Mark Paddey's avatar

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Invest in the future - it's looking bright and there's a lot to be excited about.
Is Rivian the next Tesla?
Let's do a comparison:

$TSLA Q2 2011 vs $RIVN Q4 2021
(soon after IPO)

Auto Rev:
$39M vs $54M

Auto Gross Margin:
22% vs -709%

$77M vs $2,071M

Net Loss:
$59M vs $2,461M

These two companies are NOT the same. Even IF Rivian is able to manufacture solid state batteries, that does not mean they'll be able to do so profitably (just look at those -709% GM's). Rivian is wildly overvalued and still has much to prove.
Energy Disruption root cause of Russian aggression?
New article out by RethinkX that attributes Russian invasion of Ukraine to a decline in global oil demand (upon which the Russian economy is built). For context, since 2014, Russia's per capita GDP dropped from $14k-9k (35%).

Tony Seba (of RethinkX) predicted Russian aggression in the early 2020's six years ago in 2016. His reasoning: global transition to renewables will leave oil assets stranded - Russia serving as the worlds top oil & gas exporter, would be left uniquely vulnerable and looking for ways to reassert its global power and authority.

If this was the reasoning it backfired in a big way, as many nations are now implementing strategies to accelerate their transition to renewables and achieve energy independence, further accelerating the global energy disruption.

Great article, quick read, check it out:

It’s such a vicious cycle for Russia. If they do nothing, they’re main export is tanked over the next 8-15 years. If they continue to show aggression, they only accelerate the problem by throwing other world powers’ moral fuel on the fire. Ideally, from your perspective, what would have been the right way forward for Russia? How could they have become the world power they wish to be economically without war and without oil/gas?
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Do the math...
$LMND is set to complete the acquisition of $MILE in Q2 with an all-stock deal.

Metromile shares will be converted to Lemonade shares on a 19:1 ratio. Metromile ended FY2021 with $121M cash on the balance sheet and 128.22M shares outstanding.

In a 19:1 all-stock acquisition, Lemonade (at current stock prices) will be acquiring Metromile for $137M. Subtract the value of cash to be acquired and $LMND gets all of $MILE's state insurance licenses, IP, telematics data, and in-force premiums for a mere $16M.

Steal of a deal.
PEG ratio as a valuation metric
Came across this thread from Gary Black (an institutional PM) on twitter and I thought it was worth sharing. You can't look at growth names based on trailing 12 months of earnings. The future is forward, not back. Invest in the future.

post media
If you had 90% odds that one stock in your portfolio would far outperform all other holdings over a multi-year horizon (10+ years), what allocation would you give that one stock? What percent certainty would you need before allocating 100% of your capital to it?

Trying to understand how different people view diversification and risk tolerance.
The answer for me is “it depends”. How much the holding may potentially outperform in that 90% probability vs what it does in the other 10% would determine the allocation
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New Speculative Position
Started a SMALL position on $DNA. Still have much research to do before expanding the position, but I find having a little skin in the game lends motivation to the research. At this point, my DNA position is admittedly more of a bet on the future of precision fermentation (PF) than a true investment.

My speculation is based on declining cost curves of the technology, and growing awareness and buy-in to the possibilities enabled by PF.

Does anyone else have any speculative positions they've initiated during the sell-off?
Invest in the Future
I firmly believe that investment decisions should be made based on where the world is going, not where the world is coming from. Imagine 10-15 years ago you invested in phone books instead of Google. The past does not always predict the future.

Tony Seba is a futurist, and from the predictions he's made over the past 10-15 years surrounding EV's, energy, and agriculture, you'd think he has a crystal ball. If you're curious where the future might be headed over the next decade, and looking for ideas in how to invest in that future, check out the video below. I promise you this video is well worth your time, and I suspect it will age well.

Look forward, not back.

Three things come to mind after watching this video: Metaverse, Cryptocurrency, Space exploration. This video really gets you thinking. Worth every second. Thank you for the post @markpaddey!
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Ginko Bioworks Bull/Bear Case
Does anyone have any good resources relating to $DNA?

Whenever Tony Seba speaks, I listen (if you haven't heard of him do yourself a favor and look him up). He seems to think precision fermentation and bioengineering are going to explode this decade.

Looking to go a little deeper as my research into this company is still early days.