TIP837: Adobe, Lululemon, PayPal – Are our Biggest Losers a Buy Now? w/ Daniel Mahncke & Shawn O’Malley

Investment mistakes and portfolio management strategies define the performance of the Intrinsic Value Portfolio, where recent divestments from Lululemon and PayPal highlight the dangers of management turnover and shifting competitive landscapes. Lululemon’s reliance on discounting signaled a loss of premium brand status, while PayPal’s strategic pivots failed to materialize as promised. Conversely, Adobe and CoStar remain core holdings despite market volatility; Adobe faces existential threats from AI yet maintains a dominant distribution advantage, and CoStar’s heavy investment in Homes.com is viewed as a misunderstood, mispriced opportunity rather than a fundamental failure. Managing a public portfolio creates significant cognitive biases, including anchoring and the pressure to defend past decisions. Success requires prioritizing qualitative business understanding over rigid financial models and maintaining a disciplined approach to opportunity costs when evaluating long-term compounders.