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CuriosityStream (CURI) just reported a 46% jump in revenue for the third quarter, fueled largely by explosive growth in its AI training data licensing business. The company also declared a dividend for the fourth quarter.

See our latest analysis for CuriosityStream.

CuriosityStream’s pivot into AI data licensing and the latest quarterly results have caught investors’ attention, with the share price rallying 188.6% year-to-date and a stunning 199.3% total shareholder return over the past twelve months. Momentum remains strong in the short term, which suggests the renewed growth narrative is resonating even as the company navigates evolving revenue streams.

If CuriosityStream’s transformation story intrigues you, now’s a great time to broaden your search and discover fast growing stocks with high insider ownership

With the stock’s rapid ascent this year and ambitious revenue forecasts ahead, the big question is whether CuriosityStream is still trading at a discount or if the market has already priced in all that future growth.

With CuriosityStream shares closing at $4.56 and the narrative’s fair value set at $6.17, current pricing suggests meaningful upside for those who believe in the company’s growth blueprint. Strong catalysts and forecast improvements frame an ambitious but debated valuation, driven by specific company milestones.

Surging demand for high-quality, rights-cleared video for AI training is driving a transformative new licensing revenue stream for CuriosityStream. Management cited recurring and growing partnerships with large-scale AI companies. This is establishing a durable, high-margin revenue base that is expected to fuel both top-line and earnings growth.

Read the complete narrative.

Is this growth run just getting started? The most popular narrative highlights bold assumptions for future revenue, profit margins, and share count. There’s a projection buried within that could flip expectations for years ahead. Curious what strategic shifts and industry forces are steering this bullish price target? Delve into the full narrative to see the math behind the market optimism.

Result: Fair Value of $6.17 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, persistent subscription declines and the unpredictable nature of AI licensing revenue could easily disrupt CuriosityStream’s current growth trajectory.

Find out about the key risks to this CuriosityStream narrative.

While analysts see upside based on growth and future potential, the current price-to-sales ratio of 4x stands out. This is higher than the US Entertainment industry average of 1.7x and well above the fair ratio of 1x. Such a gap suggests investors today could be paying up for optimism, which increases the level of valuation risk if growth stalls. Does the market know something others do not, or are expectations running ahead of reality?

See what the numbers say about this price — find out in our valuation breakdown.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out CuriosityStream for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 879 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.

If you want to dig deeper or see things from your own perspective, you can put together your own CuriosityStream story in just a few minutes. Do it your way

A great starting point for your CuriosityStream research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

Don’t wait on just one trend. Smart investors know opportunity loves company, so consider jumping on market shifts before the crowd does and elevate your strategy.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include CURI.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Melco Resorts & Entertainment (MLCO) released its latest quarterly earnings, showing a clear jump in both revenue and net income compared to the same period last year. The company’s improving profitability has caught investor attention.

See our latest analysis for Melco Resorts & Entertainment.

The upbeat earnings report appears to have powered strong momentum in Melco Resorts & Entertainment’s share price. The stock has climbed 11% over the past month and surged 64% so far this year. Although the five-year total shareholder return is still well below its prior highs, recent gains suggest a shift in sentiment as the company’s fundamentals improve and confidence returns.

If Melco’s sharp turnaround has you thinking bigger, now is a perfect moment to broaden your search and discover fast growing stocks with high insider ownership

Given the sharp rally and recent earnings surprise, investors are now weighing whether Melco Resorts & Entertainment remains undervalued or if the market has already factored in its future growth potential. Is there still a buying opportunity, or has optimism run ahead of reality?

At a price-to-earnings (P/E) ratio of 34x, Melco Resorts & Entertainment’s valuation is notably higher than the industry average. This makes the stock look expensive at the latest close of $9.06 despite recent growth.

The P/E ratio measures how much investors are willing to pay per dollar of company earnings. It is a widely watched indicator for hospitality companies because profits can fluctuate significantly in this sector due to shifting consumer demand and economic cycles.

While Melco’s P/E ratio is higher than the U.S. Hospitality industry average of 21.4x, it is still beneath the peer group average of 40.2x. This suggests the market is pricing in robust future earnings growth and a turnaround in profitability, but perhaps not to the same degree as its closest rivals. The fair price-to-earnings ratio is estimated at 33.3x, not far from Melco’s current multiple, which could mean future re-rating potential is limited.

Explore the SWS fair ratio for Melco Resorts & Entertainment

Result: Price-to-Earnings of 34x (OVERVALUED)

However, slower revenue growth or a sudden dip in profitability could challenge the optimism that has been driving Melco Resorts & Entertainment’s recent share price rally.

Find out about the key risks to this Melco Resorts & Entertainment narrative.

Looking beyond the price-to-earnings ratio, our DCF model estimates Melco Resorts & Entertainment’s fair value at $21.84, which is 58.5% above its current share price. This approach suggests the market may be underestimating Melco’s long-term cash flow prospects. Is the stock an overlooked opportunity?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Melco Resorts & Entertainment for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 879 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.

If you have a different perspective or prefer digging into the numbers yourself, you can shape your own Melco Resorts & Entertainment story in just a few minutes with Do it your way.

A great starting point for your Melco Resorts & Entertainment research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

Stop limiting your search and try the Simply Wall Street Screener to target opportunities in overlooked areas, smart sectors, or strong income streams before the crowd catches on.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include MLCO.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com