Jimmy's Trade Alert #3: Don’t Be Fooled by the Narrative

Buying a high-quality business with 30%+ upside...

Markets are supposed to be about numbers: revenue growth, margins, cash flow, valuation multiples.

But in practice, they often move based on something far more fragile: narratives.

A good story simplifies complexity. It helps investors make sense of a world overloaded with information. It creates conviction where the data alone might not.

“This company is the next big thing.”

“That one is broken beyond repair.”

These frames shape how we process every new data point.

And once a narrative takes hold, it tends to stick.

Sometimes it runs far ahead of fundamentals. Sometimes it lags behind them.

Either way, it colors perception, attracts flows, and moves prices (often dramatically).

Narratives can distort - but they also create opportunity.

For long-term investors, the real edge often lies in identifying when the market’s story about a business is wrong, incomplete, or outdated. That gap - between perception and reality - is where mispricings live.

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You don’t need to fight the narrative. You just need to know when it no longer fits the facts.

And sometimes, in the wreckage of a misunderstood story, you find something rare: a high-quality business hiding in plain sight.

One that aligns perfectly with the profile we look for:

• World-class moats across multiple layers

• Clear structural tailwinds

• Clean balance sheet + optionality from other bets

• Proven capital allocation

• And a valuation that ignores the upside from emerging AI platforms

After doing the homework - going deep on the numbers, the competitive position, and the execution roadmap - we were left with only one conclusion:

We had to buy it.