Previous Month Summaries
Dec 2016 (contains links to all 2016 monthly posts): http://discussion.fool.com/bear39s-portfolio-at-the-end-of-2016-…
Jan 2017: http://discussion.fool.com/bear39s-portfolio-at-the-end-of-janua…
Portfolio Performance
This Month
My Portfolio 6.80%
S&P 3.72%
Nasdaq 3.75%
Russell 2000 1.93%
YTD
My Portfolio 17.96%
S&P 5.57%
Nasdaq 8.22%
Russell 2000 2.22%
Changes this month, and why I made them
Sales:
PERI - Noticed this tiny position because it had doubled in just over 2 months. Had no idea why or what would happen next or really, anything. So I sold. And now it’s been going back down, ha. Luck sometimes helps. http://discussion.fool.com/what-does-the-company-do-bear-matt-ju…
TWTR - Like Chris Sacca before me who said, “I literally should go to a Twitter therapist, just the 10 years of stress and trauma with this company”, it’s time to give up here. It had been my second smallest position other than PERI, so I clearly wasn’t betting the farm anyway, but it’s just the opportunity cost factor. I just can’t keep watching other businesses (that I could have this money with) grow incredibly while watching Twitter’s business languish. Fare thee well, Twitter. Sigh…so much untapped potential.
Buys:
TLND - http://discussion.fool.com/tlnd-32598219.aspx If you’re interested, please note especially that it is pretty illiquid.
TTD - I’m trying out Rule Breakers, and this was recommended just a week or so ago. I hope that’s ok to say now? (Guidance please on this…I don’t want to abuse the Fool’s policies.) Anyway I did a little digging and I’m starting to think it could be the next SHOP. It grew revenue by 70% DecQ over DecQ and 78% 2016 over 2015. Wow. And get this! They’re profitable! Like PAYC profitable! Current PS ratio is “only” about 8 (much less than SHOP or even TWLO) and PE is about 47. By no means cheap, but did I mention it grew revenue by 78% last year? RB seemed to catch it just in time, because it’s up over 20% since their rec. And roughly 50% in 2017. I think it still has plenty of daylight ahead.
STMP - http://discussion.fool.com/why-i-bought-stmp-again-32611029.aspx…
TWLO - I finally bought a little this morning. Kind of a starter position to motivate me to follow it more. We’ll see how that goes. This is basically what I’ve done for BOFI…but with it I just continue to watch, but can’t get interested. With TWLO, we’ll see.
Trims, Adds, and Holds:
SHOP - Still one of my largest holdings and probably still my favorite company, and the growth is just insane and amazing. Here’s where I talked about trimming SHOP: http://discussion.fool.com/i-think-this-is-a-great-question-and-… I actually am very satisfied at 8%, and if it keeps going up I’ll be glad…but it’s also the perfect size where I would still be ready to add plenty more if there were a significant dip in share price.
AMZN - Trimmed mostly just to redistribute into other things. I’m comfortable fluctuating between a slightly undersized position (only 4% today) and an oversized position in AMZN depending on the current valuation and the other current opportunities Mr Market is offering. But like SHOP, this is a company I want to own for a long time.
LGIH - Added a bunch when January sales FREAKED everybody out. http://discussion.fool.com/it-comes-down-to-if-you-believe-in-ma…
…but then I got nervous later in the month and unloaded the shares I had added. It may be paranoia, but for some reason I sleep better without this being an oversized position. I still have more than enough to be very happy if they continue to succeed.
HDP - Love this company. Added a ton. It’s a tough one to value, but in my opinion that just makes for cheaper shares and more upside potential. http://discussion.fool.com/incredible-analysis-saul-i39m-continu…
YELP - Added after earnings – can’t believe the prices we’re seeing! I guess almost 30% growth isn’t enough for some people. With the PS under 4(!), I would have thought that was already expected. I think this is my pick for “best buy now.” Though HDP is in some ways cheaper, YELP is much simpler than HDP, and easier to value with traditional metrics. In this post I mentioned I might buy a little…I actually ended up buying a lot. http://discussion.fool.com/yelp-opportunity-32592103.aspx
SQ - I got lucky in that I added to SQ before earnings. Earnings were fantastic and they’ve enjoyed some appreciation since, but I haven’t trimmed.
XPO - This one I added to after the great results came in, as I mentioned here: http://discussion.fool.com/xpo-turned-in-another-solid-quarter-3…
FB - Insane growth, unbelievable margins, and a 1YPEG Matt recently calculated of 0.37…this may be the most “Saulish” stock that Saul doesn’t own, and you better believe I’m adding. I’ll also mention for the risk averse that I see this (much like AMZN) as one of my safer bets. I can’t really imagine them getting disrupted at this point. Strangely, to my eye, it also looks to have the most near-term upside of any of the FANG stocks. Of course, that’s just a hunch. But a PE of 32 just seems WAAAAAAAAAAAY too cheap for this company.
That just leaves PAYC, SPLK, and HUBS untouched this month (ignoring my tiny BOFI and SSW positions). All three had great earnings reports, and I’m content to let all three run. They’re all fairly “full positions” sized in conjunction with my convictions on each. I would probably add to PAYC before the other two, but all three have their place.
So where does that leave us?
My Current Allocations
NOTE: The “YTD Ch” column lists the % change in share price in 2017.
Ticker Curr% YTD Ch
HDP 8.6% 19.6%
SQ 8.0% 27.1%
SHOP 8.0% 38.1%
XPO 7.9% 18.1%
PAYC 7.5% 18.3%
FB 7.2% 17.8%
YELP 7.0% -11.6%
SPLK 7.0% 20.7%
TTD 6.9% 52.5%
LGIH 6.7% 1.0%
HUBS 5.5% 26.6%
TLND 5.0% 22.1%
AMZN 3.9% 12.7%
STMP 2.9% 10.0%
BOFI 2.2% 10.5%
TWLO 2.1% 9.9%
SSW 1.8% -14.2%
cash 1.6%
Watchlist
I got really close to buying ANET this month. The product still puts me to sleep…it just goes right over my head and I don’t understand it at all. But they do seem to be just kicking CSCO’s tail, and obviously they have some very impressive leadership. I’ll keep thinking about it.
Even after the drop, I’m simply not interested in UBNT. It’s just not for me. Same with SBNY. I’m taking those two off my watchlist, although obviously Saul’s following them and owning them will no doubt keep them on my radar.
CYBR and VEEV and TEAM are still on the watchlist long term, but none is growing fast enough for me to pay what they’re going for. CYBR is close, and I like the space…just not sure who the winners will be.
GOOG/GOOGL - have thought about parking a little money in this low risk investment. They do look like a pretty good buy. I’ll probably just add more to FB instead, for now.
SKX - I’ve been thinking about getting back in because I do like the company and their prospects. It’s just not a rocketship like some other things seem to be, but it’s on my radar.
DY reports earnings tomorrow, so that should be interesting.
Random Thoughts and Conclusions
Kind of interesting what has happened to my portfolio in the last couple months.
- At the end of 2016 I only had 5 positions in the 5% to 9% range, plus 2 oversized positions
- At the end of January I had 10 positions in the 5-9% range and only 1 oversized position
- Now at the end of February I have 12 positions in the 5 - 9 percent range, and no oversized positions.
As SHOP (the fat pitch from late 2016) has appreciated greatly, I’m not particularly seeing anything in my portfolio that I feel is both extraordinarily high-conviction and also more undervalued than the rest. I feel like all of the companies and their stocks have plenty of room to grow, so I’m happy to spread my money around among them.
I’ve also moved up from 14 to 15 to now 17 total positions. However, the way I look at it I really have 14 now, because BOFI, TWLO, and SSW are each 2% or less…try out positions.
Anyway, I’m still very happy with and confident in the positions I own.
My best to all,
Bear
