Valuing the Buyable MANGOES — Meta, Nvidia, and Google at Today's Prices

A great story at the wrong price is a bad investment

Of the four buyable MANGOES, the three I'd actually run through the numbers are Meta, Nvidia, and Google. SpaceX sits in that post-IPO premium zone I consider too speculative for this exercise.

There's no argument that all three are excellent businesses. The question is always the same: is the price you pay today worth the value you're getting? I ran a 10-year valuation on each to gauge a "reasonable entry." What follows is based on my own assumptions — it's a thought process, not a stock tip.

Meta: the quality is clear, the price gives me pause

Meta booked over $56 billion in revenue last quarter, up 33% from a year ago.

Its market cap is about $1.46 trillion. Free cash flow last year was $48 billion — above its five-year average of $41 billion even after a big ramp in AI data-center spending. It trades at 30 times free cash flow but only 20 times earnings. That gap exists because data-center capex makes accounting earnings run higher than cash flow, and it's a difference I'm not especially worried about right now.

The quality metrics are solid: return on invested capital averaged 18.6% over five years, revenue grew 22% a year over three years and 27% a year over a decade, and gross margin sits at 82%. Analysts see EPS going from $33 this year to $58 in four to five years, and revenue more than doubling from $258 billion to $584 billion over seven years.

My stock-analyzer assumptions: revenue growth of 7 / 10 / 14% over the next decade, net margins of 29 / 31 / 33%, an applied P/E of 20 / 24 / 28 ten years out, and a 9% required return (to estimate intrinsic value with no margin of safety). The stock is at $560. The output: a low of $580–600, a high near $1,500, and a midpoint around $900–925. If the middle assumptions all come true, that's roughly a 15% annual return.

Nvidia: the numbers are hard to believe

Nvidia's revenue jumped 85% last quarter to over $80 billion, with the data-center segment alone up 92%.

To see how surreal that is: as recently as 2024, Nvidia didn't clear $80 billion in a full year. Now it does that in a single quarter. Its market cap is about $5.1 trillion, and its cash more than covers its debt — essentially a net-cash business.

The quality is overwhelming: ROIC averaged 45% over five years, and free cash flow was about $120 billion over the last twelve months — more than double the five-year average of $50 billion. Net income is $160 billion, one-year net margin is 63% (52% over ten years, 54% over five), and gross margin is 74%. On the eight pillars, though, valuation is heavy: 105 times its five-year P/E and 88 times five-year free cash flow. Analysts see EPS going from $4.78 to $13.27 over six years, and revenue from $217 billion to $684 billion in five.

My assumptions: revenue growth of 10 / 15 / 25% over the next decade, net margins of 35 / 45 / 55%, an applied P/E of 20 / 24 / 28, and a 9% required return. From $209, the output was a low of $114, a high of $738, and a midpoint of $245 — about an 11% annual return at the middle. The catch is how much of that lofty growth actually shows up. Because I think the world's best-case expectations usually don't pan out, I tread carefully with names like this.

Google: I might just be too conservative here

Google's revenue grew 22% last quarter to nearly $110 billion, and Warren Buffett's Berkshire Hathaway has been adding shares.

Market cap is about $4.28 trillion and enterprise value about $4.38 trillion, so net debt is roughly $100 billion. Free cash flow was $64 billion — but net income was a staggering $160 billion. That $100 billion gap is entirely capex poured into data centers and AI. For context, Google recently signed a deal to lease data-center space from SpaceX at $920 million a month for three years — about a $30 billion deal.

Net margin has climbed steadily: 26.9% over ten years, 29.4% over five, and 38% last year. ROIC is around 18.7% over five years. It trades at 66 times free cash flow and 27 times earnings. Analysts see EPS going from $14.54 to $31 in five years, and revenue from $500 billion to over $1 trillion in seven.

My assumptions: revenue growth of 7 / 9 / 13%, net margin and FCF of 28 / 30 / 32%, an applied P/E of 20 / 23 / 26, and a 9% required return. But given last year's 38% margin, these might actually be too low — YouTube and ads are growing furiously. From $342, the output was a low of $240, a high of $530, and a midpoint of $330. With the midpoint below today's price, this isn't a comfortable entry for me. Of course, you might look at the same numbers and reach a completely different conclusion.

The three side by side

Metric	Meta	Nvidia	Google
Market cap	~$1.46T	~$5.1T	~$4.28T
Last-quarter revenue	$56B+ (+33%)	$80B+ (+85%)	$110B (+22%)
Free cash flow	$48B (5y avg $41B)	$120B (5y avg $50B)	$64B
ROIC (5y)	18.6%	45%	~18.7%
Current price	$560	$209	$342
My midpoint	$900–925	$245	$330
Implied return at midpoint	~15%/yr	~11%/yr	low entry appeal

Bottom line: the price decides, not the business

All three are excellent businesses. But by my assumptions, the one closest to an attractive entry is Meta; for Nvidia it hinges on whether the growth assumptions hold, and for Google it's the current price itself.

My point is simple: even a great story becomes a bad investment at the wrong price. It's not the nickname — it's the quality of the business and the price you pay that decide your return. I'm asking whether these companies will still be here in 10 or 20 years with bigger revenue and profit, and whether I can pay a reasonable price today. That's the whole of what I look at.