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2026年2月23日星期一
Financial instituion newsletter 2026
Is Tilray (TLRY) Finally Turning the Corner?
Cannabis investors have been waiting five years for a reason to care again.
On April 1st,Tilray Brands (TLRY)gave them one. The company posted record Q3 net revenue of $206.7 million, up 11% organically, and its international cannabis business exploded 73% year-over-year.
Days earlier, Tilray closed its ~£40 million acquisition of BrewDog, the UK craft beer brand, and announced a 2027 distribution partnership with Carlsberg.
Search volume from financial pros placed TLRY second in the cannabis sector, according to our TrackStar data, trailing only SNDL.
Yet shares still trade below $1. That gap between operational momentum and market price is where this story gets interesting.
Tilray's Business
Tilray is a global consumer packaged goods company that built itself at the intersection of cannabis, beer, spirits, and wellness. Headquartered across New York, London, and Leamington, Ontario, it holds the #1 cannabis market share position in Canada by revenue.
The company operates in over 20 countries and owns more than 40 brands.
Its portfolio spans medical cannabis, adult-use cannabis, craft beer (including Shock Top and Blue Point), hemp foods, and pharmaceutical distribution across Europe.
Tilray segments its business into the following areas:
Distribution (39% of total revenues) - Tilray Pharma wholesales pharmaceutical products across Europe, primarily Germany
Cannabis (31% of total revenues) - Canadian adult-use and medical cannabis plus a fast-growing international cannabis franchise
Beverage (21% of total revenues) - Craft beer and spirits sold across North America, with new European and APAC reach via BrewDog
Wellness (8% of total revenues) - Hemp-based foods and supplements under the Manitoba Harvest brand
Q3 marked a genuine inflection. Adjusted EBITDA climbed 19% to $10.7 million, adjusted net income flipped positive to $2.4 million, and net loss shrank 97% to $25.2 million.
International cannabis revenue hit an all-time company high, with flower sales volume doubling year-over-year.
CEO Irwin Simon has leaned hard into a global beverage platform. The BrewDog deal adds scale across Europe, the Middle East, Australia, and APAC, while the Carlsberg partnership opens U.S. distribution for Tilray's craft portfolio starting in 2027.
On the cost side, Tilray just wrapped Project 420, delivering roughly $33 million in annualized savings concentrated in the beverage segment. Management reconfirmed FY26 adjusted EBITDA guidance of $62 million to $72 million.
Financials
Source: Stock Analysis
Tilray's top line tells one story. Its bottom line tells another.
Revenue grew from $210.5 million in 2020 to $858.3 million TTM, a respectable 12.9% five-year CAGR built on acquisitions as much as organic growth.
Gross margin expanded meaningfully, climbing from 11.7% in 2020 to 27.7% today. That's real progress.
The rest of the income statement is a different animal. Tilray has posted a net loss every single year shown, with TTM net loss at $1.3 billion and operating margin at -173.7%.
Free cash flow has been negative every year, burning $73.8 million over the trailing twelve months and more than $568 million cumulatively since 2020.
The real damage shows up in the share count. Diluted shares outstanding jumped from 13 million in 2020 to 116.6 million TTM, nearly 9x dilution in five years.
On the bright side, the balance sheet is finally clean. Tilray holds $264.8 million in cash and marketable securities against minimal net debt, ending Q3 in a $3.5 million net cash position.
Valuation
Source: Seeking Alpha
Traditional earnings multiples don't work here. None of the major cannabis names post positive GAAP earnings, which is itself a sector indictment.
EV/EBITDA on a forward basis sits at 13.5x, well above SNDL's 5.6x and ACB's 5.2x. Cronos Group (CRON) commands a premium 6.6x P/S, reflecting its cash pile rather than business quality.
Growth
Source: Seeking Alpha
Tilray's 3.8% YoY revenue growth trails Aurora's 16.5% and Cronos' 24.6%. Forward growth of 11.9% looks healthier but still lags Cronos at 26.6%.
The three-year revenue CAGR of 12.9% is the best of the group, though that number leans heavily on acquisition-fueled expansion.
EBITDA growth of -39.5% YoY underscores that scale alone hasn't solved the profitability puzzle.
Profitability
Source: Seeking Alpha
Tilray's 27.7% gross margin sits mid-pack for the sector. But everything below the gross line remains deeply negative, with an operating margin of -173.7% and FCF margin of -8.6% TTM.
None of the peers shown post positive operating profit either, which tells you this is a sector problem, not just a Tilray problem.
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Our Opinion 3/10
Tilray is executing better than it has in years. International cannabis is genuinely accelerating, the balance sheet is repaired, and Project 420 delivered real savings.
But five years of perpetual losses, $568 million in cumulative cash burn, and 9x share dilution can't be erased by one record quarter.
The BrewDog bet doubles down on a beverage segment that just shrank 24% year-over-year, and the bull case still rests heavily on U.S. federal cannabis rescheduling, a catalyst nobody controls.
We'd wait for two consecutive quarters of positive free cash flow before taking this seriously.
The arcade-and-eats chain now sports a market cap near $430 million against an enterprise value of $3.6 billion. That gap tells you most of what you need to know about who really owns this company right now.
Despite the carnage, financial pros can't stop searching the ticker. PLAY edged out larger, healthier peers likeCheesecake Factory (CAKE)andTexas Roadhouse (TXRH)for the top spot in our TrackStar casual dining searches last month.
New CEO Tarun Lal just delivered his first full-year report, and the back-to-basics pitch is finally on the table.
The question is whether it's enough.
Dave & Buster's Business
Founded in 1982 and headquartered in Coppell, Texas, Dave & Buster's blends a full-service restaurant with an arcade floor under one roof. The company runs two brands: the flagship Dave & Buster's and the more family-focused Main Event.
The chain operates 243 venues across North America, with 179 Dave & Buster's stores spanning 43 states, Puerto Rico, and Canada, plus 64 Main Event locations in 22 states. Four international franchise locations round out the footprint.
Dave & Buster's reports as a single segment, but revenue splits cleanly into two streams:
Entertainment (~66% of revenues) - Arcade games, virtual reality, sports simulators, and the Power Card system that drives repeat play
Food and Beverage (~34% of revenues) - Full menu of entrées, appetizers, and a complete bar program across all venues
Fiscal 2025 was rough. Revenue slipped 1.4% to $2.1 billion, comparable store sales fell 5%, and the company swung to a $48.7 million net loss against $58.3 million in prior-year profit. Adjusted EBITDA dropped to $436.6 million from $506.2 million.
CEO Tarun Lal, nine months into the job, is leaning hard into a turnaround plan. He's sharpening marketing, refining pricing and the menu architecture, refreshing the remodel program, and rolling out what he calls "culturally relevant" new games.
The company opened 11 new stores in fiscal 2025 and remodeled 16 Dave & Buster's locations, bringing the total remodel count to 51 since the program began in 2023.
Management is guiding to positive same-store sales, revenue growth, EBITDA improvement, and more than $100 million in free cash flow for fiscal 2026. That's a meaningful jump from where things sit today.
Financials
Source: Stock Analysis
Dave & Buster's revenue has gone the wrong way for two straight years, sliding from $2.2 billion in fiscal 2023 to $2.1 billion in fiscal 2025.
Operating margin compressed from 13.9% to 4.1% over the same stretch, and the EBITDA margin slipped from 23.4% to 17.4%. The pressure shows up at the gross line too, with gross margin easing from 86.1% to 85.7% as food, beverage, and labor costs ate into the model.
Operating cash flow came in at $290.8 million last year, but capex of roughly $391 million pushed free cash flow to negative $100.6 million.
That's the second straight year of FCF burn after a $217.9 million cash outflow in fiscal 2024. Management's $100 million FCF target for 2026 hinges on the remodel cycle winding down and comps turning positive.
The balance sheet is the real concern. PLAY ended the year with just $16.6 million in cash and $466.3 million available on its revolver, against an enterprise value of $3.6 billion. Liquidity is fine, leverage is not.
Valuation
Source: Seeking Alpha
PLAY trades at 1.5x cash flow, the cheapest multiple in the peer group by a wide margin. CAKE sits at 9.4x, Brinker (EAT) at 8.8x, Cracker Barrel (CBRL) at 5.4x, and TXRH at 14.7x.
On enterprise value to forward EBITDA, PLAY trades at 9.3x, in line with EAT at 9.7x but well below CAKE at 13.9x and TXRH at 16.2x. Price-to-sales sits at 0.2x, tied with CBRL for the bottom of the group.
The catch is that PLAY shows NM on every P/E line because it's not making money.
Growth
Source: Seeking Alpha
Trailing growth is ugly across the casual dining group, but PLAY is the worst performer. Revenue fell 1.4% year-over-year compared to TXRH at +9.4% and EAT at +17.9%.
EBITDA dropped 15.8% over the trailing twelve months, and forward EBITDA is expected to decline another 3.2%. Forward EPS growth is projected at -66.6%, the weakest in the group.
The bright spot is the five-year revenue CAGR of 37%, though that figure is heavily flattered by the pandemic rebound off a low fiscal 2020 base.
Profitability
Source: Seeking Alpha
PLAY's gross margin of 39.8% is roughly in line with CAKE at 40.4%, but the picture deteriorates as you move down the income statement.
EBIT margin sits at 5.9%, below CAKE, TXRH, and EAT. Net income margin is -2.3%, the worst alongside CBRL. Levered free cash flow margin is -6.4%, again the worst in the group.
Return on common equity is -41.1%, while EAT posts 177.8% and TXRH delivers 28.8%. The peer comparison isn't kind.
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Our Opinion 4/10
Dave & Buster's is a speculative turnaround, not a core holding.
The valuation is genuinely cheap, the new CEO has a coherent plan, and the $100 million free cash flow target for fiscal 2026 would change the conversation if hit. Liquidity buys management time to execute.
But comps are still negative, free cash flow is still red, and the leverage stack means equity holders are last in line. Until Tarun Lal proves the back-to-basics strategy can move comps positive, PLAY belongs in the watchlist bucket.
Nike's (NKE) Comeback Keeps Getting Pushed Back
Nike (NKE) beat Wall Street estimates on Tuesday. Revenue of $11.3 billion edged past the $11.2 billion consensus. EPS of $0.35 topped the $0.30 forecast.
None of that mattered.
Shares cratered 11% to a 9-year low near $48 after management guided Q4 revenue down 2-4%, a stark reversal from the +1.9% growth analysts expected.
Greater China, once the company's most promising growth engine, is expected to decline 20% next quarter.
CEO Elliott Hill admitted the turnaround is taking longer than he'd like. That's not what investors wanted to hear 18 months into his tenure.
Search volume among financial pros surged to 4,819, nearly 4x the next closest footwear stock, according to our TrackStar data.
With the stock down 40% from its 52-week high, is this a generational buying opportunity or a trap?
Nike's Business
Nike's iconic swoosh has adorned the feet of Michael Jordan, Serena Williams, and billions of everyday consumers across 170+ countries since 1964.
The company designs, markets, and distributes athletic footwear, apparel, and equipment under the Nike, Jordan, and Converse brands. It serves professional athletes, weekend warriors, and lifestyle consumers through both wholesale partners and its own retail and digital channels.
Nike segments its business into the following areas:
Footwear (65% of total revenues) - Athletic and casual shoes spanning running, basketball, football, training, and lifestyle
Apparel (30% of total revenues) - Performance and lifestyle clothing across all major sport categories
Equipment (5% of total revenues) - Bags, socks, sport balls, and other accessories
In Q3 FY26, revenue was flat year-over-year while net income fell 35% to $520 million. Gross margin dropped 130 basis points to 40.2%, primarily due to 300 basis points of tariff impact in North America.
The bright spots were real but narrow. North America wholesale grew 11%. Nike Running surged over 20%. The Nike Mind platform, with 150+ patents, sold out globally.
But Sportswear, the company's largest category, declined double digits. Converse cratered 35%. And the company took a $230 million severance charge to restructure its supply chain and technology workforce.
Hill's "Win Now" strategy is focused on cleaning up excess inventory from classic franchises like Air Force 1, rebuilding wholesale relationships, and leaning into sport-specific innovation. The company plans an Investor Day this fall to lay out its long-term vision.
The 2026 World Cup in North America looms as a major catalyst with Nike set to unveil new products and elevate its presence in 5,000+ football doors globally.
Financials
Source: Stock Analysis
Nike generated $46.5 billion in trailing twelve-month revenue, down 2.7% year-over-year. That follows a 9.8% decline in FY25, making this the second consecutive year of shrinking sales.
Gross margins have compressed from 44.6% in FY24 to 40.8% on a TTM basis, driven by tariffs and heavy promotional activity to clear aged inventory.
Operating margin sits at 6.0%, down from 12.3% in FY24. Net income margin has fallen to 4.8% from 11.1% over that same stretch.
The balance sheet remains clean. Nike holds $8.1 billion in cash and short-term investments against $8.0 billion in total debt. Free cash flow on a TTM basis is $3.3 billion, down from $6.6 billion in FY24.
The company still pays a 3.2% dividend yield backed by 24 consecutive years of increases. It spent $609 million on dividends in Q3 alone.
Valuation
Source: Seeking Alpha
Nike trades at 35.0x trailing P/E (Non-GAAP) and 33.5x forward P/E (GAAP), a significant premium to most peers.
Deckers Outdoor (DECK) trades at just 14.1x trailing P/E while Crocs (CROX) sits at 6.7x. Even Birkenstock (BIRK) is cheaper at 15.9x trailing earnings.
On a price-to-cash-flow basis, Nike's 25.6x is the most expensive in the group. CROX trades at 5.9x, and DECK at 14.0x.
On Holding (ONON) doesn't have a meaningful trailing P/E, but its 24.3x forward P/E still comes in below Nike's multiple.
Put simply, the market is still pricing Nike like a premium growth company despite two years of revenue declines.
Growth
Source: Seeking Alpha
This is where Nike's premium valuation breaks down.
Revenue declined 5.0% year-over-year, the worst among the peer group. ONON grew 30.0%. BIRK grew 14.7%. Even CROX managed to limit its decline to 1.5%.
Forward revenue growth of -1.9% is also the weakest. ONON expects 26.8% growth while BIRK projects 18.3%.
Over a 3-year period, Nike's revenue CAGR is -1.8%. ONON delivered 35.1% and DECK posted 14.6%.
The story is even worse in earnings. Nike's 3-year EPS CAGR is -21.6%. BIRK delivered 38.3% and DECK posted 31.9%.
The one silver lining: Nike's levered free cash flow grew 55.3% on a 3-year CAGR basis, though that metric is volatile and masks the recent deterioration.
Profitability
Source: Seeking Alpha
Nike's 41.1% gross margin is the lowest in this peer group. ONON leads at 62.8%, while BIRK and CROX both sit near 58-59%.
At the operating level, Nike's 6.5% EBIT margin trails DECK's 23.9%, CROX's 22.0%, and BIRK's 25.9%.
Net income margin of 5.4% is second worst, ahead of only CROX's -2.0% (which reflects one-time charges).
Nike's return on equity of 18.0% looks respectable until you see DECK at 39.7%.
The one area where Nike's scale shines is cash from operations at $3.1 billion, dwarfing every peer on this list.
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Our Opinion 5/10
Nike is a brand that still matters. The swoosh carries cultural weight that no competitor can replicate overnight.
But the turnaround keeps getting pushed back. Revenue is shrinking. Margins are compressing. China is in freefall. And at 35x trailing earnings with negative growth, the stock isn't priced for this level of uncertainty.
The clean balance sheet, 3.2% dividend yield, and World Cup catalyst provide a floor. North America's momentum and the upcoming Investor Day could spark a re-rating.
We'd wait for either a lower entry price or concrete evidence that margins have bottomed before committing capital.
Broadcom's (AVGO) $100 Billion AI Bet
Everyone knows NVIDIA makes AI chips. Fewer know that Broadcom (AVGO) designs the custom silicon that powers Google, Meta, and Anthropic's AI infrastructure.
Last week, the company dropped a record quarter. Revenue hit $19.3 billion, up 29% year over year, while AI chip revenue surged 106% to $8.4 billion.
But it was CEO Hock Tan's bold claim that turned heads. He told analysts Broadcom has line of sight to $100 billion in AI chip revenue by 2027.
Search volume by financial pros jumped after the report, landing AVGO at #4 among semiconductor stocks, according to our TrackStar data.
Shares popped 8% the morning after earnings, erasing a painful 11% selloff from December.
With Q2 guidance of $22 billion crushing the $20.6 billion consensus, investors want to know if the rally has legs.
Broadcom's Business
Broadcom designs and supplies semiconductors and infrastructure software for the world's largest enterprises. Its $69 billion VMware acquisition in 2023 transformed the company from a pure chipmaker into a diversified technology platform.
The company serves hyperscale cloud providers, telecom operators, and enterprise IT departments across more than 30 countries. Its custom AI accelerators power the training clusters behind some of the most advanced AI models in the world.
Broadcom segments its business into the following areas:
Semiconductor Solutions (65% of total revenues) - Custom AI accelerators (XPUs), AI networking chips, broadband, server storage connectivity, and wireless components
Infrastructure Software (35% of total revenues) - Enterprise and mainframe software including VMware virtualization, cybersecurity, and IT management tools
In Q1 FY2026, Broadcom beat estimates on both the top and bottom line. Non-GAAP EPS of $2.05 topped the $2.03 consensus while adjusted EBITDA hit $13.1 billion, or 68% of revenue.
The real story is AI. Broadcom now designs custom chips for five major hyperscalers, including Google's Ironwood TPU and Anthropic's compute infrastructure.
Tan revealed that Anthropic alone will deploy 1 gigawatt of TPU compute in 2026, with demand surging past 3 gigawatts in 2027. Meta's custom accelerator program, MTIA, is also alive and well despite analyst skepticism.
The company authorized a new $10 billion share repurchase program and returned $10.9 billion to shareholders in Q1 through dividends and buybacks.
Financials
Source: Stock Analysis
Broadcom's revenue has tripled since FY2019, from $22.6 billion to $68.3 billion on a trailing twelve-month basis. EPS has followed suit, climbing from $0.64 in FY2019 to $5.12 TTM.
Gross margins tell an interesting story. The TTM figure of 70.6% is down from 77.3% in FY2025 as lower-margin AI hardware takes a bigger share of the revenue mix.
Operating margins held steady around 40.7% TTM, aided by disciplined cost control.
Free cash flow is the headline. Broadcom generated $28.9 billion in FCF over the past twelve months, a 42.3% margin. That easily covers the $2.48 per share dividend and the company's aggressive buyback program.
The balance sheet carries $63.8 billion in long-term debt, largely from the VMware deal. But with $14.2 billion in cash and $8.0 billion in quarterly free cash flow, the company is paying it down quickly.
Valuation
Source: Seeking Alpha
Broadcom trades at 47.6x non-GAAP trailing earnings and 40.8x forward GAAP earnings. That's a premium to NVIDIA (NVDA) at 38.2x and Taiwan Semiconductor (TSM) at 32.7x on a trailing non-GAAP basis.
On EV/EBITDA, Broadcom's 23.8x forward multiple also sits above NVDA's 17.7x and Micron's (MU) 8.1x.
However, the PEG ratio paints a different picture. At 0.77x forward non-GAAP PEG, Broadcom is cheaper than TSM's 0.81x and comparable to Advanced Micro Devices' (AMD) 0.72x.
Growth
Source: Seeking Alpha
Broadcom's 25.2% trailing revenue growth lags NVDA's 65.5% and MU's 45.4%. But forward estimates tell a different story.
At 43.7% forward revenue growth, AVGO is closing the gap with NVDA's 53.1%. Its forward EBITDA growth of 48.4% is competitive with the entire group.
On a 3-year CAGR basis, Broadcom delivered 25.7% revenue growth and 23.5% levered FCF growth, solid numbers for a company its size.
Profitability
Source: Seeking Alpha
Broadcom's 76.7% gross margin leads the pack, ahead of NVDA's 71.1% and TSM's 59.9%.
Its 37.3% levered FCF margin also tops the group, outpacing NVDA's 26.9% and TSM's 16.9%. Only on return on equity does Broadcom fall short at 33.4%, well behind NVDA's 101.5%.
Cash from operations of $29.7 billion is impressive but trails NVDA's $102.7 billion, a reflection of the sheer scale difference in profitability.
Broadcom has positioned itself as the essential architect behind custom AI compute. Its five hyperscaler relationships give it a diversified revenue base that doesn't rely on any single chip design cycle.
The VMware acquisition added a sticky, recurring software revenue stream that provides ballast during semiconductor downturns.
However, the premium valuation and $63.8 billion in debt demand near-flawless execution. If AI spending decelerates before 2027, that $100 billion target could weigh on sentiment.
For long-term investors, Broadcom's combination of AI growth, elite margins, and aggressive capital returns makes it one of the strongest semiconductor holdings available today.
Is Costco (COST) Worth 50x Earnings?
Few retailers can beat earnings estimates and still watch their stock drop 2.4% after hours.
Costco Wholesale (COST) did exactly that last week. The company posted Q2 fiscal 2026 EPS of $4.58 on $68.2 billion in net sales, topping Wall Street on both lines.
Yet investors shrugged. At roughly 52x trailing earnings, the bar is sky-high.
Search volume by financial pros surged around the announcement, landing COST as the second most searched discount retailer in our TrackStar data behind Walmart.
The results were strong. But the question everyone is asking is whether the stock's premium is justified.
Here's our take.
Costco's Business
Costco has turned the unglamorous act of bulk buying into a $286 billion revenue machine. Its membership model flips traditional retail on its head: keep margins razor-thin on merchandise, then profit from the annual fees people gladly pay for access.
The company operates 924 warehouses across 14 countries and runs e-commerce sites in eight markets. Its Kirkland Signature private label has become a brand unto itself, often matching or beating national brands in quality at a fraction of the price.
Costco segments its business into the following areas:
Foods & Sundries (~40% of net sales) - Dry groceries, snacks, candy, tobacco, and household essentials
Non-Foods (~26% of net sales) - Electronics, appliances, furniture, apparel, and seasonal goods
Fresh Foods (~14% of net sales) - Meat, produce, bakery, and deli items
Warehouse Ancillary & Other (~18% of net sales) - Gasoline, pharmacy, optical, food court, e-commerce, and travel
Membership Fees (~2% of total revenue) - Annual fees from Gold Star, Business, and Executive memberships
In Q2 FY2026, comparable sales rose 7.4% with traffic up 3.1%. Digitally enabled comparable sales jumped 22.6%, led by gold/jewelry, toys, and pharmacy.
Membership income grew 13.6% to $1.36 billion. The company now has 82.1 million paid members with a 92.1% U.S./Canada renewal rate.
Costco plans to open 28 new warehouses in fiscal 2026, bringing total locations to an estimated 942. The company also continues to lower everyday prices on Kirkland Signature items to reinforce its value proposition.
Financials
Source: Stock Analysis
Costco's revenue has grown from $152.7 billion in FY2019 to $286.3 billion on a trailing 12-month basis. That's an 8.4% year-over-year increase in the latest period.
EPS hit $19.23 on a TTM basis, up from $8.26 in FY2019. The company runs a tight operation with a 12.9% gross margin and 3.8% EBIT margin, both consistent with its low-price, high-volume model.
Free cash flow reached $9.1 billion in the trailing 12 months, up from $7.8 billion in FY2025. That easily covers the $5.20 per share dividend and $419 million in share repurchases over the first half of fiscal 2026.
The balance sheet is clean. Costco holds $17.4 billion in cash against just $5.7 billion in long-term debt.
On a price-to-cash-flow basis, COST commands 29.5x compared to 23.7x for WMT and just 8.3x for TGT. Five Below (FIVE) trades at 38.7x trailing P/E, the only peer close to Costco's premium.
Even Costco's price-to-sales ratio of 1.6x is higher than every peer on this list. Investors are clearly paying up for quality and consistency.
Growth
Source: Seeking Alpha
The premium starts to make more sense when you look at growth. Costco's 8.4% revenue growth leads the pack alongside Five Below's 15.8%.
Its 3-year revenue CAGR of 6.9% is solid, and the 18.5% levered FCF 3-year CAGR is the best of the group. WMT's levered FCF actually declined at a 14.4% 3-year CAGR.
EPS growth of 12.3% year-over-year outpaces both WMT and TGT. Forward EPS growth of 11.2% suggests the momentum is sustainable.
Only Five Below posts stronger top-line numbers, at 19.8% on a 5-year revenue CAGR compared to 9.9% for Costco.
Profitability
Source: Seeking Alpha
Costco's 12.9% gross margin is the lowest in the group, which is by design. The membership model lets the company sell goods near cost.
Where Costco separates itself is in efficiency. Its 29.7% return on equity is the highest among peers, and its 10.3% return on assets also leads the pack.
Cash from operations of $15.0 billion towers over the competition. WMT generates $41.6 billion, but on a far larger revenue base with lower returns on equity and assets.
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Our Opinion 7/10
Costco is one of the best-run retailers on the planet. The membership moat, pricing power, and operational efficiency are difficult to replicate.
But at 52x earnings, you're paying for a lot of future perfection. Any stumble in comps, membership growth, or tariff-related margin pressure could send shares lower in a hurry.
We'd rate it a 7/10. It's a long-term compounder, but the current valuation leaves limited margin of safety for new buyers.
The Gold Miner ETF Up 145% This Year
Gold just blew past $5,000 an ounce, and the companies pulling it out of the ground are printing money.
A new 15% global tariff, escalating geopolitical tensions from the Arctic to the Persian Gulf, and central banks aggressively swapping Treasuries for bullion have turned gold into the trade of the decade.
For the first time since 1996, gold now accounts for a larger share of central bank reserves than U.S. Treasuries.
Our TrackStar data shows GDX dominating precious metal miner ETF searches among financial pros, pulling nearly 3,908 searches last month. That's more than COPX and SIL combined.
With miners generating record free cash flow at these prices, let's dig into whether GDX still has room to run.
Key Facts About GDX
Net assets: $32.9 billion
12-month trailing yield: 0.57%
Inception: May 16, 2006
Expense ratio: 0.51%
Number of holdings: 49
GDX tracks the NYSE Arca Gold Miners Index, capturing the performance of the largest publicly traded gold mining companies worldwide.
The fund uses a market-cap weighted approach, giving investors exposure to the biggest and most liquid names in the industry. This isn't a speculative bet on junior explorers. It's a portfolio of established producers with proven reserves and expanding margins.
The top holdings read like a who's who of global gold mining. Agnico Eagle Mines leads at 9.9%, followed by Newmont Corp at 8.6% and Barrick Mining at 6.4%. Anglogold Ashanti rounds out the top four at 5.5%, with Wheaton Precious Metals at 5.2%.
Source: VanEck
These aren't small operations. Newmont recently reported record net income of $7.2 billion for fiscal 2025, riding the gold price surge. Agnico Eagle operates mines across Canada, Finland, Mexico, and Australia. Barrick runs tier-one mines on four continents.
Wheaton Precious Metals adds an interesting wrinkle as a streaming company. It doesn't operate mines directly but finances them in exchange for the right to purchase metals at below-market prices. This gives it higher margins and lower operational risk than traditional miners.
The top five holdings account for roughly 35.5% of the fund. That's concentrated enough to benefit from individual winners but diversified enough to absorb single-stock setbacks.
With gold above $5,000 and analysts at major banks targeting $5,400 to $6,000 by year-end, these producers are positioned to keep delivering outsized cash flows.
Performance
The numbers are hard to ignore. GDX has returned 145.0% over the past year, making it one of the best-performing ETFs in any category.
Year-to-date, the fund is up 10.1%. The three-month return sits at 32.6%, showing the momentum hasn't faded.
Over five years, GDX has delivered an annualized return of 24.0%. The ten-year annualized return comes in at 22.0%. These figures crush what most equity funds have delivered over the same periods.
Source: VanEck
Since its 2006 inception, the annualized return is a more modest 5.4%. That number reflects the brutal bear market gold miners endured from 2011 to 2015, when gold prices collapsed from record highs. It's a reminder that this sector can give back gains quickly.
GDX has slightly underperformed its benchmark index by about 0.6% annually over five years, typical for a fund charging a 0.51% expense ratio. The tracking is tight enough that costs aren't a major drag.
The recent surge has been driven by the perfect cocktail: $5,000+ gold, disciplined capital spending by miners, and a structural shift in global reserve management away from the dollar.
Competition
GDX isn't the only game in town for metals-focused investors. Our TrackStar data highlighted four other ETFs drawing serious attention from financial pros.
Global X Copper Miners ETF (COPX): Targets copper producers rather than gold, offering exposure to the electrification and infrastructure megatrend. Its 2.1% yield beats GDX, but the five-year cumulative return of 153.3% trails significantly. The 0.65% expense ratio is slightly higher.
Global X Silver Miners ETF (SIL): Focuses on silver miners, which offer both precious metal and industrial demand exposure. It carries a 0.65% expense ratio with a 0.9% yield. The five-year cumulative return of 156.9% lags GDX by nearly 90 percentage points.
Sprott Uranium Miners ETF (URNM): A pure play on nuclear energy's comeback. With just 27 holdings and a 0.75% expense ratio, it's the most concentrated and expensive of the group. The 184.4% five-year return is strong but still behind GDX.
VanEck Vectors Junior Gold Miners ETF (GDXJ): The higher-risk sibling of GDX, targeting smaller gold miners with more growth potential. It matches GDX's 0.51% expense ratio and offers a higher 1.8% yield. Its 215.6% five-year return is impressive but comes with significantly more volatility.
GDX's combination of size, liquidity, and blue-chip miner exposure makes it the default choice for most institutional allocators looking at this space.
Our Opinion 8/10
GDX is the most straightforward way to play the gold mining sector, and right now, the sector is firing on all cylinders.
Record gold prices, disciplined management teams, and strong free cash flow generation create a compelling setup. The 0.51% expense ratio is reasonable for the exposure you're getting.
The risk is clear: if gold prices pull back, miners will fall harder. Gold stocks historically amplify gold's moves by 2x to 3x in both directions. And with gold having nearly doubled in under two years, a correction isn't out of the question.
But the structural drivers remain intact. Central banks are buying at record pace. The new tariff regime is fueling inflation fears and dollar skepticism. Geopolitical risk isn't going away.
For investors who believe this macro backdrop holds, GDX offers leveraged upside to gold without the complexity of futures or physical storage. It works best as a 5-10% portfolio allocation for those looking to hedge against inflation, currency debasement, or geopolitical instability.
Top-Performing ETF Stories of January: Winning Investing Areas
Wall Street has delivered a moderate performance over the past month (as of Feb. 2, 2026). The S&P 500 has gained 1.1%, the Dow Jones has added 0.9%, the Nasdaq Composite has advanced 0.8%, while the Russell 2000 has lost 0.7%.
The key event of January was President Trump’s announcement of former Fed governor Kevin Warsh’s nomination as the next Fed chair. If he makes it through the Senate, Warsh would take over when Powell's term ends in May.Appointed by former President George W. Bush, Warsh served as a Fed governor from 2006 to 2011, a tenure that earned him the status of an inflation hawk.
Other important events that shaped January’s performance in the investing world were heightened geopolitical tensions, the rebound in the U.S. dollar, a roller-coaster ride of precious metals, winter storm Fern and its impact on natural gas prices, and election speculation in Japan.
Geopolitical Tensions
Geopolitical worries rose at the start of the year following the U.S. move to oust and capture Venezuelan leader Nicolas Maduro. Moreover, Trump indicated that he was considering potential actions on Iran, while threatening to take Greenland and questioning the value of the NATO alliance — remarks that added to market unease.
President Donald Trump threatened new protectionist measures against Europe over the “Greenland row,” but later eased trade war fears after announcing an Arctic security framework deal at Davos (read: European ETFs in Spotlight Following Trump's Tariff Retreat at Davos).
Japanese Stocks Hit Record Highs
Japanese stocks surged to record highs in mid-January on reports that Prime Minister Sanae Takaichi may call snap elections soon. Takaichi is hoping to convert her high approval ratings into a parliamentary majority for her party.Investors expect Takaichi to introduce aggressive fiscal spending, including increased defense outlays and tax cuts to support economic growth.
U.S. Consumer Confidence Slumps to Decade Low
U.S. consumer confidence fell sharply in January, sinking to its lowest level since 2014 as worries about personal finances and the broader economy intensified, per Associated Press, as quoted on Yahoo Finance.
Survey respondents continued to cite inflation pressures. Other dampening factors included tariffs, trade, politics, jobs and health insurance (read: U.S. Consumer Confidence Slumps to Decade Low: ETF Areas to Play).
Natural Gas: A Winner From Winter Storm Fern
A powerful winter storm, namely Fern, swept across much of the United States in late January. Bank of America economist Aditya Bhave projects that Fern will cut first-quarter 2026 GDP by 0.5-1.5pp [at a quarter-over-quarter seasonally adjusted annual rate], as quoted on Yahoo Finance.
Meanwhile, analysts at Morgan Stanley estimate that the storm could reduce 0.5 to 1.5 percentage points from first-quarter GDP, as mentioned on MarketWatch. However, some sectors may face pressure in the coming days due to the activity loss. Natural gas prices jumped in January, as the storm boosted heating demand. United States Natural Gas Fund LP UNG has added 9.2% over the past month (as of Feb. 2, 2026).
Precious Metal: A Rapid Roller-Coaster Ride
SPDR Gold Trust GLD is up 7.2% this year but slumped 8.2% past week. iShares Silver Trust SLV has gained 10.2% this year but plunged 26.1% past week (as of Feb. 2, 2026). The dollar strengthened amid the Warsh nomination. Warsh is viewed as a hawkish central banker, which has probably played spoilsport for the commodity segment.
Invesco DB US Dollar Index Bullish Fund UUP is off 0.4% this year (as of Feb. 2, 2026) while the ETF gained 1.1% past week. Note that commodities are priced in the U.S. dollar. Hence, any strength in the greenback is bad news for gold and silver. Gold’s start to 2026 was great as the metal is viewed as a market hedge. Heightened geopolitics made it a winner in early 2026.
Against this backdrop, below we highlight a few winning ETF investing areas of the past one month (as of Feb. 2, 2026).
Shipping
Breakwave Tanker Shipping ETF BWET – Up 92.5% over the past month (as of Feb. 2, 2026)
Global shipping stocks have been steady, mainly due to firm freight rates caused by ongoing geopolitical tensions. Many companies are benefiting from increased ton-mile demand as ships take longer routes to avoid conflict zones.
Strong demand for commodities is another reason. The Baltic Exchange’s dry bulk index, which tracks rates for vessels transporting dry commodities, jumped about 7.3% to the highest since mid-December on Jan. 30, 2026, per Trading Economics.
Robotics
Themes Humanoid Robotics ETF BOTT – Up 25.1%
The American robotics industry entered 2026 riding an amazing wave of commercial breakthroughs, venture capital and FDA approvals that position the United States at the forefront of global automation. From surgical suites to factory floors to the lunar surface, recent developments signal an upbeat phase for the industry ahead.
ASML Holding-Heavy ETF
ASML Holding NV ADRhedged ASMH – Up 16.6%
ASML Holding NV ASML stock has gained 17.4% over the past month (as of Feb. 2, 2026).In late January, ASML reported orders that topped expectations, while the 2026 sales guidance was also ahead of estimates, as AI demand continues to support the company, as quoted on CNBC.
South Korea
Franklin FTSE South Korea ETF FLKR – Up 15.5%
South Korea's KOSPI index has surged impressively in early 2026, reaching record highs. The strong chip rally can be held responsible for this jump. Booming AI chip demand, December export surges, and optimism around HBM4 technology mainly led to the gains (read: 4 Country ETFs Hovering Around a 52-Week High).
Uranium Miners
Sprott Uranium Miners ETF URNM – Up 15.4%
Uranium futures in the United States rose in January, the highest since February 2024, on speculation of high demand in the long term. Bets of higher investment in the sector due to government efforts to boost energy security and rising demand from power-hungry data centers, supported uranium funds, as quoted on Trading Economics.
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
Feb 23 2026 rated 7/10
Walmart (WMT) Is Expensive. Buy It Anyway?
Discount retail is having a moment.
With tariff fears rattling consumers and a shaky macro backdrop, Americans are trading down. That's good for Walmart (WMT).
The company just reported FY2026 Q4 earnings, and the results were solid. The stock, however, trades at a steep premium.
Is it worth it? Here's the breakdown.
Walmart's Business
Walmart is the world's largest retailer by revenue, operating nearly 10,500 stores and clubs across 19 countries under dozens of banners.
Its scale is unmatched. Roughly 90% of the U.S. population lives within 10 miles of a Walmart store, giving it a physical footprint no competitor can replicate overnight.
Walmart segments its business into the following areas:
Walmart U.S. (67% of total revenues) - General merchandise, grocery, health, and wellness products sold through physical stores and ecommerce
Walmart International (17% of total revenues) - Operations in Canada, China, Mexico, and other markets
Sam's Club (16% of total revenues) - Membership-based warehouse clubs offering bulk goods and services
In its most recent quarter, Walmart posted TTM revenues of $703.1 billion, up 4.3% year over year. EPS grew 18.2%, and the company raised its dividend 12.3%.
Advertising revenue and its third-party marketplace are becoming meaningful contributors, adding higher-margin dollars to what was historically a razor-thin business.
On the strategic side, Walmart is building out its flywheel. Walmart+ membership, in-store media, and data monetization are all growing. These aren't just nice-to-haves. They structurally improve margins over time.
Financials
Source: Stock Analysis
Revenue has grown every year since 2019, with 5-year CAGR of 5.1%. That's steady, not spectacular.
Operating margins have held firm around 4.1%-4.3%, and gross margins remain in the 24%-25% range, consistent across the cycle.
Free cash flow came in at $15.3 billion on a TTM basis, up from $12.7 billion in FY2025. Operating cash flow is a healthy $41 billion.
CAPEX runs around $13-14 billion annually, leaving meaningful room after that for dividends and buybacks. The dividend yield is modest at around 1%, but dividend growth has been consistent, up 9.2% in FY2025.
Long-term debt is manageable relative to the cash generation of the business.
Valuation
Source: Seeking Alpha
This is where things get complicated.
Walmart trades at 44.3x trailing GAAP earnings and 43.9x forward earnings. That's a premium to every name on this list except Costco, which fetches 53.4x.
On a price-to-cash flow basis, Walmart trades at 24.6x versus Target at just 7.7x and Dollar General at 9.2x. The market is paying a steep premium for Walmart's consistency and its evolving, higher-margin business mix.
At 1.5x forward sales, it's not cheap on that metric either.
Growth
Source: Seeking Alpha
Walmart's trailing revenue growth of 4.3% is respectable for a company this size, but Costco is growing at 8.3% and Dollar General at 4.9%.
Where Walmart separates itself is EPS growth. Diluted EPS grew 18.2% year over year and 38.1% on a 3-year CAGR basis. Levered free cash flow grew 26.8% over the same period.
Those are not the numbers of a slow-moving retailer. They reflect improving margins and disciplined capital allocation.
Profitability
Source: Seeking Alpha
Walmart's gross margin of 24.9% lags Dollar Tree and Dollar General, but its return on equity of 23.7% and return on total capital of 11.0% are solid.
Costco's returns are stronger, but Costco also benefits from a membership model that front-loads profits.
Walmart's cash from operations at $41.0 billion dwarfs every other company on this list. Target generates $6.8 billion and Costco $14.8 billion.
Markets are sliding. The Magnificent 7 are losing steam, and talk of a correction is everywhere. But smart money is quietly moving into one overlooked sector that has historically outperformed the S&P during tough times. At the center is a breakthrough technology — and one stock positioned to benefit.
Walmart is a well-run business with improving margins, exceptional cash flow, and a sharpening digital strategy.
The problem is the price. At 44x earnings, you're paying for perfection. Any stumble in consumer spending or a guidance cut could send shares lower quickly.
For long-term investors who can stomach a full valuation, Walmart is a core holding. But don't expect a bargain here.
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