It has been a few months since my last portfolio review in the Summer. Apologies for waiting so long. As a full time school teacher in the UK “life is very busy” is my only excuse. I have however continued to benefit greatly from this excellent board, and have continued to post from time to time, namely on SMCI and APP. But with 5 months having past since my last review I thought it was time for an update because such a lot has changed in my portfolio since then.
In my previous review on July 1 my stocks were as follows:
- NVDA - 40%
- SMCI - 32%
- ELF - 13%
- PGY - 6%
- APP - 5%
- CLS - 4%
After selling out of ELF in mid July, and then eventually SMCI in late August (only to buy back in again just 1 day before EY resigned, then selling out again 3 days later!) I spread the bulk of these proceeds into still more NVDA and still more APP.
For the last 5 months NVDA has been over 50% of my portfolio, and APP has has been 30%. For the last few months I have only had 4 stocks - but my returns this year have been the best I have ever had.
But then yesterday I decided to eventually reduce NVDA to buy 3 new companies for me - ALAB (thanks to wpr101 for this one) , ROOT (thanks to wsm007 and Bear for this) and QTWO (thanks to seeking alpha for this one).
As of today, Dec 7, my portfolio is as follows:
- NVDA - 30%
- APP - 25%
- CLS - 19%
- PGY - 11%
- ALAB - 6%
- ROOT - 5%
- QTWO - 4%
My YTD returns are currently 84.2%. This is without options, calls, puts or anything else that I do not understand! I am thrilled with this return, yet I am still a long way off my ATH that was set on Oct 17 2021 (54% off it to be precise). But another double from here will bring me back close to where I was in 2021 before the horrendous fall of my SAAS stocks in 2022 where I lost 80%+ of my entire portfolio.
As I explained in my previous review here, Jonathan's First Portfolio Review and Four Year Update, buying SMCI early in May 2023 greatly helped my returns this year. Even though it dropped precipitously from the highs it reached in the Spring of this year, it still made me a lot of money and has helped my returns greatly.
APP and NVDA have also been incredibly significant for my returns this year. I first bought APP in early April for just $75 a share - and I have continued to buy more as it has risen and risen and risen again - now over $400 (though dropping a little in yesterdays AH’s). Having a very large percentage in NVDA for most of this year (until yesterday) has also been a reason for my out-performance this year. It is no good believing in a company but then only putting a very small percentage into it. Even if it doubles it will still only be a small percentage of the whole portfolio.
Briefly, why do I hold these companies now?
NVIDIA 30%
So much has been written on this that I don;'t need to add any more. Blackwell is only just beginning to ramp, demand continues to be “insane”, and no other company is coming close. I continue to believe NVDA can triple from here to be a 10T+ company and I sleep very well at night knowing that I have a significant percentage in it. Why did I sell a chunk of it yesterday? Simply to raise cash to buy the 3 new companies I had been reading about and researching on this board and on Seeking Alpha.
APPLOVIN- 25%
Through Alpha Picks I was able to get in very early on this company - and I am so pleased I did. It has been a quintuple for me in just 8 months! I only wish I had bought a lot more of it earlier in the year. But I am also glad I have continued to buy as the stock has continued to rise (one of Saul’s principles). What APP has done in mobile advertising and gaming it is now looking to do in eCommerce - and then in CTV. The early signs of eCommerce are more than promising - and in fact Adam (CEO) has stated that he believes their success will be even greater in eCommerce than it has been to date in mobile advertising. Their ROAS is rivalling, and surpassing META. Even though it is now a 134B Market CAP I can still see this stock growing significantly from here. A 1T Market CAP is still more than 7 times increase!
CELESTICA - 19%
CLS is a little overlooked, it seems, by the market at large - yet still it’s returns YTD are currently at 224% - so none too shabby! As I explained in my previous review, it is a Canadian company that continues to greatly benefit from the AI data centre build out. I first bought it in early February, and I have continued to buy more and more throughout the year as the stock has continued to rise. It’s consistently been north of 20% YOY Growth for each of the 3 quarters so far this year, but it is in the adj EPS where things have really been taking off this year with a forecast of nearly 60% growth for the year. It is still only an 11B MC and I can see this stock continuing to have another stellar year next year.
PAGAYA 11%
This is actually my longest held stock - and the one that continues to be a drag on my returns. I have owned it for over 18 months and I am still 28% down on it. But I continue to hold because I think that next year it will at least double or triple. For a long time they have saying they will be GAAP profitable in 2025 and their recent moves have hastened this along. I thought their last ER was very positive - 22% YOY growth in sales, 100% growth in adj EPS, 100% growth in adj EBITDA with an EBITDA margin of 22%. I continue to hold on, and will do so for at least the next 2 earnings releases.
I bought Astera Labs yesterday after being convinced by wrp101’s writings on them. After their last 3 Q’s YOY growth of 269%, 619% , and 206.2% and their GM of 77% along with their being on the brink of GAAP profitability I was convinced. I bought them at an average price of $119. It is only a 6% holding for me as I continue to learn more about this company.
ROOT is a 5% holding for me, but only bought yesterday at $94. But again their revenue growth has been blistering over the last 4 Q’s with the oldest to most recent (173%, 263%, 292%, 165%).
Then yesterday I bought a small holding in QTWO - simply because it is a recent ALPHA PICK. I figured I have done incredibly well with SMCI, APP and CLS through ALPA PICKS so I would buy a small holding in QTWO. They are a SAAS company specializing in financial services to small and mid sized banks.
Once again, thank you to Saul for sharing his wisdom over the years so readily on this excellent board he has set up, and can I take this opportunity to wish everyone a happy and peaceful Christmas and prosperous New Year.
Jonathan