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Welcome
Welcome to this week's edition! We apply fundamental price-valuation methods together with our proprietary efficiency formulas to evaluate how well each stock works for capital. Using AI as a tool we deliver clear, fact-checked insights into companies across sectors. Each issue highlights valuation ranges, risk profiles, and efficiency ratings so you can navigate the market with discipline and precision.
What You'll Get Every Week
Macro Trends: A simple overview of the economy and how it could impact stocks.
How to Understand Our Efficiency Score: An easy guide to our stock rating system.
Stock Evaluations: Clear breakdowns of 4-5 stocks, with stats, background, what might make them go up, and what to do.
Quick Portfolio Overview: A table summing up the stocks for quick checks.
Macro Trends
The economy looks strong but has some risks to watch. The yield curve measures the difference between long-term and short-term interest rates. Right now, the spread between the 10-year and 2-year Treasury yields is about 0.51%. This positive spread suggests economic growth ahead and lower chances of a recession. The Federal Reserve, which sets key interest rates, cut the federal funds rate by 0.25% in October to a range of 3.75%-4.00%. This makes borrowing cheaper, helping growth companines invest more easilty..
Credit spreads show how much extra interest companies pay compared to safe government bonds. High-yield spreads (for riskier companies) are around 3-4%, and BBB spreads (for medium-risk) are about 0.98%. These tight spreads mean investors feel confident about company debt, but they could widen if economic shocks hit. GDP growth, which tracks how much the economy expands, was 3.9% for the third quarter of 2025 (July to September). That's driven by strong spending from consumers and businesses. Unemployment rose slightly to 4.3% in August. Inflation, measured by the Consumer Price Index (CPI), hit 3.0% in September—above the Fed's 2% goal but still manageable.
The U.S. trade deficit—the gap between what we import and export—has been affected by tariffs. The Supreme Court might review Trump-era tariffs, adding uncertainty. This could hurt tech stocks by increasing costs, while healthcare companies might benefit from overall
How to Understand Our Efficiency Score
Our Efficiency Score shows how well a stock's price matches its real value, using math like future cash predictions and comparisons to similar companies. Scores go from 0-10:
Score Range | Rating | What It Means |
|---|---|---|
9.0-10.0 | Exceptional | Great deal; lots of potential with little risk. |
7.0-8.9 | Solid | Good balance; worth holding long-term. |
5.0-6.9 | Fair | Okay for now; need good news to improve. |
3.0-4.9 | Weak | Not great; more risks than rewards. |
0-2.9 | Poor | Stay away; too expensive or troubled. |
Stock Evaluations
UnitedHealthcare (UNH): Leading Managed Care Provider with Strong Cash Flow
Key Stats
Q3 Revenue: $113.2 billion (up 12% year-over-year).
Net Income: $2.5 billion, with diluted EPS of $2.59.
Cash Position: $27.2 billion, supporting operations and M&A.
Efficiency Score: Equity 6.2/10 (Fair), LEAP 5.4/10 (Fair)
The Story UnitedHealthcare is a big health insurance company. It runs two main parts: UHC for insurance and Optum for services like pharmacy benefits and doctor networks. It helps millions of people get healthcare. In the third quarter, sales grew a lot, and they made $4.3 billion in operating profit. But medical costs were high at 89.9% of premiums. The company's strengths are its huge size, mixed income sources, and lots of cash from operations ($18.6 billion so far this year). Weak spots include government investigations and rising costs in Medicare plans for seniors. Overall, UnitedHealthcare is good at buying other companies and running efficiently, which helps it in the steady healthcare world.
What Could Spark a Rise
Clear rules on 2026 Medicare payments to keep costs stable.
Better profits from buying parts of Optum.
Extra cash leading to more stock buybacks and dividends.
Action Plan
Price Range | What to Do with Stocks | Options Idea | Max Portfolio Weight |
|---|---|---|---|
≤ $300 | Buy aggressively | Cash-secured puts at $290 strike | 5% |
$300–$335 | Accumulate on dips | Diagonal spreads (sell $320 put, buy $300 put) | 5% |
$335–$375 | Hold position | Covered calls at $380 strike | 5% |
$375–$410 | Trim holdings | Collar (buy $370 put, sell $420 call) | 5% |
≥ $410 | Reduce or sell | Debit put spreads ($410/$390) | 5% |
Fair Value: $300–$380 (upside of about 4% from current price of $341.56 to midpoint of $355).
Uber Technologies (UBER): Ride-Sharing and Delivery Platform Scaling Globally
Key Stats
Q2 Revenue: $12.7 billion (up 18% year-over-year).
Gross Bookings: $46.8 billion (up 17% year-over-year).
Cash & Equivalents: $6.4 billion, with $20 billion buyback authorization.
Efficiency Score: Equity 7.1/10 (Solid), LEAP 6.3/10 (Fair)
The Story Uber runs ride-sharing, food delivery, and freight services. It has over 180 million users each month. In the second quarter, trips jumped 18%, and they made $1.45 billion in operating profit. Earnings per share were $0.63. Strengths include its big network, growing Uber One memberships (36 million, up 60%), and cash for buying back stock ($3.1 billion in the first half). Challenges are high insurance costs, rules on gig workers, and currency changes abroad. Uber is focusing on better operations and new areas like self-driving cars, making it a growth pick as the economy picks up.
What Could Spark a Rise
More ads and memberships to boost profits.
Wins in court on worker rules to cut costs.
Using the $20 billion buyback plan with strong cash.
Action Plan
Price Range | What to Do with Stocks | Options Idea | Max Portfolio Weight |
|---|---|---|---|
≤ $95 | Buy aggressively | Cash-secured puts at $90 strike | 5% |
$95–$105 | Accumulate on dips | Diagonal spreads (sell $100 put, buy $95 put) | 5% |
$105–$115 | Hold position | Covered calls at $120 strike | 5% |
$115–$125 | Trim holdings | Collar (buy $110 put, sell $130 call) | 5% |
≥ $125 | Reduce or sell | Debit put spreads ($125/$110) | 5% |
Fair Value: $103–$115 (upside of about 13% from current price of $96.71 to midpoint of $109).
Cigna (CI): Health Services Firm with PBM Strength
Key Stats
Q3 Revenue: $69.75 billion (Evernorth up 15% year-over-year).
Adjusted EPS: $7.83 (beat estimates).
Medical Care Ratio: 84.8%, with strong Evernorth growth.
Efficiency Score: Equity 6.0/10 (Fair), LEAP 5.2/10 (Fair)
The Story Cigna offers health insurance and manages pharmacy benefits through Evernorth. It focuses on plans for companies and government. Third-quarter sales were $69.75 billion, with Evernorth growing 15% on client wins and specialty drugs. They beat profit expectations with adjusted earnings of $7.83 per share. Strengths are its pharmacy scale, specialty drug growth, and a 2.47% dividend yield. Weaknesses include higher medical costs (MCR up to 84.8%) and coming changes to pharmacy payments that could squeeze profits in 2026-2027. Cigna's mix of services and cost controls help it grow steadily in healthcare.
What Could Spark a Rise
Growth in specialty pharmacy offsetting PBM margin pressure.
Stable medical cost trends keeping MCR in check.
Successful PBM model transition resuming earnings growth.
Action Plan
Price Range | What to Do with Stocks | Options Idea | Max Portfolio Weight |
|---|---|---|---|
≤ $285 | Buy aggressively | Cash-secured puts at $270 strike | 5% |
$285–$320 | Accumulate on dips | Ladder puts ($280–$300 strikes) | 5% |
$320–$350 | Hold position | No options or small puts at $310 | 5% |
$350–$385 | Trim holdings | Covered calls at $370–$390 | 5% |
≥ $385 | Reduce or sell | Roll calls up/out | 5% |
Fair Value: $300–$370 (upside of about 37% from current price of $244.41 to midpoint of $335).
T-Mobile US (TMUS): Wireless Leader with Network Edge
Key Stats
Q3 Revenue: $22.0 billion (service up 9% year-over-year).
Net Income: $2.7 billion, with 9M cash flow at $21.3 billion.
Capital Returns: $3.0 billion dividends and $7.4 billion buybacks YTD.
Efficiency Score: Equity 7.1/10 (Solid), LEAP 6.0/10 (Fair)
The Story T-Mobile is a leading cell phone company in the U.S. It stands out with its fast 5G network and home internet services. In the third quarter, sales grew, and they added 1 million new customers. Strengths are low customer loss, partnerships for fiber internet, and strong cash to pay dividends and buy back stock. Challenges include lots of debt ($76.4 billion) and tough competition with deals. T-Mobile's size and tech focus make it strong in the phone industry.
What Could Spark a Rise
New fiber deals bringing in more sales.
Lower interest rates to handle debt better.
Keeping up growth in main phone customers.
Action Plan
Price Range | What to Do with Stocks | Options Idea | Max Portfolio Weight |
|---|---|---|---|
≤ $195 | Buy aggressively | No options; add on weakness | 5% |
$195–$215 | Accumulate on dips | Avoid chases | 5% |
$215–$240 | Hold position | Covered calls at $240–$250 | 5% |
$240–$260 | Trim holdings | Collar (buy $235 put, sell $265 call) | 5% |
≥ $265 | Reduce or sell | Debit put spreads | 5% |
Fair Value: $212–$244 (upside of about 9% from current price of $210.05 to midpoint of $228).
Quick Portfolio Overview
Company | Ticker | Efficiency Score (Equity / LEAP) | Fair Value Range | Upside Potential |
|---|---|---|---|---|
UnitedHealthcare | UNH | 6.2 (Fair) / 5.4 (Fair) | $300–$380 | ~4% |
Uber Technologies | UBER | 7.1 (Solid) / 6.3 (Fair) | $103–$115 | ~13% |
Cigna | CI | 6.0 (Fair) / 5.2 (Fair) | $300–$370 | ~37% |
T-Mobile US | TMUS | 7.1 (Solid) / 6.0 (Fair) | $212–$244 | ~9% |
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Important Legal Notices and Disclaimers
The information in this newsletter is for informational purposes only and does not constitute investment advice, financial advice, trading advice, or any other sort of advice. Past performance is not indicative of future results. All investments involve risk, including the possible loss of capital. You should do your own research and consult with a qualified financial advisor before making any investment decisions. We are not responsible for any losses incurred based on this content.
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