With all the horrors going around, I thought I should give just a brief note on what my positions are now:
**Datadog 20.2%**
**Snowflake 17.0%**
**Bill 15.1%**
**Zscaler 14.6%**
**Cloudflare 13.7%**
**Sentinel 13.3%**
**Crowdstrike 9.0%**
**Mongodb 7.1%**
No big surprises.
The portfolio was up 2.1% today. It has a long way to go. And please don’t follow what I invested in. Make your own decisions. My stocks are down a bunch so I’m no-one to follow.
Best,
Saul
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hi Saul. Thank you for posting your midmonth update. A couple of questions for you.
Monday
They’ve been posting amazing financials, why did you sell out entirely? Is your decision impacted at all by upcoming earnings or recent poor stock performance or did you really not give those factors any weight?
(I don’t own them as I have concerns about sustainability of growth and also transparency given their foreign domicile)
Crowdstrike
Revenue has shown some deceleration, why did you add back from recently zero allocation?
(I own them as I like the security theme and am hoping for durability of growth)
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Hi Saul,
Thank you for posting the mid- month portfolio brief.
Maybe I ask why you have sold out on Monday? Do you see anything that we have not seen? Or just to raise cash for other even better position?
Monday - They’ve been posting amazing financials, why did you sell out entirely?..
(I don’t own them as I have concerns about sustainability of growth and also transparency given their foreign domicile)
Crowdstrike - Revenue has shown some deceleration, why did you add back from recently zero allocation?
(I own them as I like the security theme and am hoping for durability of growth)
Good questions.
I regretfully signed out of Monday because its guidance was incredibly weak. I don’t ordinarily pay attention to guidance but guiding to annual growth of 54% when you grew last year at 91%??? And to an adjusted annual operating loss of $142 million, when you lost $53 million this year??? Almost triple!!!
Then, in addition, at a time of a possible recession they are not as mission critical as my other companies. They are also not dominant in their field although growing very well. And finally, as you pointed out, their foreign domicile meaning less information.
On the other hand, Crowdstrike is a powerhouse in their field, and even if they are slowing down, at 63% they are still in hypergrowth, and quite profitable at the same time, with operating cash flow of $160 million last QUARTER alone, and an operating cash flow margin of 37%, and $575 million for the last fiscal year. Besides which, they ARE mission critical, and have a tailwind in an era of breaches everywhere, and Federal revenue soon to be added. So I rebuilt a position.
(A month or two ago, I made fun of management crowing about setting a 4-year “goal” that was so ridiculously low they couldn’t possibly miss it, and people invested in the company got angry at me, but I said at the time that I was happy with the numbers they were putting out, just not with putting up a silly goal).
Saul
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