Interesting Stocks

[jiesen]

If you have a good-sized gain right now, I would say it's a good time to lock that in at around 200. Don't worry about missing out on more, you should have another chance to get in below $175 again, either soon or once the insiders are able to sell their stock.

You see? Any shares you sold at 205 yesterday could be bought back today at 175. (or tomorrow for 165, probably)

[jiesen]

I sold another 1/3, and I’m going to hang on to the rest for now.

That was a very good call. Congrats on getting the quick profit out of this monster stock, BW!

[BlueWolf]

If you have a good-sized gain right now, I would say it's a good time to lock that in at around 200. Don't worry about missing out on more, you should have another chance to get in below $175 again, either soon or once the insiders are able to sell their stock.

I sold another 1/3, and I’m going to hang on to the rest for now.

[jiesen]

If you have a good-sized gain right now, I would say it's a good time to lock that in at around 200. Don't worry about missing out on more, you should have another chance to get in below $175 again, either soon or once the insiders are able to sell their stock.

[BlueWolf]

I wish I had legged in pre-IPO now. I really think, after the reading I’ve been doing over the last few days, that SPCX is going to be a keeper for the long run.

I still have my doubts about OpenAI and Anthropic, but, hey, maybe I just need to dig a little deeper. I can convince myself of just about anything if I try hard enough .

[jiesen]

Well, with a share price of over 190 you've obviously made a good choice to jump on the SPCX rocket. Even SATS has started to perk up, since it can't help to be boosted along with SPCX... good luck with the rest of the run, and I think it could keep going for a while before any actual selling in size happens!

[BlueWolf]

Well, I now have a position in SpaceX. I took a bit of a risk in the way I entered, though, in order to give myself a buffer. I took a triple position position (to my normal size position), and because I was lucky enough to catch a wave, I sold 1/3 of the position today and booked a little profit. If continues to run tomorrow, I’ll sell off another third, and then move a stop to just below my original entry with the hope of hanging on to a normal sized position. If it doesn’t retrace past my stop, I’ll have a long term position I can hang on to. If it retraces, I’ll book some profit, reload, and try again when the charts look promising. I’m now convinced there’s something worth having here for the long term.

[BlueWolf]

It has been my understanding that a positive EPS is not necessary to achieve GAAP profitability. A company can have a negative EPS while still being profitable under GAAP. The money coming in from the IPO may not be booked as revenue, but it is booked as additional paid in capital, which is income, is it not? I think I may have muddied the waters when I said positive GAAP earnings, when what I meant was simply GAAP profitability. Sorry about that.

You may be correct about the four consecutive quarters, however. I assumed it was a TTM requirement, but perhaps it was 4 consecutive Q’s, which was part of what the S&P declined to waive. Still, I’m sure that if SpaceX wants to be listed on the S&P in 2027 it would be a simple enough matter for them to either structure their income or raise new sources of income in order to satisfy a 4 consecutive quarter requirement.

[jiesen]

Raising money by selling stock doesn't always result in an immediate increase in earnings, but it can allow them to spend a lot more. That spending will likely take time before it shows up as earnings, since it'll be used mostly to build out the AI business and pay for rocket R&D. Perhaps I'm wrong (I've been known to say a few dumb things) but I believe in order for the S&P to take SPCX into its index, the entire company must have positive income per GAAP, not just a part of it, for each of the 4 quarters. Taken as a whole, SPCX isn't likely to have a net positive income for the next few quarters, imo.

Also, google agrees with this:
Asking Gemini: SPCX has had an IPO. will that make its EPS go up?
Gives:
No, the IPO will almost certainly cause SpaceX's (SPCX) reported GAAP Earnings Per Share (EPS) to go down significantly in the short term, even if its actual rocket and satellite business continues to grow. [1]

[BlueWolf]

[QUOTE=jiesen;n192964]So you believe SpaceX will be profitable over the next year, for each quarter? They have recently been unprofitable, and it seems unlikely to me that they will have 4 quarters of GAAP positive earnings anytime soon. The rockets do make money, but the AI business is burning it up faster.

You’re forgetting that they just did a giant IPO, so yes they’ll have positive GAAP income.

[jiesen]

So you believe SpaceX will be profitable over the next year, for each quarter? They have recently been unprofitable, and it seems unlikely to me that they will have 4 quarters of GAAP positive earnings anytime soon. The rockets do make money, but the AI business is burning it up faster.

Here's what 4 analysts estimate for SPCX earnings over the next 4 quarters:

https://www.tradingview.com/symbols/NASDAQ-SPCX/forecast/

[BlueWolf]

Watched an interesting video on SpaceX today. In the video, it was claimed that SpaceX was maneuvering to get itself fastracked into the S&P500. In the end, its efforts failed, as the S&P (and Dow) declined to change all the eligibility requirements needed to accommodate them. Interestingly, though, the NASDAQ and Russell indices both approved the necessary changes, which will allow immediate inclusion of big IPOs like SpaceX. The S&P, came close, but refused to drop the 12 month waiting period. They did lower the bar so that a company can be included with only four quarters of GAAP positive earnings, so it’s a lock that SpaceX will join the S&P in 2027. This is big news! It means that every market-weight ETF is going to have to buy a ton of SpaceX stock over the next year or so. That’s potentially billions of dollars of forced purchases. This adds a whole new dimension to buying stock in these big IPOs. I’m way more interested now.

[jiesen]

I’m probably going to miss a big opportunity because there may be a lot of initial IPO euphoria over these companies, but after doing my deep dive, I’ve decided I am not going to open any positions just to get exposure to the SpaceX, OpenAI, or Anthropic IPOs. I’m going to wait it out before I enter.

Probably a wise choice. You'll be able to get all of these at a good discount later this year, I think. I'm hoping for a big pop either tomorrow or next week, so I can sell my SATS at a 30-50% gain. I might pick up SpaceX with that later, after it drops 30-50% with waning interest from the masses.

[BlueWolf]

I’m probably going to miss a big opportunity because there may be a lot of initial IPO euphoria over these companies, but after doing my deep dive, I’ve decided I am not going to open any positions just to get exposure to the SpaceX, OpenAI, or Anthropic IPOs. I’m going to wait it out before I enter.

[jiesen]

Yeah, I know, these AI giants are all way way way overvalued at $1T odd market caps. Realistically, most are worth 1/10 that, and one of them is possibly worth 10x that or more. Question is which one? To be safe, best way to play it would be buy shares 50/50 in GOOG and MSFT. One of them will likely buy out the eventual winner of the AI game. Or sure, buy all 3 big AI stocks in a fund, or on their IPO and hope you're holding the right one when it pops 10x. Weak hands will sell at 2x, though, and the risk is that all 3 will fail, and MSFT walks away with the prize anyway. So, I think putting any money in a pure AI play is not a great idea. Better would be to buy shares in an established company or two that has an AI component, some of those are GOOG, MSFT, ORCL, or AMZN. Of the 3 IPO's, only SpaceX fits with that idea (because of rockets), and the other two (OpenAI and Anthropic) are just too risky now to put good money into, imo.

And to be clear, timing is also very important here, and best would have been to buy last year, or 3 years ago, but not today. If the market corrects another 10-15% that might give us a compelling reason to scoop up some AI picks on the cheap, though.