Update on my portfolio

Update on my portfolio

Although I just gave my end of February a week ago, and I usually give updates just at the end of the month, I will give a quick update on the portfolio today as there have been a number of changes in a short time. Here is what it looked like a week ago:


**Crowdstrike		30.2%**
**Cloudflare		22.3%**
**Datadog			18.2%**

**Snowflake		 6.9%** 
**Inari			 6.4%**

**Okta			 4.6%**
**Zscaler 		 4.0%**

**LightSpeed	         2.9%**
**Twilio			 2.6%**
**Zoom			 2.2%**

Here’s what it looks like now:

**Crowdstrike		29.4%**
**Cloudflare		20.2%**
**Datadog			18.0%**

**Inari			 7.4%**

**Zscaler 		 4.4%**
**Etsy			 4.1%**
**Okta			 3.6%**
**Snowflake		 3.4%** 
**LightSpeed		 3.1%**
**Twilio			 3.1%**
**Peleton			 2.8%**

**Zoom			 1.8%** 

I made no changes in Crowdstrike or Datadog during the week, but I decided that it made no sense to carry a well over 20% position in Cloudflare while I had other strong companies in my portfolio with much, much, smaller positions. It just didn’t make sense to me. I cut Cloudflare 2.1 points to about a 20.2% position. As you can see, I cut my Snowflake position in half, as it seemed that its huge growth was at war with its huge price, and I could see other places I’d like to put my money. I continued to slowly trim Okta which is now 1% lower in its share of my portfolio. Okta made what may turn out to be a smart acquisition, but it’s a huge acquisition for a company the size of Okta, and the acquisition makes the story much more complicated and uncertain. And finally, Zoom is 0.4% lower, and my smallest position. I’m still ambivalent about Zoom. I think that noone currently using Zoom for video is going to quit it post-pandemic, but I don’t think that even Zoom phone will budge the needle. And they are basically forecasting no growth at all for the last two quarters of the fiscal year they just started. (Of course they will beat their forecast handily though).

So what did I do with the money? I decided that I had a brilliant group of smaller contenders, and in addition I finally added a 2.8% position in Peleton. Why? I felt that not being able to keep up with demand because of supply constraints, and still growing well over 100%, seemed a positive rather than a negative, and I dipped my toe in. As you see though, it’s the smallest position except for Zoom.

So what is left? Five contenders that I enjoyed building up. My favorite is Inari, which has grown to a 7.4% position, in 4th place, but well behind my big three. It preannounced some weeks ago but will give final revenue results this week. Its revenue will be up about 140%, it will have gross margins about 92%, it is quite profitable, it just paid off all its longterm debt. It is low capex, and has a form of recurring revenue, because once they sell a cardiovascular surgeon on their products, they don’t need to go back and sell him again next year. He will keep using it, and probably use more the second year.

The next four are tightly packed between 3.0% and 4.5% positions. First is Zscaler which just announced results and accelerated revenue growth, again, this time to 55%! Billings were up 71%, RPO was up 68%. RPO was $1.025 Billion. That’s enormous for a company whose revenue last quarter was just $157 million.

Then Etsy, with revenue up 127%, with marketplace revenue up 150%, and gross margins of 76%, up from 67% yoy. Net Income was $149 million, up from $31 million.

Next is Lightspeed, which is a cross between an ecommerce company and a recovery from the pandemic company, as it serves a lot of restaurants and hospitality companies as well as regular retail.

And finally Twilio which is again reaccelerating, and has been well discussed on the board. Remember though to consider their orgainic revenue growth (without the acquisition), as they are also digesting a large acquisition.

Please remember that this is just where I happen to be now, and I give no guarantees for tomorrow. I could change my mind about any one or more of them, and I promise that I won’t do another update until the end of the month.

Twelve positions is much more than I like but 68% is in the top three positions, and the rest are heavy hitters as well, and I’m easing out of Okta and Zoom very slowly.

To summarize: I cut my Snowflake postion by 50%. I now feel that taking such a large position (around 11% or more at one time) was a foolish mistake. I cut my Cloudflare by 10% (just because it was larger than I wanted). I cut Okta and Zoom positions, each by about 20%. Neither of them was a mistake and both have been very profitable. It may just be time to move on.

With the money I freed up, I took positions in Etsy and Peleton, and then added to them. I also added to existing positions in Inari, Zscaler, Lightspeed and Twilio.

I hope that this was of interest,



Update on my portfolio

Although I just gave my end of February a week ago, and I usually give updates just at the end of the month, I will give a quick update on the portfolio today as there have been a number of changes in a short time.

Saul,thank you for taking the trouble to provide an update. As I sat in my office reading through the most recent 30 or 50 posts it quickly became clear just how much trauma was being experienced and expressed by various board contributors. The general tenor of responses to inquiries to which I subscribe is that ones best course of action is to stick with the most promising holdings and the best growth prospects and stay the course.

Its hard to deal with of course. A quick 25% drop in ones portfolio , such as I have just experienced can be somewhat discombobulating to say the least. But it has happened before, several times to me and things have eventually gotten back on track.

But staying the course and sitting still aren’t one and the same. A drop such as we’ve had is also a chance to make some improvements and set things up for the better. And so from my perspective Saul’s update is both timely and very helpful in deciding how to manage my portfolio. Better to take some positive steps than to be paralyzed.

About two weeks ago when prices began to weaken I sold out of a couple of things whose sale I had been contemplating. Accelerating the timetable a bit resulted in some short term rather than long term gains but left me with a pile of cash.

I started building a position in SNOW (now 10%) as the price declined and acquired it at an avg price of $285. I’m underwater by about 18% but so are all my other companies. I added to my position in ZS and to Inari and started small stakes in LSPD and TWLO.Both have reported excellent results and both are highly recommended by several commentators whose opinions I respect.

As a results of the changes I have left about 12% cash plus another 12-15 % ETF investments that I’m seeking to redeploy. I’ve been impressed with Etsy’s recent results and its business thesis, and writeups by discogator, horseplay Andrew and others are quite persuasive. Several of my other positions are still small relatively speaking so there are lots of options which I have been mulling over for the past 2 days. Again thank you Saul for supplying your current thoughts, .

I anticipate a busy weekend.

Hang in there everyone.Its often dark before the dawn




Hi Saul

You probably can’t imagine how much this post is appreciated in a period of uncertainty as we face at the moment.
Not because it gives me a plan to copy but to validate some of my thoughts.

Snowflake: I exited Snowflake with a small loss last Thursday. The earnings report did not give me the confidence to hold whilst the lock-up period was expiring. I will monitor and probably re-enter once the market has calmed down.

I reallocated the cash from SNOW in a similar way as you did:
Peloton: I started a 1% position in PTON last week. There is still strong growth and the Share-price has become very attractive at these growth levels. Given that Corona will probably be with us for the foreseeable future I doubt people will fully stop the exercise from home trend.

Lightspeed: I started a 2% position last week due to the lack of a position in my portfolio that would benefit from the Corona recovery. I plan to further grow this to about 5%.

DDOG: I started adding further to DDOG this week. It is now 6% of my portfolio. I believe the growth story is intact and the share-price gives an opportunity to further grow this position to about 10%.

I consider trimming my big positions (Crowdstrike, SEA Ltd and NET - each around 18% of my portfolio) as I see further downward risk and would like to free-up cash to grow the above. The challenge is to make me pull the trigger - as these companies have an outstanding performance and great medium/long term growth prospects. Your post gives me further food for thought…

Once again thank you for this post and to you (and many others) for sharing your knowledge on this board. Although I am in the red for the year I believe I have become a much better investor since I found this board in summer last year.
Even more importantly I now have an investment strategy that I believe in. This makes me sleep calmly throughout massive corrections as we experience at the moment.

All the best,


I was wondering when you were going to finally pay attention to Etsy. Here’s a few other points about this company.

Etsy is now the number 4 online retailer behind Amazon, Ebay and Walmart.

They are just beginning to have significant growth in Europe specifically in the UK and Germany.

While Etsy does not have the guaranteed repeat business of our companies with a subscription model, they do have strong repeat business. Enough so that they classify a segment of Etsy shoppers as “habitual”. The reason for this is obvious, personalization. If you want to buy a teapot for aunt Lydia with her name surrounded with hearts and flowers enameled on it, you’re going to shop at Etsy. You just can’t get that so conveniently anywhere else, not online and not brick and mortar.

And they have another form of personalization which is the more someone shops there, the better they get to know exactly what that person’s tastes are. Unlike a Google search that returns thousands of results to a query, an Etsy search will return far fewer highly targeted results for each specific shopper.

Along with their business performance, there’s nothing to not like about Etsy - though they have been very conservative with guidance. During the most recent CC they only projected next quarter rather than the full year. They asserted that there’s just too many unknowns as the nation moves forward with COVID recovery so rather than guess about the coming year they will take it quarter by quarter until they feel they have more clarity on what to anticipate.