mekong22 Sept 2021 portfolio review

I’m a bit late with my update this month, busy workweek

My month started out with a bang, as MongoDB and Nutanix posted really good earnings the first week of September and both moved up early, although similar to others here, my portfolio gave back much of this month’s gains last month as everything got dragged down.

Overall, I finished only slightly higher in September as Mongo and Upstart still finished the month significantly higher, offset mainly by Docusign and Teladoc dropping in September.

Year To Date Results by Month

Here’s my latest YTD performance:

 +5.0%  YTD Jan 
+14.6%  YTD Feb 
 -9.2%  YTD Mar
 -8.2%  YTD Apr
-19.7%  YTD May
 +7.9%  YTD Jun
 +3.8%  YTD Jul
 +5.6%  YTD Aug
 +7.2%  YTD Sep

It seems like quite the distant memory when my portfolio was up +45% YTD in mid February when Magnite was $60+, The Trade Desk was over $90+, and I hadn’t yet started building my Teladoc position which hasn’t fared well (so far) in 2021.

But I take comfort that my companies businesses have continued to fare well and are moving in the right direction. My 2021 gains are lagging far behind many others here so far but I do believe I own the right companies that will continue to perform well over the next couple of years an should result in solid investing returns.

August 31, 2021 Allocation by Holding

17.5%	Nutanix (NTNX)
17.0%	Magnite (MGNI)
16.9%	MongoDB (MDB)
14.0%	Upstart (UPST)
12.2%	The Trade Desk (TTD)
10.7%	Docusign (DOCU)
 6.8%	Teladoc (TDOC) 
 3.2%	Smartsheet (SMAR)
 1.7%   Global-e (GLBE)

Transactions during September:

Sold: (MNDY)
Smartsheets (SMAR) - partial
MongoDB (MDB) - just sold a sliver after the post-earnings pop

Magnite (MGNI)
Upstart (UPST)
Teladoc (TDOC)
Global-e (GLBE) - new
The Trade Desk - small additional add

Thoughts on the Companies: (MNDY) and Smartsheet (SMAR)

I had originally bought my small 2.5% MNDY position last month by selling down some of my large Magnite position. However, after MGNI’s investor day boosted my confidence in the company, in addiiton to the stock coming down a little, I decided I would prefer to have a larger Magnite position and MNDY was at the lower end of my conviction at the time. My timing was fortunate as I sold monday at just over $382/share, slightly above where I had purchased the shares. Since then MNDY is down about -15% and MGNI has been relatively flat, so I lucked out with the timing of the Magnite investor day.

Coming into the month, I was looking forward to Smartsheet’s earnings thinking I might sell my SMAR position and build up MNDY further. SMAR had what I considered a really good quarter, beating analyst estimates, their own guidance, and my own expectations, yet the stock dropped -15% the next day (I still am not so sure why they had such a negative reaction). So suddenly, I was thinking of flipping my plan 180 degrees and selling my MNDY and building up SMAR further. I didn’t do that, and I proceeded to eventually sell off about half of my Smartsheets position during the month to build up other higher conviction holdings. I do think SMAR is worth significantly more than it is currently valued at, but the market doesn’t seem to want to get excited about it. I still think, given the business performance and low vation, Smartsheet is a very possible acquisition target, but I’m less interested in staying on this ride, and may continue to sell down my stake in coming weeks and months.

I didn’t have any negative view of monday, especially with the stock price where it is today. I just prefer to concentrate my portfolio in other companies where my confidence is higher at the moment.

Upstart (UPST)

I don’t have anything new to add to the Upstart discussion that hasn’t alredy been said here. I also added to my UPST position in September, those addiitonal purchases were already up nearly +30% over the rest of the month, although have pulled back a little on Friday. Even with all of the stock gains so far this year, UPST still looks realtively inexpensively valued if they continue their growth trajectory.

Magnite (MGNI)

I posted my summary of Magnite’s Investor day here:

They also announced that they are now the preferred SSP for fuboTV. I think they’re making the right moves and are in the right place focusing their business around CTV, at the right time. Although the stock price dropped in September, I added back to my Magnite position after the invetor day.

MongoDB (MDB)

I posted my thougths on MDB’s quarterly earnings here:…

The stock definitely isn’t cheap, but my confidence remains high that they will have years of high growth ahead. Management really sounds confident on their calls, and this is one I expect to own for some time.

Docusign (DOCU)

Docusign’s stock initially popped upwards after earnings this month to $310+ and now has come all the way down to $240. They won’t continue have 2020 pandemic like growth as we return to normalcy, but I never expected them to. Even with where their go-forward growth rates are likely to be, I didn’t think the stock was that expensive at $300, and I certainly think it is a buy at $245.

I bought most of my DOCU in late 2019 at less than $45/share and there have been plenty of ups and downs since then. I expect these past few weeks are just another dip that, in the future, will look like a blip on their stock chart along a long term consistent upward trajectory. Great company, not hyper growth, but I still expect years of nice shareholder returns as they expand their international presence in e-signature, and when their oomplementary products become a bigger focus.

Teladoc (TDOC)

With no negative business news the stock just keeps drifting lower and lower…and lower!

Some could argue that the pandemic continuing to linger as long as it has should be a positive for Teladoc’s business, but Mr Market certainly hasn’t gotten that memo.

They just grow last quarter +100% (yes, some of that was due to the contributions of the Livongo acquisition), yet the stock has dropped from $290+ in February all the way down to the low $120’s/share today. The combined company still has a market cap only slightly higher than the $18.5 billion that TDOC paid for LVGO last year.

Maybe I’ll ultimately be wrong and their growth will stall more than I expect, but I really can’t see this situation as anything other than a great opportunity. The valuation is so cheap. I do think most investors are putting it in teh “too hard” category and not trying to guess at what the future pro forma, apples to apples, growth rate will look like once the impact of the Livongo acquisition is in the rearview mirror. Investors like certainty, but sometimes the most investing gains come from making educated guesses before that certainly has arrived.

The good news, we don’t have much longer to wait. The Livongo acquisition closed on 10/30/20, so when they report Q3 in a few weeks, they’ll give guidance for Q4, which will be “mostly”, two of the three months, apples to apples with Livongo in both periods. Then when Q4 is reported early next year, we’ll get the first guidance for FY 2022 which will have consistent operations in the 2021 vs 2022 growth comparison for both full periods.

And the new combined online and app interface that will enable cross selling of TDOC and LVGO products (one of the main benefits of the acquisition) has always been expected to launch in early 2022, so we’re not even realizing those yet.

I can’t see it likely that Teladoc won’t be worth much more in a couple years vs where it is today, but I’ve been wrong before, so nothing is guaranteed.

Off topic for this board, but I posted some thoughts on other ways I’m investing in TDOC, and also MGNI, on the TMF Options board here:…

Global-e (GLBE)

This is a really intesting one. Great coverage on this board a few weeks ago. Shopify’s big investment in them, and the prospect of GLBE launching more significantly on SHOP next year, should give them a boost. But as others have noted, they are small, have a high valuation, and Shopify has other products that compete on their own platform with Global-e.

It’s a small, starter position. Not so sure I will build it up more more, but I’d like to see how the next few quarters play out.

Cumulative Gains by Company

And here is the table I’ve been using the past few months, showing my primary purchase of each holding, with the gains in the common stock so far. Several of these I’ve added to over time, either bringing my average cost basis higher, or in cases like TDOC, lower.

		             Purch Date	 Cost  9/30 Price
Nutanix (NTNX)	  up  +185%   3/16/2020	 13.24 	  37.70 
Magnite (MGNI)	  up  +157%  11/10/2020	 10.90 	  28.00 
MongoDB (MDB)	  up  +722%   7/16/2018	 57.39 	 471.51 
Upstart (UPST)	  up   +94%   8/11/2021	163.18 	 316.44  
Trade Desk (TTD)  up  +517%    1/2/2019	 11.40 	  70.30 
Docusign (DOCU)	  up  +476%    8/7/2019	 44.73 	 257.43 
Teladoc (TDOC)   down  -32%   3/17/2021	186.45 	 126.81 
Smartsheet (SMAR) up   +29%  11/11/2020	 53.35 	  68.82 
Global-e (GLBE)	  up  +4.9%   9/13/2021	 68.47 	  71.80

That’s it for another month. October should be a pretty slow news month for my companies. Teladoc will probably report Q3 at the very end of the month, but will be interesting to see how the overall markets, and tech stocks, in particular trend these coming weeks without a lot of substantive earnings news coming until November and December.