The 5 Stocks You're Ignoring Right Now

No matter how high the market goes, there's always opportunities for investors, but you oftentimes have to dig into the companies that just aren't getting a lot of attention in the market. Today, I'm going to go through five that I think are being overlooked by the market. Those five stocks are on holding or on running, as I call them, mobilized. Just reported earnings, numbers looked really good. MGM Resorts, Zillow, and Lyft. You probably know all these names and you've probably been overlooking just how strong their businesses are and just how cheap their stocks are. That's what I'm going to dig into today. My name is Thanks for watching Asymmetric Investing. If you want more from me, check out my newsletter, Asymmetric Investing. There's a link on the screen and a link in the show notes. I also want to thank this video sponsor, Fiscal.ai. I'm going to use Fiscal.ai throughout this video so you can see exactly what this platform looks like, but they just reduced their prices. Their max plan now has 20 years of data, just phenomenal resource. If you look at a company like on holding, you're going to get all of their company statistics that you see right here on the left. Their charts are newly improved and their financials are just phenomenal because they include things like KPIs. What drives a business? What's the shoe revenue? What's the apparel revenue? What's the accessories revenue? All this stuff is very, very easy to find. You can even stack these together, make phenomenal looking charts. Now that it's earnings season, one of the things I'm using Fiscal.ai for all the time is listening to those conference calls and looking at presentations. All of this is in one platform. That's what makes Fiscal.ai so great. Check it out. You can get two weeks for free and then 15% off of those lower prices, as I mentioned, by going to fiscal.ai. Let's go over on holding and why I like this company. You can see that stock's actually done pretty well over the past couple of years, up 168% since late in 2022, but hasn't really done much of anything over the past year or two. Valuation, pretty solid, $15 billion market cap. They've got a three-year compound annual growth rate of 40%. This is what's so phenomenal is they're growing revenue like crazy and they're doing it profitably. Let's dig into some of those numbers. I'm going to show this in a couple of ways just to show the diversity of the business, but this right here is the revenue from wholesale sales that's in blue and then direct-to-consumer, which is in orange. In total, $3.6 billion worth of revenue. 2020, they were just selling $480 million worth of products, so extremely fast-growing company. They've also got some pretty good geographic diversification. Now, a lot of their revenue is going to be coming from the Americas, in particular, the US. That's going to be most of their revenue in the blue segment you see there, but Europe continues to grow and the real growth avenue over the past year or two has really been in Asia Pacific as they move into that market a little bit more aggressively. What we shouldn't overlook is where there's opportunities for future growth. In blue, you have shoes. That's a vast, vast majority of their revenue, but apparel and accessories are the kinds of things that could generate 20%, 30% of revenue long-term. That accounts for almost none of their revenue today. They've started to introduce some of those products. I have a couple of pieces of apparel from Onholding, really, really high quality, so something I'll probably continue to add to the wardrobe, but this is the kind of growth opportunity that they're just going to be able to lean into over the next decade or two. One of the things that's so impressive about Onholding is they've been able to generate a gross profit of over 60%, an operating profit, and generate positive free cash flow from the business. This is actually their operating cash flow. This is going to be a pretty good proxy for what's happening with their free cash flow because there's not a lot of capital expenditures that go into running a business like this. You can see over the past year, $510 million in operating cash flow. That's likely to continue to improve as they grow that revenue. They've shown over the past year that they have pricing power. One of the comments that just sticks with me from their management is when tariffs started to come online in the US, they basically said, you know what? If tariffs are impacting our costs, we're just going to raise our prices. Not a lot of shoe and apparel companies had that kind of confidence to be able to say, you know what? We have the pricing power to be able to raise our prices, but Onholding does. That's what makes this such a strong company. Like I said, the valuation is pretty compelling today. Enterprise value to sales is about four. Typically Nike, which actually has negative revenue growth, they're going to trade for about two times sales. You're only paying double the price for a company that's growing significantly faster. If you have a company that's growing 30 plus percent, you make up for that higher price you pay in a stock like this extremely quickly. I think this is a great value. This is one of the biggest holdings in the asymmetric portfolio. I'm looking for a big year from Onholding. Mobileye has had a really tough go of it lately. The stock is actually down. They reported earnings before the market opened, as I'm recording today on Thursday. When you look at those results, I think they were actually pretty good. I'll get to some of the things I liked about the results, but let's just go through what the valuation is, because I think the market's really underestimating just what potential this company has. The market cap, nearly $9 billion, but they have almost $2 billion worth of cash on the balance sheet. Now, some of that is going to be used to buy the robotics company that they just announced that deal with. That'll go down to somewhere around a billion dollars in cash, but about a $7 billion enterprise value as we stand today. Look, their revenue, which is in blue, is growing over time. Their gross profit, also growing over time. The reason that I'm showing gross profit here is because this doesn't include their operating expenses. All the development that's going on for their next generation chips, for testing out fully autonomous vehicles, which is their drive platform. They're working on that with Volkswagen's Moya. All that goes into R&D costs today. When you look at these SG&A and R&D costs, you can see these are rising. I'll hide the first two. These are rising over time, but this is exactly what you want to see for a company that's investing in the future. They're investing in those new technologies. That's how you get backlog like this or pipeline like this. This was from the quarterly report for the fourth quarter 2025 came out this morning. The revenue pipeline from the automotive business reached $24.5 billion at the end of 2025. That indicates that average revenue over that period of time is going to be about 50% higher than the nearly $2 billion that Mobileye is generating today. On top of that, we have all kinds of new products that are likely going to win deals this year. Earlier this month, they announced a new deal that's going to add about 9 million units to their surround ADAS backlog. That's with a US manufacturer. We don't know exactly who that is, but it's likely either General Motors or Ford. There are other engagements that they say are expected to convert in 2026. On top of that, they're expecting the robo taxis that they're working on with Volkswagen's Moya group. Those are going to likely go without a safety driver in the vehicle later this year. That's going to demonstrate their capabilities. This is a modular business model. What's exciting about this is as other automakers go, you know what? We need to be in the autonomy game. We need to have eyes off features. We need to have hands off features. We need to have full robo taxis. They're going to have to turn to somebody to provide the technology, the chips, the sensors. Mobileye is the company that can do that. They're working with some of the biggest automakers in the world. That's why I think this company is being completely overlooked. You can see here, enterprise value to sales is just 3.6. Price to free cash flow is just 14 times. That's for a company that already has a pipeline that we should expect growth for the next decade. I think Mobileye is the kind of company that's going to grow as not only volumes increase, but also as the price point per vehicle is going to increase dramatically. They're only generating about $50 in revenue per vehicle that they're in today. That could go up to $1,000 or more as there's more chips and more sensors in those vehicles as more autonomy hits the road. That's unloved part of the market. You can see this is the five-year chart for MGM resorts. Stock basically hasn't gone anywhere. The odd thing about that is that the share count has dropped dramatically. Compound annual growth rate or negative growth rate is 12% since the end of 2022. Look, there's a lot of negative sentiment around Las Vegas right now, but the fact of the matter is Las Vegas revenue is actually up over the past 12 months in the latest month that was reported. On top of that, Macau is doing extremely well. MGM resorts is one of the only six operators there. That core business is doing very well. Enterprise value to sales is just two right now. Price to free cash flow is just seven. Let's look at some of these long-term trends because this is the thing that I think investors really overlook. Oftentimes, we look at MGM resorts and some of these gaming and entertainment companies as what's happening right now. What does the travel numbers look like going to Las Vegas? Look at the long-term trend. You can go back to 2016, the company was generating $9 billion worth of revenue. Over the past 12 months, from its main three segments, the Las Vegas Strip, regional casinos, and MGM China, we're looking at over $16 billion worth of revenue. This is what I think of as the core business. These three segments right here, they're generating cash flow. They built all these casinos. This is a cash flow machine. The growth is going to come from this little purple segment here. This is digital revenue. There's two pieces to this business. They own 50% of BetMGM in the US with Antane. That's a business that's now starting to generate cash flow, paid MGM a $100 million dividend at the end of last year. What you're seeing here in this digital revenue is actually the assets that are owned by MGM operating in countries like Brazil. This is, again, not yet a cash flow business, but it likely is to be a cash flow business in the future. You get all this value, all of these buybacks, but the biggest reason to own MGM resorts long-term is going to be the MGM Japan casino that's being built today. This isn't going to open until 2030, but that single resort could be the most profitable casino in the world when it opens up. I would be surprised if that one resort doesn't generate $2 to $3 billion worth of cash flow for MGM. They're going to own about 44% of that resort. That is going to make this an absolute steal sometime between now and 2030. Investors are going to continue overlooking this. I'm going to continue acquiring shares in management. Is it going to be aggressively buying back short shares over that period of time? I'm happy to be the last shareholder and own that huge stake in MGM Japan because that is going to be a huge cash flow and growth monster for MGM long-term. Let's go to another company that is absolutely crushing the market that they operate in. That is Zillow in home sales and also rentals. You can see over the past five years, the stock's down 55%, but this is a phenomenal business. $16 billion market cap. They have about a billion dollars worth of cash on the balance sheet, so $15.5 billion enterprise value. The enterprise value to sales is about six. Maybe not quite the same value from that specific metric as the first three companies that I've talked about. They're also not generating a ton of earnings or free cash flow. Those metrics aren't going to be how we want to judge Zillow in particular right now. What we do want to look at is some of these KPIs. What I always look at is three segments. You have the residential business, that's the traditional business, mortgages, and rentals. I'm going to look at the revenue for all three of these. Let's look at the past 12 months. You can see the residential business is growing, but it's not growing a lot. That's going to be impacted mostly by the macro environment in the US. Not a lot of home sales, not a lot of volume going through it right now. That impacts the revenue. Let's hide that, because the trends in these other two segments are completely different. Rentals and mortgages is where we really want to see growth. Let's just move this to the September 2023 quarter. Just look at the growth rate here. You see over this period of time, the compound annual growth rate in mortgages, 41%. Rentals, the compound annual growth rate is 32%. They're expecting both of these to continue to grow. The reason this is important is you want Zillow to be the place that people go to look for homes, to look for rentals. You want them to be the aggregator of demand. If they have all the demand, then all the supply needs to come to Zillow. This is apartment owners. This is companies offering mortgages. This is people selling homes, real estate agents. We're seeing their power in the market continue to grow as more people use the Zillow app. As more people use the Zillow app, they have more money to reinvest in the business, make that app better. If you've looked at Zillow recently, you notice that their technology is getting better. The walkthroughs that they have with homes, the layouts that you can see by just clicking on a home, you can actually see what the floor plan looks like. All of that is getting better and better, and their lead over the competition is getting better over the same time. Look, the housing market just in the US alone is a multi-trillion dollar market. Zillow has a ton of growth potential over the next 20 years. If they're going to continue leading in residential rentals and mortgages, I think their take rate of each of those is going to continue to improve. Even then, the take rate is going to be lower than real estate agents today. A lot of growth potential for Zillow. I love seeing them winning the markets and improving the technology in home buying and rentals today. The final stock is one that has not been very popular, but it's actually up 34% over the past year. I think another overlooked stock in the market, that is Lyft, $7.3 billion market cap. They've got a ton of cash on the balance sheet, so an enterprise value of $6.7 billion as I'm recording today. Enterprise value to sales is just one. I also own shares of Uber. Uber typically trades for between three and four times sales. Price of free cash flow is just seven. That's going to be a little bit volatile depending on what their insurance costs are. At Lyft, the most important metrics are getting better. In pink, what you have is total revenue. That's growing 17.6 compound annual growth rate. This is since the middle of 2022, so over the past three years. Then free cash flow has gone from negative to now positive. I think autonomy is going to be a tailwind behind both Uber and Lyft. The reason that Lyft has more upside potential is if they gain a little bit of market share, they could have growth at their back, they could have margin expansion at their back, and they could have multiple expansion at its back. That's exactly what we want for investors. You want all three of those things working in your favor. That's what I see with Lyft. I think autonomy is going to expand the size of the market. I don't think this is going to be a winner-take-all market. I think these aggregators of demand, like Uber, like Lyft, are going to do extremely well. That's why I own both of them. The one that I'm excited about because of that great valuation, that great balance sheet, is Lyft. I think the 10x potential for the company is there over the next 10 years. The five stocks that I went over today on holding, Mobileye, MGM Resorts, Zillow, and Lyft, let me know what you think about those five. Like I said, if you want more from me, including every stock that I buy every single month, check out Asymmetric Investing. There's a link on the screen and a link in the show notes. You can follow my Asymmetric portfolio. Those buys for that portfolio coming up pretty quick. I'm going to do those at the beginning of February. I'd love to have you as part of that community. Thanks for watching, everybody. We'll see you here next time.