Author: Camila Morocho

Newsletter 4:

WELCOME TO TIGER WOLF CAPITAL
We are a small private hedge fund. We are here to foster a community of growth in the trading / investment realm and teach anyone from the start. We provide educational material that is catered to teach beginners the basics of trading in the stock market as well as teach experienced traders more advanced strategies.
“The secret of change is to focus all your energy, not on fighting the old, but on building the new.”
– Socrates
TABLE OF CONTENTS
  1. PFIZER
  2. REVIEW OF LAST WEEK’S EARNINGS
  3. UPCOMING EARNINGS
  4. UPCOMING EVENTS & TALKS
  5. MERCHANDISE
  6. DISCORD RECAP
  7. STOCKS ON OUR RADAR
  8. EDUCATIONAL LEARNING SEGMENT
  9. BOOK OF THE WEEK
  10. VIDEO OF THE WEEK

MARKET LAST WEEK (11/9 – 11/13)

PFIZER ANNOUNCEMENT

Last week Pfizer announced that they had a vaccine candidate that was over 90%effective. PFE opened up 12% as a result of the news Monday morning before selling off and remaining flat on Tuesday. While Pfizer’s vaccine has seen tremendous success, it is far too early to celebrate success. The vaccine is expected to be in limited supply for the majority of 2021 and will not be available to most Americans.

The economic impact of a successful vaccine is expansive. This will benefit industries, ranging from restaurants to travel. Given the successful inoculation of the American people, we will see restaurants have an increased seating capacity as well as benefit from the reduced third party costs associated with delivery services. The travel industry specifically airlines and cruises can find their footing as people begin to trust traveling again. Brick and Mortar stores stand to gain the most from the vaccine as an inability to shop in person will lead to increased foot traffic. Corporate offices will reopen to the benefit of their landlords, although early reports indicate that many companies will shift entirely to remain working remotely to reduce overhead and increase productivity.

REVIEW OF EARNINGS WE COVERED LAST WEEK

Monday, November 9th

Canopy Growth Revises Beverage Launch Timeline
Canopy Growth Corporation – $CGC

The five states this election cycle with cannabis-related measures on the ballot all passed. This win is pivotal for the growth of companies like $CGC because it will aid in their legal expansion in other states. This specific quarter $CGC reported record net revenue. Partially, this may be due to growing sales in Canada during the pandemic period, but could also be the result of a more lean company. As noted below, $CGC has been able to cut legal expenses.

  • Increase in net revenue over 135 million 

  • Gross margin increased 19%

  • Selling, General Administrative expenses down 19%

  • Recreational net revenue business to business up 2%

  • Recreational net sales business to consumer up 43%

  • Canadian medical cannabis net sales up 7%

  • International cannabis revenue down 8%

Takeaways: 

The current CEO of $CGC is not relying too heavily on federal cannabis legalization in the United States to grow $CGC. Instead, the company is focusing on a line of products that the CEO described as cannabis 2.0. One of the major products in this lineup is a THC infused soft drink that $CGC hoops can legally export to states like California for legal consumption.

Join the Team - Beyond Meat - Go Beyond®

BEYOND MEAT – $BYND

BYND had a less than inspiring earnings performance but is doing relatively well, sitting in a position to experience some continued success in the future. The plant-based meat market is up 41%, as well as the buyer rate, which increased by 13%. This indicates that despite the challenges seen with COVID, on average more households are buying BYND products more frequently, and spending more. BYND certainly has challenges operating in the coming future as there is a general decline in their product category, but their significant part of the market space demonstrates that if the plant-based meat market withstands COVID, Beyond will find success.

BYND reported the following:

  • $94 million net revenue (Down from $113 Million in Q2)

  • BYND meat products up 63% Y/Y

  • Food service business declined 41% Y/Y

Takeaways:

Despite a bleak Q3, BYND has the potential to resume its halted success due to COVID in the future. While they neglected to issue Q4 guidance due to the volatile market space in this COVID environment, looking at their performance in context shows that they are still performing well overall. Their $19 million declines in revenue from Q2 to Q3, still represents a 2.7% increase in revenue for Q3 from the year-ago quarter.  The statement by their leadership to not misinterpret the near-term pandemic induced drop as weakening in their long term value holds weight and BYND will be an interesting stock in the coming future.

Norwegian Cruise Line Vector Logo | Free Download - (.SVG + .PNG) format -  SeekVectorLogo.Com
Norwegian Cruise Line Holdings – $NCLH

$NCLH, like many travel stocks, is trying to stay alive until a vaccine is widely available. Recent news specific to the cruise line industry stated that the CDC has recently permitted for crosses to resume sailing under the condition that social distancing guidelines are followed, but with the second wave of COVID likely, the question has yet to be answered. Will cruise-goers will have the same appetite as they did pre COVID-19? And if they do, at what price point will cruise lines like $NCLH be able to charge such cruise-goers?

  • Loss of -2.35 earnings  per share (2020)

  • Net of +2.23 earnings  per share (2019)

  • Net income loss of 677.4 million

  • revenue of 6.5 million

  • 1.9 billion in revenue in 2019

  • 2.4 billion in cash equivalents

Takeaways:

At this current moment in time, $NLCH revenue is at an all-time low. The silver lining in these earnings is that $NLCH still has 2.4b in cash equivalents and may sell bonds as needed to secure more debt to prevent a default. Similar to the profile of other travel-related companies, it will be vital for $NLCH to remain financially lean long enough to experience an inflow of returning patrons now comfortable with traveling again. The CDC allowance of cruises to resume sailing may provide hope to the industry that in the not so distant future, they may be able to sail with a significant number of passengers on board.

Tuesday, November 10th

Lyft - Wikipedia

Lyft – $LYFT

Lyft has been hit hard by the Coronavirus since March. They did not have an “Eats” delivery service, so they could not immediately offset the ride-sharing coming to an almost complete halt and have struggled to recover since then. Their pilot programs for delivery services have done well, and they will need to expand and take the market share from other services to stay competitive.

  • Non-GAAP sales & marketing expense as a percentage of revenue < 15%reflecting rider incentives near historical lows

  • On track to realize annualized fixed cost savings of $300 million by Q4’20

  • Expect to achieve Adjusted EBITDA profitability by Q4’21 even with a slower ride recovery

  • Delivered Q3’20 Adjusted EBITDA loss of $240 million versus most recent outlook of $265 million

  • Active Riders grew 44% to 12.5 versus 8.7 million Q2’20

  • Revenue per Active Rider increased 2% versus Q2’20 reflecting an improvement in ride frequency

  • Contribution Margin of 50% was 15 percentage points higher versus Q2’20 and exceeded outlook of 45%
  • Revenue per Active Rider was $39.94 up $0.86 from Q2’20
  • Ride-share recovery in 2020 has recovered more each month but is slowing down. Sep’20 it was at -48.1% Y/Y and Oct’20 it’s -47.4% Y/Y

Takeaways:

Lyft will not be able to recover its full riding revenue for the foreseeable future. Its partnership with Grubhub is a nice stopgap to fill lost revenue, but it’s too small and only available to Lyft Pink members. With multiple lockdowns being reinstated locally throughout the United States, this will only hamper ride-sharing recovery. Lyft has a long march ahead to maintain its place in the market.

Thursday, November 12th

Walt Disney logo | Walt disney logo, Disney logo, Walt disney
Disney – $DIS

Disney has had a rough time with its parks, hemorrhaging the company’s cash from not operating during the pandemic. Disneyland, its largest park, has been closed since March due to the COVID restrictions in California. Disney World, however, has been able to come back into play as they’ve enacted safety measures to prevent the virus from spreading. Disney will be continuing dividends in the long term, but the short-term is reliant on the pandemic’s ending, and how much they want to fund Disney+ content.

  • Parks, Experiences and Products: $2.58 billion, down 61% year over year

  • Media Networks: $7.21 billion, up 11% year over year

  • Studio Entertainment: $1.60 billion, down 52% year over year

  • Direct-to-Consumer and International: $4.85 billion, up 41% year over year

  • Disney estimated that pandemic related costs will total roughly $1 Billion in their fiscal year 2021 subject to small changes in local restrictions.

  • Disney World capacity is increasing from 25% to 35% in Q4

  • ESPN+ subscribers doubled to 10 million

  • Hulu’s subscribers increased 28% to 36.6 million

  • Disney+ subscribers rose to 73.7 million from 60.5 in August

Takeaways:

Disney’s expansion of its subscriber base across all three platforms (ESPN+, Hulu, and Disney+) is putting it in a prime position to catch up to Netflix. Disney is more diversified in streaming content from Disney+ movies and shows to sports on ESPN and all content on Hulu. Conversely, its direct competitor, Netflix, is only able to obtain old shows and movies and make new original content. Disney’s holding back of theatrical movie releases due to closures of theaters is hurting their bottom line currently however, a return can be seen in 2021 when the pandemic can be expected to subside.

Friday, November 12th

Company Snapshot - DraftKings | Roundhill Investments
DraftKings – $DKNG

COVID-19 has created a unique challenge for companies in 2020; prominent among them is DraftKings. They rely heavily on a consistent sports schedule and a high level of fan interaction to see continued and significant success in their business model. Teams have had varying levels of success in containing outbreaks through team bubbles to be able to compete. Despite this hectic sports schedule and the pandemic, DraftKings has performed well and is poised to see continued success down the road with recent legal developments.

  • Monthly unique players surpassed 1 million, a 64% increase Y/Y

  • Loss per share: 57 cents, vs an expected loss of 61 cents

  • Revenue: $133 million, vs $132 million expected

  • The company also raised its fiscal year 2020 guidance to a range of $540 millionto $560 million, from a range of $500 million to $540 million.

  • DraftKings said it expects $750 million to $850 million in revenue for 2021

  • DraftKings paid out about $15 million extra in bets this quarter

  • Total U.S. iGaming handle increased 335% Y/Y and represented around ½ of total online gambling revenue

  • Multiple states’ voters passed gambling legislation on ballot initiatives

Takeaways:

DraftKings can expect continued expansion as more states pass positive gambling legislation. This will increase active users over the next few years as bills, regulations, and licenses are enacted. Revenue is steadily increasing and will only hasten as legalization spreads to the entire United States.

UPCOMING WEEK 11/16 – 11/20

EARNINGS

Tuesday:

Walmart $WMT (Before Market Open)
Estimated EPS for Q3 is $1.27, revenue is expected to be $131.79B. With Covid cases rapidly rising, and stay-at-home orders being instituted, Walmart’s eCommerce will rise, and sales will continue to grow. Walmart is in a prime position for growth for the next quarter as we prepare for a harsh winter. More and more people will continue to shop for groceries, meaning revenue will increase.

$HD (Before Market Open)
Estimated EPS for Q3 is $3.08 and revenue is expected to be $31.44B. These are strong earnings estimates as people are still staying home and continuing to work on home improvements. The earnings call should provide steady growth and continued positive revenue moving forward.

$NIO (After market close)
Estimated EPS is -$.17 and Revenue is expected to be $628M. NIO is a stock we trade often and we will be paying close attention to their earnings call. Estimated Sales should increase as their sales figures have increased by up over 68% YOY.

Wednesday:

Nvidia $NVDA (After market close)
Estimated EPS is $2.56 and revenue is expected to be $4.42B. Nvidia is on the leading edge of graphic processors and data centers. We trade Nvidia frequently and will be keeping a close eye on the earnings call. The growth of gaming and data centers has led the great continued earnings for Nvidia.

Thursday:
Workday $WDAY (After Market Close)
Estimated EPS is $.67 and revenue is expected to be $1.09B. Revenue is estimated to increase by 16.2%, and as stay-at-home orders begin to come in Workday utilization will increase and revenue will continue to grow.

EVENTS & TALKS

Tuesday: GDP Growth Rate QoQ/YoY Final Q3

Wednesday: Durable Goods Order MoM

Thursday: Initial & Continued Jobless claims

DISCORD RECAP

On Monday we alerted our members to buy $ZM $350 puts for November 20th. When we bought them they were $360 per contract.

On Tuesday these contracts were valued at 1,082 and hit a high of $1,600.

On Average the team closed the contracts around 1,100 making a 200% return on investment.

Stocks On Our Radar
(November 16th  – November 20th)

$PLUG Plug Power

Reported strong earnings last week.

Currently has support at $22.26 and trading at $23.43.

We see it hitting $25 or $26 sometime this week.

$XLE Energy ETF 

In times of uncertainty we turn over the energy sector as a hedge and long term position.

President Elect, Joseph Biden, is in favor of clean and renewable energy, while current President Donald Trump is in favor of fossil fuel. No matter how we flip it, both parties are paying attention to this sector.

Currently trading at $33.88, we set a target price of $37.95

$CCL

After Pfizer announced a 90% effective vaccine, travel companies have become more appealing to investors.

We see Carnival Cruises ($CCL) to be one of those companies.

If stock price is able to stay above $16, we could see price move higher into $16.50and then $17.28.

 $17 calls for this week look good.

EDUCATIONAL LEARNING SEGMENT

The difference between who you are and who you want to be, is what you do

Cognitive dissonance is defined as “the state of having beliefs and thoughts that are inconsistent with your actions and decisions.” Everyone has experienced cognitive dissonance at some point in their life and the key to beating it is spending time reflecting on whether you are experiencing it. Many people claim they desire to learn about the market or want to be a skilled trader but haven’t put the time in to develop their skills. While this is counter-intuitive, it isn’t the end of the world. You may experience this many times. Be aware and make the necessary changes in your actions to meet your values and desires.

BOOK OF THE WEEK
Make your Bed by Admiral Williams McRaven
Contrary to last week’s book topic of financial literacy, Make your Bed advocates for thinking big while remembering to take care of the small steps necessary to achieve your goal and significant change. The book imparts anecdotal lessons, pushing discipline and positive daily habits which will in turn benefit your financial literacy and trading experiences. Admiral McRaven shares the ten lessons he learned from seal training, with the pinnacle lesson being “if you want to change the world..start off by making your bed”, a call to action signifying the large psychological effect seen by starting your day with accomplishing a task that motivates you to finish the next one. If you find yourself not heading in the direction of your goals, first start by breaking them down into their components and attacking it day by day.
VIDEO OF THE WEEK
Second Stimulus Checks | What Trump JUST Said!
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Newsletter 3:

WELCOME TO TIGER WOLF CAPITAL
We are a small private hedge fund. We are here to foster a community of growth in the trading / investment realm and teach anyone from the start. We provide educational material that is catered to teach beginners the basics of trading in the stock market as well as teach experienced traders more advanced strategies.

“Some people want it to happen, some wish it would happen, others make it happen.”

– Michael Jordan

TABLE OF CONTENTS
  1. BIDEN 2020
  2. REVIEW OF LAST WEEK’S EARNINGS
  3. UPCOMING EARNINGS
  4. UPCOMING EVENTS & TALKS
  5. MERCHANDISE
  6. DISCORD RECAP
  7. EDUCATIONAL LEARNING SEGMENT
  8. BOOK OF THE WEEK
  9. PODCAST OF THE WEEK

MARKET LAST WEEK (11/2 – 11/6

BIDEN 2020

Over the next two weeks we will deal with recounts and lawsuits before the Supreme Court, but it is projected that Joseph R. Biden will be the next president of the United States of America. But what does this mean as far as policy making? The Democrats lost seats in the House of Representatives and are more than likely not going to win the Senate as they need a minimum of two seats with a Vice Presidential tie breaker to write and enact any bills. To paraphrase Andrew Yang, we have no government with a mandate. It will be incredibly difficult for the Democrats to pass any of their key legislation written in the DNC’s convention platform at least for the next two years until the midterm elections when Republican seats are up 2:1 to Democrats’ in the Senate.

How will the markets be affected? We can expect increased oversight of financial institutions if and when all the agency heads are confirmed by Congress. The IRS will also be staffed so we can expect increased tax collection. Mergers and acquisitions can also be expected to be a little tougher on restrictions with increased emphasis on monopolies or potential monopolies. What would be very difficult to envision? A key policy rollback of the 2017 Republican Tax Plan. Expect with Mitch McConnell at the head of the Senate to never see that rolled back without a minimum of two senators forcing a Vice Presidential tie breaker if the current Democratic Caucusing members remain at 48 in the Senate. Biden wishes to increase capital gains tax rates to 39.6%near the Obama administration levels, but McConnell will go to his grave before he allows that. The corporate environment outlook, even with increased oversight, looks bright. Democrats are much more willing to help people and in turn businesses with government stimulus. This bodes well for demand and corporate bottom lines. We can expect markets to remain in favorable conditions during the Biden presidency’s first two years with this environment.

REVIEW OF EARNINGS WE COVERED LAST WEEK

Monday, November 1st


Clorox

Clorox is in a very unique position as a health and wellness company because they are among those companies fortunate enough to find significant growth due to the pandemic as opposed to in spite of. Their professional products have seen double digit growth with the key driver being the total Clorox 360 system which has been extremely  popular amongst reopened companies amid the pandemic. Global demand and attention for sanitized environments has skyrocketed reflected in share prices increasing 40% on the year and Clorox is just getting started with their plan to capitalize on this as we heard on their earnings call.

CLX reported the following:

  • 27%  increase in company wide growth

  • International sales grew 18% across nearly every geography

  • Double digit sales growth in 8 of their 10 businesses

  • Gross margin expansion in every segment

Takeaways: 

Clorox performed extremely well, beating earnings and going on to raise their forecast for 2021. They have just posted their 8th consecutive quarter with gross margin expansion as a result of their aggressive cost savings program. They developed an out of home team to strengthen partnerships and existing relationships with companies like Uber, United Airlines, AMC, and Cleveland Clinic which may bode well for their dollar based net expansion. This coupled with their commitment to increased advertising spending, market innovation, and production capacity paint a very promising picture for their upcoming quarters.

Thursday, November 5th 

 

$BABA

Alibaba continues to show strength as a Chinese commerce and tech giant. They’ve adjusted to the pandemic and positioned themselves strongly to come out on top of the post-Covid19 world with their logistics and supply chain enhancements for e-commerce when dealing with deliveries of packages, takeout from restaurants, and grocery delivery.

  • 30% YoY Revenue Growth

  • Consumers: 881 MM (Mobile MAUs) 757 MM Annual Active Consumers

  • Profitability and Cash Flow: RMB 41.2 Bn (US $6.1 Bn) Adjusted EBITA, RMB 40.5 Bn (US$6.0 Bn) Non-GAAP Free Cash Flow

  • Marketplace-based Core Commerce Adjusted EBITA increased by 12% YoY to US $7,503 million.

  • Core Commerce Adjusted EBITA increased by 19% YoY to US $6,769 million, primarily due to an increase in marketplace-based core commerce adjusted EBITA , as well as reduced losses for local consumer services business. Core Commerce Adjusted EBITA margin was 35%.

  • Cloud Computing revenue increased by 60% YoY to US $2,194 million, primarily driven by growth in revenues from customers in the Internet, finance and retail industries. Adjusted EBITA was a loss of US $23 million

  • Digital Media and Entertainment revenue increased 8% YoY to US $1,188 million, primarily due to an increase in revenues from online games, partly offset by the decrease in revenue from customer management. Adjusted EBITA was a loss of US $105 million

  • Innovation Initiatives and Others revenue increased by 10% YoY US $173 million. Adjusted EBITA was a loss of US $351 million

Takeaways:

Alibaba’s Core Commerce Segment is carrying its other five segments with $699 million losses and still making US $6,070 million. Its cloud segment is rapidly growing and expected to continue to grow as we deal with Coronavirus and rapidly technologize society. During the quarter, merchant adoption of “Fulfilled by Cainiao” services continued to improve, with almost four million daily cross-border packages delivered in September 2020.

UPCOMING WEEK 11/9 – 11/13

EARNINGS

Monday:

$CGC (Before Market Open)

Canopy Growth Corporation is predicted to lose 23 Cents per share and EPS is expected to decrease by 15% from last quarter. While EPS isn’t a positive, revenue is expected to increase to $87.61 M and grow by 35%. We aren’t necessarily looking for a great earnings call but to use this as a baseline for the future under a Biden presidency. As the election comes to a close the possibility of legal marijuana nationwide under a Biden administration is very possible. There will become much more space for growth in the next 4 years.

$BYND (After Market Close)

BYND is a volatile stock that we often trade on its way down and up. For Q3 the estimated prediction for EPS is $.05 and its Revenue Estimate is $132.24M. With the possibility of another shutdown and stay-at-home orders the retail sales for Beyond Meat may continue to grow and provide a better EPS and Revenue in the upcoming quarters.

$NCLH (After Market Close)

NCLH will provide an outlook for Cruise stocks on what the entire sector has looked like through Q3. With 0 cruises setting sail and these ships having to idle in their ports Norwegian’s Q3 estimate is very grim. The estimate for EPS is $-2.24 and the Revenue is $.76M -100%, the election theme is continued as the Biden Administration will force social distancing and stay-at-home orders. As with most cruise and travel stocks it could be up to a year for any revenue to come in for these companies.

Tuesday:

$LYFT (After Market Close)

This is solely based on the election results of California allowing their drivers to be independent contractors. The Q3 earnings are expected to be pretty ugly as coronavirus has all but stalled business for LYFT. The estimate for EPS in Q3 is $-.92 and Revenue is $502.03M decreasing by -47.5%. In the same tone as BYND and NCLH under the Biden Administration with possible shutdowns and stay-at-home orders LYFT may be facing a few ugly quarters ahead.

Thursday:

$DIS (After Market Close)

Disney is a blue chip stock that has been hit hard due to Covid-19, over 30% of their business comes from theme parks and hotels. Their EPS estimate is $-.65, and revenue is expected to be $14.14B. In the next few quarters $DIS may have to rely on the Direct-to-Consumer, and Media Networks portions of their business with COVID-19 guidelines beginning to change.

Friday:

$DK (Before Market Open)

As more election results come in and sports betting is becoming legalized in many states, the space for sportsbooks is becoming massive. More and more states are continuing to pass laws for legal sports betting and Draftkings is on the leading edge. Their estimate for EPS $-.64 and Revenue is $132.19M, and we can expect these revenue projections to increase in future quarters.

EVENTS & TALKS

Monday: Fed Mester & Fed Harker Speeches at 1:30 and 2:20 pm EST, respectively

Tuesday: Fed Quarles Testimony at 2:00 pm EST

Thursday: U.S. Inflation rate YoY at 8:30 am EST. Fed Evans and Fed Williams Speeches at 1:00 and 2:00 pm, respectively

Friday: Fed Williams & Fed Bullard Speeches at 7:00 and 8:30 am, respectively

MERCHANDISE

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DISCORD RECAP

Thursday 11.05.20

We brought to attention $PLUG, an American energy company focused on creating clean energy.

We personally like to own shares in this company as well we have stock options for November 20th.

We entered into position around $18.09 and bought the $20 November 2020 calls for $0.95.

On Friday, Plug was up 5% and our contracts were up to $1.30 representing a 36% gain.

Friday 11.06.20

On Friday morning, we saw ROKU to have a very nice bullish setup and entered into the ROKU 245 calls for November 13th for $5.20.

JOIN OUR DISCORD
DISCORD

EDUCATIONAL LEARNING SEGMENT

“Do not celebrate when your trade goes green. Celebrate when you close your trade in the green.”

Oftentimes we tend to prematurely count our profits and overlook that nothing is guaranteed until we close out a trade. What tends to happen is a once green and profitable trade we leave it open and the trade then becomes a losing trade. Do not allow your trade to go bad.

BOOK OF THE WEEK
The Richest Man In Babylon by George Clason
Likewise to the book of the week last week the richest man in Babylon urges financial literacy. Through a series of parables/anecdotes. This book was first published in 1926 but it’s tales in regard to financial literacy dates back 4,000 years. Despite us living in the year 2020 there are concepts and principles of acquiring wealth that have remained timeless. It is one of the few books that not only urges saving for unfortunate times, and unexpected expenses. But also urges the importance of saving in the event an opportunity or investment comes along. The example this book uses is of a farmer using a windfall of cash to purchase fliverous items only later to be given the opportunity to invest in an irrigation system that would supply his town with water but due to his lack of saving has no other choice but to pass on the opportunity when approached by a peer. In addition, to urging savings and encouraging investing the book does cautious the reader to make informed investments a “a fool and his gold is soon parted” is a common motif within the pages.
PODCAST OF THE WEEK

Mindset Mentor with Rob Dial

How to Deal with Uncertainty 

We do not know how to prepare for the future, as people we struggle with uncertainty. Uncertainty inside of the human brain sounds like a threat. Roots in a control issue, wanting to control every single aspect of your life. Uncertainty changes internal state, wanting to control everything and not able to control anything causes stress and anxiety. Feeling stress, worry and anxiety comes from thinking about the future, something is uncertain.

How to have a better relationship with control problems and uncertainty?

Accept and Embrace that we control almost nothing. Learn to allow. Change the way you feel and think around certain situations.

Grab a Pen & Paper when you feel stressed or worry :

  • Ask yourself, are you okay right now?

  • Is there anything that is wrong?

  • Is there an immediate threat?

  • What exactly am I uncertain about?

  • What if it is not as bad as I have it in my head?

  • How will you respond to it?

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Newsletter #1Our mailing address is:
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Newsletter 1:

 

WELCOME TO TIGER WOLF CAPITAL
We are a small private hedge fund. We are here to foster a community of growth in the trading / investment realm and teach anyone from the start. We provide educational material that is catered to teach beginners the basics of trading in the stock market as well as teach experienced traders more advanced strategies.
TABLE OF CONTENTS
  1. LAST WEEK MARKET RECAP
  2. JEROME POWELL TALK
  3. UNEMPLOYMENT
  4. STIMULUS TALKS
  5. PAYPAL
  6. SNAPCHAT
  7. GILEAD
  8. SOCIAL MEDIA
  9. UPCOMING EVENTS
  10. UPCOMING EARNINGS
  11. EVENTS & TALKS
  12. MERCHANDISE
  13. DISCORD RECAP
  14. EDUCATIONAL LEARNING SEGMENT
  15. VIDEO OF THE WEEK
  16. BOOK OF THE WEEK
  17. QUOTE OF THE WEEK

MARKET LAST WEEK (10/19 – 10/23)
MONDAY: JEROME POWELL SPOKE AT THE INTERNATIONAL MONETARY FUND REGARDING DIGITAL CURRENCY

Federal Reserve Chair, Jerome Powell, stated that the central bank has not decided to issue a digital currency, citing the need for further work and “extensive” public consultation with stakeholders before doing so.

Powell believes that it is more important for the United States to get it right than to be first, embracing a full-scale study on whether a digital currency approach might be suitable for the United States.

The central bank announced back in August that they were expanding experimentation and research on technology relating to digital currencies. The Boston Federal Reserve has been working on analyzing the results of a digital currency oriented for the central bank to use.

Powell does believe that the current payment system could use some improvement as society transitions away from cash. Digital currency can change the way that monetary policy works, as well speed up payment systems that have been lagging in modern time.

Powell believes that any digital currency adoption by the government should complement the dollar and cash, not be a replacement for cash or cash equivalents.

UNEMPLOYMENT: U.S. JOBLESS CLAIMS FELL TO 787,000 LAST WEEK – NEW LOW DURING THE COURSE OF THE PANDEMIC
New applications for unemployment benefits so far for October fell to the lowest levels since the coronavirus pandemic shut many businesses in March, a sign of improvement for the U.S. economy.
Last Thursday, the Labor Department reported that initial jobless claims have declined by 55,000. The declining layoffs serve as a further indicator that the economy is continuing to recover from the effects of Covid-19.
In recent weeks, companies ranging from American Airlines Group Inc. and United Airlines Holdings Inc. to Walt Disney Co. and AT&T Inc.’s Warner Media have announced job cuts. These layoffs may have affected filed claims last week. Meanwhile, businesses such as restaurants, gyms and theaters are closing doors due to what appears to be a prolonged slump for services and products that rely on public gatherings.
STIMULUS TALKS THROUGHOUT THE WEEK 
Lack of direction and indecision on the part of the government continues as talks of a second stimulus bill progress.

Stimulus talks as of 10/24 continue to lag although both Nancy Pelosi and the White House claim to be eager to reach an agreement. It seems that progress and agreement had been reached in terms of the amount that will be distributed, however, there is much left to discuss.

Currently, Pelosi and House are disputing the language of the bill. Pelosi, specifically, desires a bill that requires contract tracing of Covid-19. The White House, however, wishes to give individual states the option of contract tracing versus making it a mandatory requirement.

Stimulus talks continue into next week while the election date nears closer.

The pharmaceutical and medical industries stand to benefit immensely from passing the stimulus due most of the funds being allocated to the continued research and advancement of ways to prevent the spread and fight Covid-19.

Travel companies, specifically airlines, also favor a stimulus package being agreed upon given that currently there is $25+ billion being allocated to airlines.

We have also taken note on Friday of a flow exhibiting a large block of $JETS (Airline ETF) being purchased. This may be an indicator that hedge funds expect the agreement of a bill soon.

PAYPAL TO ALLOW ITS USERS TO BUY, SELL, AND SHOP WITH BITCOIN


PAYPAL – $PYPL

PayPal is implementing crypto buying, selling, and shopping on its service. While buying and selling crypto is not novel, using crypto currency to pay for goods and services is. The details of the launch are as follows:

  • PayPal users will be able to shop using cryptocurrency as a form of payment at the 26M merchants on its PayPal’s network starting in early 2021

  • US account holders can start buying crypto currency such as Bitcoin, Ethereum, Bitcoin cash and Litecoin on PayPal in the next few weeks

  • PayPal is planning to bring this service to its partner – Venmo – and implement the service in countries other than the United States next year

  • The merchants will not actually get paid in crypto. PayPal plans to settle Bitcoin to USD on the backend and complete sales transactions in dollars

WHY IT MATTERS

This launch can be big for Bitcoin and other crypto currencies. With 346M active accounts, PayPal has a way bigger reach than any other fintech companies that allow the use and trading of crypto. With the news alone, Bitcoin hit a record high for 2020. PayPal could help to normalize the use of crypto in everyday purchases.

SNAPCHAT REPORTS PHENOMENAL EARNINGS, SHARES JUMP 30%


SNAPCHAT – $SNAP

The pandemic continues to cripple the economy, although businesses are slowly beginning to open, most earnings for Q3 are subpar. SNAP surprises investors with a killer earnings report. On their earnings call, Snap reported the following:

  • Sales increased drastically to 52% as advertisers started spending again, compared to growth of 17% in the previous quarter.

  • Daily users grew 18% to 249M – that is equivalent to 75% of the US population between the age of 13 -34.

  • On average, 4 billion snaps are created every day

  • Average revenue per user grew to $8.29 from $6.29 – a 32% growth year over year

  • Total Revenue grew to $1,716 million from $1,180 – a 45% increase year over year

  • Snap’s losses shrank 12%, but the 9-year-old company still isn’t profitable

  • Snap’s growth slumped after Facebook’s Instagram copied its game-changing Stories back in 2016. Last quarter, however, Snap profited from FB’s ad boycott as marketers shifted their spending to Snap instead

  • TikTok is officially banned in India, since that date, Snap more than doubled its users in the world’s 2nd most populous country

WHY IT MATTERS

Snap has been booked, busy and a little lucky with pandemic recovery and Facebook’s and TikTok’s misfortune. Snap is one of the few companies that have benefited from the pandemic lockdowns by increasing their user gain as more people spend time online.

Snap is continuously taking steps to improve their platform and provide a great user experience. It has introduced an array of new filters such as an anime filter that turns your selfies into a cartoon and a transforming landscape filter that takes users to outer space. It also launched new features from mini apps to TikTok rivaling sounds.

The lingering question is: Can Snap hold this momentum into 2021 or will their growth plateau?

REMDESIVER GAINS FDA APPROVAL
GILDED SCIENCES INC. – $GILD

On 10/22 moments before market close news broke that GILD’s drug, Remdevisir, gained FDA approval for use in Covid-19 treatment. During after-hours trading $GILD stock price rose by 6%. This may mark a milestone in Covid-19 research, and we may soon see an array of similar drugs given FDA approval.

There are already quite a few similar drugs in the making, but they have yet to gain FDA approval limiting their use to limited small groups. Most known of these pharmaceutical companies is Regenron (REGN) whose REGN-COV 2 Antibody Cocktail was used to treat President Trump in the days following his hospitalization. Unlike a vaccine, these antibody drugs are designed for people post-exposure to COVID. They attempt to boost the user’s number of antibodies to increase the odds of recovery.

Drugs of this nature will not be obsolete in Q1 of 2021 which is the current expected timeline for a viable vaccine. Instead, antibody drugs like this will likely serve as a complement for the segmented group of people in the population who may not have gotten a vaccine or who have low risk of exposure to COVID-19 but still contracted the virus.

UPCOMING EVENTS 10/26 – 10/30

TWILIO – $TWLO

At Tiger Wolf Capital, TWLO has become a fan favorite amongst investors and we are very eager to see what their earnings report will look like, which is being reported on Monday after market close. We are very bullish on the results as we stated in ourresearch report published back in late September.

Twilio streamlines businesses to client communication through the power of AI and cloud-based services.  By using Omnichannel customer service, Twilio enables businesses to connect with their clients through WhatApp, SMS, or WebChat, powered by automated routine customer inquiries with conversational IVRS and chat box to reduce wait.

We see great value and long-term growth potential for this product as more companies are switching over to remote work and the need to provide greater customer satisfaction and increase brand loyalty are increasing significantly.

On Friday afternoon we purchased TWLO 330 and 335 call options with the expiration date of 11.20.20 at a price of $11.20 and $10.75 per contract.

We have a price target of $350 for TWLO.

UPCOMING EARNINGS 10/26 – 10/30

Monday:

Twilio – We are bullish on TWLO earnings and the stock in general long-term as we stated in our research report. Although they are not yet profitable, the stock has performed well, and we find great value with this communications company poised to continue to thrive during this pandemic and the work from home shift beyond it.

Alphabet – Parent company of Google presents an interesting earnings case. Google is being sued by the U.S. DOJ for anticompetitive practices and the first quarter with decreased advertising revenue for the first time in 22 years. Their cloud business however is poised to make healthy gains in the future.

Tuesday:

Advanced Micro Devices – Predicted to have a strong earnings performance despite the miss and weak forecast of rival Intel. The increase in work from home trends saw PC CPU, consoles along with steady server share gains suggest upside for AMD through earnings.

Microsoft – They are expecting growth in EPS as well as revenue. This is expected to happen at a slower rate year over year. Microsoft Teams is serving as an interesting alternative to zoom that could bode well for Microsoft’s future with 75 million daily users, an increase of 62 million since July 2019.

Wednesday:

United Postal Services – We expect the surge in e-commerce demand amid the current pandemic situation to boost UPS’ third-quarter results. The impending release is likely to reflect the significant increase in home deliveries amid the ongoing coronavirus outbreak. Higher demand for residential delivery is expected to have contributed to the performance of the U.S. Domestic Package segment, which accounts for the bulk of the top line. With expected revenue at $19.95 billion, up 8.9% from a year-ago quarter.

Thursday:

Twitter – After SNAP reported a strong earnings growth last week, we expect Twitter to do as well. Twitter generates the majority of revenue from ad spending, which has gone down drastically the past quarter in response to political unrest over the pandemic and civil rights issues. However, as elections come to an end, we expect a focus on business ad spending to increase as companies reopen. We also look to see how Twitter users’ time on the app has increased and a possible increase in revenue from revenue from users.

Penn – While faced with year over year decline in revenue, $PENN has several promising factors on the horizon. They’ve taken several expansion strategiesincluding the barstool sportsbook app for online sports betting and is now the #1 app on the market. Several states (Michigan, Tennessee, Virginia) are expected to legalize sports betting soon. While already legalized markets have received a boom in revenue with the return of sports, Pennsylvania leading the charge with just shy of $500 million in September along from the return of the NFL. Access to these new markets and with sports returning to bet on, $PENN has an optimistic outlook.

Apple – is a difficult case to reach a conclusion on in regards to earnings. The rollout of their new highly anticipated smartphone has been delayed due to the pandemic and as such pushes out their earnings forecast. As well we do not see Apple having a “wow factor” in store for us this earnings season.

Boeing – Boeing, unsurprisingly, is not expected to perform well this earnings quarter with a decline in revenue and only more bad news. The stock has been performing poorly all year since the two fatal crashes of their 737 max. Revenues are expected to be $14.14 billion down 29.2% from the year-ago quarter with multiple airlines demanding deferrals on their reception of the 737 max and many renegotiating their contract prices as well which Boeing is allowing due to their failure to meet expectations according to Boeing’s CEO.

Amazon – Wall street is expecting a year over year increase in earnings on higher revenues. That does not necessarily mean they will beat earnings as it’s hard to tell if consensus EPS will be inflated. Amazon has beaten the consensus EPS estimates two times out of the last 4 quarters. U.S. retailers online were up to 68% year over year growth in revenue, and 146% in all online retail orders. Online conversion rates were also up just shy of 10%, a frequency level typically seen around Cyber Monday. Stay at home orders coupled stimulus checks amid the pandemic sparked growth in retail therapy and E-Commerce has been reaping the rewards.

EVENTS & TALKS

ALIBABA TO BUY A FIFTH OF SHARES IN ANT GROUP’S MEGA IPO

Alibaba Group has agreed to purchase more than a fifth of shares in Ant group’s upcoming IPO on October 27th.

Ant group is a Chinese fintech company that serves as the parent company to Alipay, a digital payment processor used by millions of Chinese.

Some key points about Alipay

  • a third party payment platform, their primary service being a digital wallet (Aliwallet), that has been deemed practically essential for any business looking to reach a critical mass of Chinese shoppers.

  • Alipay reports over 500 million monthly active users and twice that in daily transactions as the Chinese head towards a cashless future.

  • For reference, Apply Pay has 127 million users globally despite coming preinstalled in every iPhone.

  • 92% of the people in China’s top cities use mobile pay as their primary payment method.

  • Mobile payments have grown into a $16 Trillion dollar industry in China over the past 15 years, with Alibaba on the forefront.

Alibaba is buying 730 million of approximately 1.67 billion of Class A shares. As a result, Alibaba is poised to own about 32% of Ant Groups affiliate shares, which is currently in speculation to receive a valuation in the region of 280 billion USD. This valuation would make Ant Group worth more than nearly every financial or fintech stock currently listed in the United States other than JPMorgan, Visa, or Mastercard.

CONSUMER CONFIDENCE INDEX 10 AM NEXT TUESDAY

In the United States of America, the U.S. consumer confidence index (CCI)  is an economic indicator of  optimism. This indicator allows us to understand the habits of American consumers and the likely spending of US households. If a V-shaped recovery is viable, the CCI increasing from pandemic lows is vital. The last index reported that consumer confidence was up to a reading of 101.8 from a reading of 86.3 in September, an almost 20% increase in reported consumer confidence.

In an economy when economic uncertainty is at its highest, consumer confidence was extremely low. Households not only spend less, but even in the event of no change in income overall, spending is likely to decrease and savings are likely to peak.

This was the case in April of 2020 when savings rates reached all-time highs in the American economy. A stark change from a country and economy that prides itself on being robust and encouraging constant consumer spending and consumption at every turn. As consumer confidence trends up and returns pre-corona levels we are likely to see an increase in American consumption and the two sectors that will likely benefit from this are retail and travel. Volume of travel will likely return as Americans return to partaking in activities of leisure, but volume is heavily dependent on progress made on the medical front of the virus such as the availability of PPE and the development of treatments. Retail also shares similar challenges to the travel sector but as income rises and spending increases shoppers may begin flocking back to commercial spaces such as malls. While COVID-19 alters the retail, landscape companies that have adapted to online sales and venues have outdoor segments where social distancing is easier will have edge over firms where primary revenue derives from in-person sales.

INITIAL JOBLESS CLAIMS 8:30 AM NEXT TUESDAY

With last week’s report for unemployment benefits we saw unemployment claims drop to a record low since the coronavirus took the toll it has on the U.S. economy in March. This is unprecedented news and a significant sign of recovery for the economy. We look forward to seeing if there is a continued decline in that area.

DISCORD RECAP

TUESDAY 10/21 EVENING


Snowflake Inc. – $SNOW

After recently launching its IPO back in late September, we noticed that hype surrounding the company has died down with the chart being well positioned to gain the attraction of serious investors and traders. SNOW’s price action was consolidating for the past two weeks between $231.28 and $252.58.

Ideally, we wanted SNOW to get above $253 level before getting into Call options and target $270.

The $260 calls for 10/30 were trading around $3.58 when we got in them. 

By Thursday SNOW ran up to touch $300, blowing past our $270 price target. 

The $260 contracts we bought on Tuesday were trading at $46 from $3.28 we bought on Tuesday.

That is a 1,400% return on investment!!

EDUCATIONAL LEARNING SEGMENT
“See profit, take profit” 

Many times we find ourselves making a decent return on our investment and think “this is going to keep going up’ to later having our profits taken away from us. The concept of locking in profits, or at least a good portion of it is what has led me to continue to be a profitable trader and investor.

I have also never met anyone that went broke locking in profits, but i have met plenty of people who lost a lot of money thinking their gains will grow.

VIDEO OF THE WEEK
New Deadline Update: Stimulus Check Plan: Update
BOOK OF THE WEEK
What I Learned Losing a Million Dollars 

We advocate that all traders, rookies to veteran, take the time to read this book. This takes a deep dive into the mindset and philosophy behind trading, highlights why some traders lose so often, and what steps should be taken to avoid emotional trading. Feel free to click the link below and read a comprehensive review by a member of our team.CONTINUE READING…

QUOTES
“People who wonder if the glass is half empty or full miss the point. The glass is refillable”
– Unknown
Copyright © Tiger Wolf Capital  All rights reserved.
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Newsletter 5: Let the FOMO Begin

WELCOME TO TIGER WOLF CAPITAL
We are a small private hedge fund. We are here to foster a community of growth in the trading / investment realm and teach anyone from the start. We provide educational material that is catered to teach beginners the basics of trading in the stock market as well as teach experienced traders more advanced strategies.

“How wonderful it is that nobody needs to wait a single moment before starting to improve the world.” – Anne Frank

TABLE OF CONTENTS
  1. TESLA TO JOIN $SPY
  2. BOEING’S 737 RETURNS
  3. REVIEW OF LAST WEEK’S EARNINGS
  4. UPCOMING EARNINGS
  5. UPCOMING EVENTS & TALKS
  6. MERCHANDISE
  7. DISCORD RECAP
  8. STOCKS ON OUR RADAR
  9. EDUCATIONAL LEARNING SEGMENT
  10. BOOK OF THE WEEK
  11. VIDEO OF THE WEEK
tesla GIF
MARKET LAST WEEK (11/16 – 11/20)

TESLA TO JOIN $SPY

The world was a very different place in 2003, the year Tesla Motors was founded. The standard in american cars were very large SUVs. Large SUVs at the time were perfect in part because gas was so cheap and they could fit an extended family. Yet, here came Tesla, a company urging buyers to be sustainable to use electric instead of gas. Despite a lengthy series of infamous set backs over the decade Tesla has arrived. Standard and Poor’s (S&P500)  disclosed Tesla is to be added December 21st. The addition of Tesla ushers in a new era for the index funds.

Index funds are viewed in part as safest assets American households seeking to participate in the market can acquire adjacent to Bonds and CDs. This “safe” factor is in part why this new addition to the S&P 500 is a milestone not only for Tesla but the electric vehicle sector as a whole. Fund managers that have been short/bearish on Tesla have constantly critiqued the company for being too over valued and have accused Tesla of currently not having the proper financials to justify various market price valuations. This inclusion makes Tesla as american as apple pie. Once added, pension funds  and retirement accounts alike will own a small portion of Tesla. Consecutive quarters of profitability, reducing production cost, and a successful expansion into Asia has now earned Tesla the legitimately entry.

 This inclusion  comes at a time when persons like Cathy Wood’s have heavily criticized classic index funds like Standard and Poor’s for not including companies that she would describe as innovative. Wood’s has critiqued Wall Street for undervaluing many of the intangible assets of tech companies like intellectual property (i.e althroghims, patents). Wood’s who manages $ARK  Invest the innovation ETF has consistently been long $TSLA. And has publicly disclosed her PT for $TSLA was $7,000/share (pre-split) or a price of $1400/share post split.

Tesla in the weeks to come is likely to rally in anticipation of inclusion into the index. Yet, similar to its rally in anticipation of its stock split it is unlikely the rally will continue after its inclusion. Historically companies that have been added to the S&P 500  are likely to experience a run up after newsies made public  followed by a pull back once the inclusion is complete.

BOEING’S 737 RETURNING

On March 19 of 2019, the Boeing 737 max was grounded by the FAA post the Ethiopian Airlines crash. The incident happened on March 10, 2019, at this time Boeing’s share price was trading right around the $400 mark this was a high for the past 12 months. In recent news this week the FAA has released that the Boeing 737 max is now set to return to the skies. The 737 max’s return provides a lot of clarity for investors. The aircraft has and will continue to be a pivotal piece of technology in mass commercial aviation. With its new MCAS (system dedicated to providing additional sensors to the aircraft to help navigate through unusual weather) system, Validation program, Pilot training, modifications from airline input regulatory review as well as a grueling inspection process it is safe to say that the 737 max is back and better than ever. However, it would be naïve to say that the 737 max’s return solely will directly correlate to a jump in its stock price. Expect heavy fluctuation In the stock in the near future due to several factors.

One of the biggest factors that investors should be aware of is the mass cancellation of 737s that were on backorder. Due to COVID-19 airlines have taken a gruesome hit it should be kept in mind that at this point there are hundreds of 737 orders that are now pending cancellation. The airlines simply cannot afford to pay for these aircraft due to the lack of business due to COVID-19. As it stands now 20% of Boeing‘s backorder is now pending cancellation which is around 780 Aircraft. On the brighter side of things, there is still 3,120 737 max to be sold this will be monumental for Boeing. With all this being said it is with no doubt that the airline industry will return as we begin to enter a post-pandemic world. As people begin to travel more airlines will rely heavily on the 737 Max’s capabilities. Expect the high demand for these aircraft to run parallel to a flux in $BA share price in long run.

LAST WEEK’S EARNINGS

Tuesday, November 17th

Walmart Logo Tagline
WALMART – $WMT

Walmart like other major brick and mortar stores has seen a decline in overall foot traffic to both Sam’s Club and Walmart stores. What is important to understand is the increase in online shopping from Walmart. The pandemic has accelerated online grocery and general merchandise shopping for the entire retail sector. These key areas will drive Walmart into 2021.

Walmart:

  • Same-store sales rose 6.4%

  • E-commerce soared 79% and contributed approximately 570 basis points to comp sales

  • Comparable sales at its discount unit Sam’s Club were up 11.1% 

  • Reduced tobacco sales negatively affected comp sales by approximately 4.2% 

  • Sam’s Club e-commerce sales grew 41%

  • Membership income increased 10.4% at Sam’s Club

  • Total revenue was $134.7 billion, an increase of $6.7 billion, or 5.2%

  • Walmart International net sales were $29.6 billion, an increase of 1.3% after currency

  • Consolidated operating income was $5.8 billion, an increase of 22.5%

  • Operating cash flow year to date has been strong and increased approximately$8.3 billion versus last year to almost $23 billion

Takeaways: 

Walmart has had strong all around growth in Q3. Even after currency exchange expenses, its international sales have grown. Shoppers are spending more at Walmart per visit than pre-pandemic. Its online presence has allowed it to compete with Target and Whole Foods for store pickups, which have expanded to 3600 stores with same day delivery at 2900. Walmart is one of the largest corporations in the US with good economies of scale capable of continued growth during and post this pandemic, and it’s apparent in their report.

   File:TheHomeDepot.svg - Wikimedia Commons

HOME DEPOT – $HD

Due to the closing of malls and stores that were not deemed essential the majority of the retail sector at the start of the pandemic experienced a major decline in revenue. $HD Home Depot however unlike many other retailers has seen an increase in revenue in part because it is classified as an essential business and due to many more persons working from home. More persons working from home in a pandemic has led to more homeowners renovating their living space to make it more suitable to work from home.

Home Depot

  • Actual earnings per share $3.18

  • $3.06 expected earnings per share

  • 33.54 billion revenue

  • 32.04 billion expected

  • Net sales increased by 23%

  • 33.5 billion in net sales (Q3 2020)

  • 27.2 billion in net sales (Q3 2019)

  • Average customers sale rose by more than 10% 

Takeaways:

Similar to earnings last quarter Home Depot beat analysts expectations. Yet, this beat resulted into a 1%+ decline in share price. Today Home Depot has beat expectations but this beat has lead skeptics to question how well $HD will perform in a post pandemic economy. Will customers still feel the need to renovate their homes in a post-vaccine economy and if so will net revenue see an increase or decrease when laborers are able to ditch their home offices and return back to the workspace.

NIO (car company) - Wikipedia
NIO – $NIO

Electric vehicles are gaining popularity globally. Sleek designs coupled with multiple countries publicly announcing their push towards EV in the years to comes enables a hyper competitive atmosphere in the EV market. NIO being based in China is an advantage in terms of potential market share.

  • 31,430 vehicles delivered (10/31) 111% year-over year growth

  • Adjusted loss per share 12 cents 

  • Expected loss per share 18 cents 

  • Revenue: 666 million v. 663 million expected

  • Actual gross margin: 12.9%

  • Expected gross margin: 11.25%

Takeaways:

Value investors may have difficulty in understanding NIO’s  current valuation relative to their current earnings. Nio’s current price is not based on what it is today but is based on what NIO could be in the not so distant future. Indicative of this valuation is their current growth as of October 31st 111% year-over-year growth gives NIO a promising future. In addition to NIOs current gross margin is higher than expected which will likely aid NIO is scaling up to higher production numbers and ensuring profitability on vehicles as demands grows.

Wednesday, November 18th

NVIDIA - NVDA - Stock Price & News | The Motley Fool

Nvidia – $NVDA

Nvidia is the premier GPU producer. Their cards are years ahead of the competition and that’s evident in their $300 Billion market cap compared to their competitor AMD’s $100 Billion market cap. They are also extremely integrated in the data center sector, which is their best performing division in terms of profits to expenses and growth.

  • Record revenue of $4.73 billion, up 57 percent Y/Y

  • Record Gaming revenue of $2.27 billion, up 37 percent Y/Y

  • Record Data Center revenue of $1.90 billion, up 162 percent Y/Y

  • GAAP earnings per diluted share for the quarter were $2.12, up 46 percent from $1.45 Y/Y, and up 114 percent from $0.99 Q/Q

  • Third-quarter revenue was a record $1.90 billion, up 8 percent from the previous quarter and up 162 percent Y/Y

  • Shared news that Amazon Web Services and Oracle Cloud Infrastructureannounced general availability of cloud computing instances based on the NVIDIA A100™ GPU, following Google Cloud Platform and Microsoft Azure (not sure what we want to do about hyperlinks. They do lead to articles with the announcements.)

Extended its lead on MLPerf performance benchmarks for inference, winning every test across all six application areas for data center and edge computing systems

Takeaways:

NVIDIA’s GPU segment is taking off rapidly and better than ever before. As new games come out that utilize ray tracing, the RTX GPU becomes more relevant. Unseen loads of everyday life are being automated, put online, or requiring very precise and technical technological inputs from GPUs and CPUs in our society. Of these two, they lead in GPU technology, and the acquisition of ARM will allow NVIDIA to fully compete with AMD in the CPU division with their state of the art processors. CPUs were the only division NVIDIA was not leading in. NVIDIA has excellent growth drivers that continue to accelerate business growth and push the company forward well into the future.

Thursday, November 19th

File:Workday Logo.png - Wikipedia
Workday – $WDAY

Workday has been able to expand throughout the last year owing to its ability for an ease of use platform.

  • Total revenues were $1.11 billion, an increase of 17.9% from the third quarter of fiscal 2020

  • Subscription revenue was $968.5 million, an increase of 21.3% Y/Y

  • Operating loss was $14.1 million, or negative 1.3% of revenues, compared to an operating loss of $110.3 million, or negative 11.8% of revenues Y/Y

  • . Non-GAAP operating income for the third quarter was $268.1 million, or 24.2%of revenues, compared to a non-GAAP operating income of $142.6 million, or 15.2% of revenues Y/Y

  • Operating cash flows were $293.8 million compared to $258.0 million in the prior year

Takeaways:

Subscription service growth has led the way for Workday’s growth the past year. Even in the midst of the pandemic, Workday has been able to grow revenue and shrink their operating loss Y/Y from (11.8%) to (1.3%). Workday’s partnership with Accenture will help make an even more ergonomic friendly experience for Workday users through “greater visibility and simplified experiences”.

UPCOMING WEEK 11/16 – 11/20

EARNINGS

Tuesday:

Best Buy unveils new logo | Fox Business

Best Buy $BBY (Before Market Open)
Best Buy is a massive tech retail company who has posted strong earnings from the last 2 Quarters and they are expected to continue that trend for the Q3 report. They have an expected EPS of $1.93 and Revenue is expected to be $10.9B. With quarantine orders coming back into effect and schools shutting down the need for technology at home is going to come back and we expect Best Buy to post strong earnings for a long time.

Dollar Tree Bringing 'Snack Zone' Initiative to More Stores | Convenience  Store News

$DLTR (Before Market Open)
The largest single price point store in the U.S., as money in the current economic climate is very precious, Dollar Tree will continue to grow. $DLTR expected EPS is $1.24 and Revenue is expected to be $6.11B. For the next several quarters Dollar Tree will see growth and revenues steadily increase.

File:Dell Logo.svg - Wikimedia Commons

$DELL (After market close)
Correlating in the same vein with Best Buy is Dell technologies. More and more people are buying technology to work from home or go to school online. Much like the previous two companies mentioned the Q2 numbers provided positive insight to how the company is performing. Dell is expected to have $1.50 EPS and revenue is expected to be $21.92B. Continued stay at home orders and in person learning put on pause, we will be on the lookout for their Q3 report.

EVENTS & TALKS

Tuesday: Consumer confidence index
Wednesday: Initial & Continuing Jobless claims (8:30 am)

MERCHANDISE

When your drip becomes your life style, get yours today

DISCORD RECAP

This past week we had a total of 24 trades. 20 of which were positive trades and yield an average of 112.7% return on investment. We had 4 losses with an average loss of 60%.

The trade of the week goes to Tesla ! 

On Tuesday, we alerted our members about the $TSLA 490calls for November 27 at an average price of $460.

30 minutes prior to market close, the 490 calls dropped in value to $390, where we saw this as an opportunity to add to our position. We also added the $500 calls for $325

On the 18th, the 490 calls were trading at $2,300 and the 500 calls were trading at 1,950.

A 400% and 500% return on investment over night !! 

Stocks On Our Radar
(November 23rd  – November 27th)

Zoom Video Communication, $ZM 

With lockdowns taking place across New York and California, we anticipate more states to follow suit.

Irrationally, Zoom price will go up.

Alibaba, $BABA

We used to be short on BABA, but one question I want everyone to get used to asking is “why didn’t we sell off” when we had every reason to sell off. BABA had complications with the recent ANT group IP, new anti monopoly laws introduced in China, and the cherry on top, Trump wants to ban chinese companies from being traded on the NYSE. But yet, BABA didn’t sell off?
Time to get in long. Price target $300

Tesla, $TSLA 

Join our Discord to see how we will play this beast this week.

Last week we had 3 Tesla plays that each gave us a  500% return on investment.

$30 for the week DISCORD MEMBERSHIP 

EDUCATIONAL LEARNING SEGMENT

“I didn’t lose money, I paid for a lesson”

Perspective is a strength that is invaluable. The ability to look at a situation and discern more than just the negative from it. Perspective has allowed me to view loss differently and find the silver lining. While trading even when your trade doesn’t have the desired outcome, spend more time trying to understand why you want wrong and adding that information to your tool kit rather than energy being disappointed at the outcome.

BOOK OF THE WEEK
Everything is Fucked by Mark Manson
In keeping with the theme of perspective, our book of the week takes a deep dive into hope and the power of perspective. This New York Times bestseller analyzes prominent examples throughout history and the shared human experience. It advocates for choosing to enjoy and appreciate what is positive in your circumstances rather than being obsessed with quick wins and never ending target posts. Those ultimately lead to greed and a lack of fulfillment. In regards to trading, many traders fail to follow their plan by being dissatisfied with their position and hoping for change rather than exercising the discipline to secure the profit they have or minimize the loss they’re experiencing. It’s important to remember that in good times and bad, things can always be worse.
VIDEO OF THE WEEK

New, Detailed Stimulus Update & News Update

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Newsletter 7: Stock Market Hits New All Time High, What’s Next?

“Opportunity does not knock, it presents itself when you beat down the door.” – Kyle Chandler

Friday, December 4th Closing Price

TABLE OF CONTENTS

  1. VACCINE LATEST UPDATE
  2. REVIEW OF LAST WEEK’S EARNINGS
  3. UPCOMING EARNINGS
  4. UPCOMING EVENTS & TALKS
  5. MERCHANDISE
  6. DISCORD RECAP
  7. STOCKS ON OUR RADAR
  8. EDUCATIONAL LEARNING SEGMENT
  9. BOOK OF THE WEEK
  10. VIDEO OF THE WEEK
MARKET LAST WEEK (11/30 – 12/4)

MARKET

VACCINE LATEST UPDATE

Pfizer is set to roll out their vaccine in the UK today and December 15th in the U.S. for non clinical recipients. While this presents a lot of logistical challenges there are a lot of interesting potential ramifications down the road. If the vaccine lives up to or even nears the success rate seen in clinical trials we can expect to see pfizer stock benefit handsomely from their position in the forefront of the COVID-19 vaccine. Looking forward to 2021, positive results have great implications for travel as well as brick and mortar retail. Conversely, a failure to see significant benefits may lead to many who added $PFE to their portfolio due to the positive news exiting the position. Pfizer has also cut their vaccine production targets nearly 50% due to a shortage of the necessary raw materials which will delay the ability to distribute in both the UK and the U.S. The negatively impacted industries can only survive so long as we have already seen the entertainment industry shift their movie release model entirely as a direct result of COVID. Travel ranging from airlines to the cruise industry as well as brick and mortar retail will continue to perform beneath expectations as a direct result of the challenges presented by the COVID environment.

LAST WEEK’S EARNINGS

Tuesday, December 1st

Zoom | Enterprise Information Technology Services

ZOOM – $ZM

Zoom has been on an absolute tear this year up, 500% YTD. The acceleration in business from Stay-at-Home orders and teleworking has increased Zoom’s revenue stream by over 300 percent this year. This is expected to continue into 2021 as there will not be enough vaccines for mass migration back to office spaces. Covid-19 has also proven that large swaths of employees do not need to be in the office to get work done. Companies will more than likely offer and integrate work-from-home jobs into their company structure to save on real estate expenses.

Zoom reported the following:

  • Third-quarter total revenue of $777.2 million, up 367% Y/Y

  • Number of customers contributing more than $100,000 in TTM revenue up 136% Y/Y

  • Approximately 433,700 customers with more than 10 employees, up 485% Y/Y

  • Expects to strengthen their market position as they finish the fiscal year with an increased total revenue outlook of approximately $2.575 billion to $2.580 billion for the fiscal year 2021, or approximately 314% increase Y/Y

  • Third-quarter, GAAP operating margin was 24.7% and non-GAAP operating margin was 37.4%

  • GAAP income from operations for the third quarter was $192.2 million, compared to GAAP loss from operations of $1.7 million Y/Y

  • Non-GAAP income from operations for the third quarter was $290.8 million, up from $21.3 million Y/Y

  • Net cash provided by operating activities was $411.5 million for the third quarter, compared to $61.9 million Y/Y

Takeaways: 

Zoom’s operating activities have soared with their increased customer base. They have approximately 433,700 customers with more than 10 employees, up 485% Y/Y. 1289 customers contributing more than $100,000 in trailing 12 months revenue, up 136% Y/Y. Zoom will continue to increase its market share as other companies lag in their integration and ergonomic capabilities with their platforms. Microsoft with its “Microsoft Teams” has large contracts with big corporations but lags in small businesses that don’t find their platform easy to use.

   

SALESFORCE – $CRM

Salesforce’s Customer 360 has been growing in demand for years, but the pandemic highlighted the need for different employee teams to communicate effectively when not in person. The ease of access to information and communication is imperative to that cause. Salesforce has used the pandemic to further deepen its revenue streams as the mass shift to stay-at-home took effect. Companies have begun to realize just how difficult it can be to talk with team members when not in person. Through Salesforce’s integration of multiple teams into one platform for all to communicate with each other and see what other teams are doing, they have placed themselves at the forefront of Customer Relationship Management services.

Salesforce reported the following:

  • Third Quarter Revenue of $5.42 Billion, up 20% Y/Y

  • Current Remaining Performance Obligation of Approximately $15.3 Billion, up 20% Y/Y

  • Third Quarter GAAP Operating Margin of 4.1% and Non-GAAP Operating Margin of 19.8%

  • Initiates Fourth Quarter FY21 Revenue Guidance of Approximately $5.665 Billion to $5.675 Billion, up Approximately 17% Y/Y

  • Raises FY21 Revenue Guidance to Approximately $21.10 Billion to $21.11 Billion, up Approximately 23% Y/Y

  • Initiates FY21 GAAP Operating Margin Guidance of Approximately 2.0%

  • Maintains FY21 Non-GAAP Operating Margin Guidance of Approximately 17.6%

  • Initiates First Quarter FY22 Revenue Guidance of Approximately $5.680 Billion to $5.715 Billion, up Approximately 17% Y/Y

Takeaways:

Salesforce sees further expansion of its products to more businesses into their 2022 fiscal year.

They see a $4 billion revenue increase to $25.5 billion for their FY22 guidance. This would be a 20 percent increase in their revenue driven by their Customer 360 Platform and the $600 million acquisition of Slack Technologies, Inc. President and CFO, Mark Hawkins, will retire as CFO on January 31, 202,  and move to an advisory role as their CFO Emeritus through October 2021. Amy Weaver, the current President and Chief Legal Officer, will become President and CFO on February 1, 2021.

DOCUSIGN – $DOCU

DocuSign’s ability to use and navigate the cloud efficiently and effectively is integral to their business practice. DocuSign’s easy integration into already existing systems and future systems for small businesses and large businesses is key. Small businesses can take advantage of mundane and expensive clerical work that will allow them to increase their margins. Corporations can also trim their bottom lines and compensate investors more or reinvest spare capital back into the corporation’s activities.

DocuSign reported the following:

  • Total revenue was $382.9 million, an increase of 53% Y/Y

  • Subscription revenue was $366.6 million, an increase of 54% Y/Y

  •  Professional services and other revenue was $16.3 million, an increase of 43% Y/Y

  • Billings were $440.4 million, an increase of 63% Y/Y

  • GAAP gross margin was 74% compared to 75% Y/Y

  • Non-GAAP gross margin was 79% Y/Y

  • GAAP net loss per basic and diluted share was $0.31 on 186 million shares outstanding compared to $0.26 on 178 million shares outstanding Y/Y

  • Non-GAAP net income per diluted share was $0.22 on 206 million shares outstanding compared to $0.11 on 191 million shares outstanding Y/Y

  • Net cash provided by operating activities was $57.4 million compared to $1.9 million net cash used in operating activities Y/Y

  • Free cash flow was $38.1 million compared to a negative $14.1 million Y/Y

  • Cash, cash equivalents, restricted cash, and investments were $675.6 million at the end of the quarter

Takeaways:

Increase of $50+ million in free cash flow Y/Y. DocuSign Analyzer introduction. DocuSign CLM+ and DocuSign Analyzer will allow organizations to automate many mundane and repetitive tasks freeing up employee time. It will also learn how you operate to better accommodate future tasks as well. DocuSign Monitor will help with anti-theft protection through advanced analytics and round-the-clock activity tracking. Expansion of the company will increase over time as businesses see the value in trimming the edges of clerical work from their balance sheets.

Smith & Wesson – $SWBI

Smith & Wesson shattered expectations, reporting a record-breaking earnings performance. Smith & Wesson is in a position where they can and have benefitted handsomely from the rise in demand for guns and munitions. According to an A&U study, Smith & Wesson sits at #1 in unaided awareness in the handgun industry which is likely why gun purchasers new and old are flocking to the industry leader.

Smith & Wesson reported the following:

  • Quarterly revenue of $249 million

  • Net Income of over $49 million 

  • Demand metric increased 57.5% from the year-ago period

Gross margin of 40.6% up, representing a 12.4% increase from last year

Takeaways:

Although Smith & Wesson neglected to issue guidance due to the rapidly changing marketplace that already exists coupled with the challenges COVID represents they appear to have a bright future on the horizon. Demand has increased impressively and quarterly revenue has more than doubled from a year-ago period. Continued demand for guns will see Smith & Wesson positioned to remain atop the industry moving forward.

UPCOMING WEEK 12/7 – 12/11
EARNINGS