UBER is rejected as a value investment because it lacks a safety margin in downside scenarios and has no durable competitive moat given that self-driving tech will be widely available.

Next is "Uber". We discussed it. Bill Ackman sees a 5x growth in scalability across everything from transportation and delivery to all other services. The market does not agree with Billy Boy's opinion.

This has been the case for the past decade, but I look at Uber and we have analyzed it as well in our intrinsic value model . You can download this for free in my free Value Investing course from the link in the description below.

Here we have Uber, and we have entered the free cash flow for three scenarios. If it grows at the high growth rates projected, its intrinsic value will be almost double the current share price .

And if it grows at higher rates, this means potential growth of 5 times. This means easily 4 times as much. However , if it grows by only 10%, which is more likely, the market might say, " Well, the competition is high, and that's high."

Then the present value, i.e. the intrinsic value, is less, even 50% less than our current situation. Therefore, it is a gamble that does not provide a safety margin in the worst-case scenarios.

So, it's not a value investment bet , but a risk-and-reward bet that I won't accept.

And now another acquisition, "Foodpanda" for 2.3 billion. They spend all their cash flow for this growth, and for this competitive environment to build their position, but with robotaxi or others , it's quick enough that you can simply switch.

It is very difficult for them to enjoy a sustainable, long-term competitive advantage in this industry. No one will own it. So, it's a big risk for those 14 billion, not the 8 billion they paid to Delivery Hero.

When it comes to self-driving vehicles, eventually everyone will own them. Therefore, you do not have a profitable competitive advantage. No defensive trench, no profits, no growth, and no scalability, because everyone else is doing that. Therefore, Uber is not my choice.

Like Uber, you can create those competitive barriers. It is very important to make a distinction here. Adobe has a business model and a commercial activity, but that activity will experience a slow decline over the next ten years.

They will use the money to build something, or to make stock buybacks and things like that. The new thing is what they cannot have, because you can get it cheaper and of better quality elsewhere.

And that's the problem there, just like with Uber.