Talking Stocks 2.0

[yoast]

For ARK investors:

https://www.barrons.com/articles/cat...nt-51605699000

I am an investor and not too happy if they will push this through.

[chadwick4eva]

Originally Posted by huncho

another day where RKT does nothing. i bought leaps last week because i still think it's pretty undervalued (and they're cheap) but somehow it continues to amaze everyone by sitting at the same price instead

Two reasons why company's go public- one is for management to cash out, the other is to raise capital to actually scale up the operations and create more value for shareholders. With rocket being a mature company in a relatively niche space of the financial sector, I think it's clear what management was trying to do. Think about their timing as well- they decided to IPO in the middle of this crisis when the fed slashed rates and they knew people would take advantage of the ReFis or new home purchases. They knew that this was a perfect storm to make the company look like its doing much better than it probably is on average.

Their TTM valuation is misleading because we are in a boom of ReFis and new home purchases. I have no doubt they will maintain this level of business for at least another year or so while rates remain low but once the Fed finally starts to raise rates in another couple years (hopefully), their business won't be what it is at the moment. Their growth potential is questionable- they already cover the US and Canada. Given they're a mature company in the financials sector they should also be paying yield. Something is way off here with corporate governance if they aren't paying shareholders.

Keep in mind that although they have a great software platform, they are not a software company. The mortgage business is fairly capital intensive and requires a lot of personnel, many of whom are well compensated.

Everything about the way their IPO was executed just seems shady. Staying away.

[beshannon]

Markets back to flat at 1:00, no real news to trade

[huncho]

Originally Posted by chadwick4eva

Two reasons why company's go public- one is for management to cash out, the other is to raise capital to actually scale up the operations and create more value for shareholders. With rocket being a mature company in a relatively niche space of the financial sector, I think it's clear what management was trying to do. Think about their timing as well- they decided to IPO in the middle of this crisis when the fed slashed rates and they knew people would take advantage of the ReFis or new home purchases. They knew that this was a perfect storm to make the company look like its doing much better than it probably is on average.

Their TTM valuation is misleading because we are in a boom of ReFis and new home purchases. I have no doubt they will maintain this level of business for at least another year or so while rates remain low but once the Fed finally starts to raise rates in another couple years (hopefully), their business won't be what it is at the moment. Their growth potential is questionable- they already cover the US and Canada. Given they're a mature company in the financials sector they should also be paying yield. Something is way off here with corporate governance if they aren't paying shareholders.

Keep in mind that although they have a great software platform, they are not a software company. The mortgage business is fairly capital intensive and requires a lot of personnel, many of whom are well compensated.

Everything about the way their IPO was executed just seems shady. Staying away.

i agree there's definitely something shady with it all. IPOs at 18 and goes to 34 relatively fast then earnings come out (they were good too) and it drops to low 20s for months. regardless i'm not expecting it to fly up to 40+, high 20s is my expectation for sometime in the near future at least. takes a lot less for stocks to go up now anyway lol, literally have worthless companies with insane valuations

[chadwick4eva]

Originally Posted by ndls

Anyone else in PLTR? I'm at a 21 average - been a wild ass ride.

Played SNDL from 0.24 --> 0.88. Day Date coming?

I bought in at 20 and sold at the peak when it was up about 6% the morning it hit $31. The hype and velocity was peaking at that moment. That deceleration in momentum was my cue to get out. I bought in again today though- I like them long term- seems like they have a lot of traction in government/B2B and a high customer retention rate. If they keep working on reducing cost of new sales they'll be able to drive shareholder value. When they break cash flow positive in the next year they will hopefully have another rally. If I lose a little in the short term it's whatever, there is clearly a lot of legitimacy with the company and a lot to be excited about in the long run. If they run up again in the near term without any major news to drive it then I may sell again and try to play it similar to how it worked the first time around.

Does anyone have any updates on NET or FSLY? Seems FSLY has hit a holding pattern but NET continues to break out. Who has the best in class product offering out of these two?

[logo]

Originally Posted by chadwick4eva

I bought in at 20 and sold at the peak when it was up about 6% the morning it hit $31. The hype and velocity was peaking at that moment. That deceleration in momentum was my cue to get out. I bought in again today though- I like them long term- seems like they have a lot of traction in government/B2B and a high customer retention rate. If they keep working on reducing cost of new sales they'll be able to drive shareholder value. When they break cash flow positive in the next year they will hopefully have another rally. If I lose a little in the short term it's whatever, there is clearly a lot of legitimacy with the company and a lot to be excited about in the long run. If they run up again in the near term without any major news to drive it then I may sell again and try to play it similar to how it worked the first time around.

Does anyone have any updates on NET or FSLY? Seems FSLY has hit a holding pattern but NET continues to break out. Who has the best in class product offering out of these two?

They are two completely different businesses with different product classes/focus. They overlap somewhat in providing CDNs, but cloudflare has a much broader portfolio of products focusing on internet security and networking. Simply put, cloudflare runs the internet. Here’s a nice chart from the CEOs Twitter showing cloudflare use vs AWS Lambda for developers:

https://twitter.com/eastdakota/statu...358278656?s=21

[huncho]

Originally Posted by ndls

Anyone else in PLTR? I'm at a 21 average - been a wild ass ride.

Played SNDL from 0.24 --> 0.88. Day Date coming?

got in with some leaps today (it was 22.05 at the time)

[chadwick4eva]

Originally Posted by logo

They are two completely different businesses with different product classes/focus. They overlap somewhat in providing CDNs, but cloudflare has a much broader portfolio of products focusing on internet security and networking. Simply put, cloudflare runs the internet. Here’s a nice chart from the CEOs Twitter showing cloudflare use vs AWS Lambda for developers:

https://twitter.com/eastdakota/statu...358278656?s=21

I mean... I don't really look at # of tag posts to be any reasonable indicator of how a business is doing, the quality of its product, its prospects for growth, or its stock price's trajectory... Social media is flooded with bots, all it takes these days is a few thousand dollars and you could easily flood any platform you want with whatever message you want from a bunch of fake accounts. Although platforms will ban you if they find out, you can also buy viewers as a twitch streamer, views as a youtuber, likes as an influencer, etc.

Anything more substantial?

[logo]

Added short expiry PLTR calls (Dec 18) looking for a small bounce. Don’t like the company enough for long term, and the end of the lockout period could bring a deeper dip.

[logo]

Originally Posted by chadwick4eva

I mean... I don't really look at # of tag posts to be any reasonable indicator of how a business is doing, the quality of its product, its prospects for growth, or its stock price's trajectory... Social media is flooded with bots, all it takes these days is a few thousand dollars and you could easily flood any platform you want with whatever message you want from a bunch of fake accounts. Although platforms will ban you if they find out, you can also buy viewers as a twitch streamer, views as a youtuber, likes as an influencer, etc.

Anything more substantial?

Well it was from the CEO, and compatible with what the CEO was mentioning as their target a few earnings calls ago.

In any case, it boils down to what the two companies do, as it does differ quite a bit. Developers tend to prefer NET as well (not the stock, but the product). I won’t repost my DD as I’ve put it up here several times, but I’ve been in NET since $26/share and for several reasons I have never bought FSLY.

[scarlet knight]

Generally, if Cramer says it, I do the opposite. But I thought he made some sense in recommending the FANG stocks. They have been somewhat dormant. They seem like an interesting growth choice compared to the cloud stocks, pandemic stocks and reopening stocks, which have been a roller coaster.

[ndls]

Originally Posted by scarlet knight

Generally, if Cramer says it, I do the opposite. But I thought he made some sense in recommending the FANG stocks. They have been somewhat dormant. They seem like an interesting growth choice compared to the cloud stocks, pandemic stocks and reopening stocks, which have been a roller coaster.

Ya, I’m heavily in MSFT, GOOG, AMZN, and AAPL and this consolidation the past few months is poised for a breakout. Just slowly adding.

PLTR killing me though lol. I’m long, with shares so I’m not worried with a 23 average.

[chadwick4eva]

Originally Posted by scarlet knight

Generally, if Cramer says it, I do the opposite. But I thought he made some sense in recommending the FANG stocks. They have been somewhat dormant. They seem like an interesting growth choice compared to the cloud stocks, pandemic stocks and reopening stocks, which have been a roller coaster.

Even if they are overvalued now (and they are), it's only a matter of time before their growth likely catches up with the valuation and they keep trucking higher.

[JWD531]

Originally Posted by chadwick4eva

Even if they are overvalued now (and they are), it's only a matter of time before their growth likely catches up with the valuation and they keep trucking higher.

Agreed on this. The value rotation will inevitably cool down a bit.


Sent from my iPhone using Tapatalk

[7sins]

Great article I read below on CVS and Walgreens, I talked about this a few pages back and have been adding to them after the dip on the amazon news came out as I don't believe people will wait two days to get their drugs, especially when they are in pain and CVS already offers delivery services. LEAPS are still very cheap on both.

Stock Wars: CVS Health Vs. Walgreens Boots Alliance
8:00 am, December 2, 2020

Tickers: AMZN CVS RAD
Categories: Trading Ideas
Read the full article

The two largest pharmacy chains in the U.S. have grown through unit expansion and several major acquisitions. The companies have seen their share prices fall on concerns surrounding Amazon.com's entry into the market.

Benzinga is looking at how CVS Health Corporation (NYSE: CVS) and Walgreens Boots Alliance (NASDAQ: WBA) stack up in Stock Wars.

About CVS Health: CVS is a player in the pharmacy, insurance and benefits management businesses. The company has over 9,900 retail pharmacy locations and over 1,100 walk-in clinics.

CVS has over 105 million plan members for its pharmacy benefits and 37 million health insurance product customers.

One in three Americans interact with CVS on a yearly basis. Over 70% of the U.S. population lives within three miles of a CVS store.

Related Link: Stock Wars: Home Depot Vs. Lowe’s

About Walgreens Boots: Walgreens has a presence in more than 25 countries and operates over 21,000 stores across its held companies. In the U.S., Walgreens has over 9,000 stores.

Around 78% of the U.S. population lives within a five-mile radius of a Walgreens-owned store.

Major Acquisitions: In 2018, CVS acquired managed health care company Aetna in a $70-billion deal. The completed deal led CVS to three major priorities going forward: making health care accessible, simplifying how consumers access care and lowering costs.

Walgreens attempted to buy Rite Aid Corporation (NYSE: RAD) in a large $17-billion deal between two of the top three retail pharmacy companies in the U.S.

The deal with Rite Aid faced heavy pressure from the Federal Trade Commission. Walgreens eventually acquired 1,932 Rite Aid stores in a separate $4.4-billion deal.

In 2014, Walgreens completed its acquisition of Alliance Boots. Walgreens restructured into a holding company structure after acquiring the remaining 55% of Alliance Boots that it did not own.

Medicare, Medicaid: With its ownership of Aetna, CVS Health is a major player in the Medicare and Medicaid health care market.

Piper Sandler recently initiated coverage of CVS and cited the growth in Medicaid as a catalyst going forward under a Joe Biden presidency.

Analyst Sarah James sees CVS adding $700 million annually for its health insurance plan business due to Biden winning the 2020 election. The plan business could hit $8.4 billion in annual revenue.

Fighting Off Amazon: E-commerce leader Amazon.com (NASDAQ: AMZN) announced plans to launch Amazon Pharmacy to take on the $300-billion pharmacy market.

The plan for Amazon is to offer prescription medicines for home delivery, including free delivery for Amazon Prime members.

The announcement from Amazon has put pressure on retail pharmacy stocks.

Both companies will need to fight to fend off disruptor Amazon. Right now, Amazon's offering will only be available to Prime members. Amazon also cannot ship certain drugs through the mail.

Financials: CVS had revenue of $256.8 billion in fiscal 2019, which represents year-over-year growth of 32%. The company has grown its revenue in each of the last five years, going from $153.3 billion to $256.8 billion.

Walgreens had revenue of $139.5 billion in fiscal 2020. The company has grown sales in each of the last five years, going from $117.4 billion to $139.5 billion.

CVS has increased its earnings per share in four out of the last five years, with fiscal 2019 and fiscal 2018 both posting $7.08 in earnings per share.

Walgreens has seen earnings per share fall several times, going from $3.85 to $3.80 and $5.07 to $4.32. Fiscal 2020 earnings per share were $4.74.

Stock Performance: Shares of CVS Health are down 9% in 2020. The company’s shares have lost 28% of their value over the last five years.

CVS Health has a market capitalization of $89 billion.

Shares of Walgreens Boots are down 36% in 2020. The company’s shares are down 55% in the last five years.

Walgreens Boots shares have a market capitalization of $33 billion.

Benzinga’s Take: In the Piper Sandler analyst note, it was said that CVS had more stores offering COVID-19 tests, which brought new customers to CVS stores.

Of the 3 million tests done, 40% were done for people who were not CVS customers.

Add in the logistics of CVS having stores within three miles of 70% of the population and health insurance plan offerings that could benefit from a Biden presidency, and CVS could be the winner.

[AshCashEmAll]

Anyone have any GMHI? They are merging with Luminar and it’s exciting to see the price action going on. Apparently lidar technology is gonna pave the way for autonomous driving. Long shot but might pay off.


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[-dustin]

https://www.investors.com/news/china...d-allegations/

House passed the bill re: Chinese stock delisting. We’ll see how this plays out AH and early hours tomorrow. I’m intrigued. Especially given the bounce some of these stocks saw today.

[logo]

Originally Posted by -dustin

https://www.investors.com/news/china...d-allegations/

House passed the bill re: Chinese stock delisting. We’ll see how this plays out AH and early hours tomorrow. I’m intrigued. Especially given the bounce some of these stocks saw today.

I was pretty surprised by the Chinese EV bounce today. I don't really expect them to continue higher tomorrow, but who knows.

[beshannon]

Covid-19's Deadliest Day, Snowflake, Splunk, Jobless Claims - 5 Things You Must Know Thursday

https://www.thestreet.com/markets/5-...hursday-120320

Markets flat at these over bought levels, no real news to trade as yet

This chart concerns me

[Xelorpepsi]

If you go to the Public Company Accounting Oversight Board (PCAOB) website, you will realise that most of the best performing companies are unsurprisingly audited by Big4 firms (e.g. BABA by PwC HK, NIO by PwC Zhong Tian, etc).

Here is the link for you, if you want to check for specific companies: https://pcaobus.org/resources/auditorsearch

[JParm]

https://www.barrons.com/articles/sno...?mod=hp_LATEST

Keeping an eye on SNOW today, as it sank post-close with earnings yesterday.

Any further dips today and I'll probably look at buying calls.

[chadwick4eva]

Originally Posted by beshannon

Covid-19's Deadliest Day, Snowflake, Splunk, Jobless Claims - 5 Things You Must Know Thursday

https://www.thestreet.com/markets/5-...hursday-120320

Markets flat at these over bought levels, no real news to trade as yet

This chart concerns me

Keep in mind that most companies of the S&P 500 suffered a pretty rough year in terms of earnings. That drastically affects the overall P/E ratio average of the S&P. Energy, real estate, travel all got hammered and it shows. We are clearly overinflated, but we are not in internet bubble land when even stocks like HD were trading at 70 times earnings. If we have a return to normalcy within the next quarter or two I think that those earnings go back up.

Invest in high quality businesses that are essential to people's lives at reasonable valuations and we should be okay. All that being said, there are a number of growth companies that are complete head scratchers for me at the moment in terms of valuation, and none of them pay yield to shareholders. Square, snowflake, zoom, teladoc, docusign, paypal, etc. Basically any stock with a higher than 3-3.5 PEG ratio. I think too many people got a little overexcited about these- you can start to see in all of their charts that they're starting to trend down a bit. SNOW trading somewhere around 50-60x forward sales- insanity. Buffett clearly saw something he liked, but he paid less than half the current price for his shares. I don't think a lot of investors are asking how the landscape looks a couple of years down the road- many of these companies will have to hit positive earnings and grow earnings by 30-50% a year for multiple years for the current valuations to make any sense. There's so much risk involved hoping that these software companies can keep growing at astounding rates for years to eventually catch up to valuation and take off, and with very little moat as well. Then they have to sustain growth once they'e broken positive cash flows. Looking at Tesla's forward earnings and their growth projections actually makes me think the company is relatively undervalued compared to a bunch of these software companies. Many things aren't proprietary in software anyway.

Lowe's looks decent in the current environment- will likely pick a bit more up soon. It bounced off its latest earnings that barely missed.

Has anyone here read Competitive Strategy by Michael Porter? Heard good things about it.

[beshannon]

Originally Posted by chadwick4eva

Keep in mind that most companies of the S&P 500 suffered a pretty rough year in terms of earnings. That drastically affects the overall P/E ratio average of the S&P. We are clearly overinflated, but we are not in internet bubble land when even stocks like HD were trading at 70 times earnings. If we have a return to normalcy within the next quarter or two I think that those earnings go back up.

I do not disagree. I am not suggesting selling and I do not think this is a bubble.

I am concerned that we could get a healthy pullback that could be 10-15%.

In the longer term yes I believe we will be higher. I just don't like to see numbers like this with the anemic trading volumes we have been having.

[logo]

Watching CRM. I was tempted into adding yesterday, but at the same time I’m not crazy about the Slack deal, and last time I thought a sell-off from acquisition news was largely overdone (TDOC) the stock didn’t move much, or trended lower. CRM is a way bigger company of course, so we’ll see.

[beshannon]

AAII Survey

Bullish 49.1% Average (38%)

Bearish 22.7% Average (31%)

Panic model

[chadwick4eva]

Took profit on Costco, great company and great business but can't justify current valuations. Locked in the special dividend ex date from yesterday and moving on.

[JParm]

Originally Posted by jpeezy14@hotmail.com

https://www.barrons.com/articles/sno...?mod=hp_LATEST

Keeping an eye on SNOW today, as it sank post-close with earnings yesterday.

Any further dips today and I'll probably look at buying calls.

Looks like the dip was after hours and that's it; SNOW didn't allow me to get in this am...

[chadwick4eva]

Originally Posted by jpeezy14@hotmail.com

Looks like the dip was after hours and that's it; SNOW didn't allow me to get in this am...

Don't sweat it- they're still trading at 100x sales and still burning cash. The valuation is ludicrous and will come back down to earth at some point.

[JParm]

Originally Posted by chadwick4eva

Don't sweat it- they're still trading at 100x sales and still burning cash. The valuation is ludicrous and will come back down to earth at some point.

Yes, this wouldn't have been a long-term hold. Was looking to take advantage of a dip and buy calls, similar to what I did yesterday with the excess selling in PLTR and CRM.

[tudorbaja27]

Originally Posted by yoast

For ARK investors:

https://www.barrons.com/articles/cat...nt-51605699000

I am an investor and not too happy if they will push this through.

I'm invested across all 5 ARK funds and would be terribly unhappy if this happened.

this is a good read
https://seekingalpha.com/article/439...tment-managers