Bullpen.News From Edwin Dorsey
Get Daily Recap Feedback

Wednesday, September 23, 2026

Back to today

Research Roundup Vol. LIII

Micron’s customer agreements, Analog Devices’ acquisitions, Ondas’ GATE deal and Baker Hughes’ power systems position them for AI infrastructure demand.

MU $1.2TADI $193B
Monte Independent Investment Research 4 clicks

From X

@convequity 2 clicks

Convequity on X

Convequity’s AI Bubble Barometer (ABBX) — Week 17 | 11 September 2026 Our weekly framework tracks valuations, returns, capex, financing risk and forward infrastructure economics across hyperscalers, neo-clouds and model labs. This week’s print is also an Oracle week. $ORCL reported FQ1 FY27 on 10 September: revenue and cloud growth accelerated, disclosed backlog (RPO) jumped to $664B, cash capex ran hot, FCF stayed negative but better than feared, and a $20B ATM equity sale was completed. Capacity delivery was the operational headline — 850 MW and >300k GPUs in the quarter. The ABBX read is below. As of 10 Sep session close (US ET), 13 selected companies (hyperscalers + neo-clouds): -EV / IC = 5.80x (↓ 0.06x from 5.86x on 4 Sep Friday close; ↓ 1.87x from 7.67x on 15 May series start) - All-in EV / IC (incl. private OpenAI & Anthropic) = 6.52x - ROIC / WACC = 3.07x in Q2'26 vs. 3.73x in Q1’26 - ROIC – WACC spread = +23.1% EV/IC tells you what the market is paying for every dollar of invested capital. ROIC/WACC tells you whether those dollars are still earning more than they cost. A classic bubble is when EV/IC keeps expanding while ROIC/WACC is rolling over. That is still not the setup. Returns remain more than 3× the cost of capital while EV/IC for the public builder set sits near 5.8x — well below the midsummer 7× prints and the 15 May series start. The multiple compression looks more financing-driven than fundamental: the return spread is still wide. Oracle is the live test of that financing channel — and on ABBX it sits halfway between the diversified hyperscalers and the neo-clouds. Start with backlog. ORCL’s $664B RPO is now in the same league as $MSFT (~$678B) and ahead of $GOOGL (~$520B) and $AMZN (~$496B). Neo-clouds are a different scale entirely: $CRWV ~$104B, $NBIS ~$40B, $IREN ~$17B. On disclosed backlog, Oracle is already peer to Microsoft — hyperscaler-scale contracted AI demand. The constraint is not finding counterparties; it is delivering power, GPUs and campuses against a backlog that already exceeds its AI enterprise value (EV/RPO ~0.7x on the company row). Valuation paints the halfway case. On Forward Valuation, Oracle’s AI EV is roughly mid-hundreds of billions against ~$163B/year of plan-implied revenue (~12.8 GW internal × ABBX blend (colo vs. GPU rental vs. mode/app derived revenue) — about 2.8x EV / plan-implied revenue and ~4.3x EV / implied gross profit. That sits well below Microsoft, Amazon and Google (roughly high-single-digit to low-double-digit EV/plan on the same framework) and Meta (~4.5x), but well above CoreWeave and IREN (sub-1x to low-1x on plan revenue). EV/IC tells a similar story: Oracle is cheaper than the big four diversified names and closer to the neo-cloud pack on capital multiples, while its backlog and quarterly capex now look hyperscaler-sized. The market is pricing Oracle more like a leveraged AI builder than like Azure/AWS/GCP — even though its contracted demand book looks like theirs. Capacity mix explains part of the gap. In AI Infrastructure Capacity Plans, Microsoft, Amazon, Meta and Google all show some external planned GW — capacity rented from specialists such as CoreWeave, Nebius and IREN. Oracle shows none. Its disclosed plan is treated as internal OCI build. Oracle is the landlord in this graph, not a tenant: it sells AI cloud to frontier labs and enterprises, and does not need a large rented-GPU line to hit the plan. That is control and a cleaner path to own-stack margin. It is also concentration. Build cost, leases and delivery sit on Oracle, not on a diversified supplier set. The Implied Revenue & Valuation Multiples table shows the same shape in the numbers. Oracle’s implied ABBX USD per planned GW is about USD 13 billion, below Microsoft at about USD 17 billion and well below Meta and Google in the mid-20s. That is not a claim that OCI is worse infrastructure. It is a revenue-density assumption. Oracle’s plan is weighted to large-contract AI infrastructure sold to hyperscale counterparties, closer to wholesale cloud economics. Meta and Google’s higher implied USD per GW embeds denser take on their own AI and platform stacks. CoreWeave can look high on a thin equity base. Oracle is the opposite: a huge RPO and more conservative revenue per gigawatt of disclosed plan. Financing is where Oracle looks more neo-cloud than Microsoft. Our Expanded Debt & Capex, split by disclosure vintage: From FQ1 FY27 (31 Aug, condensed balance sheet in the earnings release): borrowings $125.3B, cash $36.4B, IC $156.2B, plus operating-lease ROU/liability lines on the face of the BS. Still on the May / Q4 FY2026 full note lock (not in the FQ1 PR): on-books stack ~$167B (~1.3× borrowings), uncommenced DC leases ~$260B, purchase obligations ~$13B, all-in burden ~$441B (~3.4× borrowings). That roughly 3.4× all-in multiple sits near Amazon (about 4×) and above CoreWeave (about 2.5×) and IREN (about 2.9×), but far below Microsoft (about 17×), Google (about 10×) and Meta (about 9×). Those names carry large off-balance-sheet lease books relative to thinner headline debt. Oracle’s uncommenced lease line is still huge; the multiple looks moderate only because borrowings themselves are already large. The setup is notes debt, a completed ATM equity raise, heavy cash capex, negative FCF, and a large May commitment book that the next 10-Q still needs to update. Management says new contracts need no further equity raise. ABBX treats that as a claim to monitor, not a free pass. Oracle’s Q1'27 cash capex was about USD 28.5 billion — in the same league as Meta, below Microsoft, still below Amazon and Google. Against that sits about USD 664 billion of contracted future work, more than twenty times one quarter’s build spend, with management guiding that roughly half should become revenue inside three years. That is the highest backlog-to-build ratio in the group, and it is why demand on paper looks full. It does not mean this year’s cash bill is already paid. RPO is multi-year revenue, not cash this quarter. Capex is a repeating outflow — FY27 guidance is about USD 90–95 billion, or about USD 70 billion net after customer prepays — and Oracle has also signed about USD 260 billion of data-center leases (as of May 2026) that are not yet on the balance sheet and start as campuses come online. Rent is due once those leases begin, even if customer cash is later. That is why the stock can de-rate on funding even with a full book. The high ratio argues for utilisation if delivery lands. Free cash flow and the lease stack are the separate question of who funds the build before the backlog turns into cash. Other hyperscalers can look weaker on the same ratio because more of their spend serves their own ads and cloud stacks, which never appear as Oracle-style external backlog. Delivery is catching up with that book. Oracle has put about 850 MW and more than 300,000 GPUs into service, with GPU utilisation at 97.9% and renewals at a premium — capacity is being used when it lands. At the Abilene, Texas campus, six of eight buildings are live, and customer acceptance of new clusters has shortened to about 24 hours: delivered capacity is signed and usable in a day, not weeks. The earlier caution still holds: lab tests of how many tokens a cluster actually produces, and real traffic samples through gateways that serve open-weight models, are still thin. Campus delivery looking full is not the same as those checks. Direction still matters. Across the complex, Friday’s snapshot still looks like a build-out, not a hangover. For the 13 names, aggregate AI enterprise value is about USD 10.7 trillion. AI EV over disclosed backlog is in the mid-single digits. AI EV over plan-implied revenue is in the high-single digits on the broader cuts. Planned capacity is still well above 100 GW. Those multiples look attractive if the book converts: a few years of contracted work, and under 10 times the revenue the build plan implies — not a 20-times software multiple on a hope. Financing risk is the other side of the same picture. One debate is a high EV versus invested capital. Another is a high EV versus off-balance-sheet commitments. Oracle now forces both into one name: hyperscaler-scale backlog, a neo-cloud-like equity valuation, and a commitment stack you can inspect in ABBX. Verdict: no broad AI bubble signal. Week 17 of our ongoing weekly series. Updates every Friday. Full interactive dashboard (Fundamentals, Forward Valuation, Expanded Debt & Capex, Capacity) available at Convequity. #AIBubbleBarometer #AIBubble

Investor Letters

All letters

GameStop Is Extreme Deep Value

GameStop's collectibles mix rose to 45% of sales as gross margin reached 44%, supporting a deep-value case built on cash and store…

GME $12B
The Value Road 8 clicks

A2Gold: Research Note

A2Gold’s first Taylor drill holes returned 20.96 g/t AuEq over 1.5m and 209.4 g/t silver over 10.7m, alongside 141.10 g/t gold at…

KGC $29B
Atrium Research - Equity Research 3 clicks

[CoStar] Homes are different

CoStar spent more than $1 billion building Homes.com to challenge Zillow, betting seller-agent leads, proprietary listing content and…

CSGP $11B
scuttleblurb 4 clicks
MA · long

Mastercard

Mastercard trades near $495, about 18% below its $602 52-week high, framing a favorable long risk-reward case.

MA $494B
Value Investors Club 1 click

“Going Through Some Pain”

Dick’s Sporting Goods’ $2.4 billion Foot Locker acquisition nearly quadruples its store count and adds international exposure, risking a…

DKS $12B
TSOH Investment Research 1 click

The Monday Morning Briefing

Latticework’s weekly briefing spotlights discounted European assets including Barco, Bolloré, Brookfield and D’Ieteren, with catalysts…

BN $82B
Latticework by MOI Global 4 clicks

Brookfield of Dreams

Brookfield is recasting itself from an industrial owner into a $1.3 trillion asset manager and insurer, betting AI infrastructure can…

BN $82B
Net Interest

Publications we follow

Every publication on this site, hand-picked.

110 publications

Newsletters 93

YouTube 4

Blogs 12

Seeking Alpha 42 of 199

Nominate a publication

X accounts we follow

Every account on this site, hand-picked.

72 accounts
Nominate an account

Investor letters we follow

189 firms

Sectors

Ordered by how often our editor reaches for them.