Jonathan's February Portfolio Review

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It has been a few weeks since my last portfolio update, and such a lot has changed with my holdings in that time, that I felt it was worthwhile for me to update my review.

A bit of context for me again. I am a UK investor who has been investing since 2004. For the vast majority of that time I only held UK stocks on the London Stock Exchange that were recommended by the Motley Fool UK. I was in a number of their real money portfolios at the time. Over the course of 15 years my returns were nothing to write home about - barely beating the market.

Then in the Summer of 2020 I joined the US version of the Motley Fool and it wasn’t long until I came across Saul’s board. During that Summer I had a lot of time to read and learn and develop my investing style into a much more hands on approach. I sold all of my UK stocks and transitioned solely to Saul Stocks - holding between 8 - 10 stocks in my portfolio at any one time.

My returns from 2020 have been:

2020: +14%
2021: +26%
2022: -66%
2023: +5.5%
2024: +70%
2025: YTD +14%

The returns are lower than many have on here - but I have accounted for all taxes and fees and currency charges that I have to pay being in the UK and investing on the US Stock exchange.

However, I am very happy with my returns from 2024 - my best year ever. A lot of those returns came from Supermicro, Nvidia, Applovin and Celestica. I was fortunate to be a very early investor in SMCI, CLS and APP.

At one point in 2024 I had grown NVIDIA to be over 50% of my portfolio and SMCI to be over 30%. Such massive holdings in those two companies, along with APP and CLS helped to explain my oversize (for me at least) returns in 2024.

My portfolio just a few weeks ago, when I reported it on this board in the middle of January, looked like this:

  • APP - 22.5%
  • ALAB - 22%
  • CLS - 20%
  • NVDA - 17%
  • PGY - 6%
  • CRDO - 5%
  • ROOT - 4%
  • QTWO - 3.5%

I decided soon after to sell out of ROOT and QTWO and to build up the other smaller positions I held.

Celestica became my new number 1 holding. I have been in CLS since Feb 2024 at only $44 a share. I bought more as it continued to rise and as I continued to learn more. I loved their ER just a few weeks ago. Celestica was already a triple for me - and then since January 2025 it grew another 40%!

However, on Thursday this week I, reluctantly, sold out completely when I discovered that the CEO had sold nearly half of his shares - and the CFO and COO had sold all of their shares on the same day. I got scared and felt that I wanted to protect my holdings that had grown from $44 to over $135. After I sold I discovered that the execs had sold their shares as part of a stock comp plan and that they received more shares at the same time that will vest in 3 years - so maybe I was premature to sell out at $135 (though the price is lower today at $129).

I was going to buy back in again yesterday, because I really like Celestica as a company, but I decided to make a very bold move (hopefully not Foolish with a capital F) and to buy back into Supermicro.

I will say more below.

As of today, Feb 8 2025, my portfolio looks like this:

  • APP - 22%
  • ALAB - 16%
  • SMCI - 15%
  • NBIS - 12%
  • OPFI - 11%
  • CRDO - 9%
  • NVDA - 9%
  • PGY - 6%

APPLOVIN (YTD return +16%)

I have held APP since April 2024 and I am happy to count it today as my number 1 position. My total return on APP to date is 71% (taking into account the many purchases I have made on this since my first purchase). I strongly expect the ER and call in a few days time to propel the stock to new heights. I am looking forward to the updates on their drive into e-Commerce. And from everything I have read and learnt to date, I expect this to be extremely positive.

Astrea LABS (YTD return -23.5%)

I did buy in quite late to this one following wpr101’s initial write up of it. It is still underwater for me by -17% overall. My first purchase was in Dec 2024 at $118 but I was buying all the way up to $141 in January. Today it sits at just over $100. However, they should deliver another triple digit YOY growth (155%) when they report their Q4 24, and they are guiding to 230% growth at the midpoint for FY. With a high gross profit margin of 78% in their last quarter and on the verge of being GAAP profitable, I continue to expect great things from this company. Although I missed out on the +180% growth of the last 6 months I do not think their growth spurt is over. Along with CRDO, ALAB is my most expensive company on a fwd PE basis, but it is not healthy to use a PE ratio on a growth company in its early stages. So as long as they can keep growing as they do with the high margins they have then I am happy to keep this as my number 2 holding.

SUPERMICRO (YTD return +19%)

I was very early into SMCI in May 2023 and I grew it into my number 1 holding in 2023 and then in 2024 it took off big time. I won’t go into all of the details again of late Summer 2024 - but I was late to sell. However I sold at $33 and was happy to get out with an overall return of +40% over the 15 months or so I had held.

But I have not stopped following this company. I learnt such a lot about it over the past 2 years that I was reluctant to stop learning about it even though I was completely out of it.

Yesterday, having sold Celestica on Thursday, I bought back in.

As you will know, they have a new auditor - BDO. In Charles Liang’s fireside chat with Retuers at the end of last year he shared how they were working very closely with BDO to sort out all of their accounting issues to ensure that they file on time.

NASDAQ have given them a deadline of Feb 25 - just over 2 weeks time. But this coming week, on Feb 11 SMCI are giving a business update. I am expecting Charles to confirm on this day that they will be able to file their annual reports from 2024 on time to avoid NASDAQ delisting.

In the fireside chat (https://www.youtube.com/watch?v=rvtuxlUKT0E) Charles used his 20 minutes well to dispel fears and to promote all they are currently doing. Their partnership with NVDA remains intact (as was seen by their release a few days ago that states they are ready with their NVDA Blackwell racks) and their insane growth rate is intact having grown from 200 racks per month to over 5000 racks per month (half of which are liquid cooled). And after their Malaysia factory comes fully online they will be able to increase that to 10,000 racks per month.

The market has left them for dead. They are hugely undervalued for a growth stock. I see things as a binary moment for them from here. If they are able to file on time, then I think the stock will very quickly return to anywhere from 70-100+ dollars. If they don’t and if they are delisted then it will quickly go down to zero. I feel the odds are very much stacked up in favour of a positive outcome for it, and I will be watching this make or break point for SMCI over the next few days and weeks.

NEBIUS - (YTD growth 38%)

Thanks to Luffy for bringing this company to the board in mid January. I instantly liked what I read about and learned of their CEO as I shared in this post here Nebius ($NBIS) - A new star of AI infrastructure - #22 by jonathan1

I have continued buying through Jan and February to make this a 12% holding for me. I think that once the market and the wall street analysts catch on to this company then it will be re-rated. The CEO is the real deal - having built up Yandex in Russia. He has been brave enough to speak out against the war in Ukraine and to divest of the Russian companies. He has 400+ of the top Russian AI engineers with him, and I like their portfolio of companies (especially Nebius AI and AVRide). I expect great things from this company.

OPFI - (YTD growth +121%)

This is still a small company with less than a 1.5B MC. I first heard about it on Seeking Alpha. From their profile, they are a tech-enabled specialty finance platform that broadens the reach of community banks to extend credit access to everyday Americans. It supports consumers, who are turned away by mainstream options, to build financial health, through transparency, responsible lending, financial inclusion, and a better customer experience. The company was founded in 2012 and is headquartered in Chicago, Illinois.

Revenue growth is nothing much to write home about (yet), but it is their GAAP profitability that is seeing significant growth at 106% YOY in the last Q. There is very strong momentum behind this stock, and in spite of the 121% growth just since Jan1, they still have a long way to grow. I am happy to have it as an 11% holding for me.

CRDO - (YTD growth +15%)

This is a 9% holding for me. Wpr101 and others have written much about it on the board already (and already my review is turning out to be rather long) so I won’t add anything here other than to say with a forecast revenue growth of 127% YOY and 67% QoQ growth for their Q3 25 I see a long runway ahead for them.

NVDA (YTD growth -3%)

I did reduce this after Deepsake, even though I think the DS fears are overblown. It had been an overly large holding for me. But I did not want to sell out completely so I am happy to also have it as a 9% holding for me.

PAGAYA - (YTD growth 34%)

This is actually my longest held stock (apart from SMCI, but I sold out of that for the last 4 months until yesterday). I first bought PGY in July 2023. At one point it was a much larger holding for me. I have written about it on this board a few times, so I won’t say much more about it here. Apart from to say that things are finally looking good for this company and I think my patience and long suffering with this holding will be rewarded. Once they can clear all of their 2023 impairments on bad loans, then there is a clear path to GAAP profitability this year. In the last few days they have announced another forward flow agreement for 2.4B with Blue Owl. The market seems to be waking up to them having a great year and in the last week alone PGY is up 40%. Because I have held for such a long time I am still holding this at a loss - but after the rise so far this year I am now only 33% down.

Thanks to Saul for this great board, and for all he has given to it over the years. Even though I have read and re-read the knowledge base dozens of times I still continue to learn from it, and also from the posts of everyone else who posts here.

Wishing everyone great continued success in 2025.

Jonathan

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Hi Jonathan,
Congrats for the great performance in 2024 and 2025!
Can you share what were the reasons for investing in Celestica and Pagaya since their revenue growth is in the low 20s, whereas all other companies you have show much higher revenue?
And how you chose Celestica over Arista Networks?

Thanks.

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Welcome to the board Jonathan. We have followed similar paths - from UK Fool to US Fool to Saul’s Board. Always interesting to see another outside in investing viewpoint from Ex US.

I have plenty of overlap with your holdings with the exception of Celestica, OPFI (prefer SoFi, Pagaya and Upstart), CRDO (on my watchlist but like ALAB) and AppLovin (on my watch list but so expensive but hold TTD).

I’m still struggling to maintain conviction in NBIS and have kept that small. I can’t see value in their standalone FSD software, their Euro/US flip flop in datacenters and their track record in Russia which was really a captive market for them given the tilted playing field towards Russia and against MNCs there.

Ant
(From UK but now in Singapore).

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Hi IamM,

Thanks for the question. The reason I chose Celestica a year or so ago was that although their overall revenue growth was only in the 20’s at the time, the largest part of their revenue (their CCS segment which is their connectivity and cloud solutions segment for AI data centres) was, and is, growing continually in the high 60’s% YOY.
For example, their last 8 Q’s of their CCS segment is as follows (oldest to most recent Q):
57%, 55%, 58%, 63%, 65%, 68%, 67% and 68%.
That, along with their EPS growth of 78% in their FY24 and their very low valuation at the time, made me pick them and make them a number 1 holding for me.

If I compare ANET performance and CLS over the past year then it looks like I chose well. ANET has gained 77% over the past year whereas CLS, even after their fall a few days ago, has gained 257% over the past year.

In terms of PGY, I would of course have been better with hindsight to have let this one go a long time ago and to have invested those funds in one of my much higher growers. I had done very well out of UPST in 2020 and I reasoned to myself, at the time, that PGY was UPST done right and that once again it was being overlooked by the market. But as I said in my review above, I think that now, finally, PGY may actually be about to have their growth spurt as they get all of their ducks lined up in order! It has risen 40% in the past 5 days alone - and I am expecting much more to come after their next 2 ER’s.

Thanks

Jonathan

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Thank you Ant for the welcome. I’ve actually been on the board for quite some time, and I have posted a number of portfolio reviews previously. I started posting on Saul’s board in the Summer of 2020 when I first joined, but not regularly enough to be automatically included on the list of eligible posters when the TMF boards changed. I think my opening paragraph when I gave my background reads like I have just joined the board (I should have made this more clear). But thank you, welcome received!
Yes, I am very happy to invest on the US stock exchange even though I am from the UK. We just don’t have as many consistently high growers in the UK as there are in the US. There are some of course, but not as many to choose from - so I figured it was worth taking the hit on fees, currencies, and tax. And in all my years of investing in the UK I have never had a year like last year when I grew 70%. (In 2021 I grew 82% from Jan - Oct, but then things started to fall off the cliff in Nov 21 with the Saas stocks that we all held at the time and I only ended that year +26%.).

I really like Nebius. Yes, I take the heedings from some on here that it is a risky stock. But I like what I have seen of their CEO in interviews on YT. I like the fact that the Motley Fool have said that 2025 will be a monster year for them. I like their businesses, I like that NVIDA have given them a vote of confidence, and I like the fact that they have such a lot of computing and AI talent with them. They are already up 38% YTD and I think there is still a lot more to come.

Thanks

Jonathan

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I would be curious to know if there are names on the London Stock Exchange that you like? Wise and Raspberry Pi have come up on these boards before. Any insights on those companies or other UK/overseas companies which have attractive growth?

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Hi wpr101

I actually only know of Wise and Raspberry Pi from reading your own, and others, excellent write ups on them. Since 2020 I have not followed the LSE at all and I have read very little of UK stocks. Maybe it is time for me to look again.

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@jonathan1 I’m also one of the few posters that holds Pagaya and have similar feelings as you. The Loan Impairments completely took me offguard and basically torpedoed the rest of the thesis up to this point (much more stable stock in the AI lending space with interest rates coming down which should accelerate growth).

In addition to management suggesting a large reduction in loan impairments and GAAP profitability in the near term, the other catalyst for this company SHOULD be the major deals they signed to expand their footprint with large lenders. They are still ramping those channels and they haven’t hit the numbers yet. I will need to see a reacceleration in order to stay in longer than a couple more quarters.

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Jonathan, what are your thought for the SMCI earnings? I believe thesis is in tact, but was curious for your and @prust04 thoughts on it.

Thanks,
MV

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Yes, I believe the thesis is intact too. It was a mixed report with good and bad - but I really feel the gains, and greater potential gains, outweigh the risks. Charles and David both said that they believe they will be ready to file by Feb 25. I think that once this happens, 11 days to go, then there will be a large increase in the SP. They did revise their numbers down for this FY - but the guide of 40B for next FY (which Charles feels is conservative) would also present another significant increase in the SP. It all comes down to whether management can be trusted - but if we don’t think they can be then we shouldn’t be investing here anyway. Personally, I am still very happy I bought back in to SMCI last week in anticipation of the good news, and I am still holding. After the big rises of the last few days it is now my Number 2 holding, with APP at number 1 and Nebius at Number 3.

Jonathan

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@IamM I saw the glass half empty.

They made a very confident statement with their FY’25 revenue guide 8 months or so ago, and then the accounting violations happened…and suddenly they have to lower their guide and the revenue and guides are both falling. Pure coincidence? Eh.

I was willing to stay in as long as they were still reporting growth at breakneck pace, but they aren’t. They also did not deliver improved margins as they predicted they would months ago, which is maybe the most important metric for them.

I sold out, and wish the best to @jonathan1 and the other holders. I moved the funds to APP before earnings, Delcath and Innodata.

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Bingo.

Not much else to say. The CEO is still around after the last debacle, and now with the company missing their annual report and taking every single day of the 7-8 additional months NASDAQ will allow to file it, not to mention that their “new” auditor (KPMG) quit with a scathing public letter rather than file the delayed report, so they had to hire their third auditor (BDO) in the past several years.

Jeez. The only thing holding this stock up is that no-one has reported problems with the actual products delivered so far. That’s good, but not enough to make me re-invest.

This is going to pay off big or be a further train wreck. There’s really no way to know and the “winning side” will not, IMO, be able to brag about their result anymore than operating a slot machine paid off or not.

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Yes, maybe. All I can say is that because Id been a holder for 2 years, and had followed the ups and downs of this company very closely over that time, and I had continued to follow it closely even after selling out, that I was happy to buy back in 10 days ago as I posted above.
I could see momentum building again. I reasoned to myself that BDO would want, for their own benefit, to file on time, and that SMCI would do everything in their power to ensure they were not delisted. So it was an educated guess that the reward far outweighed the risk. That’s why i bought such a big chunk of it again just a short time ago.
I felt even more confident after the Feb 11 update. The market also seems to believe they will file on time. My purchase of just 10 days ago is up 90%. I could have been very wrong, and I still might be of course, but I do feel that a key to all of our investing is knowing the company as much as we can. This is why I bought back in again. And I’m very happy I did so.

Jonathan

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It’s not whether we know all we can, it’s whether we know enough. And with regards to SMCI, we don’t know enough. What’s funny in a sad way is that everyone seems focused on when they’ll file their annual report, not about what’s actually going to be in that report.

One clue we do know is that they lowered this year’s guidance so that the top of the range is now below what was the bottom of their range.

But, at this point I’ve already spent more brain cells on SMCI than it deserves. Best of luck to longs.

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Thank you Smorgasbord. I decided, after the run up of the last few days, and after up 90% in the last 10 days, to sell half my holding at 65 before market close today, just to lock in some more profits. Its still an 11% holding for me even after this trim, and I still think it has further to run, but the percentage increases from this point on are obviously going to be smaller.

Jonathan

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Great news for any SMCI holders left. They have finally filed, as I really hoped and thought they would, and as Charles had said they would do 2 weeks ago. Currently up 21% and rising in the AH - and expecting much more tomorrow. It may even touch 70 again. Details here - https://ir.supermicro.com/financials/sec-filings/default.aspx

Jonathan

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