Stock correction / mid month update

Hope this is not OT.
I’m starting a thread for discussion of the portfolio companies that we hold.

I’m wondering what members thoughts are during this correction.

What moves have you been making if any and what is the reasoning.

  1. I personally am wondering what thoughts are regarding $NET.
    It has come down substantially in this correction. from $221 to under $100 yesterday.

Nothing seems to have changed except sentiment, it seems like an amazing opportunity here and we have had a larger portion in the past. (I do worry they will show up with a 30+% Qtr at some point which would be devastating probably to the share price)

Are those that sold $NET interested in getting back / adding or do you see it to still be overvalued after a more than 50% haircut?

  1. I am wondering why we are more cautious now on $UPST. We loved it and had much large positions when it was $300-400/share (partly due to share price appreciation). The report missed their guidance but still reported 250% y/y growth. Seems to me that momentum could return with sentiment reversing again if Q4 ER is great. (However, I do worry if they “whiff” again on earnings this one will be cooked and tossed from the portfolio forever). Are we staying small with UPST due to worries the next quarter will also disappoint?

  2. I sold Crwd along with Saul and others. At 60% y/y growth, it still seems like a great company and is growing faster than some of the other portfolio companies (Ex, NET is 50%) but this makes sense to me because we have Sentinel One growing faster at 127% y/y in the same sector (cybersecurity).
    Thanks and I hope everyone is doing well handling this correction. It’s never fun but as David Gardner says: ‘We want to have tennis balls and not eggs’. When the correction bottoms our stocks (great companies) should bounce hard and fast.

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Thanks MusiCali!

I made quite a few changes, mostly this week. All were either adds or new positions, since I had money set aside and didn’t want to sell anything at these prices. But the sale prices sure are attractive on the buying side! As a result, I now have 14 companies, which is more than I’ve had for quite some time. I’ll see what survives after earnings.

Here’s what I have done:

Upstart (UPST): I am still a true believer, and it is still my largest holding. I did trim some of my highest-priced shares in the month after earnings; but with the stock price now so very low, I actually bought more earlier this week. Whether other members here want to stay in for a lumpy, bumpy ride, I don’t know. I believe in their long-term growth potential. I actually think they will probably bump in and out of the hyper-growth category and I don’t have the stomach to jump in and out with those shifts. If something happens to make me doubt their ability to execute on their vision, that’s another story. But right now I’m happy with the company, even though the share price is painful.

DataDog (DDOG) and Cloudflare (NET): I haven’t touched either one. They are my second and third largest holdings, respectively. They both have come down significantly but I was already at my allocations for each, so I didn’t add. The only other companies that I left alone, for similar reasons, were ZScaler (ZS), Crowdstrike (CRWD) and Affirm (AFRM). I’m likely going to trim Affirm after earnings, but am not selling down here in the gutter.

I added to my positions in DigitalOcean (DOCN), Global-e Online (GLBE), The Trade Desk (TTD), and Asana (ASAN) as the prices were just too good to pass up.

In December I got back into Sprout Social (SPT)

Just in the last two days, I have taken advantage of the bargain basement to start new positions in SentinelOne (S), Monday.com (MNDY), and Bill.com (BILL). For now I am mostly borrowing my conviction in these from others on this board and elsewhere. I had been in and out of MNDY a couple of times and today was the first day I could buy and avoid the wash sale.

I believe they are all great companies and there has been very little news out of any of them. All my activity this month was due to the sell off and the opportunities that has presented. Perhaps we’re not done and they’ll go lower still. But one thing (of many) that I’ve learned from Saul is to ask myself whether I’m happy owning Company X at price Y. The answer for me is, “Why, yes. Yes, I am.”

I do have a couple that I’m hoping will be stable growers if not hyper growth (looking at TTD and CRWD) which help me in this uncertain environment. But with my entire portfolio now down 32% from inception, I just tell myself that I own what I believe are great companies and the market will, in time, reflect their value. If I’m proven wrong, I’ll exit when that happens. In the meantime, I am fully invested, and buckled in for the ride.

JabbokRiver

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