Talking Stocks 2.0

[Frontier]

Originally Posted by jpeezy14@hotmail.com

I'm one of those that has been pushing Barry over here - welcome to the thread, my friend.

Glad we've got another person involved here with abundant knowledge of the markets.

Thank you Jessie for the kind words.

[Frontier]

Originally Posted by jpeezy14@hotmail.com

I'm one of those that has been pushing Barry over here - welcome to the thread, my friend.

Glad we've got another person involved here with abundant knowledge of the markets.

Originally Posted by SMD

Those are some strange holdings for a VC firm no? In fact I am confused as to why a VC firm would own much public stock at all unless this is just personal investing outside of your core area of focus.

Correct these are my holdings. I use my analysts to identify value. Separately my business partners and I have a VC firm that is all self funded.

[Bruin Watch]

Great to have you join the thread, Barry. Insightful commentary that I'm sure the group appreciates. Thank you.

[Frontier]

Originally Posted by Bruin Watch

Great to have you join the thread, Barry. Insightful commentary that I'm sure the group appreciates. Thank you.

Thank you

[cornerstore]

This market has now transitioned from trading in a bubble to trading in a vacuum.

[Zack21]

Barry: Thank you for sharing your thorough examination of the current and future market and economic trends. You provided me a level of clarity to what is occurring in these currently tumultuous times. My life's work is pretty far removed from finance and investments but, your logical analysis and conclusions make perfect sense to me.

[beshannon]

DIS getting raked over the coals, reporting earnings after the bell today

I sold out of my small position a week ago after taking a profit, I may look to get back in depending on the conference call

[Zack21]

Brian and others:

Can someone give me an idea as to what percent of DIS business is tied into their theme parks and hotels (which are obviously suffering tremendously from this shutdown)? I tried Googling that info but the data seemed pretty old. Thanks.

[RyanO]

Originally Posted by beshannon

DIS getting raked over the coals, reporting earnings after the bell today

I sold out of my small position a week ago after taking a profit, I may look to get back in depending on the conference call

Do you have a target price you'd be looking to re enter at?

[Frontier]

Originally Posted by Zack21

Barry: Thank you for sharing your thorough examination of the current and future market and economic trends. You provided me a level of clarity to what is occurring in these currently tumultuous times. My life's work is pretty far removed from finance and investments but, your logical analysis and conclusions make perfect sense to me.

I am glad I could help. Investing is like Yoga - if you don't block out all of the distraction and background noise you won't get the most out of it. If you stay focused and disciplined you will benefit. The media loves to create panic and many of the self proclaimed specialists like the Rapunzel brothers on CNBC use retail investors as pawns to exit their equity/options positions or problems. If you stay disciplined, block out the noise and nonsense, and study the buying and selling habits of sophisticated institutional investors you increase your chances for success - just like Yoga.

[ELLimon]

I was reading a article yesterday about it. Cannot find it. This is what I remember.

Disney has a few cruise ships parked and 2 under construction in Germany at the cost of 1b each.

It has many hotels around the world.

And with all the parks closed closed around the globe.

Questions. How many people will visit the parks once they reopen?
How will Disney control distancing?
The cruise bushiness is toasted in my opinion for what 2years?

With movies closed and when they open most likely accepting less people per showing.

Also I read most of Disney movie productions are in pause because of distancing and shelter in place...

They do have fox, Disney+, espn, Hulu and other valuable online properties.

I sold all of my Disney stock. Too much of a gamble.

Might be this quarter will be ok because of January, February and the beginning of March and next quarter disastrous.

[beshannon]

Originally Posted by Zack21

Brian and others:

Can someone give me an idea as to what percent of DIS business is tied into their theme parks and hotels (which are obviously suffering tremendously from this shutdown)? I tried Googling that info but the data seemed pretty old. Thanks.

Originally Posted by RyanO

Do you have a target price you'd be looking to re enter at?

The 52 week low was 79, not sure we get back there, very hard to put a price target on it since there will likely be no guidance.

It is not only the theme parks but the media is suffering as well, ESPN with no sports and pushed movie releases.

From CNBC

“Seventy percent of Disney’s revenues come from just parks and media and if you have lower ad spending budgets for the next 18 to 24 months, and you have a very slow reopening of the parks, then that is definitely going to hurt Disney,”

https://www.cnbc.com/2020/05/05/ahea...ers-value.html

Based on this I would think that below 90 gets my interest

This chart shows revenue based on segment



My thesis is simple, Disney is not going out of business. They face challenges and that is the opportunity to grab a great name at a low price for the long term.

If the stock does not get low enough I move on, I am not desperate to own DIS just looking for beaten up opportunities.

[Uggi]

Originally Posted by beshannon

DIS getting raked over the coals, reporting earnings after the bell today

I sold out of my small position a week ago after taking a profit, I may look to get back in depending on the conference call

I also ditched DIS last week after buying at 85 near the end of March. Around 40% of revenues come from parks and I don't see them opening until 2021. Not sure how much comes from cruises. Disney+ could be good for them I have faith in their content and creativity. I'd buy again at 85ish and hold.

[austinp]

Originally Posted by Frontier

A few TRF members have asked me to comment on here. I am a managing partner of a venture capital firm. My analysts research companies based on a number of factors - institutional ownership, available free cash, P/E multiple, outstanding debt, rank in sector, sector analysis, relative value, RSI, Bollinger Bands, OB/OS, and option activity. After reading 81 pages of content I am proceeding with a few of my own thoughts.
From a 30,000 foot view I believe we are headed into another turbulent period later this month. While I am in the camp that I think we have tested the lows (for now) I believe investors should be at least in 50% cash and be prepared to buy on what could be some rather quick dips in later May through July. If investors are sitting in losses they should remain disciplined and focused on their long term objectives, but for those with cash they should be more selective than ever in what they are purchasing.
To start, look around at the behaviors and habits of society. Where are people spending money? AMZN, TGT, WMT, CVS, DG, DLTR, COST, BJ, KR, and others. Paper towels are now more valuable than Panerais, Toilet Paper more than Tag Heuers, and Wesson oil much more valuable than West Texas Intermediate. This Food & Drug/Discretionary sector has become the sector to build wealth. Some of these companies have little debt, low P/E ratios, and very strong analyst's outlooks. I like them all, but love AMZN even though it trades at 112X earnings.
In the Industrial/Defense sector I like GD and LHX. Both are loved by the analysts, have manageable debt, low P/Es, and are owned almost exclusively by institutional investors.
I am not a fan of financials, but believe that BAC and JPM are best positioned for the economic slowdown. This crisis has none of the characteristics of the Great Recession so I don't believe the banks face any immediate risks, however aside from decent dividends I am not convinced financials will benefit the same as Consumer Finance companies like PYPL and V.
High level, I have already sold anything associated with travel and hospitality. I am not (nor have I ever been) a fan of the commercial airline industry. I also don't like hotels, movie theaters, cruise ships, oil exploration, and wouldn't recommend buying them unless they are first lien debt plays on the cheap.
My core positions are in AMZN, ABT, ADBE, BABA, GOOGL, HD, JNJ, MDLZ, MSFT, NVDA, PYPL, SAFM, UNH, V, and ZBH, and GLD and SLV for precious metals.
I have ancillary positions in AAPL, AKAM, AMAT, CMG, COST, CRM, CSCO, CVS, DHR, EW, GD, ISRG, KMI, LYFT, NSRGY, NVS, PG, SAP, SIEGY, TWLO.
I am trying to acquire TTWO (below $115) , GWPH (below $95), VRTX (below $225), NFLX (below $350) and DIS (below $80).
If the virus spirals out of control in the fall of 2020, I believe we will retest the lows (target 1850 on the S&P). I am hope full that herd immunity prevails and we have seen and experienced the worst, but like the Spanish Flu a century ago the second leg would feel much worse than the first.
I do believe the damage from an eight week closed economy will not be forgotten for years and that behaviors will change. As a result, I believe the Entertainment sector will be hit hard and movie theaters in particular will become obsolete. Indoor malls will have to be retrofitted into living communities, and cruse ships will be sold for scrap or for cargo use. Airlines will survive, but I am still of the opinion that the top three, along with BA, could be nationalized if the virus returns.
We are going to need bankruptcies to clear the markets and end this recession. Its also going to need rationalization. The sooner sellers are rational the faster we can recover - whether it be stocks, bonds, real estate, cars, art, or watches!

Great to have you Barry. Thank you for the analysis. Looking forward to future posts.

Sent from my SM-G935P using Tapatalk

[Zack21]

Brian and ELLimon: thank you for all the detailed info, observations and conclusions regarding DIS. I completely forgot about the DIS cruise lines and really didn't focus on the "first run" movies in theatres as well. Boy, reading about the 2 cruise ships under construction reminded me of the term "sunk costs" from Econ classes I took in college several decades ago. Unfortunately, I have a cost basis of around 140/share on DIS and my hope was for the stock recover somewhere close to that level before I sold but now I am wondering if it is time for me to just cut my losses.

[Frontier]

Originally Posted by austinp

Great to have you Barry. Thank you for the analysis. Looking forward to future posts.

Sent from my SM-G935P using Tapatalk

My pleasure. Happy to be here to contribute and to learn.

[RyanO]

Originally Posted by austinp

Great to have you Barry. Thank you for the analysis. Looking forward to future posts.

Sent from my SM-G935P using Tapatalk

Appreciate your insights, Brian. Thank you.

[JParm]

I'm long DIS at $83 and will not be selling this go-around; looking to only add here post-earnings.

[cornerstore]

Dis has approx $65billion in long term debt vs a $182B market cap, as well as short term accounts payables, operational moth balling costs and contingent liabilities from pre sales. Among other problems.

[beshannon]

Originally Posted by Zack21

Brian and ELLimon: thank you for all the detailed info, observations and conclusions regarding DIS. I completely forgot about the DIS cruise lines and really didn't focus on the "first run" movies in theatres as well. Boy, reading about the 2 cruise ships under construction reminded me of the term "sunk costs" from Econ classes I took in college several decades ago. Unfortunately, I have a cost basis of around 140/share on DIS and my hope was for the stock recover somewhere close to that level before I sold but now I am wondering if it is time for me to just cut my losses.

Well I guess that depends on your plan, time horizon and need for the capital

You could average down if you want to hang on, Disney is not going out of business. You could take your loss if you have something else to invest in, use that loss to offset any cap gains you have.

[Bearxj86]

Originally Posted by Frontier

I am glad I could help. Investing is like Yoga - if you don't block out all of the distraction and background noise you won't get the most out of it. If you stay focused and disciplined you will benefit. The media loves to create panic and many of the self proclaimed specialists like the Rapunzel brothers on CNBC use retail investors as pawns to exit their equity/options positions or problems. If you stay disciplined, block out the noise and nonsense, and study the buying and selling habits of sophisticated institutional investors you increase your chances for success - just like Yoga.

Clearly you haven't heard of beer yoga :)

I kid I kid!

[Zack21]

Brian:
Good points re: my DIS position. Since I don't have a current need for the capital nor a stock/investment that I am "champing at the bit" to reinvest this capital, I may as well ride it out. Maybe averaging down if the stock price takes another tumble. Like you correctly pointed out, "Disney is not going out of business." It will be interesting to see how a company like Disney reinvents itself in areas where it will be needed in the next few years. Will the Disney parks be back to essentially business as usual this time next year with some basic modifications or will these parks take on a much different persona.

[beshannon]

The Market sold off into the close as people love to hate this rally.

DIS numbers not as bad as thought, news still developing however, next quarter is not priced in IMHO. I am steering clear at the moment

[vipereaper30]

Originally Posted by beshannon

The Market sold off into the close as people love to hate this rally.

It's definitely causing me a lot of stress as my net worth has been inverse to the April gains. Although I'm happy for those longs in solid companies for now and hope it holds up. It's time we all got back to normal!

[logo]

I went mostly cash last week, including some of my long holds out of anticipation of further drops in May. Contemplated buying yesterday, but wasn't quite the prices I wanted yet. Now kind of wishing I had bought, but still waiting patiently on the sidelines this week for some good opportunity to get back in at a better price for long-term positions. I suspect the April report out on Friday may be a perfect storm of weekend selloff, end of earnings season with a gloomy Q2 outlook coming up, sell in May and just overall bad news.

[JParm]

Disappointing earnings call for PINS. One thing that I'm trying to wrap my head around is the CEO saying that people are spending less time time online due to COVID...really?

Still a believer in the company, but after seeing what happened with SNAP, GOOGL and FB post Q1 earnings, I think it's fair to say that a -20% swing is not what was expected.

[cornerstore]

Originally Posted by jpeezy14@hotmail.com

Disappointing earnings call for PINS. One thing that I'm trying to wrap my head around is the CEO saying that people are spending less time time online due to COVID...really?

Still a believer in the company, but after seeing what happened with SNAP, GOOGL and FB post Q1 earnings, I think it's fair to say that a -20% swing is not what was expected.

Maybe because people aren’t traveling, I don’t know enough about the companies revenue stream from people traveling, but possible I would think. They reported a big uptick in new users. Advertising is contingent on people posting, no body is traveling so no or reduced revenue stream from that segment.

[beshannon]

DIS cuts July dividend payment stock now below 100, CVS reported good earnings

https://www.thestreet.com/markets/5-...dnesday-050620

Futures up again, oil is also up this morning

More DIS info, the July div cut offsets park lost revenue

https://www.thestreet.com/investing/...t-dividend-cut

The story is still intact but setback. DIS has not cut their dividend entirely, just suspended the July payment. I would still be a buyer below 90 as I believe they will find ways to adapt.

[beshannon]

Subdued open after ADP numbers and in front of what will again be bad jobless claims numbers

Looking at SWKS, CVS and watching DIS. I averaged into UPS over the last few days

4.5T sitting in money market accounts (bullish?) for stocks or bonds or both?

[beshannon]

Originally Posted by jpeezy14@hotmail.com

Disappointing earnings call for PINS. One thing that I'm trying to wrap my head around is the CEO saying that people are spending less time time online due to COVID...really?

Still a believer in the company, but after seeing what happened with SNAP, GOOGL and FB post Q1 earnings, I think it's fair to say that a -20% swing is not what was expected.

I have no interest in PINS but read that it was more of a lack of subscriber growth and ad spend rather than online time