Monday, November 22, 2021

Selling GreenDot (GDOT) @$39.94 (59.82% Gain).

 Green Dot is a financial services company. Among other activity it provides and manages pre-paid debit cards and the software to manage balances etc..

I bought GDOT at the hight of the pandemic with the thought that people will be moving away from cash and that unbanked people will be moving towards pre-paid etc.

The thesis has proven itself but the future doesn't look worthy of continuing to hold on the this investment.

Regardless of whether or not Green Dot will continue to perform well, the thesis is less clear to me and I will take my profits and move on to, what I feel are, more lucrative investments.



Thursday, October 28, 2021

StoneCo update / Why I'm still bullish (STNE)

 StoneCo stock has been on quite a rollercoaster ride since it's IPO in late 2018.  After almost 2 years of trading, the stock has gone from an IPO price of $23.57, up to $85.81 in Feb of 2021 and all the way back down to $35.26 currently.

What happened?

StoneCo launched a credit service 2 years ago which was gaining a lot of traction. 6 months ago, the Brazilian government started implementing a new national payment system which has had a shaky launch.

StoneCo has announced that it will pause it's own service until it can comply with new regulations.

All this news has troubled investors and sent the stock tumbling.

StoneCo's core product - digital payments is going fantastically well, surpassing one million users this year.

So I'm not selling and not adding. Holding still.




Monday, September 27, 2021

Buying Etsy (ETSY) @$224.60

 Etsy operates a global marketplace where people can buy and sell unique goods online. Etsy can be seen as the "Amazon for artisans" and is a place people go to buy "one of a kind" special products.

- Etsy has been on my watchlist for a while. There was a lot of hype around the company during the hight of the pandemic, so I held back. But the company has proven that it's numbers go with the hype and is consistently performing.

- Etsy has a market cap of $28B which tells me it has much room to grow in the super hot e-commerce sector.

- The company has 5.2 million active sellers. Sellers are the number to follow since they will tend to be very loyal to the platform.

- According to a 2020 survey, 88% of Etsy buyers say that they find on Etsy items that they can't find anywhere else.

- Also consider that people are trying to turn away from China made products and move towards supporting artisans in their own countries.

- Etsy is focusing on new markets. Particularly - U.K., Canada, Germany, Australia, France and India, representing a $1.7 trillion addressable market opportunity.

- Recent acquisitions of Depop (2nd hand fashion) and Elo7 (Brazilian market place) are great moves in my opinion.

- I love "Platform Businesses" for their flywheel effect. More sellers create more products, bring more customers who increase total merchandise volume - all maintained with a steady spend on technology and R&D.

- P/E of around 60 is high, but not unheard of in this space.

- One of my favorite ratios to look at is the 'Return on Equity' = ROE. Simply put this shows the return the company make on it's market cap, excluding debt. Etsy's ROE is a fantastic at 91.44%

- CEO Josh Silverman is very impressive. Has previously served at American Express, was CEO of Shopping.com and Skype.

- Etsy is part of my E-commerce position which includes Amazon, Pinterest, Riskified, Berkshire Grey, Fiver and Amazon.


 

Wednesday, September 15, 2021

Selling Acuity Ads @$7.42 (4.58% Gain)

 After Apple came out limiting data that 3rd party ad platform can use to track customers, it seems that the space is cooling off.

I have two positions in this space - The Trade Desk (TTD) and Acuity Ads (ATY).

- The Trade desk is a bigger company, more established and set to continue to grow. I'm still very bullish on the space in general but think one position will suffice.

- In choosing which position to sell, I have no doubt - hold the big player.

- Selling ATY with a small gain and making room for my September investment.


Friday, August 20, 2021

Selling McCormick (MKC) @ $87.07 (41.49% Gain)

 Selling McCormick to make room for a more aggressive investment. I bought McCormick at the hight of the pandemic after it took a hit together with so many other quality stocks. 

- The investment turned out profitable but this portfolio is about driving more aggressive returns so I'm exiting this position.

- I love this company as a long term investment in a solid portfolio.

Buying Procore Technologies (PCOR) @$87.12

 Procore Technologies is a provider of construction and workflow management cloud based software, aiming to bring construction into the digital age.

- Construction is an industry with on of the lowest technology adoption rates in the market. According to McKinsey, construction is one of the least digitised sectors in the world despite accounting for about 13% of global GDP.

- Procore software helps connect all members of the construction process. To solve the problem of having to get all participants to pay for the service, Procore does not charge on a per-seat basis but charges the contractor according to the estimated dollar value of the project. This enables the contractor to invite all members of the construction process to download the app for free.

- Due to overall high demand for building, many companies are facing backlogs and efficiency on the job site is becoming more important than ever. This means leveraging technology and Procore is the leader in the space.

- The opportunity for Procore could only materialise in 2011 with the introduction of iPads to worksites so this market and the opportunity is relatively new.

- Procore provides it software for education purposes to 85% of construction management universities in the US. 

- Founded in 2002 by Tooey Courtemanche, who is currently CEO.

- Procore operates in 9 countries. 

- The stock is a recent IPO. First quarter reports show $123M in revenue, 27% rise Yoy.

- Customer count: 11,149, 19% higher than last year.

- Market Cap is at $11B.

- I like the founder/CEO. I like that this is very early stage. I like that there's no real competition and I like the tailwinds of a booming construction market.





Friday, August 6, 2021

Adding to Fiverr International FVRR @ $169.12.

 Fiverr stock dropped 25% yesterday after the company lowered guidance. As people go back to work it makes sense that less people will depend on gig jobs. People are traveling more, out of the house more so doing less gigs.

- I think this is an overshoot by investors.

- Fiverr actually delivered a stellar quarter and my thesis for the company remains bullish.

- Revenue was up 60% year over year.

- Spend per buyer was up 23%

-  Bottom line: The gig economy will continue to grow and Fiverr will continue to grow with it.

- I'm up 111% Since June 2020

- Added 20% to current position.