4 Cheap Growth Stocks Right Now: APP SEZL IREN META.. Down from Recent Highs, Firing All Cylinders!

0:00 Hello everybody. So in this video I want to cover stocks that are relatively cheap compared to either their sectors, their peers, their competitor or either compared to what they used to trade at. And so I see four deals in the market respective of their own sector. It's Applovin Sizzle which is a buy now pay later company that's firing on all cylinders. Iron, which is kind of the the Nebus counterpart, you know, also aiming 5 gawatt of developed capacity for their Neocloud business, but you know, kind of left behind. And then Meta, which is a Mac 7, which is now much cheaper than all of the other Mac 7 and continues to be cheap. Meta cannot catch a bid. So anyways, let's get started with Applovin. I've covered twice in the past two weeks. Applovin Applovin is down because the growth didn't go up as fast as they thought it would. they are working on their AI de with an ex with the Axon platform as they call it and the ALGO improvement that they hoped to have for this quarter didn't really work as well as they used to. And so it's a temporary deceleration. they're already working on improving again their their their efficiency in their sales and the the stock has just just dumped entirely. If you look at the stock, you know, it's down 50% from 2 months ago. It's down 50% from a year ago. It's it's it it's been it hasn't done much in more than two years for a stock that really used to be the darling of Wall Street. At least ever since 2024, this stock was the high flyer of Wall Street, the darling. In fact, if you look at the total return since IPO of Apploving, we are at 33% annualized every year. for 34% return versus 15% for the NASDAQ over the same period. And so to me this stock relatively right now is very much underperforming.

2:14 It may look a little expensive on EV over GP over RG. But the main reason for that is because the the price to sales, right? The multiple of the stock is a little high. Why is it so high? Because of their EBIDA margin. Their IBIDA margin is 79%. That is not a typo, that is not a mistake. This stock is pretty much pure margin and so it attracts you know kind of a traditional type of investor as well as the growth investor.

2:44 This is a stock because of its margin. This is a stock that can attract a value investor because of how much money they they are generating and making. And this stock really has a tremendous avenue for growth. Much of their success right now has been from being the leading publisher of ads on games on games on phones, right? Pretty addictive games. You want to play play another round. You want you want to get some points in the game, you have to watch a 30-second ad.

3:13 The leader in that space is Applovin and they're especially the the leader on iPhone. On Android, they're in the top two publishers, right? Because Google is the number one in Android because they own Android. but the the the point is they used their platform historically to promote more games to promote new games to sell to gamers other games for them to install. They're shifting that now. They are selling to gamers consumer goods, consumer products, all sorts of e-commerce, retail, they're moving into that type of advertising to their billion plus installed user base that uses their game on a regular basis. And as a result of that, I believe Apple loving has a tremendous revenue for growth. And to me, when I see such a drop in no time, I mean, not that it's odd in 2026, right? How many stocks are down 50% right now from like months ago or a year ago, a lot a lot a lot a lot a lot of stocks are like that, but still it's still a major major drop. and I don't understand it. And you know, the analysts got got a little messy and they they downgraded the stock. Okay.

4:22 But I don't think that's going to hold. I mean, if I look at this stock, it's it's it's been having a hard time to rebound. but but in my in my view, in the advertising space, this is this is the winner in the advertising space much more than say a trade desk for example, which keeps getting into the valley of despair getting its lunch taken by some some new players. And I think Apploin is one of those players.

4:43 Anyways, let's talk about Sizzle. So, Sizzle is one of these stocks that has surprised Wall Street and you know for good reason. If you look at Sizzle since IPO, this has got to be one of the best IPOs ever, at least of that era. Remember how many IPOs crashed in that era. That wasn't the case for Sizzle. Sizzle returned a 44 times your money if you had gotten hit at IPO. the average annual total return average return every year 260%. So just just just blowing past the NASDAQ like like it's it's not even funny. And sizzle same thing went way down. and you know I I I I really don't see why it went way down. I mean they're they're moving to subscription. They're pushing their subscription. I listened to the call. To me everything's doing just fine. I guess they disappointed the analyst a little bit by by by by just a percentage point or something like that on one of the metrics, but really not not that big of a problem in my view.

5:45 Selzle I think keeps winning. It's the super fast the smaller BNPL player in the US. It's the super fast growing one. It's the one that definitely has the best total return ever since they went to the IPO. and they have competitors. There's namely two big competitors. I don't I don't have Afterpay in there because Afterpay is part of Cash App and and part of Square. So, we can't really analyze Afterpay on its own. But really, there's three players. You have Sizzle, you have a firm, and then you have CLA. And so, Sle really distinguishes itself by by being the fastest growing one as well as the most profitable one. And so, that's why the EV over GP over RG4 settle say 0.24.

6:28 It's cheap again. A while back it was expensive. No, now it's back into the cheap. The rule of 40 is 101. you know, that's way more than all of the competition. And then you have a firm. So, a firm a firm I have a hard time understanding why it's so expensive. yes, a firm is the established player. It's the most well-known player in the space. It's the biggest player in the space. It's kind of a blue chip in the in in the space and so it has this premium valuation. I don't really know why. And then the last question mark in the space is of course CLA. So the reason why CLA is not doing too well and why it's down per my understanding is because they are very exposed to Germany and there's quite a bit of issues in the German market. I also saw perhaps they may be having some tough growth in the US. I saw some somewhat negative PR on on CLA in the US. Cla is definitely trading at a discount. I think CLA is more of a turnaround story.

7:32 It would require a little more attention. The problem with CLA and they highlighted that on their call their I think it was their November call of last year. One of their problem is they have to educate the market on how they compute profitability at CLA and you know I'm generous. I put 1% in Ebida margin but it's actually slightly under 0% on the Ebida margin. So that's also one of the problem. it it doesn't catch a bit because the market seems to have issues calculating the profitability or disagrees with the way they report the profitability at CLA. So CLA to me is the turnaround play. A firm is the blue chip and then sle is the growth play now at a discount now down 33% from from prior to their Q2 earnings. So I think sle relatively is a good deal here. Then moving on to iron. been talking about iron a lot these past two weeks even though I hadn't talked about it in years because you know I had and it was a mistake but I I I had dismissed iron back in the day because they were selling all of their Bitcoin. clearly iron was already thinking about something else. iron is now a neocloud with contracts and with arr recurring revenue and with with a a ramp for their revenue. And so as a result of that, as a result of iron having insignificant mining, you know, the mining operations are now not significant for iron, I can actually put iron in a spreadsheet and entirely compare it to the two other players, the two other Neoclouds, which are Nebus and Cororeweave. really briefly the difference between a Neocloud and a collocation play like a cipher for example is that the Neocloud buy their GPUs. They own the GPUs.

9:20 They're vertically integrated and they own the GPUs. A lot of Bitcoin miners who are moving into HPC decide often to not own the GPUs but to provide a shell. They provide a building with cooling with electricity but they don't want to own the GPUs. That's the main difference between these three and the other ones. And when I fully analyzed it from the channel, that was a few days ago here, I actually said that the the stock was almost 5x cheaper than Nibius. Now, ever since that video, Nibbius dropped quite a bit, right? It dropped into the 220, 215, and then iron stayed flat, which means that the valuation gap has now narrowed. And if you look at a trailing 12-mon valuation, you know, it's between 3 and 1/2 and 4x, right? It's not 5x cheaper anymore, but it's it's still about 4x to 3 and 1/2x cheaper depending on intraday where you look. and I still can't explain that. I still can't explain why iron is that that much cheaper. Yes, I believe that if both Nibbius and Iron were the same valuation, I would prefer Nibius.

10:24 But when I look at the trailing 12 months, to me, there's still a valuation disconnect between the two. Perhaps perhaps the market is is placing a premium on Nibius because of prior returns. If you look at prior returns, Nibbius has absolutely outperformed iron 269% in but you see it's not even two years, right? But it's clearly outperformed it over iron. you know, I I think Nibbius maybe maybe getting a little little bit ahead of it of themselves.

10:53 There was some shorts squeezing, you know, shorts having to cover having to buy back the shares. you know, I I I've been very happy with the performance of Nibbius. As you know, back in the day, I had chosen Nibius. I had invested in Nibbius. very happy with the 10x in Nibbius. I just think it ran too far too fast and and these assets sometimes tend tend to mean revert and and and iron has just been waiting for its turn. So in my view when I look at iron I find it too cheap relative to Nibbus and when I look at my spreadsheet EV over GP over RG you can see iron is a 0.1 NUS is 0.14 and so that's that's a 40% discount on a forward growth basis.

11:33 And then we have corewave. But coreweave is kind of a special situation. you know the stock is the biggest in the in the sector. It's tougher to move the needle and core you have you have a lot of thud. You have a lot of people who dislike the debt at core. Even though make no mistake whether it's nebius or iron they will add debt to their balance sheet as well. But you know the these three three plays out of these three plays to me the cheapest is is iron. And let me conclude to to to talk about meta to finish with meta. So, so, so Meta is the cheap is is the cheapest Max 7. I mean, there's no there's there's no other way to put it. It's the cheapest Mac 7. It's trading at a valation of 0.33. The rule of 40 is a 71. So, highly profitable company, you know, in line with Microsoft really as far as profitability goes. growing fast, 23%, right? Growing faster than most of the Mac 7, of course, except Nvidia.

12:27 Nvidia is the one that grows the fastest. but if you look at valuation 0.33, I mean, we're we're not we're not too far from companies that are arguably way less solid than a meta, right? If you look at sil's valuation at 0.24 or a firm at 0.54, you know, or even even apploing at 0.57, Applovin is a good example. I mean, who who's the best in the advertising space? Is it Meta or is it Apploving? You know, you know, one of them is is a is a top seven company in the world. the other one is not there yet. So so I don't understand why it's so cheap. you know the market of course is there there's two things really that the market doesn't like about about Meta.

13:08 First of all is a capex and it got me thinking. I think the market forgot about this part of the capex. You may remember that Meta has actually a long-term purchasing plan with AMD which will give them an option to own up to 10% of AMD in in in a matter of a few years. And I think that's a very big deal. If you have Meta that matures at one point, they would be able to own 10% of AMD through a deal that they signed for purchasing their systems and purchasing the AMD system. OpenAI having a similar deal. I think this is a very very big deal that they could own AMD especially own 10% of AMD especially as you know AMD is picking up steam in the market. I think people have forgotten about that. But of course the main reason why Meta is down is the California lawsuit with that headline number of 1.4 4 trillion, which is a headline number to get the clicks to to make people scared essentially. But that that number is the max number that they put on there. these numbers, assuming Meta was to be found guilty, the these numbers always get negotiated, renegotiated way, way, way, way down.

14:23 But unfortunately, as long as this suit is going on, I think we're going to have a bit of overhang on the stock. And that's why the stock is down. And it's disappointing to see it under 550. Now, is that going to last? I just think we need the headlines on on on this California suit. We need those headlines to go away. Historically, I see these headlines go away about 10 days after they come out. So, maybe next week, maybe the week after next week. you know, I I I haven't seen anything really that bad in these headlines. It's just always the same headline being recycled and recycled and recycled for clicks.

14:58 That's the main explanation as to why I think Mai is down o over over the long run. You know, it's it's it's it's the leading app. I mean, 3.6 billion people log to one of their apps every day. 3.6 billion. Think about that. You know, they own Instagram. That's the leading social media. You know, they're able to launch other social medias from for their family of apps. They're able to promote social media to to social media users. you know, they they they really took the turn of of Tik Tok and now they have viral videos just like on Tik Tok.

15:32 To me, it's it's a it's a highly competitive company and they they will try to push consumer AI. You know, are we going to be in a world where hundreds of millions of people at some point maybe pay 249 or 299 a month to have Instagram plus or WhatsApp Plus? Is is is that something that's going to happen? And I think that's the vision that Mark Zuckerberg has for buying all of this AI. And they bought all of this AI for some of it years ago for other part of it last year when the prices were much lower than they are today. I mean we saw Nvidia announce the cost of AI servers by 15% today. It's it was not Nvidia who announced it. It was reported. But if Nvidia is raising its prices, if everybody's raising its prices, here you have Meta, a company that has that has contracts already signed, the value of compute is actually going up. And so may maybe Meta can turn around and resell some of that compute if for some reason their their their use of that that of that of those GPUs doesn't manifest itself. They don't need the GPUs for some reason. They could resell the compute, but you know, I think they will use all the GPUs that they got. But anyways, quite cheap in my view. Much cheaper than the other Mac 7s. So anyways, this was not investment advice. This is not financial advice.

16:55 This is only entertainment. I'm hoping you were entertained. Please like, please subscribe, follow me on Patreon, follow me on next. Thank you for watching and have a wonderful, wonderful