Sometimes I find it valuable to “Stress Test” the stocks in the portfolio by using the IBD Stock Research Ratings; realizing, that this is just one piece of information.
Note 1) Since I still rounding into shape I would like to point out a flaw - a gaping hole - a bright Red Flag in this process this evening. Usually I am checking on a regular basis to see if the RSI for companies in the portfolio are going up or down. A single number doesn’t tell you that which makes it questionable sort of like when you get a fortune cookie that says: “Don’t Eat The Egg Rolls.” See what I mean? To clarify uncertainty about RSI rating follow this general rule of thumb:
RSI Going Up: Good
RSI Going Down: Not so Good.
Note 2) I am a notorious garbler of data; why just the other day my wife popped into my office and said, “Sweetheart you are a notorious garbler of data”. So check anything you see herein prior to considering concluding that you have any legitimate conclusions or impressions.
An Alpha pick over at Seeking Alpha. An extensive and excellent write-up here at Saul’s board (just a bit shown in the preview, includes graphs and stuff):
I bought it a while ago around $60, after seeing Seeking Alpha’s write-up and deciding “Huh! This looks like it’s doing pretty well and is a decent place to park some of my unused cash.” Now, a few months later, it’s $86.
IMO, I underappreciated the company now that I know more… and I’m thinking of tossing some more dollars in that direction. Current allocation is around 2%, which is super low for me. As you may remember.
Disclosure: Portfolio is mostly NVDA and SMCI, with some CELH, a tad of APP and the smallest touch of PGY.
Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.
Thanks for the link @XMFRob! I’ve upped my allocation in APP significantly after that last report, looks like they get a 99 on this IBD rating system.
There’s another solid thread on APP too which is more of a primer on the business on Saul’s board.
I’m finding the bear case for APP seems to center around the revenue growth is not durable and they don’t like the product itself.
APP is getting into the CTV and going to compete directly with The Trade Desk (TTD). The Trade Desk has a bigger market cap, but less than half the revenue, and much less EBITDA/net income. Either The Trade Desk is way overvalued, or APP is way undervalued and I think it’s more the latter that the market does not recognize the opportunity in APP.
For what it’s worth these IBD rankings do have some bad data in them, or the model doesn’t handle when EPS crosses over from being negative to positive. When I look at the score card for HIMS in the IBD rankings they have “# quarters of EPS Acceleration” for HIMS as 0 which is just plain wrong.
However, they clearly have at least two quarters of EPS revenue acceleration (see below graph).
Was wondering Rob is this HIMS company is a business that you would potentially invest in? Putting some links here for reference,
Congratulations on your APP investment and thanks for bringing it up.
It is certainly deserving of some more attention and research but I have a sort of natural hesitation of entering companies after they have had a great run: usually dependent upon the guidance going forward.
The RSI of 99 could last a while or; alternatively, has no where to go but down. If it cools off it might be a much better risk/reward play than currently. Just my humble opinion.
That would take more time than I have right now. Certainly, in the past, I’ve often seen opportunity presenting itself when companies flip from red to green. Maybe this would be good… I’d have to understand the business and that’s time.
Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.
