Bear's Portfolio through 10/2021

PaulWBryant · October 30, 2021, 1:43pm

Disclaimer: I post my portfolio to share ideas and track my results. Please do not try to copy anything I do – it may not be right for your style, but even more than that: you have to understand for yourself why you hold the companies you hold. Please don’t email me portfolio management questions. I have absolutely no idea what you should do, because only you can know how best to run your portfolio – and if you’re like me, it will take months of following along on this board to figure out what works for you. Here are a few questions I get frequently enough that I’d like to head them off at the pass.

Q: Does your return percentage include the cash you hold?
A: YES, the 0% return from cash held is included in the overall return and obviously drags it down. But options trading (off topic for this board!) and other trims and adds can also affect return – and I won’t be able to share my real time moves, because I make little changes all the time.

Q: Are stocks overvalued? Is that why you hold so much cash?
A: I never know when anything is overvalued. Look at Cloudflare! I sold a looooong time ago.

Q: Should I hold cash to be able to buy on pullbacks?
A: Probably not if you have new money coming into your portfolio regularly (like from a paycheck), right? But when you’re retired you just have to figure out what works for you. The closest thing to advice I’ll say is this: You will never time it perfectly anyway, so just use your judgement and do what helps you sleep at night.


**Port Return**
Jan +7.3% YTD
Feb +6.7% YTD
Mar +2.0% YTD
Apr +9.8% YTD
May +12.4% YTD
Jun +29.2% YTD
Jul +33.9% YTD
Aug +65.1% YTD
Sep +68.8% YTD
Oct +79.6% YTD

Sold: I had just bought back into Cloudflare on a pull back (to 115 or so), and I sold it again when it went back up (above 140-150 or so just a couple weeks later). I just can’t understand the valuation.

Sold: The more I thought about things, I decided just to let the rest of my Crowdstrike go. It’s possible their growth will stay fast enough to keep the stock moving up for a while, but the law of large numbers seems to be catching up with them, and I just think I’ll be happier invested elsewhere. Crowdstrike is now a 68 billion mkt cap, and with (much) less revenue than Zoom (82b mkt cap) and Docusign (58b mkt cap) and Twilio (52b mkt cap). But none of those were able to maintain hypergrowth at a certain scale, and we’ll see if Crowdstrike can. Right now, the only company I’m betting on maintaining hypergrowth at massive scale is Datadog (58b mkt cap).

No new positions this month, so I’m back down to 9 holdings (plus cash).


**Allocations**
Ticker	Curr%	Sep	Aug	Jul	Jun	May	Apr	Mar	Feb	Jan
UPST	21.4%	14.9%	15.6%	13.8%	10.8%	5.2%	5.3%	6.1%	3.9%	0.0%
DDOG	14.0%	13.2%	11.8%	14.4%	15.0%	17.7%	14.7%	12.9%	8.6%	0.0%
LSPD	10.8%	11.0%	8.4%	9.0%	8.6%	6.1%	5.2%	4.5%	1.3%	0.0%
AMPL	7.5%	0.5%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
MNDY	7.4%	4.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
GLBE	5.2%	5.2%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
DOCN	3.9%	2.3%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
PATH	1.6%	2.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
SQ	1.2%	2.7%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
cash	27.1%	38.2%	32.3%	19.2%	20.7%	20.7%	6.2%	5.9%	16.6%	32.6%

**MTD and YTD performance for each holding**
Ticker	Mo Ch	YTD Ch
UPST	1.8%	690.3%
DDOG	18.2%	69.7%
LSPD	1.3%	38.8%
AMPL	36.7%	#DIV/0!
MNDY	14.0%	#DIV/0!
GLBE	-19.4%	#DIV/0!
DOCN	25.7%	#DIV/0!
PATH	-4.5%	#DIV/0!
SQ	6.1%	16.9%

Upstart (UPST)
02/26/2021: $65.64 Market Cap Approx: $4.8b, TTM Revenue: $234m)
03/31/2021: $128.86 (Market Cap Approx: $12b, TTM Revenue: $234m)
04/30/2021: $109.02 (Market Cap Approx: $10b, TTM Revenue: $234m)
05/28/2021: $148.22 (Market Cap Approx: $14b, TTM Revenue: $291m)
06/30/2021: $124.90 (Market Cap Approx: $12b, TTM Revenue: $291m)
07/30/2021: $120.76 (Market Cap Approx: $11b, TTM Revenue: $291m)
08/31/2021: $229.12 (Market Cap Approx: $22b, TTM Revenue: $467m)
09/30/2021: $316.44 (Market Cap Approx: $30b, TTM Revenue: $467m)
10/29/2021: $322.04 (Market Cap Approx: $31b, TTM Revenue: $467m)

Upstart ran to $400 this month, but then came back to give us another shot at it. Just a month ago I said I wouldn’t be comfortable letting any position get above 20%, but as my confidence in Upstart seems to grow almost daily, I took it to 21%+ as of today. I do plan to trim it at some point, but I decided the earnings report they’re going to deliver on November 9th is probably the time to be over-allocated, if ever. Remember: it’s just really hard for the market to get its collective head around numbers (revenue, etc) that are increasing this rapidly.

Datadog (DDOG)
02/26/2021: $95.41 (Market Cap Approx: $33b, TTM Revenue: $604m)
03/31/2021: $83.34 (Market Cap Approx: $29b, TTM Revenue: $604m)
04/30/2021: $85.77 (Market Cap Approx: $30b, TTM Revenue: $604m)
05/28/2021: $91.05 (Market Cap Approx: $31b, TTM Revenue: $671m)
06/30/2021: $104.08 (Market Cap Approx: $36b, TTM Revenue: $671m)
07/30/2021: $110.70 (Market Cap Approx: $38b, TTM Revenue: $671m)
08/31/2021: $137.80 (Market Cap Approx: $47b, TTM Revenue: $765m)
09/30/2021: $141.35 (Market Cap Approx: $49b, TTM Revenue: $765m)
10/29/2021: $167.05 (Market Cap Approx: $58b, TTM Revenue: $765m)

Datadog was up 18% this month, but I couldn’t bring myself to trim much. A lot of things are expensive right now – Datadog deserves that premium more than most! I think their report Nov 4th could show re-acceleration.

Lightspeed (LSPD)
02/26/2021: $68.42 (Market Cap Approx: $8.1b, TTM Revenue: $176m)
03/31/2021: $62.81 (Market Cap Approx: $7.4b, TTM Revenue: $176m)
04/30/2021: $69.81 (Market Cap Approx: $8.2b, TTM Revenue: $176m)
05/28/2021: $71.99 (Market Cap Approx: $8.9b, TTM Revenue: $222m)
06/30/2021: $83.61 (Market Cap Approx: $10b, TTM Revenue: $222m)
07/30/2021: $85.53 (Market Cap Approx: $11b, TTM Revenue: $222m)
08/31/2021: $111.18 (Market Cap Approx: $15b, TTM Revenue: $301m)
09/30/2021: $96.43 (Market Cap Approx: $13b, TTM Revenue: $301m)
10/29/2021: $97.69 (Market Cap Approx: $13b, TTM Revenue: $301m)

Lightspeed has been in a holding pattern since the short report, but hopefully their earnings report on Nov 4th will not only put that to bed, but show that the business is continuing to grow at breakneck speed.

Amplitude (AMPL)
09/30/2021: $54.34 (Market Cap Approx: $7.0b, TTM Revenue: $129m)
10/29/2021: $74.29 (Market Cap Approx: $9.6b, TTM Revenue: $129m)

Amplitude is up from my smallest position last month at just half a percent, to now a 7.5% allocation. There are 3 reasons for this:

I wanted to reduce my cash position, so I’ve been looking for somewhere to allocate more.
The more I looked into Amplitude, the more I liked it, and the more I think they are a very young version of the b2b SaaS companies we have done so well investing in.
The stock was up 37% in October.

Amplitude reports Q3 on Nov 9th. I’m looking for revenue growth to accelerate from 66% last quarter to close to 80% (their guide was for 67%!). I’ll also be very interested to hear qualitative (and quantifiable) info on progress they’re making. This is one I’ve gotten pretty excited about. More to come!

Monday.com (MNDY)
08/31/2021: $379.36 (Market Cap Approx: $17b, TTM Revenue: $223m)
09/30/2021: $326.20 (Market Cap Approx: $14b, TTM Revenue: $223m)
10/29/2021: $371.83 (Market Cap Approx: $16b, TTM Revenue: $223m)

I can see that Monday has been absolutely crushing it, but I can’t see the world where they are as ubiquitous as they want to be. I still question whether the product is mission-critical and if their amazing growth off a small base can continue. Then again, one of the best predictors of future growth is current growth. Therefore, Monday was another I added to this month. I don’t know when this train will slow down, but we’ll cross that bridge when we get there (how’s that for a jumble of metaphors?)

Global-e (GLBE)
08/31/2021: $78.96 (Market Cap Approx: $11b, TTM Revenue: $190m)
09/30/2021: $71.80 (Market Cap Approx: $10b, TTM Revenue: $190m)
10/29/2021: $57.86 (Market Cap Approx: $8b, TTM Revenue: $190m)

I’m a bit surprised at how far GLBE has fallen, but here’s what I think is happening: many believe that worldwide shipping issues will negatively affect them. I’m not sure that’s the case (I could actually imagine logistics and fulfillment frustrations driving customers to them), and even if it is, I think it’s possible it could be offset by tremendous customer adds and their fantastic NRR. We shall see soon. I couldn’t help but add under $60, enough to keep it above a 5% position, as I still believe what I wrote here: https://discussion.fool.com/global-e-belief-update-34940751.aspx…

Digital Ocean (DOCN)
09/30/2021: $77.63 (Market Cap Approx: $9.4b, TTM Revenue: $366m)
10/29/2021: $97.59 (Market Cap Approx: $12b, TTM Revenue: $366m)

Digital Ocean is growing slower (35% revenue growth last quarter) than most of my companies, and what they do (competing, sorta, with AWS and Azure and GCP) is hard to get my head around. But I think revenue growth will be over 40% when they report on 11/4. We’ll have to see what else they say. I added a bit this month, but it’s still a small position.

UiPath and Square are try-out positions. I haven’t been able to build any confidence, so I actually trimmed both of them. Obviously I might not keep them, but I want to see an earnings report before selling. Square’s will be on 11/4 (busy day!) and UI Path’s will likely be in December.

Closing Thoughts

I’d like to thank everyone who has contributed to the board in October. May November treat you well!

Bear

“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” - Attributed to Albert Einstein

XMFJebbo · October 31, 2021, 6:25pm

On his monthly portfolio review Bear wrote:

Please don’t email me portfolio management questions. I have absolutely no idea what you should do, because only you can know how best to run your portfolio – and if you’re like me, it will take months of following along on this board to figure out what works for you. Here are a few questions I get frequently enough that I’d like to head them off at the pass.

This board is for discussing growth stocks, but that doesn’t mean your portfolio questions will always be unanswered. Except for here. They will go unanswered here.

This is a link that will take you to a board that the Motley Fool has set up specifically for that.
https://discussion.fool.com/portfolio-management-100153.aspx

For any questions to that board I hope are asked in such a way that the conversation will be beneficial to all that read it (don’t make it too specific to your situation.)

Best,

Jeb