TSOH Weekly Roundup (05/08/26)

Welcome to the TSOH Weekly Roundup, which is sent out each Friday at 11am ET. Each update features a Chart of the Week and a brief discussion on three news items that are relevant to the TSOH investable universe.

Chart Of The Week

As discussed in Monday’s update, Roblox is seeing a quick reversal from the impressive 2H FY25 bookings reacceleration - and with it, their stock has fallen ~70% from where it traded in September 2025 (seven months ago).

Three Notable Items

“2026 Berkshire Hathaway Annual Meeting”

This past weekend, Warren Buffett took a seat on the floor of the CHI Health Center in Omaha, Nebraska, joining tens of thousands of fellow Berkshire Hathaway shareholders as CEO Greg Abel presided over his first annual meeting. My main takeaway from the meeting is that Greg has developed a thorough and detailed understanding of Berkshire’s key businesses, including their current shortcomings and their future opportunities. As I wrote in “Berkshire Hathaway: Transition”, I suspect the coming months and years will reveal why Warren and Charlie concluded Greg was the man for the job.

Greg Abel (58th minute): “We have a lot of work we need to do at BNSF… We have to get better operationally. We’re working hard to become more efficient and more effective, but we have to recognize where we are versus industry peers… Last year, we came in fifth out of the six Class I railroads [ranked on operating margins]. That’s a reality of where we are – but we are getting better and we’ll continue to get better. This performance leaves a lot of room for improvement… To achieve what Union Pacific has achieved [with operating margins that are ~500 basis points higher than BNSF] requires a step change in how we operate and in how we approach our operations.”

“Brown-Forman and Pernod Ricard Terminate Discussions”

One month after discussion with Pernod Ricard were publicly acknowledged, deal talks have now been terminated. There was also the reported ~$15 billion (~$32 per share) offer from Sazerac, but there hasn’t been much chatter about that deal in the ensuing weeks either. As a reminder, Brown-Forman was also the subject of a takeout target nine years ago; at the time, the company had a market cap of ~$22 billion. Any decisions will ultimately be judged through the lens of the interests and desires of the Brown family.

“Brown-Forman today announced that the company and Pernod Ricard have terminated discussions, as the companies were unable to reach mutually agreeable terms… We intend to create long-term value for all stakeholders by focusing on our strategic and operational priorities. This includes unlocking future growth by expanding our geographic footprint, continuing to build brands that resonate with consumers, and enhancing operational efficiency.”

“Brian Chesky’s Playbook: Scaling, Hiring, and New Founder Mode”

Chesky has appeared on plenty of podcasts in recent years, but this discussion with Patrick O’Shaughnessy touched on some new ground. In particular, it was interesting to hear Chesky discuss the need to balance Airbnb’s long-term growth ambitions against the near term financial demands of the business – something that I sensed was becoming a bigger focus for management as GBV growth and margin expansion started to level off.

Brian Chesky (57th minute): “I have all of these visions – but when you’re a public company, and you’re giving guidance, where the difference between hitting or missing guidance… you have to be careful. But being really careful isn’t an environment for mass innovation. So, I am also exploring little sandboxes, almost like a separate app – what is a radically different Airbnb?”

TSOH Updates

Here’s the updated TSOH research list for the past six months:

Monday’s research report will be an update on Peloton (PTON).

Have a great weekend!

NOTE - This is not investment advice. Do your own due diligence.

I make no representation, warranty, or undertaking, express or implied, as to the accuracy, reliability, completeness, or reasonableness of the information presented in this report. Assumptions, opinions, and estimates expressed in this report constitute my judgment as of the date thereof and are subject to change without notice. Projections are based on a number of assumptions, and there is no guarantee that they will be achieved. TSOH Investment Research is not acting as your advisor or in any fiduciary capacity.