Chit Chat Stocks - Our 5 Best Stocks To Buy TODAY (Plus, Our Personal Portfolio Returns)

Episode Date: September 17, 2025

On this episode of Chit Chat Stocks, we have our semi-regular update on holdings, returns, and buy/sell decisions for our personal portfolios. Plus, we dive into our favorite stocks to buy today. We discuss: (00:00) Introduction (01:55) Brett's Portfolio Performance (10:01) Ryan's Portfolio Performance (15:59) Analysis of Top Positions (21:54) Best Buys and Future Considerations (49:30) Stocks on the Chopping Block (58:44) Watchlist Stocks ***************************************************** JOIN OUR EMAIL NEWSLETTER AND CHAT COMMUNITY: https://chitchatstocks.substack.com/  ********************************************************************* Chit Chat Stocks is presented by Interactive Brokers. Get professional pricing, global access, and premier technology with the best brokerage for investors today:  https://www.interactivebrokers.com/  Interactive Brokers is a member of SIPC.  ********************************************************************* Fiscal.ai is building the future of financial data. With custom charts, AI-generated research reports, and endless analytical tools, you can get up to speed on any stock around the globe. All for a reasonable price.  Use our LINK and get 15% off any premium plan: ⁠https://fiscal.ai/chitchat  ********************************************************************* Portseido is your best portfolio tracking & reporting solution that helps you track all investments in one place. We personally use the software to track our portfolio returns across brokerage accounts. Try it for free today: https://www.portseido.com/?fpr=ryan63 ********************************************************************* Disclosure: Chit Chat Stocks hosts and guests are not financial advisors, and nothing they say on this show is formal advice or a recommendation. Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to Chit Chat Stocks. On this show, hosts Ryan Henderson and Brett Schaefer analyze businesses and riff on the world of investing. As a quick reminder, Chit Chat Stocks is a CCM Media Group podcast. Anything discussed on Chit Chat Stocks by Ryan, Brett, or any other podcast guest is not formal advice or recommendation. Now, please enjoy this episode. Welcome to Chit Chat Stocks, a podcast that helps you discover your next great investment. I am one of your hosts, Ryan Henderson, and I am joined as always by the one and only Brett Schaefer. Before we get into today's special episode, which we do, I think pretty much yearly, which is our portfolio update.

I want to mention that if you are listening to this podcast and you don't already follow the show, please follow us on Spotify, Apple, or wherever you get your podcasts so you never miss an episode. But with that said, today we have a special episode that I think we basically do annually. It's been about a year since we did our last one, and we will be breaking down our portfolios and actually taking a look at our individual returns, which I don't think we've ever done that publicly on the podcast. And a special shout out for this episode, Port Sido. They are the platform, the platform that made this episode possible. We're going to talk more about them later on, but I'll just say if it weren't for Port Saito, there's no way, well, there is a way,

but we would have had to figure out our returns manually and it would have been such a pain. So we ended up using Port Saito. It made this episode possible and just a huge shout out to them. We'll showcase them later on, but let's get right into it. Brett, we're going to kick things off with our performance. How have your returns been overall, both in total and over the last year? And then what are the biggest contributors to that performance? Yes, Ryan, thank you for introducing the show. And for anyone listening, Port Saito is a sponsor of the podcast. Now you will see advertisements embedded within the episodes, and we're going to use it throughout this one. Very, very helpful. Going to have lots of stuff to share along with

this. And if you have any interest, check them out. There'll be a link in the show notes. And if you want any troubleshooting or help with the platform, please reach out. But let's get to my return. So beginning in July of 2024, so barely over a year ago, I did switch all of my savings accounts and brokerages accounts over to interactive brokers that actually inspired me to want to reach out for them to become a potential sponsor because I thought it was a perfect fit for the show, and they're still sponsored today. Now, these two accounts include my non-taxable Roth IRA that I try to max out every year, along with an individual taxable account. I just combine them. We're not really going to be talking the nitty gritty of any tax

versus non-taxable investments and any strategies there today. Now, Port Sida was able to combine both of my accounts together to gain a holistic picture of the historical performance, which is something that is much, much more difficult for a brokerage to do on its own. And it was able to include dividends and short positions. And then after auditing the calculations myself, we wanted to make sure it was a properly working software program. I believe it came up with a pretty accurate depiction. And if you end up paying for the service again, or checking them out themselves, we will personally help with any troubleshooting you may have. Just reach out to us on Twitter, substack email us what have you yeah and let me also say that if you are listening to the show

and you don't know what your returns are you're just like me it is seriously a pain to try to do it manually but it's worth knowing them because it might help inform future investment decisions for you and knowing sort of what are the best returning stocks worst performing stocks what has contributed the most to your portfolio we're going to go through all of that and yeah big shout out to Port Saito for helping us do that. Yep. And it not isn't necessarily the total performance that is most helpful. I think it's looking at what has been the biggest contributor, what has been the biggest loser, what is my position sizing been? And was it optimal for what for my portfolio can really, really help out. So using a money weighted return,

I think that's the proper way to do it for an account like ours that is adding money over time. My combined portfolio is up, drumroll, a big 22%, well, 23%, 22.7% so far in 2025. S&P 500 is up 17% year to date. Below or not below? Well, maybe if we include in the newsletter, it'll be below, but there are some screenshots here that we might share throughout the episode. They have a table return, which we can compare to a benchmark. And as you can maybe see, if we share it, but also I'll just describe it. My outperformance, the small outperformance this year has been fairly steady and it really is not meant to be, my portfolio is not meant to be correlated or uncorrelated with the market, but it tends to have, I'd say, you know, a solid

correlation with the S&P 500 because the majority of the portfolio has been net long stocks in 2025. and in the short run, you're going to get stock flows over pros. But the fact that any sort of small periods of outperformance that has led to the slight difference between the S&P 500 has occurred during earnings season, February, May, and August gives me a good conviction in my strategy. And as fundamental information is updated to the market, Wall Street is re-rating the stocks higher. This is the type of portfolio I want flows may impact performance in the short run, but growth and free cashflow per share will drive performance over a decade. I'm going to share this next chart. It is a nice tree net visual visualization of my individual holdings

and how they performed in 2025. So if we look at this and hopefully people can see this, if they're watching the video or something like that, it's a little hard to see. I don't know if we can zoom it in properly, but it looks much better on the actual software platform. Can you see it properly, Ryan? Yep. All right. So when we look at this, it shows portfolio sizing versus whether they've been a loser or a gainer in 2025. And I think I just did year to date. So in 2025, my largest winners on a percentage basis have been Coupang, Nintendo, Alsea Group, which is the franchise operator for I think mainly American brands in Latin America. So Starbucks, Burger king oh what's their third one i should know that dominoes i believe is the biggest sorry

dominoes is their biggest yeah dominoes brain fart there and then the fourth one would be grupo aeroportario del centro norte the northern central airport in mexico now using this tool it can be quite helpful because one you can look at your position sizing and then you can look up okay well of my largest positions versus my smallest positions what have done the best have I sized up my highest conviction bets correctly or not. And I can also look at it as a bar chart. So we can kind of see, and Ryan will show these probably as well when he looks at his own, the percent, not necessarily the percent gainers, but the total value that has been, you know, contributed on a dollar amount for my personal portfolio. So my largest contributors have been

similar stocks just from a dollar amount, Coupang, Nelnet, Interactive Brokers, Nintendo, Oscar Health, Alsea, and I'll just call them OMAD, the Central North Airports in Mexico. The rest of the portfolio has not done much this year. And then if you look at the largest contributor to losses, or I guess the detractors from portfolio performance, they've been Remitly, Portelos, Harbor Diversified, and a Tesla short position that was started, I think, a couple of months ago, which really wasn't a big loser until the last week or so. So just for reference, for anyone who doesn't know, I think I mentioned this a couple of times on the show. I begin shorting some stocks this summer with a small percentage of the portfolio.

I think as of what Port Sido calculated, it was about 6% of overall assets. So really not that much, not big, but it has been a good confirmation in keeping the short book sized properly and diversified. Because even if Tesla goes up 3x from here, which would be quite shocking, that would make it probably the largest company in the world. it will still be around five percent of the portfolio and not it won't kill my entire account all right so let's let's pause just to rehash top performers for you have been coupong nelnet interactive brokers and nintendo uh in terms of pure value value gain yeah but if we look at i mean it would be interactive brokers oscar health i'll say it and omab would also be included in there. When you looked at this, did any of the stocks surprise you? Were

there any that you thought you'd done better on or maybe thought had performed worse than they actually had? I'll say it was a bit of a surprise. It's done better than maybe I suspected. It's kind of been a boring stock that I just keep in the Roth IRA portfolio. It's not one there's that much news on every month or anything like that. I just read the earnings reports, but they've been a sneaky outperformer and it's been a great business. All right. Let's go through yours, Ryan, unless you have any other questions. What's your portfolio look like? Yeah, let's do it. So a little bit of background here for those who are new to the show, listeners that have come in maybe over the last year or so. Brett and I used to manage a small

limited partnership called Arch Capital, and we closed that at the end of 2023. So pretty much all of my investable assets up until the end of 2023 were in that fund. So it's kind of like a restart at the end of 2023. That's when I actually started investing on my own. It was kind of December 2023 timeframe. Using Port Sido, which was instrumental in this episode, since December of 2023, my total return is a whopping 38.7%, which has significantly underperformed the market. And I'll mention why in a second. But the S&P 500 has generated 67% total return over that time. So nearly double my performance. Now, the one caveat that I will mention, and this isn't really an excuse because at the end of the day, this is the actual returns. But there was one massive mistake

on my part, which was the purchase of shares of Harbor Diversified. So it was literally a penny stock. Maybe we can discuss the story a little bit here. It's the parent company of Air Wisconsin. It's a regional airline. And basically, I thought it was trading for well less than it was worth. And even in a liquidation scenario, I thought that they would be able to, it would be able to generate me a positive return. Well, they ran into some huge operational issues. They also stopped filing or got delayed on their filings, which made them delist, which made a whole bunch of people sell. And unless you were on the expert market or had a certain broker, you weren't able to buy shares. So when everyone can sell, but not very many people can buy, that's usually a bad dynamic for a stock price. So I was one of the, I guess, losers in that where now it's dropped by 74%. And the biggest issue here was that I sized it poorly. If we exclude Harbor Diversified, I know that's not fair, but just for practice purposes, my returns would be up 91% my portfolio over the whole time, which would have beat the S&P 500. So literally a 50% difference in my returns over the last three years due primarily to that Harbor Diversified investment. Over the last year, which has kind of stripped out Harvard Diversified because it's a much

smaller percentage of the portfolio now and the stock hasn't really moved a whole lot over the last year, I'm up 62% versus the S&P 500 at plus 15%. So pretty good year. And it's gotten a lot better as I think most investors have kind of feels like a lot of people are outperforming now this year, but... This is, and for reference, I know it's a little bit confusing. Mine was year-to-date, but to confirm, yours is just this year. I can't go farther back. My returns, I think, would have been somewhat similar to Ryan's. It's just switching the brokerages, it makes it way too difficult to track the returns, but yours is last 12 months. Correct. So yeah, I tried to give as much of a holistic picture as I could. Have underperformed the market over the last two and a

a half, roughly years. If we strip out our diversified and in recent history, which feels like a little bit of selective data sets there, the performance has been much better. Here are the best performing stocks for me on a percentage basis. Number one, Coupang, it's up 88%. Number two, Philip Morris, up 76%. Three, Autodesk. I've actually owned this one for a long time. For some reason, it was just like that one rogue stock stuck in my portfolio for actually like five years. But that's the third best performer on a percentage gain basis. It's probably lower on an annualized return, but still not bad. And then number four is Google.

Number five is British American Tobacco. Google might be the best in terms of time-weighted return where it's a recent position. and it seems to have just recovered out of nowhere and become gone from AI loser to AI darling in a matter of five months. And then the three biggest losers for me are Harvard Diversified, which I already mentioned, SEMrush, which is a very small position, but it's been basically cut in half, and then Remitly, which we're going to talk about more in a second. but any uh anything that surprised you there for my portfolio i guess i was a little surprised bti british american tobacco has been up that much

and i guess the question for you which maybe people can when we go through your portfolio holdings and position sizing they'll be able to connect the dots but this is percentage gain off the top of your head what would you say were the biggest contributors from a dollar amount i'm guessing coupon philip morris and google slap alphabet yeah it's actually probably not too far off from the ones that were the highest percentage gainers so philip morris and coupon were kind of the two largest positions that i've had over the last year although i've sold philip morris a little bit and then google as well was a pretty sizable position but both britic british american tobacco and autodesk were small so not huge contributors on and to the actual

overall dollar value performance. But that's enough about our returns. Hopefully, I don't know what kind of information that gives our audience. Maybe it makes us more credible or less credible in your eyes, but let's get to some analysis. I want to talk through our portfolios and go through some of our top 10 positions. You want to kick things off, Brett? Sure. Why not? Let me share the screen. I think it's a day delayed, so the numbers might be slightly different than I'm reading off, but I think it should be generally the same. I'm going to just share what the Port Saito looks like. It gives a nice portfolio table here, and anyone watching can see the portfolio positions, but I will read them off just in case. We have Nelnet,

Coupang, Remitly, Oscar Health, the iShares 20-year plus treasury bond, aka TLT, OMAD Airports, Interactive Brokers, Nintendo, Airbnb, and Portillo's. Those are the top 10. These stocks, and I guess it's really stocks in one bond ETF, make up 94% of the portfolio. And for context, again, the short position I have is 6% of the portfolio, meaning regardless of whether you're netting something out, these 10 stocks are the vast majority of my investable assets. when performing our portfolio shakedowns, which is kind of what I call these when we kind of look at each other's portfolio and say, hey, what are you doing there? Why did you make that decision? You know, trying to have someone else give a look at what the portfolio allocation is. I want to

look at my own position sizing above all else. When I look at the two largest positions in the portfolio, which are Nelnet and Coupang, I think they've turned themselves into large winners over the last three years. Again, I've owned them longer than I have the data on today because I made that brokerage transition. But if you look at the stock charts, you can kind of see they've had similar strong performance over the last three years. And they've turned themselves into these large winners and deserve to be a large percentage of the portfolio. I think 20% for Nelnet, 17% for Coupang are very, they've earned that right given their business performance and the stock price performance. Maybe you can have some other questions here on my allocation, Ryan, as we

go forward. But when I look at my other position that is above a 10% holding, that is Remitly Global. And we'll talk about below how we're both optimistic on this business and consider it a good buying opportunity today. But the fact that it hasn't performed well as a stock, I think I'm going to hold off adding to Remitly Global until it becomes a smaller percentage of my assets from new deposits. But otherwise, looking at the portfolio, I think later we'll talk about some stuff that stood out from my best buys and how optimistic I am on a company versus my position sizing. But overall, I think I wasn't too disappointed in what my portfolio allocation has been. So my question for you, Brett, your top four positions, I just did the math roughly here,

make up roughly 60% of your portfolio. That is Nelnet, Coupang, Remitly, and Oscar Health. And Oscar Health is only 7%, so over 50% in those three. Do you feel comfortable with those four positions making up 60% of your portfolio? Sure. Yeah. okay that's fair what if there's yeah yeah i mean that's hopefully the answer you should have for anybody that's looking at their top positions if of all the smaller positions in your portfolio is there one that you would have you would either like to make a larger position or would have thought was already a larger position well if we go hindsight 2020 and i scroll down here

look oscar health's new and it's had a good run although it's it trades pretty volatile with a lot of volatility so i'm not sure what it is today that one um not surprising i started out i think as a five to six percent position and you know it just kind of luckily bought it at a good timing and it's done well over the last month or two uh if i look at tlt now grouper aeroportario uh airports. Sorry, I said that in some terrible Spanish. The north central airports in Mexico, UMAB, I wouldn't want that to be a larger position sizing. I think the one that stands out that I should have taken a larger position in, and it's always awkward talking about them because they are a sponsor, but I think Interactive Brokers, they have a conservative

balance sheet. They have a really strong track record of taking market share. And when I made the purchase, I believe, in April of 2025. So this year, I think it was trading at an extremely cheap price for anyone that has a long-term time horizon. So I wish I made that maybe a larger position. But besides that, there's some others here, Nintendo, Airbnb, Portillo's. We'll probably talk about them later, maybe to tease people to some stuff that I might be considering selling and considering adding for the portfolio for a later part in this episode. But Ryan, let's go through yours, your top 10 positions, your portfolio allocation. What were your thoughts and any surprises? Before we move on, we want to talk about our friends at Interactive Brokers.

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Head on over to IBKR.com. Restrictions apply. Interactive Brokers is a member of SIPC. largest position by quite a ways. Number two is for Mitli. So that's in the top four for both of us. Number three is Wise. Number four is Philip Morris. Number five is Google. Six is actually Adobe, sort of a new entrant there. And then OMAD, OMAB, which is the north central airports in Mexico, same as you. And then eight, still Harbor Diversified, still one of the larger positions. I'll talk about sort of my contingency plan with that position here in a bit. And then number nine is Nelnet and 10 is D.R. Horton. Any questions on my portfolio, my top 10 positions?

Okay, I'm looking at the pie chart here, and I guess some of them aren't included. Let me add in this. So you have 20 stocks, give or take. Do you think you have too many, or is this the number that you're shooting for? i'm okay having a certain amount of stocks in my part having 20 20 plus stocks in my portfolio but at the end of the day i want the top 10 positions to account for 60 to 70 percent of the portfolio so a lot of these smaller positions are basically just tracker stocks i'm got you know a couple of shares of British American tobacco. I've got a couple of shares of Taiwan Semiconductor

and this was, there's really no rhyme or reason to it. And I probably shouldn't do it this way. What I should do is have a very well-managed watch list. But for some reason, I have found that I watch a company and monitor the business's progress closer if I own some shares. So when Taiwan Semiconductor reports, previously, if it was just on my watch list, I would have been like, eh, I'll read it when I get to it, whatever. And maybe I like it, but it just kind of sits in our Google Drive as a research report, and I'm not actually acting on it. When I own shares, all of a sudden going from, okay, I knew I liked that business to the valuation has got more attractive, I react quicker when that happens because I see it in my portfolio on a daily basis. When I log on in the morning and I hit percentage change daily or whatever percentage change year to date and you start to see those valuations, I think I'm just more attuned to when there's a price that I like when it's actually in my portfolio. So long answer, I'm comfortable with it, but I always want some good level of concentration towards the top 10 positions.

Sounds like you need to utilize your fiscal AI dashboard feature. I think that's a good way to help with that. But I understand the strategy there. It's something that's quite popular and it seems to work well for a lot of investors out there. Now, the other question I have, and we're not going to hit on much of them today, but Nelnet is only 4.4% of your portfolio. What is, I guess my question is, why a small position given, as I know, you have a lot of optimism about this company? Yeah, it used to be a larger percentage, but I just haven't added to it over the last, I guess, year or so, two years. and a lot of other companies I've just chosen to add to instead, that is one of the things.

We're going to talk about sort of surprises from this episode at the end, but that is one of those where I would have expected I had a larger position than I actually did. And maybe that needs some fixing. Maybe I should be a larger position because when I think about the business today, I'm pretty optimistic about them. I think they traded at a reasonable valuation. And I think the management team is really competent. So there's not necessarily any reason that it shouldn't be a higher percentage, but maybe just being neglectful is the reason that it's honestly a smaller percentage than I expected. Makes sense. Makes sense. Yeah. I'm looking here and you have Ally Financial right next to them. I kind of think, well, is Nelnet a better risk

reward than Ally? We'll talk about that later, maybe on when we're making any changes to our portfolio. Maybe this is a question listeners would enjoy. I don't know if we put this in the document, but what has been some activity you've made this year? We talk about this on the show in the Substack chat and on the newsletter, but maybe I can go if it takes some time to think because I sometimes forget what I actually did. And that's nice about a tool like Port Saito is it can track everything for you. But what has been some big activity, trims, sells, buys in 2025 or recently? Yeah, that's a good question because I think we would have missed out on trims if we didn't address it now. One big one has been Philip Morris. So Philip Morris pretty much doubled for

me in a year. And I was very optimistic about it. It was my largest position by quite a ways actually up until I think roughly two or three months ago. And I just kind of got uncomfortable with the valuation it was still okay and i still wanted to own some but i basically cut that position in half and kind of redeployed those winnings elsewhere as far as the stocks i've added to the most three wise formerly transfer wise i think people have heard about us talk about that business before but their goal is to have i believe it's create money without borders And basically it's a remittance app, but you can also spend from there. You can save, you can send money, and there's just a lot of tools.

It's basically an e-wallet that makes life a lot easier if you travel across borders. Remitly and then Google. Those are kind of the biggest three I've added to lately. What about you? Okay, so adding this year, I've actually made quite a few changes. If we add to existing positions, say that it had previously, I think it added a little bit to Nelnet to keep it as a larger position as more money was deposited into the account. But significant ads would have been to Coupang. I averaged up on them, trying to learn a lesson from our friend David Gardner, adding up as the business has been doing well, but not buying, I guess, at the current price, which it's for some reason gone on a run in the past month.

then adding to Remitly. If we talk about trims or sales, the two major sales I had would have been Philip Morris International. I took out that entire position, so I did appreciate some of those gains, and I sold when it was soaring in early April and everything else was falling, and I put that money into Airbnb and Interactive Brokers, I think, and then I deposited some money into the account along with that. Then the other trim I had was GoGo. If longtime listeners know that company, I actually sold in April or maybe it was May. Yeah, it looks like early May. I was just a little bit worried about the competitive positioning in the space. It seems like it's getting more competitive. A lot of people trying to go after this satellite internet

business. We don't need to go into their whole business model. And unfortunately, they had some news event that shot the stock up from $10 from when I sold up to $15. But now I don't feel as bad because it has round tripped back to around where I sold it at. So hey, the business has been doing okay. I might have, I should have probably included on my watch list stocks that we're going to talk about later. But those are my major trims. The Philip Morris one I feel good about, I'd probably reenter and it's one of my watch list stocks for now. GoGo felt bad about it this summer. But as the stocks come back down, maybe I have an opportunity to re-enter and evaluate that one again. But it's been pretty active this year. Oh, and I should also mention, and this is one,

I added a bit to Portillo's after I saw that there was all the insider buying. I don't know how I feel about that. It's still not a large, ultra large position for me. At cost, it was probably like 6% or 7%. Now it's back down to below 5% as the stock's gone down. But I don't want to make the mistake of writing something down. And I don't, I'm not going to add unless the business shows me that I should add. I would rather add back at $10 where it's at $6 today. I'd rather add at $10 after the business shows signs of a turnaround versus at $4 when we see, keep, keep seeing bad comp store sales figures. You fell for the insider buyers trap it's uh maybe not a trap common mistake it's done uh it's done okay so far but the

the in i i think the insider buying thing was a solid especially because part of it was an activist investor but yeah that's a whole story we'll probably have to reevaluate sometime down the line we'll see if i end up selling it and spoiler alert it's one of the stocks on my chopping block but should we move on question for you before we move on i would have expected american express to be in your top 10 it's not i don't own it i don't own it we really yeah i think it's a little expensive okay well we can get to that in a second maybe on the watch list topic but let's go three best buys today you want to alternate here yeah we can How about, well, the first one's both the same, but maybe I can start and you can add in.

It is remotely global. I should say that analyzing a best buy now doesn't mean we're going to turn around and increase our positions after this show is aired. If something's already a large position or riskier company with a lot of upside, I may do nothing. I would consider it the stocks, the first stocks that come to mind that we would run out and buy tomorrow if starting a new portfolio from scratch. I think it's a good exercise to do. now and again. So the first one, Remitly Global. I'll just give a summary here. And there's a nice chart that maybe Ryan, but Ryan, I think has a chart as well that we can share from our friends at Fiscal AI. The mobile leader is climbing the wall of worry every quarter. It's putting up

fantastic financial performance, 34% revenue growth last quarter, and they're seeing continued operating leverage at increasing scale. They just launched new products to lock in customers and increase monetization tactics, including a $10 a month subscription service that has the Remitly wallet, good cashback programs there, the send now pay later stuff, a lot of new features for the remittance customers. And it is the leader in the space and has plenty of market share left to steal, especially from Western Union. Mr. Market or Wall Street or investors, but we'll call him Mr. Market is worried about, you know, immigration trends in the United States, potential new taxes on remittances and maybe other things I honestly could be unaware of. I'm not sure why the stock

keeps sinking when they put up this contained financial performance and they haven't done any update and said, look, our guidance is wildly off and they would be able to see that. But I think they're going to track on their guidance of 20, 25% revenue growth this year. And the stock trades just an EV to gross profit of three. I think, and maybe Ryan can talk about this further, that this has 10 bagger upside from the current price of $17 a share and is starting to get priced like it is Western Union when it is actually disrupting Western Union. Highly optimistic about this company. It's a 14% position for me. And what I add today, no, we're not going to, the stock's got to prove it to become a bigger position in my portfolio. And at 14%, if it works, it's going to

become probably my largest position. But if I was starting from scratch and I had zero allocation to Remitly, this is the first stock I'd want to buy. Anything to add there, Ryan? No, I agree. This is my number one best buy as well. When I think about stocks in my portfolio that have the highest possibility of being a 10 bagger, Remitly is probably number one for me, where it feels like they just have a ton of momentum in the business. They've got phenomenal brand notoriety within certain corridors. If you talk to people in Los Angeles or Miami, most of them, especially immigrants, are going to know what Remitly is. They are lower cost than other alternatives and customers tend to stick

around. They've gone from less than a million active customers to eight and a half million active customers in five years. That is astounding growth. They are compounding their active customer count at nearly 50% a year. And they're clearly on a path to operating leverage. They've shown it already. They've been investing a ton in the product and marketing. And now I believe they've actually turned the corner to profitability. Maybe you can double check me on that. But Yeah, they've done just a phenomenal job executing. People worry maybe about wise and some other alternatives like stable coins disrupting them, but I just don't see that happening in the numbers at the moment. And until I'm proven otherwise, I will probably continue to own shares. And then just the last thing I'll say, I'll admitly, it trades at a very reasonable price.

So right now, it's a two, just under $3 billion enterprise value. Brett mentioned the EV to gross profit of three, roughly. I think it's possible for them to do $500 million in operating income. by 2029 i don't think that's too far-fetched they are scaling becoming more and more profitable with each year and they're still growing so if they're doing 500 million dollars in operating income in five years today they've got a three billion dollar enterprise value that would work out as a great investment and the last thing i know i just said last thing but one more last thing people get so worried about the macro environment for remitly like last quarter western union said

there's been a slowdown we're witnessing a slowdown and less people are spending on western union and the remitly stock sold off it's like remitly is stealing those customers they are turning to remitly so it doesn't make a whole lot of sense people tend to trade it off on worries about less money flowing across borders, which is a possibility. There could be a slowdown, but over the long run, I would suspect that more money is sent across borders as opposed to less money, especially from US to Mexico. So I think they're in a great position. What's your number two stock? Okay. And to add in from the listeners that may be wondering, since you wondered if they were actually profitable over the last 12 months, their operating margin is 1.6%. A lot of leverage

to go from there up from negative 18% in 2022 and negative 9% in 2021. returns. That includes all your investments too. Stocks, ETFs, even crypto, if that's your thing, you no longer have to guess what your returns are. With Port Sido, you can find out in minutes whether or not you are actually beating the market. And that includes a dividend tracking dashboard and even tracking of short positions. I have been looking for a tool like this for a long time because I was sick and tired of tracking it manually and Port Sido has finally built it. If you want to find out what your real returns are, check out Port Sido. The link will be in our show notes. Okay. My second best stock that came to mind when doing this is the real brokerage

for anyone that hasn't heard about it before. The ticker is R-E-A-X. Back on June 18th, I did a stock research report and podcast episode on them. If you want the full details on the business, go listen to that and read the report on our sub stack. It is a cloud-based brokerage trying to take market share from traditional brokers and residential real estate transactions. So far, the investment has been fine, pretty good. The stock has gone from $4 to $5 a share, but I really think the party is just getting started. Revenue grew 59% year over year last quarter.

The company keeps adding new real estate agents and real estate agent teams to the brokerage platform. It is adding new products in titling, mortgages, and what's called the real wallet for personal finance needs, but it's gonna drive further earnings growth. The stock trades at seven times gross profit. They're not really profitable today,

but don't have any liquidity concerns. And they use a lot of stock based compensation. So cash flow is actually okay, even though their net income, I think is slightly negative. And I given their growth rate, given their potential, and given the historical growth rate, they could turn the seven times gross profit into two times gross profit in a few years. You may not see good bottom line profits soon. And like the PE is not going to go down to 10 immediately. But I called this the fastest growing company we've ever covered on the podcast for a reason. And if starting a portfolio over today, I think I would make the real brokerage a three to 4% position right away. Given the risk and small cap nature

of it, I don't know if I would make it a huge business. It's not going to be a 10% position plus at cost, just given the high risk, high upside. But I see a ton of potential in this business, reasonable price, reasonable valuation. Yeah. The other part that's worth noting here is I love a setup where the company is showing great growth in isolation. So if you just looked at the company's reports, you're saying, oh, okay. Yeah. The results look really good, but they're doing it in an industry that's suffering. Real estate transactions are down relative to COVID, which is kind of an easy comp given how low interest rates were. But you see it when you look at the home builder reports, there's not as much home buyer demand. So for them to be

able to onboard all these real estate brokers or real estate agents and actually transact more homes, that's great news for real brokerage. And I imagine things will look even better if housing starts to turn around. Okay. What is your second stock, Ryan? Yeah, little known company, Amazon. This is actually in my portfolio already, but a small position. A couple of weeks ago, we recorded our top 10 widest moats episode, and I selected Amazon number one overall. Spoiler alert if you haven't listened to that episode, but you should because there was lots of good discussion in there. I just think the fulfillment and logistics advantage is so big here that if Amazon stopped investing or improving its own delivery, like let's just say they kept it exactly where it's at, I think it would still take almost 10 years for any competitor to catch up with Amazon in terms of delivery speeds across North America. Maybe Walmart could catch them, but it would take a long time. and amazon won't stop investing in it so the advantage keeps growing investors have soured on them a bit lately partly because there was some underwhelming growth at aws last quarter but

my thesis is pretty simple here amazon is trading near its cheapest ebit multiple ever now we can talk about cash flow dynamics maybe another time given how much they're investing in capex But it's an EBIT of 33 times. And they perpetually understate their true earnings power because of how much they invest in the business. And it's one of those where you see it tangibly as a customer. You see all that they offer. You experience the benefits every time you order from there. You check out the, your prime subscription, all that you get included with it. This is a business that continues to put customers first, just like they did 20 years ago. And I think it trades at a fine multiple. It's not, it's not screamingly cheap, but I, I think it's a reasonable valuation. Reasonable valuation during a market melt up rent compared to a lot of other things.

And Hey, we might get that anthropic contribution to accelerate AWS revenue growth. A lot of chatter about that. Who knows? Don't buy because of the anthropic impact. But it seems like AWS may be getting undervalued at the moment and should grow along with the rest of this market. And they're probably not going after extremely unprofitable deals like with Oracle at OpenAI or something like that. All right. What's your third best buy today?

Okay. This one, you either love it or you hate it. Airbnb. I know Ryan likes it a bit. He has it in his portfolio as well. It is a steady growing online travel portal. And honestly, it's much more than that. It has the unique lodging supply from homes, apartments, what have you. That will be hard for any competition to replicate, even though you might see claims about that. The actual listing by listing basis, Airbnb has a lot of unique supply that people are going to target and shoppers enjoy or travelers enjoy. They have searches beginning on their own application that gives them a cost advantage versus going through

the online internet portals that Booking and Expedia and other players have to deal with. And they have a long runway to expand outside of their core markets. Fun fact for anyone that doesn't know, 70% of Airbnb's bookings still occur in the United States, Canada, United Kingdom, France, and Australia and New Zealand. There's a ton of more room to grow into other tourist areas, large tourist markets like Italy, Spain, Brazil, Japan, what have you. And that gives them a much, much easier way to grow. I think steady growth over the next five years. They have earned the right to test the waters of new product offerings. We maybe critique some of them and how they're maybe strange, but they're now implementing them. Some will succeed, some will fail.

They're doing some bold stuff with experiences and services that may or may not work, but they have earned the right to do so and have a highly profitable business that can help them test these new business lines. Founder Brian Chesky believes there's a lot of easy money to be made. I would read or go through the transcript, which you can find on Fiscal AI. That's probably the one place you will be able to find it if you're a subscriber there. You can find the transcript from the recent investment conference that Chesky was at, and he talked about how Airbnb, be without any promoted listings and other services for both hosts and guests is extremely under-monetized, which translation there, they can grow revenue easily if they want to. And you can

buy the stock at an EBITDA EBIT of 24 with all excess cashflow getting returned to shareholders in share buybacks. And did I also mention they have a ton of room to expand their profit margin? So I think the stock's quite cheap here. I think they have a wide moat that can get even wider over the next five to 10 years. I feel like given the valuations across the board and a lot of their other high quality stocks, this is a good one to add to your portfolio right now. Yeah, I agree. I think the core business at Airbnb is what we would describe as an emerging moat. I worry a little bit about lack of focus potentially from the company with maybe not lack. I appreciate that they're trying stuff, but I also have little confidence that those things will work. So at least that's my opinion as a customer. All right, number three for me, Corporacion American Airports. This is kind of a new stock to me, which is why I rank it third here. But let me give a little elevator pitch. They are one of the largest airport operators in the world with 53 total airports, and the bulk of their revenue comes from South America, primarily Argentina. In general, I like airport operators. They rake in cash through basically toll roads on flights, as well as commercial revenue. So leasing out space to businesses at the actual airport locations. And Argentina at the moment is seeing a bit of a resurgence. Traffic in Argentina is growing again, and they just extended their leases for 10 years for free with the Argentinian government. I think 10% plus earnings growth is very reasonable for this business and the stock trades at an EV to EBIT below 10 times. There's some macro risk, but this is one that I'm probably

doing the most research on at the moment. Yeah. And they have, I think for anyone worried about currency depreciation, I believe there are either inherent hedges in their contracts. Again, I'm not an expert on the business either, but there are inherent hedges in their contracts that it's not like you're betting on Argentina and peso growth and then the currency depreciates by 50% and your US dollar returns are totally eliminated. I think there's stuff within the contracts that can even that out. Before we move on, I will say I noticed one thing when looking at the three stocks I really was attracted to lately. And of course, they traded a reasonable valuation, but all three, I think, are consistent growers where I go,

okay, look, over the next five years, is this business going to be larger? Yes. And then on top of that, they have the optionality to add new services on top of their core offering. I think that could be, if we're trying to classify, you know, the emerging moat stocks that we like, maybe, and you can agree or talk about this too, Ryan, maybe this is the sign of a business with an emerging moat where you have confidence and growth plus that optionality. yeah absolutely i mean and by growth you are referring primarily to the top line customer base you think yeah any sort of revenue will be higher in five years and then there's sort of all these call options on top of it as well yes i agree i don't know if i'd characterize amazon

as an emerging moat i think it's it's a more established modes it's an emerged moat uh but yeah that's that's kind of the stocks we target all right let's talk stocks on the chopping block do you want to go first i've got i've got a few which is maybe a bad sign for my portfolio yeah one of them i will have as well that is you'll talk about harvard diversified more but that's in my portfolio as well waiting for the ability to trade it again and then sell it but i'll talk about one that is some listeners mentioned in the sub stack chat uh about wanting to discuss on the show because it's my biggest loser in 2025. And that is Portillo's. Now, a stock on the chopping block is simply just a stock I might sell. A stock I'm considering

selling or again, is on the chopping block. So Portillo's guidance was just cut. Their same store sales is expected to be negative 1% in 2025 instead of a previous guidance of plus 1% to plus 3%. And with inflation at I think 3% to 5% for their input costs, according to their guidance. That's going to lead to margins expecting to slide in 2025 as well. Costs are rising. Comp store sales are going slightly down. They are changing some of their plans because of an activist investor, which I think is probably good. They're slowing their unit expansion, which is going to help with cash flow conversion and making sure that each new opening is a quality opening, which they struggled with as they expanded their store account growth in recent

years. Most of the restaurant industry is struggling right now, which I think is a positive for this business. It's not a positive in a vacuum, but the fact that they're struggling while a lot of other restaurants such as Chipotle are even putting worse same-store sales growth out there is, I think, a good sign that this is a macro effect on the restaurant space as a whole. Maybe we can call it a reset year for the entire sector. If we look at the valuation of Portillo's today. The PE, 13.5. EV to EBIT is below 20. It doesn't look overly cheap even after this drawdown, especially when you consider the debt on the balance sheet. But I think this is kind of a misleading way to look at the valuation. You got to look at what they could potentially earn

within the next three to five years. Today, the stock has a market cap of just $441 million and has a reasonable path, I think, still to eventually generating $100 million in annual free cash flow or having the potential to do that and then plowing some of that back into store account growth. Now, the balance sheet has debt on it. There's the tax receivable liability that also adds to some payments out there, but that shouldn't be ignored. But this could turn into a 20% free cash flow yield in a couple of years, which keeps me in the stock. Now, I'm adding to it. I talked about we don't want to double down and water the weeds and keep going chasing good money after bad but it's on the chopping block part of me still likes the business i think it

could still be a 10 bagger over the next decade from my cost basis which is much higher uh than then i think it's not 50 not 100 higher but close to that as it's been a very big loser this year but i also think i could sell it at some point in the next 12 months um that's why i got it as a 5% position right now. Not adding, but been disappointed in the business. That's for sure. All right, folks, before we move on, we need to tell you where we get our financial data. Fiscal.ai. Fiscal.ai is the complete stock research platform for fundamental investors. I use the platform pretty much every single day. You'll see the charts on our podcast and you'll see it in our newsletter. This is our one-stop shop for stock research. They've got up to 20

years of financial data on all companies globally, including company specific segment and KPI data. That means Amazon AWS revenue, SoFi's total members, Google's paid clicks growth, and literally millions of more data points. They've also got earnings called transcripts, ownership data, company specific research reports, and much more. If you want complete financial data at your fingertips, then you need to check out Fiscal.ai. And if you use our link, fiscal.ai slash chitchat, you will get 15% off any paid plan. Again, that is fiscal.ai.chitchat. The link will be in the show notes. Have you ever visited a Portillo's location? I have not. I have not. Got to get some boots on the ground research there, Brett. I think. I don't know if that's going to help.

Yeah. Honestly, it might distort your view anyways. All right. Let me go through my stocks on the chopping block there are three for me so i'll try to go quickly first number one is harvard diversified i mentioned this but at this point it's just a waiting game i don't want everyone that owns shares through that that bought them sort of in the last two years they can sell them but it's really hard to buy them and i don't want to be the person that's selling when the amount of potential buyers is so low that's really frustrating and it feels like even though the operations have or the business has been performing poorly from what we can tell they're they're they basically unwound a lot of their air wisconsin operations

it's still cheap which is like dangerous last words i guess but they seem to be planning to liquidate or sell some of their planes liquidate the business a bit i'm hoping they can get to a dollar maybe a dollar fifty in per share value i might just leave an open sell order at a dollar dollar fifty somewhere in there and see if someone grabs them since it's so do it do it do it do it higher do like three dollars you'll be able to make the sell at one dollars if the liquidation happens true and yeah all right anyway moving on but yes harvard diversified it's still in the portfolio, I'm just waiting for something good to happen. And at this point, honestly, it has a negative enterprise value. I don't see how it could go that much lower,

which might be famous last words. The other two for me are Ally Financial and SEMrush. I still think you might be able to see an inflection in earnings for Ally Financial just by better performance from their loan portfolio over the next year or so because net interest margins contracted. And now as the higher yielding loans come through, it should expand net interest margins a bit. But I have soured on their position within the online banking sector. They used to have a big advantage being one of the first online-only banks. And that helped a ton in attracting customers, customer deposits. It was so easy to sign up, get ready, get started. And you had a lot of the functionality that you would with a traditional branch bank,

But it was all online. Today, that is not a novel concept. It is way more competitive. And I think they're going to struggle to grow their customer deposit base from here, given how much competition there is from other neobanks. If we comp them against SoFi, over the last, I guess, three years, Ally has gone from $140 billion in customer deposits to $142 billion in customer deposits. They've grown – it's basically flat over the last three years. SoFi has gone from $1 billion to $29 billion. I mean, it just feels like other neobanks are going to get really aggressive and steal some of those deposits. So I worry about Ally's long-term outlook. And then SEMrush, I'll just be quick here. The business seems to be in disarray.

It's a small position for me. So I might just hold out, see what happens. But initially, it was sort of a self-serve online visibility tool. So it helped marketers with their SEO, and it was a nice tool for individuals as well as SMBs because it was so easy to adopt. But fast forward two years, they've removed their founder, CEO. They brought in one of their board members. They've tried to go up market, but it hasn't really worked. It has been costly as well. So operating leverage hasn't been what I expected. And they drastically, and I mean drastically, underperformed their own guidance, which was a bizarre moment where they guided two months before for 20% growth, and they were not even close to that. and it's like i don't know how you could be so far off but anyways yeah i i'm just kind of waiting on those ally sam rush if i found a new idea and didn't have cash coming in those would probably

be the first i'd sell to fund it new idea what about now that you're right yeah maybe i would do a compare side by side ally now that and your expectations i feel like the answer is pretty clear yeah uh it's like i said probably just a matter of neglect at this point i'm not paying attention to it yeah the closing one we have is any changes we're going to make so we may have some answers to that shortly uh for the listeners there but let's talk watch list stocks three watch list stocks from each of us that are at the top of the list that would be potential new entrance into the portfolio? Brett, why don't you kick things off?

Okay, well, my watch list is never solidified. I always kind of think about it as stocks I'm currently just thinking about and reading about. There are a few dozen companies out there we all know are high quality. We all know that we would buy them at the right price. And we talk about the mad nauseam, such as Aviza. If Aviza gets to 15 times earnings, I'm done.

You know, that's okay. It's on the watch list, but it's not fun to talk about. One company I think is in that list is Airbnb be that people misunderstand, but that's another topic. There are a few stocks though that come to mind as watch list stocks today. Some are more of like, all right, it's cheap. I got to figure out if I like the business versus I'm waiting for a little bit of a lower price before the expected returns get to where I'm comfortable with. First, Lululemon, EV to EBIT of eight may make this too hard to pass up and it may make me break my never invest in apparel rule don't do it brett so there

are people on reddit saying that lululemon is the next is going the way of under armor which i think is a bit extreme uh sentiment this is like joining the dark side you've made it this long not investing in apparel don't let a multiple break it for you oh i just it has the rule has served you well it has yeah sure sure but sometimes it can help you not buy it at 13 times earnings when it might be a buy at seven it's different this time that's what i'm hearing it's not under armor i'm very confident in that under armor was at zero zero brand durability but who knows blue lemon could be going the way of under armor i'm not sure i think it's a good risk reward here. Second one would be one that we haven't talked in a while, but was a big winner

for us. Sprouts Farmer's Market. Stock is in a 28% drawdown. I don't think it is necessarily cheap yet, but it's getting cheaper. And at another leg down, I would definitely consider getting back into this company. I think they have good prospects for growth across the grocery industry in the United States. Third one, Philip Morris International. After selling at about $160 a share. I've been really hoping for a sustained dip in Philip Morris stock. I haven't gotten it yet, but right now it's an EBITDA of 17. I would like it maybe at 13 times or a price of about $130 to $140 a share. I think that it's a good risk reward and gets you good dividend income along with the potential revenue and earnings growth from their new age nicotine products. You can get

probably 10% revenue growth and a 5% dividend yield, not bad. And the dividend yield is growing. So those are the three that come to mind that I could see myself adding. Blue Lemon is more of a, I got to look into this business further, but the other two waiting for lower prices. And I still like those businesses and have for the last five years. Okay. Going long, Ryan, what are your three yeah my three are number one american express this is another one of those companies that i think has sort of a self-reinforcing competitive advantage where they've got a premium customer base or at least it's perceived to be a premium customer base and i think that does play out in the default rates as well so it is a premium customer base which attracts more

brands for partnerships which allows them to have higher fees although the fees aren't as different as people make them out to be. And those brand partnerships and the allure of being a premium brand thus attracts more customers. So it's a very sticky business, nice little competitive advantage, EV to EBIT of 17 times. It's not crazy cheap, but I do think people underestimate the quality of this business. And I think the growth over the next 10 years will look different than it did from 2010 to 2020. People comp to that period and it seems to be in just a different state, that business, and there's a ton of pricing power. I mentioned earlier that I think the stock is not cheap. I don't know if I'd use EV to EBIT because of the finance, since it's essentially a

bank. The PE is 23. I mean, I think it'll do fine from here, but big part of the story is the share repurchase program. And I think net income, bottom line net income can grow at maybe 5% to 10% a year. And when the stock is at 15 times earnings, that can really help with the share repurchase. But today, long-term, yeah, maybe you get a 10% return, but that's not, I guess I'm getting greedy and I'd rather buy it during a recession and the stocks collapse. Yeah, that's fair. I would suspect that it's closer on that 5% to 10% growth range. I would suspect it's on the higher end. Other two on my watch list, Grab Holdings. It's kind of the super app, I guess, of Southeast Asia. They are the leader in mobility and the delivery

markets. So sort of the Uber plus DoorDash slash Instacart. And there's just a great network effect in that business. The more riders, more supply you have online, the more customers you get and vice versa. So they should continue to grow GMV. That's up there on my watch list. and the last one is monday.com need to do a lot more work on this company but they are a software business that over the last few years when seemingly every software business experienced revenue growth slowdowns monday.com just powered through and got great adoption both from their existing customers as well as expanding to new ones so it seems everyone raves about the software I would be interested in the business.

Let's wrap up here. Any surprises from this episode? Are you making any changes to your portfolio? So I have about 3% of the portfolio in cash. For anyone, a little tip, use the iShares SGOV, short-term treasury bond ETF to optimize your yield. I think you get over 4% in that right now. So just do that in your cash, especially in a non-taxable account. but so i have three percent cash i have more cash i think i actually just deposited so it's even a

little bit higher than what we uh when i wrote this down but giving my thoughts on airbnb and the fact that and i'll check port side over right now it is only exactly five percent of the portfolio i think i should make this a larger position i'm very optimistic about the steady long-term growth here i think they have emerging mode and expanding moat um it's trading at a fine price you know 24 times ev to ebits okay but i think i would want this is one i want to buy in thirds this is another time so i bought them first in spring of this year and buying thirds is just buy over time buy you know first position add more for a second time and then add a third time. I think I would buy in thirds here, maybe add it to 5% position to maybe a 7% to 8%

position, maybe 7.5% is good. And if nothing changes and we see a dip down to a sub 20 times EV to EBIT, which is not that far from today, that's maybe a 10% to 15% drop, I would increase it to a 10% position at the right price. The business quality, I think, puts it in the same league for my portfolio of having larger positions as a Coupang or a Mittley or a Nelnet, but it's in the same portfolio allocation as I have the real brokerage, Alsea and Portillo's. So I think it's in that group of riskier businesses when I'm higher conviction on their long-term growth. Yeah. For me, I think I've fallen into this trap of basically thinking, oh, I'm a shareholder. Great. The stock is doing well without actually caring about the size of the

position as much as I should. So I would say the three stocks for me that I would like to have be a bigger percentage of my portfolio and ones that I think I'm really optimistic about the long-term prospects for the business are Airbnb, Interactive Brokers, and Nelnet. trying to think if i'm missing any there those are probably the big ones these are the ones that aren't already large positions correct but they're already in the portfolio so yeah i think lesson learned here don't be afraid when there's a high quality business that you think is attractive to size up the position a little bit and you can also do that over time which i plan to do at some point okay well i hope the listeners enjoyed this episode i know it's a lot of numbers out there if

If you have any questions on stuff that you may have missed, you know, listening to us list off the portfolio, you might miss something, message us in the Substack subscriber chat. It's free there. You can just ask us, hey, you know, I thought it was this, I thought it was this. Maybe we'll even just post a screenshot of the existing portfolio. If you have any questions about the small short positions I have, let me know. Or you want to make fun of me for taking a short position in Tesla. you can do that because it hasn't worked out well so far. Anything else, Ryan, before I hit

the disclosure and we get out of here? No, that's going to do it. Thank you to Port Sido. Thank you to our other sponsors as well, Interactive Brokers and Fiscal AI. We used all of them throughout this episode. So it is a true endorsement from us. Okay. As a disclosure, we are not financial advisors. Anything we say on the show is not formal advice or recommendation. Ryan, I, or any podcast guests may hold securities discussed in this podcast, may have held them in the past, and may buy, sell, or hold them in the future. Thank you, everyone, for tuning into this episode. Make sure to follow us on Spotify, Apple Podcasts, YouTube, wherever you get your podcasts, and give us a good review.

Also, subscribe to the newsletter on Substack, Chit Chat Stocks newsletter, and we'll see you all next time. Thank you.