Talking Stocks 2.0

[7sins]

Thought this was a good read on corporate taxes and what it means for the equity market, worth reading: https://finance.yahoo.com/news/corpo...095741542.html

Rough start to the week. Travel oversold today. Looking to add to my SABR position (leaps down 30% on zero news), I think this is a steal under $14 and COTY as it gets near $8 again, easy to ride this up and down then trim profits along the way. Also looking to initiate position in NKE (should not be down 4% on china boycotts, this is an over-reaction), BA and AFRM, just waiting for the dust to settle and see support in pricing. Some good opportunities arising this week to put cash to work, IPOE is another one to keep your eyes on, been down substantially as the merger with SoFi is delayed but in the long term this is a great entry point for a highly disruptive company with plenty of future upside - @ $15 that is a ~$13B valuation which is grossly undervalued. Nice hidden gem, for what I believe, will be the bank of the future.

Originally Posted by peacocknation

Anyone else here hoping oil and the oil majors rips in the next month or two?

Fingers crossed, I would suspect over summer. Keep adding to my RDS and BP LEAPS, both still well under pre-covid levels. ERX and GUSH also down significantly this week for leveraged etfs.

[huncho]

Originally Posted by 7sins

Thought this was a good read on corporate taxes and what it means for the equity market, worth reading: https://finance.yahoo.com/news/corpo...095741542.html

Rough start to the week. Travel oversold today. Looking to add to my SABR position (leaps down 30% on zero news), I think this is a steal under $14 and COTY as it gets near $8 again, easy to ride this up and down then trim profits along the way. Also looking to initiate position in NKE (should not be down 4% on china boycotts, this is an over-reaction), BA and AFRM, just waiting for the dust to settle and see support in pricing. Some good opportunities arising this week to put cash to work, IPOE is another one to keep your eyes on, been down substantially as the merger with SoFi is delayed but in the long term this is a great entry point for a highly disruptive company with plenty of future upside - @ $15 that is a ~$13B valuation which is grossly undervalued. Nice hidden gem, for what I believe, will be the bank of the future.



Fingers crossed, I would suspect over summer. Keep adding to my RDS and BP LEAPS, both still well under pre-covid levels. ERX and GUSH also down significantly this week for leveraged etfs.

i've also been adding a bit to coty because options are dirt cheap still. but yeah rough start to the week...everything looked so bright last week on monday/tuesday and just spiraled out of control. i guess it's never a good sign when things look too good lol

[7sins]

Originally Posted by huncho

i've also been adding a bit to coty because options are dirt cheap still. but yeah rough start to the week...everything looked so bright last week on monday/tuesday and just spiraled out of control. i guess it's never a good sign when things look too good lol

Haha can't expect the market to rise every week! More so, when the market consolidates and takes a breather, gives us an opportunity to initiate or add to a position. It is wild still how cheap Coty is, I trimmed some of my exposure last week and hope we drop back to sub $8, then use as a core position with 2023 leaps.

Also why I mentioned in a previous post, when market is at a high to add in VIX calls and leap puts on overpriced stocks, that way you can profit when the market corrects. Take those gains and invest in securities that are then more attractively priced.

[BNA/LION]

This is worth a watch/listen... From Mid March 2021
Economic Investment Series RBC and City National Bank.

http://rbcplayer.com/cnb_economic_investment_series

[CastorKrieg]

Originally Posted by Frank McKay

I can’t imagine this bull run continues much further. the S&P 500 has a P/E of 35.7. It has been that lofty only once in history—prior to the tech collapse in 2000. The surge were now seeing will come to an abrupt end in the not so distant future. What do you guys think? is it good time to ride this run or wait for a correction.

'The surge coming to an end' is what people have been saying since 2015, check the stock market then and now.

Where else do you put your money? We have a decade of historical low interest rates, putting your money in a bank equals losing it. Germany has government bonds at NEGATIVE interest rates.

Now pair that up with Covid - the last thing governments want you to do right now is save money instead of spending it. Go out, eat out, spend your money (including stimulus check payments) to support businesses that suffered due to pandemic. The Fed has indicated even with inflation going up they will not do anything for at least two years precisely in order not to hurt the recovery.

So yeah, everything is overheated and will continue this way for the foreseeable future.

Originally Posted by Frank McKay

Agreed. It’s out of control. How to benefit?

As always - don't try to time the market. Make smart investments and increase them constantly over a long period of time whether it goes up or down.

[jaisonline]

Thanks..what are your key take aways?

Originally Posted by BNA/LION

This is worth a watch/listen... From Mid March 2021
Economic Investment Series RBC and City National Bank.

http://rbcplayer.com/cnb_economic_investment_series

[chsu74]

Could not agree more if being ahead of ourselves. Unemployment is still down 8 or 9 million people. I went from being 17% vested down to 10% premarket yesterday. Will take a bit of a beating on my QCOM and TSM but its a few hundred shares so will add to dips.

I have been buying gold the past two weeks. Doubled bottomed in March and one of the few asset classes that have not gone crazy. Its worth the risk IMHO. Dollar index dropping and a general consensus of inflation going forward. Crypto did take a lot of gold money last year but I don’t see it as a 100% substitute. It is now another option.

Am in:
GOLD - Barrick:Gold and Copper mining comoany(Buffet bought at $25 or $26?)
NUGT - 2X gold derivative

Am not planning to get into other sectors in a big way at the moment. I read a really good quote the other day worth noting. “A 50% decline means you will need a 100% return to just break even.” Capital preservation is key here as we roll through spring/summer.

Originally Posted by logo

Been contemplating lately, I’m a little concerned about May. May was really the start of the epic run we’ve had, and with the possibility of reopening this summer, vaccinations and such, I can imagine many will take profits in line with the sell in May and go away adage. DOW stocks like HD have been on a rip the past few weeks, some tech reaching new ATHs after that last sell down just a few weeks ago and small cap growth stocks getting absolutely destroyed - especially green energy it seems. Also seeing crypto going wild, which I wonder has something to do of outflow from stocks into crypto - not sure what to make of that yet.

Could potentially see the tech earnings coming up as a good opportunity for the market to start turning. As such, I’m reconsidering where I’m at currently, contemplating liquidating a bunch of stuff to go majority cash and just wait for the opportune entry points either for short term trades or long term positioning as I’m not convinced most current prices are ideal anymore. Might stay in some growth/small-mid cap, but I think the big boys might need a breather. Still need to ponder this more. Still think we end the year higher, however.

What are other members thoughts on market as a whole currently?

Originally Posted by 7sins

Couldn't agree more, remember that small caps will more than likely be the most impacted by a hike in corporate taxes (a rise in individual tax rates will benefit municipal bonds the most). This is because large and megacap companies have floors of CPAs to make sure they manipulate the tax code and pay as little to nothing in taxes. Where as small cap companies, often pay the full corporate tax rate. As a caveat, small cap stocks, SCG in particular, are the best performing asset class over the last 50 years. They also tend to be less impacted by any foreign tensions as they are often not net exporters.

This is the highest cash allocation I have had in my portfolio in the last 18 months. As I mentioned on here, I over allocated a few weeks back in names like TSM and NVDA when they hit were down 10%+. Now I think they have overun and have been trimming a good portion of my gains to cash for the next dip. When we see markets reach all time highs and lower volatility, I am looking to add my own hedges with LEAP puts on stocks I think are over priced and buying calls on the VIX as I am sure there will be some spike in vol which has been very subdued at sub 17 VIX. I can then take these LEAP puts, use those gains when the market pulls back and roll them into stocks/calls at more attractive prices.

The common misconception as an investor is that when the market reaches all time highs, they chase returns and put their cash to work as they fear missing out on a rally. That is often the worst time to allocate new monies. I still think there are good selective opportunities, i've been pounding the table here on COTY since it was $6.50 and at $9 today I still think it is undervalued, same with SABR sub $15. I also am looking to add to my BP and RDS-B leaps as they are still well below pre-covid levels and there will be much more upside in these European oil plays as their recovery, hopefully, shows positive progress. Especially BP which just announced they are ahead of paying down their debt schedule. Will add to TSM, AMAT and ASML on pullback as I mentioned many times here too. In this environment I think being selective and have patience is imperative, there will always be buying opportunities.

[logo]

Green energy continuing to get hammered. Down every day for the past two weeks.

There are a lot of names in this space that are no doubt speculative. I remain invested in GEVO, however. Like most of the green sector, they are down >60% from ATH earlier this year. With 500M cash, no debt, IP and infrastructure in place and long-term billion dollar contracts secured (and a cofounder/Nobel laureate as a science advisor to the president), at their current share price they are trading at a price to book value in the 1-3 range. With a clean balance sheet and one of the few companies focusing on biofuel, I’m happy to keep holding and will probably add if this downtrend continues. Hoping to hear more news of additional contracts and Net Zero plants soon, and hopefully some government incentives.

[CastorKrieg]

Originally Posted by logo

Green energy continuing to get hammered. Down every day for the past two weeks.

There are a lot of names in this space that are no doubt speculative. I remain invested in GEVO, however. Like most of the green sector, they are down >60% from ATH earlier this year. With 500M cash, no debt, IP and infrastructure in place and long-term billion dollar contracts secured (and a cofounder/Nobel laureate as a science advisor to the president), at their current share price they are trading at a price to book value in the 1-3 range. With a clean balance sheet and one of the few companies focusing on biofuel, I’m happy to keep holding and will probably add if this downtrend continues. Hoping to hear more news of additional contracts and Net Zero plants soon, and hopefully some government incentives.

You mean 78M in cash according to their own financial data?

https://finance.yahoo.com/quote/GEVO...e-sheet?p=GEVO

Asking for a friend.

[logo]

Originally Posted by CastorKrieg

You mean 78M in cash according to their own financial data?

https://finance.yahoo.com/quote/GEVO...e-sheet?p=GEVO

Asking for a friend.

https://investors.gevo.com/_resource...on.pdf?v=0.217

Tell your friend to see slide 20, and to check reporting dates listed on yahoo.

[gabrielnovar]

Originally Posted by Frank McKay

Agreed. It’s out of control. How to benefit?

well two options. Participate and get in the race.

or

Stock pile cash/cheap divy stocks and hope a market pulls back then deploy that cash into the growth stocks the imploded.


Most of the time DCA wins out and takes out emotion from wondering if its too high or not.


Would I buy most stocks here after they 5-10x'd in a year? history says its never good to do that......

[pearson1995]

Originally Posted by Frank McKay

Agreed. It’s out of control. How to benefit?

Have a good cash reserve, buy some gold and slowly add into stocks.

[What’s The Time]

Can anyone shed some light as to what the new guidance from the SEC means for the future of SPACs? Will deals in the pipeline such as GHVI or IPOE decide/have the ability to not go public via SPAC and change course?

[Romeojk]

Does now look like a good time/price to get back in NFLX and BA?

They are a little higher than I want to buy back in and go long on, but not that much.


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[meloncap78]

Market has been crazy. I’m no expert by any means but I bought 40,000 DOGE @ $0.03 a couple of months back. I’m not complaining. People laughed at me....... of course I can be stubborn and will probably hang on until I’m holding empty bags. Sigh..... shoulda dumped 2 days ago.

[huncho]

Originally Posted by meloncap78

Market has been crazy. I’m no expert by any means but I bought 40,000 DOGE @ $0.03 a couple of months back. I’m not complaining. People laughed at me....... of course I can be stubborn and will probably hang on until I’m holding empty bags. Sigh..... shoulda dumped 2 days ago.

not too late to take it out and get yourself a rolex lol

[BNA/LION]

Today is Exactly 3 weeks from the PDUFA Date of May 12th 2021.

I have been in this stock for 3 years and have been disappointed with two CRLs but hopefully this is it and there is Finally an Approval on or before the PDUFA Date!

HRTX - PDUFA Run Up Stock! May 12th PDUFA date!
https://www.youtube.com/watch?v=QrbKmSCcZ2w

[austinp]

Originally Posted by BNA/LION

Today is Exactly 3 weeks from the PDUFA Date of May 12th 2021.

I have been in this stock for 3 years and have been disappointed with two CRLs but hopefully this is it and there is Finally an Approval on or before the PDUFA Date!

HRTX - PDUFA Run Up Stock! May 12th PDUFA date!
https://www.youtube.com/watch?v=QrbKmSCcZ2w

Man I’m pulling for you on this one. You been talking bout this one for a while. I hope you make a killing!


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[BNA/LION]

Originally Posted by austinp

Man I’m pulling for you on this one. You been talking bout this one for a while. I hope you make a killing!

Many Thanks! We shall know soon!

[wantonebad]

Originally Posted by logo

Green energy continuing to get hammered. Down every day for the past two weeks.

There are a lot of names in this space that are no doubt speculative. I remain invested in GEVO, however. Like most of the green sector, they are down >60% from ATH earlier this year. With 500M cash, no debt, IP and infrastructure in place and long-term billion dollar contracts secured (and a cofounder/Nobel laureate as a science advisor to the president), at their current share price they are trading at a price to book value in the 1-3 range. With a clean balance sheet and one of the few companies focusing on biofuel, I’m happy to keep holding and will probably add if this downtrend continues. Hoping to hear more news of additional contracts and Net Zero plants soon, and hopefully some government incentives.

Right there in the same boat, upped my positions just about a month ago thinking I had seen the bottom LOL. I'm going to hold hoping it turns around, knowing it should turn around, praying it turns around, however my predictions in this area are uncannily opposite <<SHRUG>>

[vipereaper30]

Originally Posted by BNA/LION

I have been in this stock for 3 years and have been disappointed with two CRLs but hopefully this is it and there is Finally an Approval on or before the PDUFA Date!

I wish you and Heron luck! Even with approval be careful, I'm licking wounds with AUPH from the drop in market value after their lupus drug was approved in January. SMH!

[7sins]

Originally Posted by huncho

i've also been adding a bit to coty because options are dirt cheap still. but yeah rough start to the week...everything looked so bright last week on monday/tuesday and just spiraled out of control. i guess it's never a good sign when things look too good lol

Did you end up adding? COTY/SABR up 10% since Tuesday, 1YR high and getting close to $10.

Originally Posted by vipereaper30

I wish you and Heron luck! Even with approval be careful, I'm licking wounds with AUPH from the drop in market value after their lupus drug was approved in January. SMH!

What are your thoughts on AUPH?? I've been DCA'ing the way down, it trades now at it's pre PDUFA price which to me is a severe dislocation. Looks like volume dried up. Was hoping for a buyout but appears they are now building a sales team.



Adding to my position in IPOE/SOFI that I mentioned earlier this week, I own it through WARRANTS so the ticker is IPOE.WS. If you are unfamiliar with warrants, they are basically like longer term options but you do not pick the strike or expiration and usually each warrant represents one share opposed to 100. Easy way to build a long core position with newly public companies. These for IPOE/SOFI trade at $4.50, expiration is 5 years (you can sell anytime) and strike is $11.50. I suspect over the next few years this trades to at least $30, which would represent a 100% gain from underlying price today on IPOE and over 400% on the warrant with plenty of time for SOFI to grow. Compared to lets say a Jan 2023 $12.50C that is $6.55.

As much as I hate SPACs, I think SOFI is a real winner, especially with Anthony Noto at the helm who helped take Twitter public at GS. This is an absolute homerun once some of the uncertainty goes away as the merger was postponed to SoFi buying a bank in SF. Should be a great longterm core play. Also adding to AONE, for a play on 3D printing, now that it is back to $10.

[huncho]

Originally Posted by 7sins

Did you end up adding? COTY/SABR up 10% since Tuesday, 1YR high and getting close to $10.



What are your thoughts on AUPH?? I've been DCA'ing the way down, it trades now at it's pre PDUFA price which to me is a severe dislocation. Looks like volume dried up. Was hoping for a buyout but appears they are now building a sales team.

Adding to my position in IPOE/SOFI that I mentioned earlier this week, I own it through WARRANTS. If you are unfamiliar with warrants, they are basically like longer term options but you do not pick the strike or expiration and usually each warrant represents one share opposed to 100. Easy way to build a long core position. These for IPOE/SOFI trade at $4.50, expiration is 5 years and strike is $11.50. I suspect over the next few years this trades to at least $30, which would represent a 100% gain from underlying price today on IPOE and over 400% on the warrant with plenty of time for SOFI to grow. As much as I hate SPACs, I think SOFI is a real winner, especially with Anthony Noto at the helm who helped take Twitter public at GS. Should be a great longterm core play. Also adding to AONE, for a play on 3D printing, now that it is back to $10.

yup, added last week and this week. good to see it finally moving back up

[vipereaper30]

Originally Posted by 7sins

What are your thoughts on AUPH?? I've been DCA'ing the way down, it trades now at it's pre PDUFA price which to me is a severe dislocation. Looks like volume dried up. Was hoping for a buyout but appears they are now building a sales team.

I doubled my position here in the 12s, think buyout is still on the table but either way I see a lot of value to be had. Long-term position if they go it alone and maybe a quicker payday if sold. If it sells I don't anticipate that prior to the end of summer so I'm not playing the options here. Just underwater on a boatload of shares. BCRX has more than made up for it and I'm more optimistic for BCRX's future, particularly if they go it alone. BL, hoping AUPH gets purchased.

I'm out of COTY recently. Had picked up a lot of '23s that did well initially but then stagnated. Moved the gains over to all my biotechs that were getting crushed to DCA those, mainly AUPH and CRVS.

[jaisonline]

Well today was going pretty well until the proposed capital gains increase news broke. Guess it caught most off guard although it's been talked about since last year. Definitely a knee jerk reaction.

https://www.wsj.com/articles/global-...21-11619077225

[904VT]

Originally Posted by jaisonline

Well today was going pretty well until the proposed capital gains increase news broke. Guess it caught most off guard although it's been talked about since last year. Definitely a knee jerk reaction.

https://www.wsj.com/articles/global-...21-11619077225

Yes, this is a terrible idea. Even worse idea than raising corporate tax rate. No significant real wage growth since the early 90's, so the last thing to do is further reduce financial capital of investors. Investors will end up holding stocks too long without investment justification just to avoid tax drag. Not surprised though, need to fund spending.

[beshannon]

Originally Posted by 904VT

Yes, this is a terrible idea. Even worse idea than raising corporate tax rate. No significant real wage growth since the early 90's, so the last thing to do is further reduce financial capital of investors. Investors will end up holding stocks too long without investment justification just to avoid tax drag. Not surprised though, need to fund spending.

Sorry I disagree.

President Joe Biden will propose almost doubling the capital gains tax rate for wealthy individuals to 39.6% to help pay for a raft of social spending that addresses long-standing inequality, according to people familiar with the proposal.

For those earning $1 million or more, the new top rate, coupled with an existing surtax on investment income, means that federal tax rates for wealthy investors could be as high as 43.4%. The new marginal 39.6% rate would be an increase from the current base rate of 20%

Those affected by the 1mm cap need and should be paying more

https://www.bloomberg.com/news/artic...-4-for-wealthy

[7sins]

Originally Posted by beshannon

Sorry I disagree.



Those affected by the 1mm cap need and should be paying more

https://www.bloomberg.com/news/artic...-4-for-wealthy

Let’s be honest here, $1M should NOT be the top tax bracket. There should be more tax brackets at $5M, $10M etc. Someone making $1M should not be taxed at the same rate as someone earning $50M. As we all know, those who are in the upper echelon of wealth often have many tax loopholes to pay less in taxes.

All in all, this will bode well for the municipal bond market.

[904VT]

Originally Posted by beshannon

Sorry I disagree.



Those affected by the 1mm cap need and should be paying more

https://www.bloomberg.com/news/artic...-4-for-wealthy

I usually agree with your evaluations of capital markets Brian but not here. $1m is not as much as it may seem. Most baby boomers are in distribution phase or nearing that now. Very easy to have income go over $1m in retirement when liquidating assets etc. $1m is far from being super wealthy nowadays. You change $1m to $1b and I can get onboard. We'll see a further push towards ETFs and index products by the wealthier, which in turn will cause additional market inefficiencies in a pricy market from a valuation standpoint which is usually the worst time.

[beshannon]

Originally Posted by 7sins

Let’s be honest here, $1M should NOT be the top tax bracket. There should be more tax brackets at $5M, $10M etc. Someone making $1M should not be taxed at the same rate as someone earning $50M. As we all know, those who are in the upper echelon of wealth often have many tax loopholes to pay less in taxes.

All in all, this will bode well for the municipal bond market.

Agreed

Originally Posted by 904VT

I usually agree with your evaluations of capital markets Brian but not here. $1m is not as much as it may seem. Most baby boomers are in distribution phase or nearing that now. Very easy to have income go over $1m in retirement when liquidating assets etc. $1m is far from being super wealthy nowadays. You change $1m to $1b and I can get onboard. We'll see a further push towards ETFs and index products by the wealthier, which in turn will cause additional market inefficiencies in a pricy market from a valuation standpoint which is usually the worst time.

Then that is very poor planning. Liquidating assets in those amounts should be planned.

1 million in income is a good starting number as it is meant to target the highest earning people.