Steve Matt's avatar
$1.2m follower assets
The 90/50/40 Club
I was reviewing the margins for Doximity ($DOCS, reporting this afternoon) when I noticed they are sitting at an impressive gross margin of 88.8%, operating margin of 34.3%, and net margin of 47.2%. That triggered my basketball mind to think of the 50/40/90 club (for those unaware, that's a club of players who shoot 50% from the field, 40% from 3, and 90% from the free throw line in a single season).

Then I wondered if any companies are members of what I am now minting The 90/50/40 Club.

There are 9 with a market cap >$1 billion, a list unsurprisingly dominated by REITs. Very surprised to see a small biotech on this list. Has anyone ever done a deep-dive on $VIR? Would be curious to learn more.

There isn't really any special point to this post lol. Just an interesting screener I thought up.

PS: Nice to see two of my positions, $IIPR & $MPW, in the elite club.
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Steve Matt's avatar
$1.2m follower assets
1 of 2
My $SMG trades
This was a tough sale. I bought for the cannabis exposure in the Hawthorne Gardening subsidiary back before I was a growth investor or had a cogent investment strategy (I sold stocks way too often). I was a big fan of SMG though. Solid business, solid dividend, and a subsidiary I thought would explode. That was March 2017. Hawthorne is now struggling mightily (along with most of the cannabis industry) and SMG has been trailing my benchmarks pretty significantly over the 5+ years I've held. Considering I already have a more pure-play cannabis exposure in $GRWG (plus $GTBIF, $IIPR, $NLCP), I feel like the funds that were tied up in SMG can be better deployed elsewhere in this current environment.

The Scotts Miracle-Gro Company ($SMG) Investment:
Time held from initial purchase: 5.13 years
CAGR: 2.38% vs $SPY 11.68% vs $QQQ 17.12%
Total Return: 8.92% vs SPY 51.96% vs QQQ 81.87%

Results: Trailed both of my benchmarks
$BGRY $NLCP $FIGS Earnings: What I'm Looking For
Earnings season is coming to a close for me. I may have a few more of these posts but they'll become a bit more spread apart (I'll probably do one for $DOCS, $RSKD, $SNOW, $PATH, $OKTA, and $CRWD in the next couple weeks before they report. Follow if you want to see them and comment about what I'm overlooking or getting wrong!
Berkshire Grey, Inc. ($BGRY) - Reporting earnings this morning (5/12)
This is a loooong term play on the robotics automation market. I think there's very little that could make me sell this position before it hits the 5-year mark in my portfolio. Not that I think it'll be a market-beater by then. I just don't think the company's execution can be properly evaluated before then. For Berkshire Grey, I am looking at three things:
  • Revenue growth - Obvious
  • Balance sheet - Don't be on the verge of bankruptcy
  • Backlog - The indicator of whether or not companies are buying into the product
Current position:
Total cost basis: 73rd highest in my portfolio
Time since first buy: 1.09 years
Number of purchases since initial position: 2
Annualized return: (84.4%)
Annualized $SPY return: (9.6%)
Annualized $QQQ return: (19.7)
NewLake Capital Partners, Inc. ($NLCP) - Reporting earnings this afternoon (5/12)
Is this a mini-$IIPR? They are certainly tracking that way, at least early on.
Here's what I'm looking for:
  • It'd be great if management began breaking out Property Expenses in their Operating Expense breakdown (like IIPR does).
  • Can revenue keep growing >100%?
  • Property count and rentable square feet needs to keep growing.
  • Stay at or really close to 100% leased.
Current position:
Total cost basis: 37th highest in my portfolio
Time since first buy: 0.55 years
Number of purchases since initial position: 1
Annualized return: (55.8%)
Annualized $SPY return: (22.1%)
Annualized $QQQ return: (34.5%)
FIGS, Inc. ($FIGS) - Reporting earnings this afternoon (5/12)
I love what this brand is doing. My wife is in the medical industry and anecdotally confirmed how loves FIGS clothes are.
Here's what I'm looking for:
  • Management is guiding for 32% full year revenue growth, which would be a deceleration. Getting a good jump in Q1 will hopefully be an indicator of a full year beat.
  • Gotta stay FCF positive.
  • Can international revenue keep growing at triple digits?
  • I know the demand for scrubs will continue to be there. What about non-scrubs revenue? It accounted for 13.5% of 2021 revenue (an all-time high) and grew at 61% in 2021. Can that continue?
  • I really wish management would updated investors CAC.
  • I also wish management would update investors on Net Revenue per Active Customer and Average Order Value on a quarterly basis instead of annually.
Current position:
Total cost basis: 23rd highest in my portfolio
Time since first buy: 0.93 years
Number of purchases since initial position: 3
Annualized return: (63.1%)
Annualized $SPY return: (10.4%)
Annualized $QQQ return: (17.8%)
April 2022 Bloodbath - Names Down >30% Since April 1
April 2022 was one of the worst market months of all time. In fact, it was the worst since October 2008. Here are 100 stocks down >30% since April 1:


Visit highsandlows.substack.com
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Stanley's avatar
$2.9m follower assets
It's like shootin' fish in a barrel!
...or Dollar Cost Averaging in a down market, whatever :)

My stock buys for today was heavy on growth stocks

Growth

$RIVN - $79.43 consensus price target. DCA down from the IPO. I mean, why not, it is a whole lot easier for me to DCA down at this point than it is for poor Amazon with their reported loss of $7.6 billion so far. Yikes...

$HNST - $7.46 consensus price target. DCA down from the IPO.

$RBLX - $59.65 consensus price target. DCA down from the IPO.

Dividend

$ABEV - $3.50 consensus price target. DCA down from previous buys. "Investing.com - Ambev SA reported on Thursday first quarter earnings that beat analysts' forecasts and revenue that topped expectations."

$IIPR - $268.17 consensus price target. Innovative Industrial Properties is another one of my 'picks and shovels' cannabis plays. DCA down from previous buys. This REIT is focused on specialized properties leased to state-license operators of regulated cannabis facilities.
My favorite is to DCA up. It means my company has been doing great and performing how I wanted it to!

DCAing down is good too though lol
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Steve Matt's avatar
$1.2m follower assets
The Coming Week in Earnings
Woooo boy, this week will be fun for my portfolio.

Monday (5/2)
  • $BIGC^ (On my Sell Watchlist)

Tuesday (5/3)

Wednesday (5/4)

Thursday

Friday

Anything with a ^ indicates I read the 8-K and 10-Q/10-K and track their financials along with KPIs on a spreadsheet I have.

So basically, this will be me next week...
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Last Week's Buy Ratings & More: MDA, RH, IIPR, RY, WSM, plus JPM Earnings Analysis
Hey everyone,

Below are our most recent buy ratings from the past week, which are free to read.

Besides the buy ratings, check out our JPM article from last week titled “Using JPMorgan's Earnings Call For Recession Clues” where we break down the biggest bank’s earnings to determine if a recession is coming soon or not.

Note: This is NOT professional financial advice.

Most of these Buy ratings are in downtrends, meaning that the chances for more short-term downside are high (as traders, we know this to be true). The ratings are not based on technical analysis. They are meant for long-term investors that have a long-term time frame.

Anyways, here they are:

  1. MDA to the Moon, Literally (TSX: MDA)

MDA is an established Canadian space technology company with a long history of success and innovation. It’s been around for more than 50 years. We are bullish due to its successful history, high efficiency, and good valuation. It is roughly 50% off its all-time highs.


  1. RH Stock: More Resilient than Investors Think

$RH, also known as Restoration Hardware, sells furniture, lighting, textiles, decor, and more. It has been beaten down as well, currently 57% off its highs. This offers a decent entry point for long-term investors.


  1. IIPR Stock: Sell Short at Your Own Risk

Innovative Industrial Properties ($IIPR) is a triple-net-lease cannabis REIT. Essentially, it makes money from owning cannabis properties and leasing them out to other cannabis companies. It is HIGHLY profitable and pays a nice, quickly-growing dividend.

This stock has done very well historically, but now, it is about 45% off its highs. It got pushed down even lower by a short-seller report that is likely to not have much merit to it (similar to a 2020 short-seller report on the company).


  1. Royal Bank of Canada: Does Valuation Outweigh Headwinds?

Royal Bank of Canada ($RY) is Canada’s largest bank in terms of market capitalization. We believe that big Canadian banks have competitive advantages due to the oligopoly they enjoy, and we believe that RY stock is undervalued.


  1. Williams-Sonoma: Dividends, Buybacks Offer High Return Potential

Williams-Sonoma ($WSM) sells home products like furniture, bedding, lighting, rugs, and more. Currently 39% off its highs, we believe this is another good stock for the long term. Its low valuation allows the company to buy back many shares on top of having a respectable, growing dividend. It also has high returns on capital, steady growth, and record profit margins despite high inflation.


Thanks for reading! If there are any stocks/topics you’d like us to cover, hit us up!
And subscribe to our free substack here, where we send out our buy ratings, market analysis, and more.
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