Paul Cerro's avatar
$26.8m follower assets
SBC is a scam to adj. EBITDA and you're getting diluted
Stock-based compensation (SBC_ has gotten out of control with some companies that utilize the line item top boost adj. EBITDA for profitability but can also dilute you.

Prime example is $TWTR. Market Cap >1.5x since IPO while price only up ~2% in the same time

The link below shows this weeks "Chart of the Week" for the following names


The numbers are quite shocking. If you're interested in receiving content like this, hit the subscribe button (it's free!).

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Paul Cerro's avatar
$26.8m follower assets
CGC Q1'22 Quarterly Letter - Can you relate?
Cedar Grove Capital released its Q1'22 letter last week and wanted to share it with you all here.

While the quarter was a challenging one, we ended the quarter with 18% in cash and are strategically positioned to continue the rest of the year deploying dry powder in opportunistic areas.

Our holdings are included below - would love anyone's thoughts on them if they have any to share.

Current:

Closed:

Paul Cerro's avatar
$26.8m follower assets
Cedar Grove Capital Q1'22 Investor Letter
Hi all,

For anyone interested, Cedar Grove Capital will be releasing its first investor letter next week for Q1'22.

This letter will encompass our holdings, position sizing, returns, my thoughts for the portfolio going forward and select commentary for certain positions.

Click the link below to subscribe and get it when it comes out. cedargrovecapital.substack.com

Paul Cerro's avatar
$26.8m follower assets
Delivery is Scam - How Much More You're Paying
Ever wonder just how much you're paying more for added convenience of delivery? I took a look at three companies: Domino's $DPZ, Chipotle $CMG, and Sweetgreen $SG to see just how much more delivery is over takeout.

Companies are training us to be comfortable paying more for convenience but at what point will we start switching back to carryout?

Would you want to pay >60% more? Click the link below for the chart of the week

Paul Cerro's avatar
$26.8m follower assets
For new investors to Commonstock - read below!
Good afternoon!

For those of you that just joined Commonstock or followed me, welcome!

A little about me, I run a L/S US equities portfolio, called Cedar Grove Capital based out of NYC, focused on the consumer(tech) and cannabis industries.

I'd highly recommend you check it out 👉🏼 https://cedargrovecapital.substack.com/

What you get when you subscribe to our newsletter:
  • Weekly-ish Chart of the Week emails where I break down a chart into a few summarized key points to help inform you or keep you up to date on certain topics (ex. How Much is Each "Subscriber" Worth?)
  • Deep dive analysis into an industry that has significant growth potential (ex. Vertical Farming: Don’t Sleep on this Opportunity)
  • Trend I’m Watching which dives into a trend that peeks my interest enough to look into companies that can either benefit or be hurt by such trend (ex. Coffee Prices Getting Squeezed)
  • 1-2 monthly deep dives into a stock I either have a position in or am considering taking a position in. These posts are not short (avg. word count ~3,000), and include many aspects including interviews with users, product reviews, and my model output for valuations (ex. FIGS: Not the lululemon of Healthcare )
  • Personal Thoughts where I express my opinions about a certain topic related to finance, the stock market, or investing. (ex. Uh, Tesla is Worth How Much Now?)
  • Full transparency of my portfolio so you can track my performance and weighting within my portfolio. This can be used, to an extent, to help formulate your own portfolio management.
  • Quarterly updates on my portfolio that highlight my buys and sells, if any, as well as fund commentary and thoughts going forward.
  • BONUS: All my posts will be accompanied by an audio option (2022 onwards). For any reason you cannot read the posts, I’ll record a ‘read aloud’ of the same article so you can listen.

Companies that I've publicly published research on are below:


Companies that I've held/hold positions in but did not provide public research are below:

  • $BRCC - Black Rifle Coffee Co
  • $DPZ - Domino's
  • $ORLY - O'Reilly Automotive
  • $RENT - Rent the Runway
  • $FXLV - F45 Fitness
  • $WRBY - Warby Parker
  • $ELF - e.l.f Beauty
  • $AQUA - Evoqua Water Tech

If you're interested in getting detailed coverage of the space, deep dives into single names and industries all while accompanied by an audio version, I highly recommend you click below and sign up for the newsletter. It's completely free! 👉🏼 Newsletter + Website
Paul Cerro's avatar
$26.8m follower assets
Need stock new ideas? Check below
Good morning everyone!

For those of you that don't know or just followed me, I run a L/S US equities portfolio focused on the consumer(tech) and cannabis industries.

I'd highly recommend you check it out 👉🏼 https://cedargrovecapital.substack.com/

What you get when you subscribe:
  • Weekly-ish Chart of the Week emails where I break down a chart into a few summarized key points to help inform you or keep you up to date on certain topics (ex. How Much is Each "Subscriber" Worth?)

  • Deep dive analysis into an industry that has significant growth potential (ex. Vertical Farming: Don’t Sleep on this Opportunity)
  • Trend I’m Watching which dives into a trend that peeks my interest enough to look into companies that can either benefit or be hurt by such trend (ex. Coffee Prices Getting Squeezed)
  • 1-2 monthly deep dives into a stock I either have a position in or am considering taking a position in. These posts are not short (avg. word count ~3,000), and include many aspects including interviews with users, product reviews, and my model output for valuations (ex. FIGS: Not the lululemon of Healthcare )
  • Personal Thoughts where I express my opinions about a certain topic related to finance, the stock market, or investing. (ex. Uh, Tesla is Worth How Much Now?)
  • Full transparency of my portfolio so you can track my performance and weighting within my portfolio. This can be used, to an extent, to help formulate your own portfolio management.
  • Quarterly updates on my portfolio that highlight my buys and sells, if any.
  • BONUS: All my posts will be accompanied by an audio option (2022 onwards). For any reason you cannot read the posts, I’ll record a ‘read aloud’ of the same article so you can listen.

Companies that I've covered are also listed below

You’re naturally doing what commonstock promotes - transparent advice. I love how you show your holdings to demonstrate skin in the game. Way to go!
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Paul Cerro's avatar
$26.8m follower assets
Short Thesis PT hit for $SG
February 11th, I published a short thesis for $SG and how I believed that overpriced salads were indeed overpriced.

At the time of the article, I already had a short position in the name via PUT contracts and the stock was trading at ~$30.

I had two PTs based on a median and average multiple. $22.70 and $21.61, respectively.

As of now, the median PT has been hit and the stock is narrowing in on the average PT.

If you'd like to read why I took a short position in the stock and why I also think it has more room to fall, take a look at my article below.

Paul Cerro's avatar
$26.8m follower assets
My "short" targets
I've come for...


I have my eyes set on...

  • Coffee $BRCC
  • ESG cleaning $VGII
  • Ball shavers $BLTS
After reading @strat 's $BRCC memo, got me intrigued. Love a good coffee melt up. Remember thinking Luckin was channel stuffing, only to find out it was just pure fraud.
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Paul Cerro's avatar
$26.8m follower assets
Sweetgreen $SG is so overvalued it's nuts
Just published my next SHORT idea, Sweetgreen $SG The company touts being part health food part tech startup but is anything but. Having never been profitable in its entire life, this simple, over-priced salad maker will go down further.

Compared to it's competitors, $CMG $SHAK $PTLO $DPZ, it doesn't look pretty

See why below

Nice writeup, @paulcerro! I like Sweetgreen's salads too, but sometimes our favorite companies are not great investments :) I think this little map is pretty illustrative of just how early on in the story we are for SG. They still have a lot of ground to cover in order to justify their valuation--literally!

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Commonstock is a social network that amplifies the knowledge of the best investors, verified by actual track records for signal over noise. Community members can link their existing brokerage accounts and share their real time portfolio, performance and trades (by percent only, dollar amounts never shared). Commonstock is not a brokerage, but a social layer on top of existing brokerages helping to create more engaged and informed investors.