The Market 2022-2023-2024

[Folster]

Sure, let me ask about the holding that's driving me craziest these days: VIAC. I sold a little near 100 when it bubbled, but it's been stuck in the 30s since it came down from that, and every time it tries to mount a charge, it just turns around again.

Great minds think alike. I just analyzed that a few months ago. I'll refresh tonight and see.

 

[dscher]

BA looking like it could be next to go... Weekly and Daily charts are hanging on by a thread.

 

[dscher]

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[elindholm]

So, any success stories in this bloodbath? I have HSBC, which is up 13.8% YTD, so I'm grateful for that. But it's a tiny percentage, of course, just like everything else I hold.

 

[dscher]

So, any success stories in this bloodbath? I have HSBC, which is up 13.8% YTD, so I'm grateful for that. But it's a tiny percentage, of course, just like everything else I hold.

Palladium? Long bonds. Not much.

 

[dscher]

The good news is we are getting extremely stretched to the downside..so a bounce could be coming early next week. I think that will just be time for consolidation before the next leg down though.

 

[Russ Smith]

Man not exactly a good close today either.

Panic has set in I suspect. The good news the friend with the 401K she rolled over from previous job told me she hasn't deposited it into stocks yet so she'll get to buy much lower than she otherwise would have. But still not good at all.

You knew this was coming eventually the stocks were just propped up so long by tax breaks and government spending but still not fun to watch it fall when it finally did.

 

[jf-08]

My individual stock holdings right now in my long term taxable account are as follows:

AMZN
AAPL
GOOG
INTC
LOW
T
HON
F
BABA
MO
XOM
GE

ETFs:

SCHB
RING
XLF
PICK

I have in my long term:

AOUT
ASTR
BRKB
COIN
GOOG
GOOGL
LAZR
MO
NOK
RBLX
SPCE
SWBI

ETF:
IWF
VFIAX
VTV
VUG
XLF

 

[Folster]

I have in my long term:

AOUT
ASTR
BRKB
COIN
GOOG
GOOGL
LAZR
MO
NOK
RBLX
SPCE
SWBI

ETF:
IWF
VFIAX
VTV
VUG
XLF

I've been eyeing SWBI. Just did a DCF analysis the other day but found it to be difficult as they had a blow out year last year and revenues are expected to obviously come back down to earth. They have really sporadic demand cycles triggered by mass shootings and political rhetoric. Very hard to predict. My estimates are all over the place and I can't get comfortable. I'll likely wait until I can get a price with a big margin of safety once I dial in my projections.

I have COIN also in a separate and small speculation acct that is just for speculation. It's my only foray into the crypto universe. I've learned I'm not good at speculating.

Can't go wrong with BRK.B. I kinda want to wait for Buffett to die as I expect there will be a sell off and an opportunity to buy. Not rooting for his death or anything though.

 

[elindholm]

SWBI feels too dirty to me, but I have LMT -- that's sort of the same thing, right?

 

[jf-08]

I've been eyeing SWBI. Just did a DCF analysis the other day but found it to be difficult as they had a blow out year last year and revenues are expected to obviously come back down to earth. They have really sporadic demand cycles triggered by mass shootings and political rhetoric. Very hard to predict. My estimates are all over the place and I can't get comfortable. I'll likely wait until I can get a price with a big margin of safety once I dial in my projections.

I have COIN also in a separate and small speculation acct that is just for speculation. It's my only foray into the crypto universe. I've learned I'm not good at speculating.

Can't go wrong with BRK.B. I kinda want to wait for Buffett to die as I expect there will be a sell off and an opportunity to buy. Not rooting for his death or anything though.

I have some crypto too. I'm down of course, but the money I threw into my crypto portfolio is something that I wouldn't sweat if I lost it anyway.

 

[elindholm]

I have some crypto too. I'm down of course, but the money I threw into my crypto portfolio is something that I wouldn't sweat if I lost it anyway.

That's what I'm trying to tell myself about OPEN, which I stupidly bought when Zillow shut down its brokerage operations. It's down 58% and is as likely to go to zero as it is to recover.

 

[dscher]

That's why @dscher said MAGA or GAMA for the Dems on the board. MSFT, AAPL, GOOG, AMZN. They are the BIG 4 right now.

Might have to move to MAG soon enough. AMZN got obliterated. We have some real momentum on that bad boy. Looking at the 2k level.

 

[dscher]

Just a preemptive apology..lol. Things are getting real out there and I'm gonna probably be blowing this place up with any of my thoughts and ideas on market related events. Just like P+R..It/I may annoy the hell out of you.

@Folster Speaking of China....

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[Devilmaycare]

I need to diversify my individual stocks to a bit. I'm way too heavy right now in AAPL, TSLA, and LCID. It's been hard to rebalance though for the last year with how they've been performing. This is all in my "play" non-retirement account. Retirement accounts are all funds.

Right now I'm holding:
AAPL - I'm still long on them but I haven't been happy with Tim Cook's leadership the last couple years.

TSLA - This is the one I've really been thinking of cashing out a lot of my position. Bought during covid and already have over 3x out of it.

LCID - Still looking long at them. If they stay executing I think we could still get a bunch of growth.

GSAT - threw only $2000 into last year as a 5G play when the spectrum they own was added to Qualcomm's new chip. It's a complete flyer, I was hoping someone would acquire them for the bandwidth.

SQ - Boy, has this turned into a dog. I'm kicking myself for not pulling the trigger 6 months ago when I was thinking of it.

RIVN - Only 18 shares that I got during the IPO. I'll probably dump it when the sell restrictions lift.

IPOF - It's been trading at NAV for like 8 months now so I've just been parking money in it as "savings". If Chammy can close something big it could print. There's been rumors again of it being Starlink or SpaceX since Elon is going to be on his podcast in a 5 weeks. If that happens I'll be really happy.

 

[dscher]

I need to diversify my individual stocks to a bit. I'm way too heavy right now in AAPL, TSLA, and LCID. It's been hard to rebalance though for the last year with how they've been performing. This is all in my "play" non-retirement account. Retirement accounts are all funds.

Right now I'm holding:
AAPL - I'm still long on them but I haven't been happy with Tim Cook's leadership the last couple years.

TSLA - This is the one I've really been thinking of cashing out a lot of my position. Bought during covid and already have over 3x out of it.

LCID - Still looking long at them. If they stay executing I think we could still get a bunch of growth.

GSAT - threw only $2000 into last year as a 5G play when the spectrum they own was added to Qualcomm's new chip. It's a complete flyer, I was hoping someone would acquire them for the bandwidth.

SQ - Boy, has this turned into a dog. I'm kicking myself for not pulling the trigger 6 months ago when I was thinking of it.

RIVN - Only 18 shares that I got during the IPO. I'll probably dump it when the sell restrictions lift.

IPOF - It's been trading at NAV for like 8 months now so I've just been parking money in it as "savings". If Chammy can close something big it could print. There's been rumors again of it being Starlink or SpaceX since Elon is going to be on his podcast in a 5 weeks. If that happens I'll be really happy.

If it's just your speculative play money.. then why not just go for broke on who you think has the best prospects at growth moving forward. I think TSLA is a massive large cap that could become even more massive. It's the "safer" speculative play IMO.

 

[Devilmaycare]

If it's just your speculative play money.. then why not just go for broke on who you think has the best prospects at growth moving forward. I think TSLA is a massive large cap that could become even more massive. It's the "safer" speculative play IMO.

That's been my thinking the last couple of years but I've been getting a little concerned over them. It's one where fundamentals are colliding with fanboys. I really don't think they're a trillion dollar company and normally I'd be expecting a correction by now. So I've been nervous over how long their bubble is going to last.

It seems like a bunch of the big boys have been closing or greatly reducing their positions too. I've actually seen some IPOF speculation on the sales that it's some of the guys getting ready for a PIPE to go along with a SpaceX merger.

 

[dscher]

That's been my thinking the last couple of years but I've been getting a little concerned over them.

They already have such a competitive advantage over the EV landscape that will make it difficult for others to eat into their market share. IMO. But you have to believe in Elon and if you don't or makes you uneasy, then I get it. Kinda like Apple with Steve Jobs. Lots of people invested in that guy and not necessarily the product when it was in it's infancy. I think TSLA is still in it's early stages of growth, with tons of free cash flow. You don't see those two things together very often for a company with their market cap. Now, will they correct to a reasonable valuation just like every other tech mega cap at some point? Absolutely. When they do and we get back into a secular growth story in the economy again, I think they will come out the strongest of the bunch.

 

[Devilmaycare]

They already have such a competitive advantage over the EV landscape that will make it difficult for others to eat into their market share. IMO. But you have to believe in Elon and if you don't or makes you uneasy, then I get it. Kinda like Apple with Steve Jobs. Lots of people invested in that guy and not necessarily the product when it was in it's infancy. I think TSLA is still in it's early stages of growth, with tons of free cash flow. You don't see those two things together very often for a company with their market cap. Now, will they correct to a reasonable valuation just like every other tech mega cap at some point? Absolutely. When they do and we get back into a secular growth story in the economy again, I think they will come out the strongest of the bunch.

Elon is part of what scares me with TSLA. There's been some rumblings for a bit now that he might step down as CEO since they're at a good point and turn his focus to Starlink and SpaceX. I really don't know what will happen to the stock if that happens. I think we'll at least see a big dip and then maybe a rebound over a little bit of time.

And yes, TSLA is out ahead in tech right now. It's actually why I'm big on them and LCID. From my DD both are way ahead of everyone else in the tech department and they both have potential revenue streams outside of their cars. That's also why I haven't been as big on the ICE auto makers going electric. They're buying most of their stuff from other companies. That's good to get going but not as much for the long term. What I'm sort of hoping is that LCID start providing battery and motor tech to them in addition to selling their own cars. Their battery management and junk is awesome. Battle tested too in Formula-E since they've been the sole provider for the league.

 

[Folster]

Sure, let me ask about the holding that's driving me craziest these days: VIAC. I sold a little near 100 when it bubbled, but it's been stuck in the 30s since it came down from that, and every time it tries to mount a charge, it just turns around again.

Okay I re-analyzed VIAC.

Most of its fundamentals are strong but there are a few concerns.

ROIC (return on invested capital) at 6.61%. I typically want to see a company's ROIC >10%.

Revenue growth estimates range from flat to single digit negative growth.

The other concern is their net debt at nearly $13B. To put that in perspective, their market cap is $20.4B. So I am getting an Enterprise Value ranging from $33-35B depending on when you pull the debt figure.

The debt poses some problems for analysis as you are also buying the debt. Despite the debt, they are easily able to cover interest payments and have a good current ratio.

Revenue is projected using a combo of analysts estimates and revenue growth rate projections. I project cashflows out 5 years based on their average percentage of revenue over the past 5 years.

Based on my projections and assuming you expect a return of 10% a year, $42.06 is fair value which means the current price is heavily discounted at $31.25. However, that does not factor in the debt that you are also buying.

If you are really conservative, you can subtract the net debt from the present value of future cash flows. This would be like having the debt paid off before you buy the company. In this scenario, I calculated a purchase price of $20.21 which means you should wait for the price to drop another 35%!

What probably makes the most sense is to spread that debt repayment over a few years since the debt is used to grow the company and create cash flows. That gives you a price somewhere between $20 and $42 depending on how you feel about the debt.

I think, VIAC starts looking really attractive sub $30 and I think the crash of NFLX will depress sentiment on the segment and depress prices in the short term. This makes me think that $25 would be realistic and a good target in the current market environment. I personally like VIAC's positioning and well rounded offerings with Paramount+, CBS, Nick/MTV, Showtime, and Pluto.

I also think it's likely we see further consolidation within the segment. NFLX, Disney, and soon to be Warner Discovery seem to be the leaders. VIAC's Paramount is the next best with Comcast's Peacock and others behind. And you can't forget about AMZN and AAPL.

 

[Devilmaycare]

Okay I re-analyzed VIAC.

Most of its fundamentals are strong but there are a few concerns.

ROIC (return on invested capital) at 6.61%. I typically want to see a company's ROIC >10%.

Revenue growth estimates range from flat to growth.

The other concern is their net debt at nearly $13B. To put that in perspective, their market cap is $20.4B. So I am getting an Enterprise Value ranging from $33-35B depending on when you pull the debt figure.

The debt poses some problems for analysis as you are also buying the debt. Despite the debt, they are easily able to cover interest payments and have a good current ratio.

Revenue is projected using a combo of analysts estimates and revenue growth rate projections. I project cashflows out 5 years based on their average percentage of revenue over the past 5 years.

Based on my projections and assuming you expect a return of 10% a year, you should be willing to pay $42.06 a share which means the current price is heavily discounted at $31.25. However, that does not factor in the debt that you are also buying.

If you are really conservative, you can subtract the net debt from the present value of future cash flows. This would be like having the debt paid off before you buy the company. In this scenario, I calculated a purchase price of $20.21 which means you should wait for the price to drop another 35%!

What probably makes the most sense is to spread that debt repayment over a few years since the debt is used to grow the company and create cash flows. That gives you a price somewhere between $20 and $42 depending on how you feel about the debt.

I think, VIAC starts looking really attractive sub $30 and I think the crash of NFLX will depress sentiment on the segment and depress prices in the short term. This makes me think that $25 would be realistic and a good target in the current market environment. I personally like VIAC's positioning and well rounded offerings with Paramount+, CBS, Nick/MTV, Showtime, and Pluto.

I also think it's likely we see further consolidation within the segment. NFLX, Disney, and soon to be Warner Discovery seem to be the leaders. VIAC's Paramount is the next best with Comcast's Peacock and others behind. And you can't forget about AMZN and AAPL.

If you're looking long, I don't think Paramount+ survives. I think They'll be one of the casualties when the streaming wars shake out the weaker players. At the end of the day I think we'll end up with the big four, NFLX, Disney+, HBO+, and Amazon Prime with Apple+ being a wild card since they have the money to keep doing it as long as they want. For the rest of the streaming services I think they're going to have to merge or license their content. We're already starting to see it with the subscriber numbers and people playing the one month here, one month there game. The smaller players are going to have trouble surviving with that.

 

[Folster]

If you're looking long, I don't think Paramount+ survives. I think They'll be one of the casualties when the streaming wars shake out the weaker players. At the end of the day I think we'll end up with the big four, NFLX, Disney+, HBO+, and Amazon Prime with Apple+ being a wild card since they have the money to keep doing it as long as they want. For the rest of the streaming services I think they're going to have to merge or license their content. We're already starting to see it with the subscriber numbers and people playing the one month here, one month there game. The smaller players are going to have trouble surviving with that.

I would agree long term, but VIAC has mounted a strong offering by merging with CBS and has some really popular and wide-ranging content, that is a tier above Comcast IMO, but below the leaders. That's one reason why I would need a heavy discount to jump in. I also own T which means I'll be getting the Warner Discovery spin-off so I'm not hot to get another player in the segment unless it's really cheap.

 

[BigRedRage]

Elon is part of what scares me with TSLA. There's been some rumblings for a bit now that he might step down as CEO since they're at a good point and turn his focus to Starlink and SpaceX. I really don't know what will happen to the stock if that happens. I think we'll at least see a big dip and then maybe a rebound over a little bit of time.

And yes, TSLA is out ahead in tech right now. It's actually why I'm big on them and LCID. From my DD both are way ahead of everyone else in the tech department and they both have potential revenue streams outside of their cars. That's also why I haven't been as big on the ICE auto makers going electric. They're buying most of their stuff from other companies. That's good to get going but not as much for the long term. What I'm sort of hoping is that LCID start providing battery and motor tech to them in addition to selling their own cars. Their battery management and junk is awesome. Battle tested too in Formula-E since they've been the sole provider for the league.

I highly doubt Elon steps down from TSLA. They are far more than cars and he still has big plans IMO

 

[BigRedRage]

turns out selling almost all my holding in late November to buy a house worked out well, especially etherium

 

[elindholm]

Okay I re-analyzed VIAC.

Most of its fundamentals are strong but there are a few concerns.

ROIC (return on invested capital) at 6.61%. I typically want to see a company's ROIC >10%.

Revenue growth estimates range from flat to single digit negative growth.

The other concern is their net debt at nearly $13B. To put that in perspective, their market cap is $20.4B. So I am getting an Enterprise Value ranging from $33-35B depending on when you pull the debt figure....

Thanks for all of this. I didn't realize that their debt is still so high. When the stock ballooned last year, they issued some more, which of course precipitated the drop, but I thought that the whole idea was to get their debt situation less ugly.