Interesting Stocks

[BlueWolf]

Something puzzles me. If your thesis about ECHO’s value being almost completely tied to the value of SPCX, then why isn’t ECHO plunging at the same rate as SPCX? It’s kind of odd since the value of the SPCX shares they hold is greater than their entire market cap. Is this because the SPCX deal is not yet finalized (it won’t be until 2027 from what I’ve read)?

[jiesen]

Yes, they can only sell bits of SPCX before 2027, as most of it's locked up until after Musk gets to sell his next year, otherwise yes it should have traded in lockstep with SPCX (that was my original bet, that when SPCX hit 200, so would ECHO, and I'd have been out with a 60% gain at least). Unfortunately due to the lockup of the shares, ECHO (and I) need to wait until later after all the shares become available to trade.

[jiesen]

So that kind of works both ways, too. As it didn't spike dramatically when the IPO launched, it's not sinking so much either, as the SPCX shares really only become relevant later, when the actual price they can get for them will be clearer. The market is probably discounting ECHO's holdings by at least 50% now, in case SPCX continues to drop from $120 down to $60 or something like that next year.

[BlueWolf]

Yes, they can only sell bits of SPCX before 2027, as most of it's locked up until after Musk gets to sell his next year, otherwise yes it should have traded in lockstep with SPCX (that was my original bet, that when SPCX hit 200, so would ECHO, and I'd have been out with a 60% gain at least). Unfortunately due to the lockup of the shares, ECHO (and I) need to wait until later after all the shares become available to trade.

The deal has received regulatory approval but I don’t believe it will close until the second half of 2027. Technically, that would mean that ECHO doesn’t actually hold the shares yet.

[jiesen]

yeah, that's the deal for additional shares they get next year. they also own shares from previous spectrum sales that will become available to sell next month.

[jiesen]

I think we might have seen the bottom for SPCX put in today at 105. If the earnings report comes out it and makes the analysts happy, it should easily pop right back into the 130s and even higher next week. Just my gut feel here. It's bound to be a highly volatile year for this one, but whoever got in under 110 probably has a good long-term entry on SPCX.

[BlueWolf]

I’m sitting on a lot of cash right now after selling into the last two rallies, but I’m on the fence about a lot of stocks. I did buy some BE, COHR, and SKHY over the last 3 days, but that’s about it. I’m kind of tech heavy in my portfolio right now which makes me a little nervous, but I’m not convinced the AI bubble is quite ready to burst. The demand for power and chips is not likely to resolve itself soon because of the enormous backlog. You still can’t buy memory chips at a decent price.

The X factor in the tech world right now is the new Nvidia RTX Spark chip. How much of an impact is this all-in-one architecture on a chip going to have? It certainly looks like it has some performance advantages over the old discrete architecture of PCs. Since it’s ARM-based, though, will developers be willing to abandon their x86-based software development infrastructure and migrate to the ARM platform? My understanding is that the old x86 software will still run in emulation mode on the Spark, albeit with a performance penalty because of all the translation overhead. Other than NVidia directly, is there an investment opportunity here? Is Spark going to take off?

[BlueWolf]

I’m such a coward when it comes to buying stocks going into earnings. It’s rare that I will open a position in a stock right before earnings. I’ve had my eye on ABNB for a little while now. I just really like the business. I held off buying, though, because they were scheduled to report on Aug 6. Well, sure enough, it popped today after an excellent earnings report including upbeat guidance. It was basing at a high too in the days just prior. I should have pulled the trigger. What a chicken I am.

[BlueWolf]

Looks like AMD is making a major play to take some AI share away from NVDA with their Helios system. I’m already holding some AMD or I might be tempted to buy more. Where is INTC in all this? What happened to them? They seem to have been taken completely by surprise by the AI revolution. The only thing that has saved them was some government intervention.

[jiesen]

Looks like AMD is making a major play to take some AI share away from NVDA with their Helios system. I’m already holding some AMD or I might be tempted to buy more. Where is INTC in all this? What happened to them? They seem to have been taken completely by surprise by the AI revolution. The only thing that has saved them was some government intervention.

I think it's as simple as you've put it. INTC got too big and lazy, lost their edge to the competition (like NVDA and TSMC). This happens to big monopolies all the time (AAPL is probably the next one to go this route). Only thing going for them now is US gov't backing. That explains why the whole AI revolution was missed, and why other outfits are doing much better than they are.

[jiesen]

I think we might have seen the bottom for SPCX put in today at 105. If the earnings report comes out it and makes the analysts happy, it should easily pop right back into the 130s and even higher next week. Just my gut feel here. It's bound to be a highly volatile year for this one, but whoever got in under 110 probably has a good long-term entry on SPCX.

You sees? What did I say? SPCX is up to 130 already today! If you got in for 110 last week, you've already got a 15% winner right here...