The Eco-systems of our companies

A couple of people have posted helpful information about the way paying attention to company x can help us better predict what is going on with a particular holding of ours. So I thought it might be helpful to have a thread where people can make those comparisons to the specific companies they hold, giving us all another way to predict what may be coming for our holdings.

For example, for those of us holding AEHR (I increased my position yesterday and it’s up to 9.8% of my portfolio), we can get a heads up on their business by looking at those who manufacture semiconductors and whether they have plans to increase production of SiC chips. This is especially true for ON Semiconductor (ON), which is AEHR’s largest customer. As Ant helpfully said a few days ago:

Silicon chip manufacturer earnings reports should be compulsory reading for AEHR holders.

I also own The Trade Desk (TTD) now at 10.8% of my portfolio. We can see either tailwinds or headwinds for TTD by watching streaming companies that remain outside walled gardens, like Disney. @mekong22 helpfully pointed out earlier today in this thread that Disney just reported 40% of new subscribers are going with their ad-supported tier. As Disney is increasing the price of it’s ad-free tier, the ad-supported tier (where prices remain unchanged) will grow, providing more business for TTD.

Global-e (GLBE) is another example (now 11.8% of my portfolio). What seems to me to be the largest opportunity for them, at this point, is the exclusive partnership with Shopify Markets Pro. Right now, Markets Pro is only in early access. As it becomes available to all, which I believe will be done region by region across the next year, that will be a big tailwind for Global-e. Even more helpfully, Shopify reports a week or two before GLBE. If those holding GLBE pay attention to SHOP’s earnings and remember that their “Markets Pro” is GLBE under the hood, those holding GLBE have a heads up about what to expect when that company reports.

I think many of us (as well as the market in general) already infer that strength or weakness in one cybersecurity company means the same for others. While not always accurate, as they each have different strengths and weaknesses, it’s not entirely wrong either. And the market definitely rewards or punishes all cloud companies, depending on the reports of the hyperscalers.

So, I ask…what are the companies you DON’T hold that inform how you make predictions about the opportunities or potential headwinds for companies you DO hold?



I’ll start by saying I think this post is on the periphery of topics appropriate for the board. Setting that aside, I do like the idea set forth.

Given that, I think that responding to that idea should be very specific. For example, paying attention to semiconductor makers in order to get some insights related to Aehr is just way too broad. Aehr is primarily focused on SiC and GaN semiconductors, with an emphasis on SiC at this time (there just aren’t a lot of applications for GaN at present). So paying attention to Onsemi (as you mentioned) is appropriate (I posted a summary of their quarterly report recently). Or Wolfspeed (they make both SiC and GaN products). There are a few more companies in this business, but not a lot. That’s why I think Aehr will be something Like Zoom. They’ll go gangbusters for maybe two years, but after that I think they will have come close to reaching saturation. Of course, we don’t know, SiC applications may broaden beyond high voltage inverters. GaN applications my explode . . . but just the same Aehr needs a lot of attention.

Aside from that I would add Pepsi as company to follow if you’re invested (or thinking about investing) in CELH. Pepsi is for Celsius Holdings as is Coke for Monster. I don’t have a CELH position at present, but I’m close to buying in. And of course, Monster, on of CELH’s primary competitors should be watched. Their other major competitor is Red Bull, but that company is a German LLC, shares aren’t publicly traded. That makes Red Bull difficult to watch.