Most important take away

The Mag 7 stocks are now trading at a combined 21.5x forward earnings after significant multiple compression, with Microsoft at a market multiple while growing 20% annually. Jonathan Boyar argues this is a generational buying opportunity for patient investors with a 2-4 year time horizon, as short-term sellers driven by momentum and de-risking are creating mispriced assets across tech, consumer, and entertainment sectors.

Summary

Mag 7 / Large Cap Tech — Multiple Compression Creating Opportunity

• NVIDIA (NVDA): Trading under 20x forward PE vs. its 5-year average of 48x. Massive compression despite strong fundamentals.
• Microsoft (MSFT): Boyar’s largest holding (bought 2007-2008). Now at a market multiple with 20% growth. Down 33% from highs. Boyar is adding for accounts where it was previously too expensive. Supply-constrained on Azure/Copilot — investing in growth long-term.
• Meta (META): Down 8% on the day of recording. Trading at 16x forward earnings. Boyar sees a potential catalyst if Zuckerberg declares a “year of efficiency” moment and pulls back on unprofitable AI spending (similar to the metaverse pivot). The $90B metaverse burn showed he can admit mistakes and redirect.
• Salesforce (CRM): Boyar started buying ~20 points above current levels. Trading at 13-14x. He is building the position slowly over time. He passed on Adobe (ADBE) because he is unsure they will survive the AI disruption to design tools.
• Actionable insight: Buy these names slowly, in tranches, rather than trying to time the bottom. Momentum is powerful, so start small and add as the stock stabilizes or turns.

Uber (UBER) — Autonomous Vehicles as a Tailwind, Not a Threat

• ~$150B market cap trading at roughly 18x with ~$10B in expected free cash flow, buying back stock, growing 20-30%.
• Boyar and Brown both argue Uber is in “pole position” for autonomous vehicles. The thesis only fails if one single AV company (e.g., Waymo) captures 80%+ market share, which is extremely unlikely.
• Uber is investing in the AV ecosystem: deals with Lucid (10,000 cars), Rivian (up to 50,000 cars), Pony AI, and partnerships globally.
• Delivery is 33% of revenue (an underappreciated segment). Waymo has no delivery offering.
• NVIDIA’s new OEM autonomy platform (software + chips for Mercedes, Cadillac, Volvo, etc.) means more autonomous cars from more makers — all potential Uber fleet partners.
• Actionable insight: The more AV players that emerge, the more Uber’s platform/network wins. Current price reflects fear of Waymo competition that is likely overblown. Boyar sees the stock worth $125+.

MGM Resorts (MGM) — Japan Casino as Major Catalyst

• Bought back 45% of outstanding shares. Ratio vs. S&P 500 hitting 7-month highs.
• BetMGM inflecting from -$200M losses to +$200M annual profit.
• The biggest catalyst: MGM will open the only legalized casino in Japan in 2030, owning 43%. They project ~$6B in revenue from Japan alone vs. ~$8.5B from all current Las Vegas properties.
• IAC/Barry Diller owns ~25% of MGM, bought during COVID. Aligns with their offline-to-online thesis.
• Risk: Sold land to private equity (now paying rent with ~2% annual escalators), and the Vegas experience may be degrading due to cost-cutting.
• Actionable insight: The Japan casino is not yet in street estimates and could nearly double the revenue base. Discipline shown in pulling out of the NY Westchester project is a positive management signal.

Scotts Miracle-Gro (SMG) — Cheap Consumer Staple with Sale Potential

• $3.6B market cap, trading at ~$62, 9.5x EBITDA (should trade at 12-13x).
• Controlled by the Hagedorn family. CEO James Hagedorn is 69 and likely tired after the cannabis disaster (~$1-2B loss).
• Lost significant value from COVID/cannabis bust but now looks like sellers are exhausted.
• Actionable insight: Boyar expects this could be sold. Family-controlled companies with aging founders and exhausted stockholders often become M&A targets.

Madison Square Garden Entertainment / Sphere (SPHR)

• Stock went from $25 mid-2024 to $108. The Sphere in Vegas (18,000 seats) has proven the concept.
• Going asset-light for expansion: smaller Spheres planned in Maryland (near DC) and Abu Dhabi, with outside investors funding each project.
• Risk: Losing the “magic” if too many are built (IMAX comparison).
• Actionable insight: Boyar thinks you can still make money here despite the run-up, but acknowledges it is behaviorally hard to buy after a 4x move.

Atlanta Braves (BATRK) — Liberty Media Spinout

• Trading at ~$42; Boyar values it at ~$60 in a sale scenario.
• John Malone (controlling shareholder, age 82-83) is simplifying his empire. Includes real estate around the stadium (“The Battery”).
• Similar to other Boyar ideas: aging controlling shareholder + public company tax disadvantage = catalyst to go private or sell.
• Actionable insight: Expect a sale within 1-2 years as Malone simplifies. The $10M salary deduction cap for public companies (top 5 employees) creates tax pressure to go private, especially with rising player contracts.

Floor & Decor (FND) — Housing Recovery Play

• Described as a “premium foreign company” (flooring) that has been annihilated.
• Took business from Home Depot and Lowe’s; draws customers into stores with little private label competition.
• Actionable insight: This is a housing recovery bet. If housing turns, FND benefits disproportionately.

Broader Market Themes and Actionable Insights

1. Buy slowly, in tranches. Boyar’s core method: start small, add over time, and be willing to add more as momentum shifts. Do not try to catch the exact bottom.
2. Small/mid-cap M&A renaissance is coming. Interest rates need to settle, but buyouts of notable mid-cap companies (especially software) will re-rate the entire space and create a floor under prices.
3. Family-controlled companies with aging founders are prime catalysts. Tax rules limiting salary deductions for public companies’ top 5 employees (capped at $10M) create structural pressure to go private, especially in sports and entertainment.
4. Narrative violations create opportunity. Stocks punished for violating a popular narrative (Uber = asset light, Vegas = dead, Mag 7 = overvalued) are where the best risk/reward sits for patient investors.

Chapter Summaries

Pre-Show Banter The hosts and Jonathan Boyar chat casually about restaurants, commutes on the Port Washington LIRR line, and food spots before the show begins.

Sponsor Messages and Introductions Ads for WisdomTree (Japan ETF, ticker OPPJ) and Janus Henderson. Josh Brown introduces Jonathan Boyar, principal at Boyar Value Group and host of The World According to Boyar podcast, and grandson of the Chef Boyardee founder.

Mag 7 Valuation Discussion The group examines the historic multiple compression in Mag 7 stocks. Forward PEs have collapsed (NVDA under 20x, MSFT at market multiple, Meta at 16x). They debate whether sellers are being short-sighted or rationally responding to the shift from asset-light to heavy capex models. Boyar argues this will look like a gift in 2-3 years.

Meta’s Unique Problem Brown distinguishes Meta from other Mag 7 names, arguing Meta’s AI spending (Llama, GPUs, data centers) lacks a clear return path unlike Microsoft’s Azure. The group speculates Meta may eventually pull back spending, creating a positive catalyst.

Uber and Autonomous Vehicles Extended discussion on why Uber is well-positioned for the AV future. Boyar and Brown argue the “more players, the better” thesis: NVIDIA enabling OEM autonomy, Uber’s partnerships with Lucid/Rivian/Pony AI, and delivery as a competitive moat Waymo lacks. The stock is mispriced due to Waymo fear.

MGM and the Japan Casino MGM’s aggressive buybacks, BetMGM’s profitability inflection, and the 2030 Japan casino (projected $6B revenue, 43% ownership) are discussed as underappreciated catalysts. IAC’s 25% stake via Barry Diller adds smart-money validation.

Sphere Entertainment The group marvels at Sphere’s run from $25 to $108 and discusses the asset-light expansion model for future Spheres globally. Risk of diluting the premium experience is noted.

Scotts Miracle-Gro, Floor & Decor, and Value Investing Philosophy Boyar pitches SMG as a cheap consumer staple with a potential sale catalyst. Floor & Decor is positioned as a housing recovery play. Boyar discusses his Gabelli training and the importance of finding companies with identifiable catalysts.

Atlanta Braves and Public Company Tax Pressure Boyar explains the BATRK thesis: Malone simplifying, tax rules on executive pay making public ownership uneconomical for sports teams, and a likely sale at ~$60 within 1-2 years.

Software M&A and Closing Thoughts The group discusses whether large SaaS buyouts could re-rate the software sector. Boyar thinks the real M&A boom will be in small/mid-caps. He directs listeners to boyarvaluegroup.com and his Substack.