Little K

😉INFJ
📈Investor & Trader
📊Long-game
💡Contrarian
✍🏼Blogger
📚Reader
⌨️Vibe Coder
💬Living a lifetime recognising true value
💬最懂行的外行人

[Little K @Little_K_Story]

These are the 2 main strategies I run currently.

[Little K @Little_K_Story]

@BullDemonBro She will do alright don worry for her HAHAHA!

[Little K @Little_K_Story]

@Iamjaneezy AI tech itself isnt overhyped, but some investments are

[Little K @Little_K_Story]

@ApesAlphaHQ Yeah too far different she is not gonna follow back

[Little K @Little_K_Story]

@linbo_tang Good night~ safe trip

[Little K @Little_K_Story]

I don't care for short posts about why demand is here and share prices dropping mean undervalued.

But something like this, showing further justification is what I look for! Shout out to him.

I don't mean he'll be 100% right, but I appreciate deeper thoughts, valuation methods, and risk control.

[Matthew Solomon @matt_solomon10]

A few people have DM'd me asking why I picked $IREN over other neocloud names. I think the answer is important:

The downside was easier to model than other neocloud names I was looking at. $IREN owns the whole stack: the power, the land, the data centers, and the GPUs. So I could value what's already signed and built, and work out what the stock is worth if nothing new goes right. That exercise convinced me the setup was asymmetric, probably very asymmetric, and I didn't think the market was pricing that in.

The base and upside cases are harder. We don't have perfect information on pricing for 2027 capacity or on construction timelines. But I'd argue there are more ways for this to surprise to the upside than the downside.

That's why I'm working on a 2027 price target. I think it's important to have a logical target we can anchor to as a community, and we have a community of capable people who can get close to the truth if we put the assumptions out in the open and argue about them.

Where I'm at now: waiting for earnings. $IREN has a lot of different hands it can play (pricing, prepay, financing, which sites get built first, customer mixes, etc.), and the report should show us which ones it's playing.

For end of '27, as of today:

The fundamentals justify the current price in almost every scenario I can think of. The main exception is IREN failing to sell its 2027 capacity and having to raise money near the lows, and I put low odds on that.

Right now, that's the most important notion: I feel very confident I can anchor to the current price as a floor, and value is being created from here. I'll put a real target range out after earnings.

[Little K @Little_K_Story]

@venom1s FD feels safer cos u never see it lose to inflation.
and the day ppl swear off stocks is usually closer to the bottom than the top.

[Little K @Little_K_Story]

@VictorTaelin The cost of a bug going up is the part ppl underrate.
once AI can find exploits for cheap, patch it later stops being a real plan.

[Little K @Little_K_Story]

@SpeculatorFL Some of it only shows up once per cycle tho, thats why a few yrs of screen time still isnt the full picture.

[Little K @Little_K_Story]

@murtuza_merc Cheaper routing calls kinda reward the teams who kept their stack simple.
a lot of those heavy agent frameworks were a workaround for slow expensive models anyway.

[Little K @Little_K_Story]

I found an interesting account to follow. It's hard to find contrarian views on AI investment on 𝕏.

Everyone agrees on AI's demand and usefulness, but valuations involve many other factors.

Following the crowd gets you nowhere—only a few get rich.

[Rose Celine Investments 🌹 @realroseceline]

What if everyone is right about AI but wrong about the investment?

This will probably get under the skin of quite a few people, particularly those heavily invested in AI infrastructure businesses. But I would encourage everyone to put their biases aside for a moment, forget about the stocks they own, and examine these businesses from a bird’s eye view. Are they truly extraordinary businesses with wonderful economics, sustainable competitive advantages, pricing power, and high returns on capital? Or are we confusing extraordinary demand for something with the existence of an extraordinary business?

I think this is something too many investors overlook. History is filled with industries that transformed the world and experienced tremendous growth, yet many of the businesses operating within them struggled to generate attractive returns for shareholders. Airlines revolutionized transportation, telecommunications connected the world, and railroads transformed economies, but that didn’t automatically make the companies wonderful investments. Just because the world desperately needs something doesn’t mean providing it is an extraordinary business.

When I examine AI infrastructure businesses, I see extraordinary demand and revenue growth, but also staggering capital requirements, huge financing needs, and expensive equipment that becomes outdated surprisingly quickly. Unlike businesses that can grow enormously without requiring much additional capital, these companies need to spend billions simply to expand their capacity. And eventually, actually rather quickly, much of that equipment will need to be replaced. So how much of this impressive growth will actually translate into cash that belongs to shareholders?

Consider depreciation, which I think is one of the most underappreciated aspects of these businesses. Imagine a company purchases $10 billion of computing equipment and assumes it will remain economically useful for 5 years, resulting in $2 billion of annual depreciation. But if the equipment’s actual economic life turns out to be 4 years, that annual economic cost increases to $2.5 billion. That’s a $500 million difference simply because one assumption about the useful life of the equipment changed.

And here’s something even more fascinating. The same technological advancements making AI increasingly powerful may simultaneously make existing computing equipment less competitive. If tomorrow’s equipment delivers twice the computing power for the same price, what happens to the economics of yesterday’s infrastructure? Technological progress can create extraordinary value for society while simultaneously destroying some of the economic value of the assets purchased to support it.

Then there’s pricing power, which deserves considerably more scrutiny. When demand exceeds supply, providers can enjoy attractive prices, but that doesn’t establish a durable competitive advantage. What happens when competitors expand capacity, supply catches up to demand, and customers gain more alternatives? Will these businesses retain attractive pricing, or will competition eventually transfer much of the economic benefit to customers in the form of lower prices?

I’m also fascinated by the enormous emphasis on EBITDA and revenue growth. Imagine a company invests $10 billion in infrastructure and generates $3 billion in annual EBITDA, which sounds extraordinary until you subtract $2 billion in economic depreciation and $600 million in financing expenses. Suddenly, you’re left with just $400 million in pretax earnings. The business hasn’t changed, but your understanding of its economics certainly has.

1/👇

[Little K @Little_K_Story]

@abalu_uthman The emergency fund part is the one ppl skip, and its exactly what forces them to sell at the bottom.

[Little K @Little_K_Story]

@_dylanga @tryramp Building for urself is the best spec tbh, the ppl using it every day catch what a vendor never sees.

[Little K @Little_K_Story]

@callebtc Writing it is the easy part now.
reviewing it still needs someone who knows what safe looks like.

[Little K @Little_K_Story]

@kenn_ronin The nightly self review is the interesting part.
curious how u stop it drifting when my reactions are just lazy thumbs up?

[Little K @Little_K_Story]

@wholemars 5 hours is probably the cleaning and charging window anyway.
at that point utilization is the whole economics of a robotaxi.

[Little K @Little_K_Story]

@ApesAlphaHQ Hihi im here

[Little K @Little_K_Story]

@linbo_tang Jthose who really write something their own will do. Just this alone u filter out most of the ppl here in 𝕏

[Little K @Little_K_Story]

@paraschopra Works for the build part.
but the ppl who struggled through it early usually know what to ask when the AI one shots smth half wrong.

[Little K @Little_K_Story]

@SarangSood Cos at 20% cheaper the headlines are also 20% scarier, and thats what ppl actually react to.

[Little K @Little_K_Story]

@championswimmer Agree, and the fix is the same tool tbh.
point AI at the old hand written code and stress test it before attackers do.