by Travis Johnson, Stock Gumshoe | August 7, 2020 4:45 pm
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Hi Travis , wow great Write up it’s great to have you back.
One question I’ve always had is that to me FAANG should really have had Microsoft instead of Netflix in the acronym (Not as catchy maybe). It just seems to make more sense to me but it’s the only one you’ve never seemed to consider, I there any reason for this?
To me It seems to constantly perform, has a forward thinking CEO and pays a dividend ( and like most tech stocks was ‘cheap’ With nearly 1.5% divi in the downturn), would a TicTok buyout change your mind at all?
Great company, and absolutely true that I missed it — over the past few years, I just haven’t been willing to pay the premium MSFT demands, but before that I totally missed the opportunity. Microsoft is dramatically more appealing than Netflix.
Travis – in regards to UDC’s blue phosphorescent material. From UDC”S conference on Thursday.
Samsung is sampling UDC’s blue emitter. From Conference Call:
Jim Ricchiuti
And then just regarding the paper that Samsung gave at the SID conference. And typically when these papers are given, I would assume and this is probably not the first that you guys have some input in papers like this. Is that fair to say?
Sid Rosenblatt
Well, this is a Samsung paper and what they were doing is looking at phosphorescent in blue and essentially, literally talking about that you need a deep blue phosphorescent emitter to get the best display and the most power efficient display. And it’s an R&D project and we don’t talk specifically about R&D projects with our customers. .
Jim Ricchiuti
But I would guess that it’s not a complete surprise, I’d assume you knew the paper was coming?
Sid Rosenblatt
Yes.
Jim Ricchiuti
Can you say when you knew it was coming?
Sid Rosenblatt
The paper, SID keeps the papers quiet until they actually publish them. And I believe it was two days ago that, I believe it was on the fourth or the third that these papers were then becoming public through the SID Web site. So you have to go there and purchase access to the content. And I think it’s a couple of days ago that this came out.
https://seekingalpha.com/article/4365553-universal-display-corporation-oled-ceo-steve-abramson-on-q2-2020-results-earnings-call?page=9
Check out EMAN – another OLED technology display. They make micro-displays and just received 40 million in government money with two more phases to come. They have a patented direct patterning display that uses more of the display screen and can do away with color filters, which can improve brightness significantly. They have military contracts and are talking about licensing their direct patterning display to other companies and it can be used for larger screens besides micro-displays.
Dear Travis,
Welcome back(? – I think you would prefer to still be on vacation).
Below are questions and comments about the proposed ban on Tik Tok. I offer them out of curiosity. (I don’t know the background to the US Government-forced sales of Grndr from its former China-based company so perhaps I should read about that first.)
If Tik Tok were to remain part of China-based ByteDance, how would a ban work? If Tik Tok produced something tangible to export from China, I can understand a ban on its imported product or a business-crippling tariff. Tik Tok has a California-based office, so perhaps a shutdown of its premises could eliminate its physical presence. But Tik Tok is an internet service platform, and if it were outside of the US, it could still make its platform available to US users. The only way to ban it would be for the US to set up something resembling China’s so-called Great Firewall. But that would be nigh impossible to establish to take place by mid-September when the ban goes into force, and viable a version would take years to develop. In addition, I don’t see US politicians and legislators, aside from the current president, having the stomach to go down that path. (But one never knows.) As I understand, the Great Firewall is a combination of government agency to oversee the wall’s function, technologies and legislative actions. Which government agency would be put in charge or created to manage the firewall? Where would the money, in the present fiscal shortfall, come from, to staff operations and develop continual technologies? Legislation would be the hardest part, not because of the laws themselves but because of the requirements that businesses cooperates. For a US firewall to be successful, the government needs powers to coerce internet companies (service providers/media entities) to monitor traffic to ensure that Tik Tok would not be downloaded, or to punish these companies if they allow (or fail to detect) TiK Tok to be available in the US, which in the long run would instill self-censorship. How is that scenario going to fly, whatever politics users hold? And as in China if it were the case in the US, users of the Tik Tok would be punished, subject to arrest or fines, or their telecommunication services taken away from them. I don’t see how Tik Tok can be banned in the US?
You don’t have to actually make sure it’s blocked for every US user, you just have to make it illegal to do business with them — then the ads dry up, and the business is toast. It’s theoretically possible to really block it for most people, just by twisting arms at telecom companies, but it’s easier to cut them off just by stopping the money — which Trump probably can do with an executive order, though I’m sure it will be fought in court if Microsoft (or someone else) doesn’t pull of a quick acquisition.
Hey Travis. Do you still have a position in SAND? What did you think about their recent earnings? Still worth holding on to?
Thanks for all you do!
Terry
Still my favorite gold play, and one of my largest positions — I have a lot of confidence in Nolan Watson and their strategy of accumulating cash-flowing royalties. If gold stays near $1,800 an ounce or higher, I think buying below $10 is a no-brainer for Sandstorm in the long run. They have some perceived political risk in their largest asset, Hod Maden, just because it’s in Turkey… but I think at these gold prices we’re essentially getting Hod Maden for free, anyway.
Of course, gold might go down, in which case…
Cloudflare shows as a sell in your real port. spreadsheet (color coding)….yet in the other info its micro buying….can you check this out …who know I’m probably just seeing things anyway at this point… And welcome back !!!
Sorry about that, ANET and NET got mixed up in the data — I’ve corrected it now, the Real Money Portfolio page is updated with the correct info.
Can Tik Tok/Bytedance try to go to court and stop the Trump order? Going to court might take a long while for the ban to happen, if it happens.
Even if Fastly loses Tik Tok, it’s only 12% total revenue. Market overreacted IMHO. It did give me a chance to get in at 77.
Sure, any number of outcomes are possible. I suspect ByteDance will
Monetize it somehow, likely with a sale, but it’s possible they could fight Trump instead, leading to a long legal battle.
Hi Travis, a very interesting article
FSLY was overpriced when I discovered it and bought LLNW. My exposure is 6.4% and I have a loss of 4.72%. I don’t see any bad news. Don’t you think that would be a good candidate for a swing trading ?
I am also thinking to buy NET.
I sold KAMBI @236 with a 15% profit . I’ll come back late
My only real concern with Limelight Networks is that they went through such a long period of disappointing performance — maybe the restructuring they’ve gone through in recent years will pay off as streaming video rises, and of so any real growth might bring investors back onboard, perhaps with an aggressive leap higher if they have shockingly good performance during this pandemic, but there’s a lot of distrust after the long period of failure to grow.
I try not to do much short-term swing trading, and there’s no indication that I’m good at that timing, so I’ll let you make your own call there 🙂
Travis,
I sol d all FSLY with a lot of capital gain. I use the money to load up MSFT.
IF, it is a big if, MSFT buys out TIK TOK ( we will know by or before Sept 15). FSLY service will no longer needed IMO,this was the main reason I let go of FSLY.
I have TDOC and LVGO, personally I hate the deal. The market hates the deal too. Since I got both at much lower cost and I stay put both right now.
Microsoft doesn’t offer quite the same Edge network that Fastly does — which is partly why GitHub still uses Fastly. It’s certainly possible that they’ll eventually drop Fastly if they buy TikTok, I have no idea, but it doesn’t worry me very much.
Travis,
What will happen to FSLY ? Look at this way for sure TIK TOK will be out US market, if FSLY still works with TIK TOK, FSLY stock price will be dropped like a rock once DOJ and Treasury Department involve. I sold
FSLY OUT ~$110. I was VERY GLAD I did.
Could be, that was certainly a nice selling point in retrospect. TikTok was 12% of FSLY revenues, so was a big chunk of their growth in the second quarter — but it’s also only a chunk of their growth, they were growing pretty well aside from TikTok as well, it’s just that it could have been as low as 35% growth instead of 50% growth in the first half of the year without that TikTok business.
Clearly, at a valuation of 30-40X sales investors are prone to be gun-shy when there’s any threat, and maybe that will turn out to be the right response… but I expect Fastly to be fine in the long run, with or without TikTok. That doesn’t mean the stock will necessarily be fine for the next month or so leading up to the September 15 deadline, that’s a question we can only answer in retrospect once we’ve seen what the news is and how sentiment shifts… just that the company will not disappear or have any meaningful operational problems if TikTok disappears overnight on that day as a customer.
Hi Travis,
With the possibility of Democrats winning in this year 2020 election, can you comment on renewable energy stocks such as Enphase?
And do you think the stock market will crash after Democrats win?
I have not looked at Enphase in a long time, though probably the biggest driver will be whether or not states decide to keep subsidizing solar installations with credits — given state budget problems, that would worry me more than anything in Washington.
And I expect the next six months to be very volatile, but given current polling (which everyone on Wall Street watches very closely), the market should be pricing in a Democratic victory already. I don’t expect a crash because of a Biden victory, but there could easily be some huge swings both directions in the next few months as people on both sides try to rile up their voters. Betting on election outcomes is a loser’s game, we don’t know anything that other investors don’t know so we’re just riding the same waves of sentiment up and down — usually that leads to losses for small investors. The economy will probably not be dramatically different in January than it is now, and whoever is President will have to be Cheerleader in Chief as we try to recover from the pandemic recession — hopefully more progress will have been made on the public health front by then, but given the reopenings and the return to indoor living it might be a scary time.
As investors, I’d guess that trying to look past this fall and winter, into some future that includes a return to normalcy, is the only way to stay sane and make rational investing decisions.
Can you offer some insight on CLSK? They are on the rise and they have many potential catalysts.
Have never heard of them — what do you think the catalysts are?
They specialize in Micro Grids, energy storage, batteries for electric vehicles. It is the software that they sell that optimizes energy consumption and allows you to store it. SaaS. Apparently it’s patented. They are working with a subsidiary of Walmart so they have a connection there, although not publicly released. But the CEO himself said the only hint he will give is that it’s the largest retail store in the US. The company also releases news every week which seems to consist of new partnerships They have acquired in other parts of the world such as sunshine solar. I think Tesla has been an ongoing partner as well. Micro Grids could benefit EV charging stations and EV batteries. ER came out last week it was very positive! Small cap company Expecting to be profitable by the end of the year.
https://m.youtube.com/watch?v=uQBSrAZOvt0
This is a video interview with the CEO he helps explain a little bit more about the company. Oh they also have their software installed at Camp Pendleton in California about 5-6 years back I think. The results were positive That the software does indeed do its job effectively and is still working to this day. The Air Force is also a customer. This is just one play in the renewable energy sector though I just thought I’d throw in a potentially good portfolio candidate. It’s been on a tear in stock price recently.
Thanks… tiny company that has tripled in a month, so that gives me great pause, but it sounds like it’s worth reading up on them a bit. Not much actual revenue yet, and surprisingly low gross margin for an IP company, but certainly growing that top line right now.
They are consolidating right now I think it’s getting ready for the next leg up. I’ve been it since $4 at 1000 shares haven’t sold any. It’s definitely no penny stock or pump and dump like so many of them turn out to be. They have so many ways of generating revenue too. One such avenue of generating revenue is Through their subscription based software that comes with data analytics. They also have hardware and consulting services. Why can’t someone else make money off the same software you might ask? Well, They have patented software. one such patent is that of “establishing communication power sharing links between components of a distributed energy system” which is pretty big. Just to even get a patent awarded you have to prove your system works and they have. These guys focus on storing energy and preventing the waste of energy which could save companies money. A lot energy customers consume energy but don’t store it. If the sun don’t shine the lights don’t either. This is what CleanSpark aims to change.
Has anyone in this thread heard anything about how all the ENPH stockholders’ lawsuits are progressing? There were a ton of them in recent months, purportedly over misrepresentation of income and earnings coming out of the company. I was an early investor in the company but got out and took profits after a rapid run-up and the first news of the lawsuits. They seem to have a great product and they’re continually updating their forward movement, but no word that I’ve seen on the resolution, if any, of such lawsuits.
Enphase? i can’t believe their stock price is that high. What about CleanSpark they At least have patented software in the clean energy sector.
I too have been disappointed by Arista Networks. But I’m keeping my position because I think the CEO Jayshree has the potential to be a Bill Gates/Steve Jobs level executive.
I’d say their stock price troubles stem from 1) their continued reliance on “Cloud Titans” meaning lumpy revenue streams 2) their bid to expand to Enterprise Campus’s may be in trouble if work from home becomes a major thing (why spend on 400B networks if no one’s working on your campus? In fact, why have a campus. Point 2 will IMO resolve itself as some businesses will realize that yes they need people to work from the office.
Hello Travis, SLP missing from Real money portfolio. Is already gone from your portfolio?
Yes, I was stopped out of that very quickly after buying (unfortunately, as it bounced back nicely later)
Travis, thanks for always sharing your portfolio. Always instructive to slowly digest your investment thinking through your purchases. Kind of similar to Buffett’s letters, in that it takes several reads to appreciate what he is saying. To the point, over the past year several newsletters have recommended endpoint security systems such as $CRWD. I don”t recall many comments about these recommendations and it is not in your portfolio. The stock has appreciated very well over the past year and currently looks extremely overvalued. Any thoughts on this particular stock or others with the WFH culture that seems to be catching on. Thanks for any comments and keep up the terrific work.
The stocks that I own in “security” are not really just cyber security stocks — I’ve always had trouble trying to differentiate one cyber security name from others, so I’ve bought into similar trends primarily through OKTA, FSLY and NET, whose offerings I understand a little better.
Travis, any thoughts on $GAN recent disclosure that fanduel will no longer be a customer as of August of 2021? I’m sure this is going to hurt tomorrow but I’m wondering if they can pivot enough with $PENN and others to counter this so that I do not need to get out. (likely with a minor loss)
Looking into that earnings update today, I’ll share my updated thoughts in the Friday File this afternoon.