Post a CommentToday I am opening my 5th trade of the year between between 2 names that I have traded quite a bit over the years. 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:
| Ticker | Name | Price | PE Ratio | PE Next Year | Return YTD | Sales Growth | Analyst rating | Book Value | Beta | Revenue/Share | Sales 5Y Avg Growth | EPS 5Y Avg Growth |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| PCLN | Priceline Group Inc/The | 1575.13 | 27.06 | 21.56 | 9.29 | 9.26 | 4.64 | 199.32 | 1.25 | 181.08 | 20.75 | 9.49 |
| TWTR | Twitter Inc | 17.62 | N/A | 28.28 | 3.93 | 58.09 | 2.85 | 6.49 | 1.48 | 3.35 | 99.28 | N/A |
Long Priceline (PCLN)
For this trade, I wasn’t sure if I’d go long Priceline (PCLN) or Expedia (EXPE). Both have been solid performers and trade at comparable valuations but I do think a clear difference is that Priceline has been so steady over more than a decade. One truly impressive aspect has been its ability to generate both top and bottom line growth so consistently over time. That reduces the odds of a miss that could hurt this trade. For that reason, I’m going with PCLN even though it has (slightly) slower growth in recent quarters.
Next earnings: February 15th
Short Twitter (TWTR)
I have started writing a post about Twitter but the short story is that the company has been incredibly slow in improving its product and that is a big part of why its user growth has stalled. The company could be taken over of course but I think that’s a risk that’s worth it in these circumstances given its current valuation and growth perspectives. Twitter continues to be a great product to use and perhaps the application I spent most time on personally but it’s been unable to grow and I believe the issue is mostly around product execution rather than having a product that’s difficult to use or understand.
Next earnings: February 9th 2016
