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Saturday, October 31, 2026

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When the liquidity does not add up

Arbor Realty Trust’s dividend suspension is presented as creating $60 million of liquidity, raising questions about its ability to meet 2027 debt maturities.

ABR $2.2B
John Hempton's Newsletter 3 clicks

From X

@DOMOCAPITAL 3 clicks

DOMO Capital Management, LLC on X

Adjusted EBITDA should be lower than Q2 and last year's Q3 (this year's Q2 was actually higher than last year's Q3!). But EPS should definitely be above analyst estimates and could possibly top Q2 EPS. Market doesn't understand how the hedges on the specialty alcohol work. Q2 EPS were penalized simply because the price of ethanol fell a bit during Q2. Well... during Q3, the price of ethanol rocketed higher. Therefore, even though Q2 had a much better average crush margin than Q3, it's possible Q3 could have higher EPS due to how these hedges work. To be clear - on an annual basis - the hedging has no impact. $ALTO is just locking in profit margin. But since it's not hedge accounting... it has an impact on each quarter's earnings. ALTO's business is operating very well. They're posting quarter after quarter of profitable earnings. Q4 should be solid as well and crush margins are strengthening again. Once California E15 kicks in (1/1/2027) then margins will strengthen further. Additionally: It sounds like passage of farm bill that includes E15 is very likely by end of this year. Check out this Politico article highlighting how the GOP is likely to pass a ton of stuff before the end of the year: https://t.co/3VL4DjDnzy "Such a bill, he added, would be “giant” and would include “all the Republican priorities that we can get done.” The House approved a framework for a party-line bill over the summer that includes war funding, farm aid and election integrity incentives. But the push has so far run aground in the Senate Moreno said the threat of imminent Democratic control of either the House or Senate would jump-start matters — and potentially push Republicans to include a debt-ceiling increase as well." "Moreno said if Democrats win control of both chambers, Republicans should stay in session nonstop to pass GOP legislation — which could be a tall order given worries about poor post-election attendance. “If we lose the House and the Senate, we should be here from Nov. 9 until Dec. 31 with no break at all,” Moreno said. “Like, we’ll have turkeys here for Thanksgiving because we have to get this done.”"
@convequity

Convequity on X

We think the market is pricing in too steep a growth slowdown for $AVGO. In Q3 FY26, Broadcom's AI semiconductor revenue reached $16.7 billion, roughly 56% of its $29.6 billion total revenue. In the same quarter, AI revenue grew 221% year over year, compared with 86% for total revenue. As AI accounts for more of the business, it has a greater influence on consolidated growth, so models that assume Broadcom's growth must slow each year risk missing this change. Our valuation work suggests that the market is pricing in revenue growth of approximately 66% in FY26 and 62% in FY27, followed by a 20% compound annual growth rate in years three to seven. Our view is that this assumes growth slows too quickly. Our base case gives more weight to the customer pipeline and management's outlook for the AI business. On that basis, we estimate Broadcom's total revenue could grow by 100% in FY27, compared with the 62% the market implied, with growth remaining well above the market's assumptions as we approach 2030. We increased Broadcom's portfolio weight from approximately 2.2% to 3.4% because we think the market underestimates both how fast Broadcom can grow and how long that growth can last.

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Verra veerer

Verra Mobility’s Avis termination threatens 2027 earnings, while Government Solutions profit rose 25% and implied fourth-quarter guidance…

VRRM $404M
The Oak Bloke 2 clicks

FTAI 3Q26: Aero margins in focus

FTAI’s Aerospace Products margin rebounded to 31% as CFM56 module output rose, while Power deposits and contracted deliveries fund its 2027…

FTAI $20B
Stock Thoughts 4 clicks

Microsoft's AI Boom Has A Cost

Microsoft’s Azure grew 48% as AI monetization accelerated, but doubled CapEx, largely for CPUs and GPUs, reduced quarterly free cash flow…

MSFT $3.9T
Yiannis Zourmpanos 2 clicks

CVX Earnings Review

Chevron’s Q3 revenue rose 35% to $65.2 billion and EBITDA 75% to $20.2 billion, while production trailed guidance and refining margins…

CVX $423B
Cestrian Capital Research 3 clicks

SNY Earnings Review

Sanofi raised FY26 guidance after Q3 sales grew 14.3% at constant currency, led by 34.8% Dupixent growth; vaccines declined 6.6%.

SNY $114B
Cestrian Capital Research 1 click
PSN · long

Parsons CORP

Parsons generates roughly half of its $6.4 billion revenue from Federal Solutions, serving defense and intelligence customers.

PSN $5.6B
Value Investors Club

AMZN Q3 FY12/26 Earnings Review

Amazon reported $201.9 billion Q3 revenue and 39% AWS growth, while $220 billion in 2026 capex drove trailing free cash flow to a $42.4…

AMZN $2.9T
Cestrian Capital Research 3 clicks

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