August Investment Portfolio Review
Portfolio Return: These are my returns after adopting most of Saul’s growth strategies.
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Stock Guidelines:
- Revenue Growth Over 50% Market leading products or services.
- Increasing Margins
- Increasing free cash flow and profitability.
- Management with high integrity (not a fan of Musk)
- Scalable businesses.
- Large Total Addressable Market.
- Reasonably Stable Share Count
I made few changes to my investments. I try to wait for strong confirmations before I move in our out of a stock.
Last month I sold Samsara to purchase a 10% stake in Transmedics (thanks to Stocknovice’s strong recommendation). After the Transmedics earnings call, my confidence in them increased to a very high level. I trimmed a little Monday.com and Celsius Holdings to increase that position to about 15%.
Monday and Celsius are in a wait and see mode now.
Comments on Companies
Mercadolibre (22.5% YTD): Mercadolibre put the concerns about Argentine inflation and a Brazilian tax judgement behind them and had reported a stellar quarter. Income was up 103% YOY. Gross merchandize volume up 83% (FX neutral), and total payment volume was up 24%. Importantly, operating margin increased from 12.2% to 15.1% Q1 to Q2. Sticking it out with Mercadolibre pays off once again!
Nvidia (114.2% YTD): Apparently the DOJ is investigating Nvidia’s acquisition of run ai and its chip selling practices. Also, there’s a lot of concern about whether big tech is getting anything from their AI investments. This reminds me of listening to an ATT engineer talk about their work after World War II. The engineer said that they knew communication would be key to the strength of America, and they didn’t care about costs. There was a belief that if you build the best communications in the world, the money would follow. And, yeah, ATT grew into a beast before it was broken up. We’re in the Devil may care investment mode, but I think it will continue and it will be worth it. In the meantime, I will sit tight.
TransMedics (6.5% YTD): Revenue up 118% to $114.3 million YOY. Purchased two new aircraft to bring the total number up to 17. Training pilots and planning to go from 12 hour aircraft utilization to 24 hr. They believe they have lots of growth ahead of them. I increased my holdings from about 10% to 15% today.
Nu Holdings (44.8% YTD): This stock has been hammered by downgrade from UBS and JP Morgan over valuation concerns. This company continues to produce great results. I imagine that after earnings, the analysts will come around again, when it’s to late. I plan to sit tight and hold my 14.8% allocation.
e.l.f. Beauty (10.8% YTD): Elf has been hammered this month due to economic and interest rate concerns. I think that interest rates will start coming down in September, and, in a few days, I think we’ll see continued growth. I plan to sit tight.
Monday (9.3% YTD): I’m in a wait and see mode for Monday. I’d like to see a lot of traction from their Developer and CRM software. It will be interesting to see how Monday does on Monday, 8/12.
Celsius Holdings (3.1% YTD): Celsius remains a wait and see stock for me. I am waiting to see how overseas sales and how improved shelf resets will affect business. I am happy to hold and remain optimistic for increased growth in the near future.
Best,
bulwnkl