Archive for August, 2016

New Trade: Long Alphabet (GOOG) & Short eBay (EBAY)

By: ispeculatornew | Date posted: 08.22.2016 (3:00 am)

Today I am opening my 17th trade of the year between between 2 names that I have traded quite a bit over the years, which will hopefully help me rebound from a few rocky weeks of long & short trading. As is always the case, you can see past 2016 (and previous years) trades here:

http://www.intelligentspeculator.net/livetrades

Let’s start off by looking at the numbers:

TickerNamePricePE RatioPE Next YearReturn YTDSales GrowthAnalyst ratingBook ValueBetaRevenue/ShareSales 5Y Avg GrowthEPS 5Y Avg Growth
EBAYeBay Inc30.6319.0214.7111.06-2.253.55.70.997.110.03100.44
GOOGAlphabet Inc775.42N/A19.312.4513.624.64N/A1.21N/A19.1913.78

Long Alphabet (GOOG)

Alphabet is a company I’ve traded less than you’d expect, mostly because as much as I love Google as a consumer, it’s not as straight forward in terms of investments. Why? Lack of discipline and transparency, but also the moonshots. While all of those issues still exist to some extent, I’d say they’re all getting better (with the hire of a new CFO, the new Alphabet structure, etc) so I do feel more confident in going long Google in a “short term” trade like this one.

GOOG_chart

 

Next earnings: October 13th 2016

Short eBay (EBAY)

While this could certainly look like I’m taking a negative view on eBay (in a way it is of course), this is more of a play on my strongs doubts about eBay being able to turn things around and/or come up with spectacular numbers. Ebay’s P/E and forward P/E ratio are not way off but do still point to more growth than what I think the company can pull off, especially in the face of Amazon, Walmart and others competing.

EBAY_chart

 

Next earnings: October 12th 2016

Disclaimer: Prior to opening this trade, I do not have a position on GOOG or EBAY

New Trade: Long Facebook ($FB) & Short Blue Nile ($NILE)

By: ispeculatornew | Date posted: 08.15.2016 (3:00 am)

Today I am opening my 16th trade of the year between between 2 names that I have traded quite a bit over the years, which will hopefully help me rebound from a few rocky weeks of long & short trading. As is always the case, you can see past 2016 (and previous years) trades here:

http://www.intelligentspeculator.net/livetrades

Let’s start off by looking at the numbers:

TickerNamePricePE RatioPE Next YearReturn YTDSales GrowthAnalyst ratingBook ValueBetaRevenue/ShareSales 5Y Avg GrowthEPS 5Y Avg Growth
FBFacebook Inc124.8860.0524.5919.3443.824.617.560.986.448.81N/A
NILEBlue Nile Inc30.6634.6929.02-16.541.3831.291.0841.147.434.53

$FBLong Facebook (FB)

No surprise in me picking Facebook which has done great things for me personally. I continues to be my largest single position and Facebook continues to execute extremely well. I do have a bit more worries when I look at the landscape for Facebook, especially about its ability to position itself against Snapchat but for that I reason I did very much like the most recent Instagram move of launching stories. Facebook continues to deliver on the top and bottom lines and it’s crazy to me to see it trading at a comparable forward valuation as Blue Nile. In many ways Facebook qualifies as a “platform” and I continue to think those will be long term winners. Just think of a recent phenomenon Pokemon-Go. You could argue that Apple is making as much as any of the parties that are actually involved in creating and licensing the game. This is playing over and over and the platform players are getting their “tax” on each transaction.

FB_chart

Next earnings: November 2nd 2016

$NILEShort Blue Nile (NILE)

Long term readers of this blog know that I’ve been bearish regarding this stock for a very long time and have shorted it quite a bit over the years. For some reason this stock has traded at very high valuations over the years with very little to justify it. NILE has continued to show very little ability to generate growth and I continue to expect increased competition, eventually from the likes of Amazon which will certainly send the stock much lower.

NILE_chart

 

Next earnings: November 3rd 2016

Disclaimer: This trade on FB-NILE will be done on today’s opening, but i am already long Facebook (FB) as a consequence of my long term speculative pick.

The fastest growing businesses in 2016

By: IS | Date posted: 08.12.2016 (1:37 pm)

 

Despite the perils of Brexit, the fragility of the British pound and continued financial uncertainty in many markets, companies continue to drive forward with their business plans. Many success stories are making the headlines this year, as businesses innovate and diversify to uncover new products or business synergies to explore.

Leading the way, as is common, are the IT and technology-focused companies. A new trend for the year are smart artificial intelligence bots, improving customer interaction and automation. Led by the likes of Facebook, Cisco, Microsoft and many startup companies, they are helping bots take over on customer service phone lines, websites, in-store kiosks, reception areas and other locations to help people find the information, advice or products they need faster. Bots in the office can help staff find business documents, plan travel and find the lowest cost products or those that can be delivered fastest, all in a matter of seconds.

Another area of growth is communication services, with unified communications allowing workers to make themselves available by the most appropriate means, be it a traditional phone, voice over IP calls, mobile, chat or video message. A unified communications service can save a company on capital expenditure and expenses on its phone bills, line rentals, communications equipment and so on.

The final fast mover from the technology world this year is personal health, with a wide range of smart weighing scales, health and heart rate monitors, and smartphone apps all encouraging consumers to be healthier and stay fitter. Fitness brands are leading with the likes of British firm Under Armour and its new Healthbox, but smaller companies can find niches and appeal to specific demographics.

Perhaps in relation to that, many traditional businesses are also thriving in 2016. Health clubs and gym memberships are on the rise again, while many small businesses are starting up their own niche healthy living ranges like office-based exercise products . Finding a new type of exercise or one specifically for a particular age group or the time poor is one of this year’s major opportunities, encouraged by health insurance benefits and rewards. ‘Corporate wellness’, as the sector is known, benefits from many of these initiatives, as businesses try to encourage their staff to be healthy for a better working environment, less time off sick and improved morale. Any company investing or innovating in these areas will find plenty of opportunities in this and coming years.

Closing 2 New Trades

By: ispeculatornew | Date posted: 08.08.2016 (3:00 am)

Wow, how things have turned around. I might have fixed issues on the website in regards to speed and the site showing up but I certainly didn’t fix the trading returns. I will be closing 2 very bad tech long & short trades this morning, they have turned out to both return around -40% as of my writing this.

Long Apple (AAPL) & Short eBay (EBAY): -41,47%: My sentiment on Apple has been changing over the past few months and while I remain bullish, I would probably not place it at the top of my list as I have done a few times. And no, that is not due to the fact that this particular trade crashed. In fact, the cause here is eBay which has been performing incredibly well.  When eBay spun off its Paypal (PYPL) position I believed I had a clear view on what it was. Yes, eBay has quite a few different divisions and websites but it does remain a big Amazon (AMZN) competitor which I don’t think will end well. In the meantime though, ebay has been showing strong growth and expanding its horizons. It doesn’t yet reach into broader areas such as SMS loans in Norway but it does remain a broad ecommerce play and for that reason ebay has been a bad short to have on the books this year.

TZOO_chartLong Facebook (FB) & Short Travelzoo (TZOO): -46.75%

Without a doubt, this is the one position that completely taken me by surprise. I didn’t see much risk in shorting Travelzoo and that has obviously been a very bad position to hold with the stock jumping by 45% in the last 5 months. I continue to have reading to do on this one (I’m behind on my Q2 earnings and earnings call readings) and will certainly report my findings but safe to say I didn’t see this one coming.

With all of this, the YTD return of the portfolio now stands at -12.90% which would be a second straight negative year if things don’t turn around. I will have some things to reflect on and write about if this keeps up:) Thankfully, it does remain a small part of my portfolio and despite the temptation to increase it given the long term solid history of returns, I did keep it around the same levels. As is always the case, you can see all of my current and past tech long & short trades here:

http://www.intelligentspeculator.net/livetrades