Stocks for the Long Term

[BlueWolf]

Been closing positions selectively over the last several days. I don’t like the feel of market right now.

[BlueWolf]

I have pruned a few positions out of my long term holdings, but I’m still holding tight with the majority of my positions. One that I am still holding is ZM, in which I have a 1/2 position that is currently under water. Despite the drop in price, I like this company for the long term. I’m thinking I might buy another 1/2 position here because the price is so discounted at current levels. Another beaten down stock I really like as a possible long term investment is WORK. I don’t own it yet, but it also looks heavily discounted and could be a buy at current levels. Do your own research and see what you think. Just putting out some ideas for you to consider.

One cautionary note: Though the market has been a little bullish over the last week, the rally of the last few days has not necessarily been broad based. For example, in the S&P, which made a new all-time high today, only 8% of participating stocks also made new highs. I have also attached an interesting chart that plots the split between the S&P and stocks above their 50 day moving average (courtesy of IndexInvestors.com).

https://www.dropbox.com/s/wfh42gk9giipol8/Photo%20Oct%2029%2C%203%2034%2003%20PM.png?dl=0

[Louetta]

Boy good luck with them.

[BlueWolf]

Boy good luck with them.

😊 I admit that it may be a little early with ZM, but I like them because they’re a phenomenal growth story with a lot of potential in an enormous market. For example, last quarter revenue grew by almost 100% YoY and their EPS beat estimates by 700%. Revenue has grown from $60.8M for FY 2020 to $330.5M for FY 2019 and is expected to hit $463.7M for FY 2020. What is even more amazing is that they are already profitable despite the fact that they only IPO’d in April. They’ve also almost doubled the number of customers in the last 12 months and generated a net dollar expansion rate above 130% for the fifth quarter in a row. There is real growth story here that seems unappreciated (so far). Moreover, the global video conferencing market size was valued at USD 3.4 billion in 2017 and is expected expand at a CAGR of 9.2% from 2018 to 2025, which provides an awful lot of headroom for this company. I think the stock took a hit because of valuation concerns, but I’m still a strong believer that growth fuels share price and this a high growth company that is still generating ridiculous growth numbers. I’ve been wrong before, and only time will tell for sure, but I like the story at ZM, and I’m willing to take shot on a few stocks like this because of their potential to become multi-baggers. The story at WORK isn’t as compelling, but it’s still strong. I am also familiar with their product and see their market penetration continuing to improve. Still haven’t pulled the trigger on WORK, though, because of market concerns. Normally, I would be more aggressive.

[Louetta]

I notice both did well yesterday. I worry about charts of various stocks since Labor Day. A lot have gotten clobbered. Why? I don't think it has anything to do with the companies. More likely the general disenchantment with IPOs. Also I got up at 5 this morning and the Dow was indicated up 38. Now at 5:30 it's indicated down 78 because of a tweet or something by someone that the Chinese will not sign an agreement with Trump. I look at FSLY, CRWD, IIPR, ZM, EDIT, RVLV, AYX recently and can't figure out what's happening.

[BlueWolf]

I sold off a few (mostly losing) positions because of volatility, and I added a few speculative (half) positions, so my portfolio has been a little shaken up. For what it’s worth here are my current positions along with stocks I am watching for possible addition. For those stocks I own and did not do a write up on, I will try and write then up when I have time, but right now I am devoting a lot of my free time to arpeggios, chord tones, and my beautiful baby granddaughter.

Current LT positions*:
AAPL, AAXN, ABMD, AMZN, APPN, AYX, BIDU, CGNX, DOCU, EDIT, EEFT, EPAM, ESTC, FB, FICO, GH, INSP, ISRG, LYV, MA, MDB, MELI, MTCH, NTNX, NVCR, NVDA, OKTA, OLLI, PANW, ROKU, SFIX, SHOP, SMAR, TDOC, TEAM, TREX, TTD, TTWO, TWLO, VEEV, WIX, ZEN, ZM, ZS

Current LT Candidates (some have run away from me ):
AMT, APPF, BRK/B, CME, CRM, CRSP, DDOG, HUBS, KNSL, LITE, LOB, MASI, MSFT, NEE, PYPL, QTWO, RGEN, SPLK, SNPS, STNE, WD, WORK

* Bold = Write Up Available

[Louetta]

Thank you for the update. OLLI is an interesting choice, opening lots of new stores, looks like a good entry point.

[BlueWolf]

Thank you for the update. OLLI is an interesting choice, opening lots of new stores, looks like a good entry point.

OLLI is a great growth story with lots of upside potential. There may be some concerns that their expenses have ramped up, which has slowed growth in their EPS even though revenue grew 15% last YoY. Then again, they’re using that money to fund their growth, so I’m OK with it. It sure looks like they’re positioning themselves for solid long term growth, i.e. they’re managing for the big picture. It also doesn’t hurt that they’re actually a little undervalued. In fact, they may be the only 4 or 5 star Morningstar stock that I currently own because, as an aggressive growth investor, I tend to buy into stocks with valuations skewed to the high side.

[billyjoe]

I stopped going to Big Lots when they went nearly 100% Chinese made. Ollies is like an early Big Lots. Actual great bargains on overstock merch. Only place I've found size 12-16 socks at less than half price. Good for lawn fertilizer and Preen also. I didn't realize OLLI had an over 4 bil. market cap.

-----------------------billy

[BlueWolf]

Update: I haven’t added or closed any new positions, but my watch list has changed a little so I thought I’d share.

Current LT positions¹:
AAPL, AAXN, ABMD, AMZN, APPN, AYX, BIDU, CGNX, DOCU, EDIT, EEFT, EPAM, ESTC, FB, FICO, GH, INSP, ISRG, LYV, MA, MDB, MELI, MTCH, NTNX, NVCR, NVDA, OKTA, OLLI, PANW, ROKU, SFIX, SHOP, SMAR, TDOC, TEAM, TREX, TTD, TTWO, TWLO, VEEV, WIX, ZEN, ZM, ZS

Current LT Candidates^2,3: (A few of these have run away from me, i.e. it’s now tough to get a good entry)^:
ADSK, AMT, APPF, BRK/B, CME, CRM, CRSP, DDOG, ETSY, GOOG, HUBS, KNSL, LITE, LOB, LOPE, MASI, MSFT, NEE, PYPL, QTWO, RGEN, SNPS, SPLK, STNE, WD, WDAY, WORK

1. Bold = Write Up Available
2. Italics - New Stock
3. Strikethrough = Dropped From List

BTW, if any of you have an opinion on any of the stocks in my watchlist, I’d love to hear it,

[Louetta]

I've been staring at ETSY data for the last 1/2 hour and really can't convince myself it's a buy. It's a loverly idea but the downward trend in the price has been so severe and I can't quite see a reason for a turnaround. Presumably they'd have to beat their guidance which is 33% or so for revenue. That's a healthy increase as it is. Methinks there's better candidates but I do keep seeing people say that after the sell-off this is a good entry point. I thought the same thing with RVLV (and CRON).

[BlueWolf]

I've been staring at ETSY data for the last 1/2 hour and really can't convince myself it's a buy. It's a loverly idea but the downward trend in the price has been so severe and I can't quite see a reason for a turnaround. Presumably they'd have to beat their guidance which is 33% or so for revenue. That's a healthy increase as it is. Methinks there's better candidates but I do keep seeing people say that after the sell-off this is a good entry point. I thought the same thing with RVLV (and CRON).

I really liked RVLV, and still do to some extent even though they’re not on my LT watch list right now. I didn’t like the way it was trending, however, and closed my position. I’m interested on ETSY for the potential. They’re revenue story has been exceptional. They got punished in August and then again at the end of November. The reasons for the August hit were a little subtle, but the October hit was because of a drop in quarterly revenue. Still, for the full year, revenue is expected to grow 30+% YoY, and their forward guidance is still strong. I agree that the trend doesn’t look that great here for an entry, but I do think it is becoming fairly valued, which for a growth stock, is compelling (usually they are somewhat overvalued). I’m lousy at calling bottoms, but I will keep an eye on this one and if it starts trending up, I might jump in.

[BlueWolf]

I opened a position in DDOG today. This is a recent IPO, so it’s speculative, but I like the product and their growth story. They doubled revenue from 2017 to 2018, and they’re on track to increase revenue by another 50% this year. The primary risk here is that they’re in a very competitive space. I thought I’d take a shot, although my track record for recent IPOs hasn’t been too good. ☹️

Here are my current holdings plus my long term watchlist.

Current LT positions:
AAPL, AAXN, ABMD, AMZN, APPN, AYX, BIDU, CGNX, DDOG, DOCU,EDIT,EEFT, EPAM, ESTC, FB, FICO, GH, INSP, ISRG,LYV, MA, MDB,MELI,MTCH,NTNX, NVCR, NVDA, OKTA, OLLI, PANW, ROKU, SFIX, SHOP, SMAR, TDOC, TEAM, TREX, TTD, TTWO, TWLO, VEEV, WIX, ZEN, ZM, ZS

Current LT Candidates:
ADSK, AMT, APPF, BRK/B, CRM, CRSP, ETSY, GOOG, HUBS, KNSL, LITE, LOB, LOPE, MASI, MSFT, NEE, NOW, PYPL, QTWO, RGEN, SNPS, SPLK, WD, WDAY, WORK

1. Underlined = I have previously provided a write up in this thread
2. Bold - New Stock

[Louetta]

Thank you for the update. Good day for your stuff. DDOG doing well. Even RVLV is up today though I can't see any news.

[Louetta]

Ooooo! Cramer just said buy RVLV now!