and concerned to incredible optimism, concentrated in big tech companies, the Magnificent 7, driving QQQ up 17.4% year to date. Strong year with markets up 13 to 17%.

While market continues up and companies get more expensive, five companies remain cheap, not keeping up with the rally, left behind undeservedly. These are still buys, not swept up in bullishness.

Credit market concerning, investors like Howard Marks citing poor deals increasing risk.
EA Electronic Arts going private in $55 billion LBO (leveraged buyout), biggest ever, primarily by Saudi Arabia's public investment fund. Implications for video game industry and microtransactions.
President Trump implementing tariffs, renewed threat on movie industry: 100% tariff on movies made outside US. Questions on how tariff works for movies.
Fail of the week: Woman charges $30,000 to name babies; customers are the fail.

S&P 500 surging 13% year-to-date, QQQ up 17%. Investors get confident, bullish, buy more, causing stock prices to inflate, leading to big bear markets. Rally twofold: companies growing earnings, multiples expanding, companies more expensive than past year or years.

Blue line: S&P 500 forward P/E. Since 2008, far more expensive, partially justified. In 2008, cheap due to economy in shambles. As investors bought back, economy recovered, equities more expensive. Equities today generate higher margins, more profits than 10 years ago. Successful companies higher quality, deserving higher multiple. From 12-14 forward P/E to 20s. Post-2020 exuberance, S&P 500 to low 20s P/E. Then fell to 2022-early 2023. Examples: Microsoft $220 to above $500; Apple near $100; Meta $80 to $750; Netflix $750 to below $200, now $1,200 (6x from 2022 lows). Pink column highlights epic sell-off from excess valuations.

Valuations key indicator of returns. Not enough to buy high-quality; buy at attractive valuations for good returns. Examples: Netflix $200 to $1,200; Microsoft $220 to $500; Spotify $20B to $100B market cap. Buy when multiples compress. S&P 500 from 23 forward P/E to 16, a deal; buyers rewarded. Recovery since 2022 rewarding, e.g., Netflix biggest winner. Many stocks like Microsoft, Apple, Google from 2022 to now at 22-23 forward P/E, all-time high territory like 2021.

Sign in to read the full notes

Get access to AI-generated notes, topic timestamps, and more.

The Stock Market Is Overvalued, Here's What I'm Doing Now

Portfolio Gains and Market Performance00:00

Five Cheap Companies in an Expensive Market01:00

Other News Topics01:31

Sign in to read the full notes