What I’ve done the last two days.
First The Trade Desk. Here’s what I wrote in Friday’s Summary:
The Trade Desk announced stupendous results Thursday after the market and rose $47, or more than 31%, on Friday. It was a new try-out position four months ago, at the end of October. Now it’s now a 7.1% position and is in 6th place in my portfolio. I posted a deep dive two and a half months ago. I’d rate them four and a half stars based on their results and their confidence in themselves, but they are an advertising company after all, which is a field that I have zero confidence in, even though I feel that this is a very innovative and creative company, so I doubt that I will ever let the position get very big. The Trade Desk seems to be a Leader in a Rapidly Growing niche Market within the larger field of advertising, which up to now is controlled by the behemoths.
However, the more I read over their results and the conference call, I decided that this company seems for real, and I wanted a larger position. It seems to really be the leader in its field, which itself is expanding rapidly, and The Trade Desk’s growth seems to be accelerating. However I didn’t have any other positions that I wanted to reduce, so what I did on Monday was sell 3% of the number of shares that I had in each position, leaving each 97% as large as it had been and keeping relative sizes. Bought Trade Desk, and my position grew to 9.6%. If you want to know why I changed my mind, just read the earnings release and the conference call.
Then on Tuesday, came the news that Lyft had left Mongo and moved to AWS. There were three bad news nuggets in that. First that they were dissatisfied enough with Mongo to undergo all the immense hassles of moving when they were already fully deployed, and second that AWS’s homegrown copy was “good enough,” and third, that this may give other companies the idea that maybe AWS really is good enough (or maybe even better) if Lyft moved to them. This bad news follows after that AWS announcement, and concurrent attack by Red Hat, which I’m sure most of you remember. And then yesterday there was also an Azure announcement.
I’ve had a checkered history with Mongo, selling out once last year just because I couldn’t understand what they did, and because they were losing such a large percentage of revenue each quarter. I bought back in at about the same price that I had sold. And then after the AWS announcement and the Red Hat attack, and after reading somewhat unproven stories that a lot of customers were dissatisfied with their service, I sold out again, but was convinced to buy back.
I must say now that I’m fed up with Mongo. I sold about two-thirds of my admittedly small position (3.5% before I sold) and added some of it to Trade Desk (now 11.4%, no more adding!) and a little to Coupa, my smallest position. I have a different take on Mongo than Steppenwulf, who I really respect, and it’s probably because I don’t have the tech expertise that he has, but there are just too many companies around that are simpler stories and don’t have Mongo’s problems. And I will definitely feel better investing in a company without all this stuff going on.
Please be aware that I make mistakes and wrong decisions all the time, and The Trade Desk may sell off after that huge rise, and Mongo may just keep on going up, so make your own decisions.