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As always, the following are potential bargains that warrant a closer look, not blind investment. Read till the end to vote on which company you want us to do a deep dive on!
1. LVMH ($LVMHF)
LVMH Moët Hennessy Louis Vuitton is the world’s largest luxury group. They have a wide variety of luxury products varying from:
Fashion & Leather Goods (Louis Vuitton, Dior, Fendi)
Wines & Spirits (Moët & Chandon, Hennessy)
Perfumes & Cosmetics (Dior Beauty, Guerlain)
Watches & Jewelry (Tiffany, Bulgari, TAG Heuer)
Drawdown
The company is in a deep drawdown, having lost 44% of its market capitalization in the last 2 years.
Slowing growth — LVMH entered 2023 with strong momentum, but by the second half of 2023, its growth had sharply slowed. Revenue growth for Q3 2023 was only 1% YoY, and next year the group sales declined by 3%. LVMH’s revenue in 2024 was €84.7 billion, down 1% from 2023. For the first half of 2025, revenue decreased by 4% and net profit declined by 22%.
Demand normalization — This connects to the above point, but people who were stuck in the pandemic bought a lot more luxury products as revenge spending. Many consumers had effectively brought forward luxury purchases during the boom, and by 2024, their wardrobes (and budgets) were less accommodating.
Weak Chinese recovery — As we highlighted in our Estée Lauder deep dive, the Chinese travel and spending haven’t yet come back to their pre-pandemic levels. LVMH’s Asia-Pacific sales (ex-Japan, mainly China) actually fell 16% in Q3 2024.
Rebound Catalysts?
A U.S.–EU deal landing around 15% tariffs (vs. feared 30–50%) plus a second Louis Vuitton factory in Texas lowers uncertainty and offsets duties via local production.
China just spared major cognac producers Pernod Ricard, LVMH, and Remy Cointreau from hefty duties on EU brandy.
Any rebound on overall macroeconomic conditions (especially China) will be a catalyst for LVMH as they remain the category’s cultural anchor.
A sidenote here is that it’s very interesting to observe that many luxury players are in a drawdown (Estée Lauder, Gucci, Versace, etc.).
2. Reddit ($RDDT)
Reddit is a community-driven social platform built around topic-based forums (“subreddits”) where users post, vote, and comment on everything from breaking news to niche hobbies. They primarily monetize through advertising and have also recently leaned into data licensing to power search and AI models.
Drawdown
Following its 550% run-up following the IPO, Reddit has now lost 35% of its market cap in the last five months. At its bottom, the company experienced a 60%+ drawdown in April ’25.
The most important factor causing the drawdown is user growth deceleration. The issues began with the Q4 '24 earnings reporting, where Daily Active Users (DAUs) growth was less than analyst expectations.
Adding to this, Reddit warned on back-to-back earnings calls (Q4 and Q1) that changes to Google’s search algorithm were slowing its new user inflows. Once Google started showing its AI summaries, there is less reason for a user to visit Reddit.
Rebound Catalysts?
While I am not a fan of meme stocks (Reddit has a high chance of becoming one), what Reddit is going through is very comparable to what Meta had in 2022. Meta stock also had a massive drawdown due to reporting a drop in DAUs.
Reddit is rolling out a lightweight app called “Reddit Lite.” This simplified interface is designed for emerging markets and low-bandwidth regions to accelerate international user growth.
Reddit’s revenue per user is climbing, with the platform’s ARPU (Average Revenue per User) improving significantly.
Finally, the company possesses a treasure trove of user-generated content and discussions. While the company sold this data for ~$60 million/year last year, this can increase massively as AI models need more and more real-world data to train on. (Plus, this is almost a 100% margin business as Reddit has no incremental cost in providing this data)
Note — Reddit will announce its Q2’25 results today after market close. All eyes will be on the DAUs.
3. Adobe ($ADBE)
Adobe builds software for content creation, document productivity, and digital marketing. Core products include Photoshop, Illustrator, After Effects, and Acrobat PDF, among others. Monetization is primarily recurring subscriptions and enterprise contracts, supplemented by usage-based services and training.
Drawdown
The stock is down more than 40% over the last year. Adobe was one of the worst-performing large-cap tech stocks during 2024 (down ~25% for that year, versus a +20% gain in the tech sector).
Investors are bearish due to a mix of fundamental and competitive concerns.
A major overhang on Adobe’s stock is the intensifying competition in its core markets, particularly driven by the rise of new AI-driven creative tools. Rival platforms like Canva have captured the easy-to-use AI design tools, and upstart AI image generators like Midjourney and Stable Diffusion threaten to erode traditional graphics software like Photoshop & Illustrator.
Another issue is the saturated subscription model market. With most of the serious creators already on Adobe’s plans, future growth relies on upselling and price increases (which have become harder due to the previous point).
Rebound Catalysts?
Based on fundamentals, there is not much wrong with the company. The company had beaten expectations as of its latest quarter with a record revenue of $5.9B (+11%YoY) and better than expected EPS.
AI model Firefly — Adobe has expanded its AI image generation and editing feature across its suite. Depending on its effectiveness, it could boost user engagement and justify new pricing tiers.
After the steep drop, Adobe’s valuation is now much more palatable. It trades around 19× forward earnings and ~7× sales, cheaper than many peers (for example, Microsoft at ~30×, Autodesk at ~65× trailing P/E)
Since they are already deeply integrated into the enterprise eco-system, upselling simple but effective AI tools (Acrobat AI Assistant) might generate a surprising amount of revenue. (Document group subscription revenue grew +15% YoY in Q2)
We would love to hear what you think.