HorsePlayAndrew Update Sep 2021

HorsePlayAndrew · October 4, 2021, 10:50am

Summary

September saw a portfolio high of 72% for me which was thrilling but we have since come back to earth. Upstart, Asana and DigitalOcean were the stars for me. My portfolio continues to evolve, with some changes to the stalwarts and a new entrant.

My background

See details here. https://discussion.fool.com/horseplayandrew-update-nov-2020-from…

Performance

YTD >61%
2020 > 209%

January > 29%
February > 23%
March > 1.7%
April > -6%
May > 11%
June >21%
July >15%
August >51%
September >61%

Sep 2021 Portfolio

Upstart - 36.10%
Datadog - 9.84%
Affirm - 9.02%
Sea - 8.20%
Fubo - 6.07%
Zoominfo - 5.99%
DigitalOcean - 5.82%
Monday.com - 5.74%
Crowdstrike - 5.00%
Cash - 8.20%

SOLD

Crowdstrike It was reassuring to see a lot of posters on the board sharing a similar thought process with CRWD. I have paired down my position considerably and I will await Q3 to see where I go from here. They have been a powerhouse for my portfolio but we know we have to be ruthless before the music stops.

Roku My conviction has been waning. With a 10-20 stock portfolio I would have stuck with them but I decided to sit it out until things are a lot clearer.

I trimmed some Upstart and Datadog but aside from that it’s been quiet.

BUYS

Affirm I posted here why I opened up a position in AFRM. https://discussion.fool.com/affirm-thoughts-walmart-34941427.asp…. I am placing my faith in AFRM with quite a big opening position because I think they delivered a great Q2 report and have some strong tailwinds to set them up for an acceleration of hypergrowth in the quarters to come. That is the sweet spot we need to be entering stocks on.

Monday.com So I had a good look at both Asana and Monday.com. I traded Asana quite nicely after earnings for a great run until I could figure out what horse to back. There has been a lot shared on the board, so all I will add is that I’m going with MNDY because of the revenue growth, their closer move to profitability, and how they have a march on the enterprise market. I still really like Asana so may still get back in. I think the “work OS” market is going to be sizable so I want my portfolio to have significant exposure to it. For now I have opened a small MNDY position, I plan to use my cash to add to it during this correction.

My companies

Upstart The stand out performer again in September. The price increase doesn’t surprise me as the stock is still relatively cheap looking at their revenue run rate. Some great news with more bank partners signed, as I said last month, I am confident this is a 30b company, but what does growth look like in 2022? The signs look very positive so far but I am obviously monitoring very closely considering the position size.

Datadog No major news this week, trimmed a little when it hit its ATH, will remain as a top tier position if they keep showing 60%+ growth is the norm.

Affirm see above

Sea Great news with the beginning of the EU expansion, setting up in Poland. I am moving to Indonesia (Bali) to live so I will experience Shopee first hand in a few weeks.

Fubo The Sportsbook app is now in the App store but not live on bets just yet. The stock continues to chop around, high hopes for some serious moves in the price after Q3 earnings are released and the sportsbook goes live.

Zoominfo A quiet month of news. One area of concern I have is competition and their moat. I am increasingly coming across more offerings in this space, see Cognism, Bombora, Apollo, Leadiro, all private market co’s and a lot smaller. Hopefully the acceleration continues in Q3 because the CEO is very bullish listening to him on youtube/podcasts.

DigitalOcean They caught a bit of a ride in September so my timing was pretty decent (lucky). Big news was the acquisition of Nimbella, enhancing their platform in the Function As a Service (FaaS) space. The techies seem to love this move and so did the market.

https://investors.digitalocean.com/news/news-details/2021/Di…

As a reminder, their revenue growth is accelerating but still at 35%, so for me to continue this position I’m looking for further moves north in Q3 on a lot of their metrics, including NRR and revenue.

Finally, it was nice to see Tom Gardner sharing his thoughts on Twitter regarding $DOCN, it appears he is a big fan. I’d recommend following him if you don’t already, one of my heroes

https://twitter.com/tomgardnerfool?lang=en

Monday.com See above.

Crowdstrike See above.

Watch List

Asana see above

dLocal I can’t make my mind up with them. The numbers are great, revenue is on a very low base, but there is a little bit of shade being thrown on management. Being in Uruguay doesn’t help matters.

Global-e There is a lot to like here but with the margins, the not-so-exclusive Shopify deal, I am waiting on the sidelines for now.

I’m still following Stem, Fiverr, Pinterest, Cloudflare, Docusign, Twilio, Snap

Previous updates

Thank you for getting this far, as always, very grateful to the amazing work and research that is shared on Sauls board.

Andrew