$GOOGL $TSLA $GM

CBS reporting Cruise suspended all autonomous vehicles after San Francisco deemed them not safe.

Recent discussion on here calling $GM the leader of autonomous vehicles looks to no longer be the case.

YTD return

Me +17.0%

S&P +12.2%

Adds - big adds to $ENPH and smaller adds to $ASML and $LMND

Sells - $ZM

Nearing 10% correction in S&P and over 10% on QQQ so I’ve started to add to a few positions after taking about 4 months off. If the market continues to dip, I’ll put more cash to work. About 11% cash.

$ABNB and $BX joining the S&P 500. Replacing $NWL and $LNC.

I propose a fun Commonstock competition.

This was brought on by reading about US Steel and how they used to be the largest company 100 years ago and now they aren’t even in the S&P 500.

The largest companies in the world turn over faster than you think. Below is a brief list of the largest companies by market cap at the start of each decade.

So the competition is simple. You get 3 guesses to pick a top 25 market cap company at the start of the next decade: 2030. Only rule is you can’t guess a current top 25 market cap company.

Now just set a reminder on your calendar.

Good luck. See you all back here.

Last August I want to get an idea of what the commonstock community thought of cryptocurrency and blockchain. It seemed the responses varied but mostly relied on the greater fool therapy to make a profit bc the next person will pay more for it than you did.

This is also how collectors make money on stamps, baseball cards but it’s also how people lost money on beanie babies.

I know a lot of crypto exchanges have come under scrutiny for fraud since that post. Has anyone’s view on crypto changed? Is it still the future of money? Have you personally used crypto to buy anything? Do you follow any companies incorporating blockchain into there business.

I wanted to do an update mainly bc my friend who has invested in crypto sent me this yesterday.

Here is Aug 2022 post

When is a PE of 95 undervalued?

When you have a year, 2022, of putting up 50% yoy EPS growth on the back of hard stay at home e-commerce comps and then you drop a 112% yoy EPS growth this quarter in 2023

Holdings

$GOOGL 14%

$ASML 13%

$VOO 13%

$MELI 7%

$UPST 6%

$YETI 6%

$V 5%

$TREX 4%

$HD 4%

$BLD 3%

​

Wow. Quite a run for UPST. Now a top 5 holding. Up 182%.

​

2023 YTD performance

Portfolio + 34.6

S&P 500 + 19.9

​

2022 performance

Portfolio - 11%

S&P 500 -19%

​

2021 performance

Portfolio + 30%

S&P 500 + 26%

​

Buys none

Sells none

​

Real Estate

1 single family home. Currently leased.

​

Where are we:

We are in a upswing. No change.

​

What I’m doing about it:

Only watch list stock is $ENPH. Especially after that pull back on weak guidance. Now closer to 9% cash up from 7% last month

​

No stocks on sell side chopping block.

Holdings

$GOOGL 14%

$ASML 14%

$VOO 13%

$MELI 8%

$YETI 6%

$V 5%

$TREX 4%

$HD 4%

$BLD 3%

$DOCU 2%

Common stock having a hard time with my portfolio recently. I’m guessing bc TD Ameritrade is migrating to Schwab. Maybe?

2023 YTD performance

Portfolio + 23.6%

S&P 500 + 16.2%

​

2022 performance

Portfolio - 11%

S&P 500 -19%

​

2021 performance

Portfolio + 30%

S&P 500 + 26%

​

Buys none

Sells none

​

Real Estate

The renter moved in. Have a year lease in place. The rent covers the mortgage, HOA and insurance. So breaking even while having someone else pay my mortgage and building equity.

Where are we:

We are in a upswing. @mapsignals had a great post about why. My market estimator is much more gestalt related. I mainly track news headlines. And coming from falls 2022 constant negativity and dark skies, we have a more even mix of bulls and bears.

What I’m doing about it:

Only watch list stock is $ENPH. I’m mainly in cash rebuilding mode. 7% cash.

​

No stocks on sell side chopping block.

$ZM

2019 revenue: 330 mil.

2% op margin.

op cash flow 51 mil and FCF 23 mil

Like PTON since 2019 had 3 years of incredible yoy revenue growth: 88%, 325%, 54%. Then significant slowing of growth yoy in 2022 of 7%.

Already, 2 things are dramatically different than PTON. ZM had FCF since before then the “at home tailwind” and its revenue growth has slowed, A LOT, but not contracted. I’d take slowing growth over contraction any day.

​

TTM

Revenue 4.42 bil (13x from 2019)

2% op income (same)

Op cash flow 1.29 bil. FCF 1.47

Also like PTON, ZM is shifting a ton of expense to SBC. 1.2 bil worth in 2022. More than twice the SBC handed out in 2020 and 2021 combined! In fact 27% of revenue the last 4 quarters was given as SBC dilution. But will ZM having FCF they were able to buy back a bil dollars in shares in 2022. Causing share count actually decrease by 1% yoy in the most recent quarter.

Don’t get me wrong. You don’t want a company giving out a quarter of its revenue as SBC. ZM share count is up 6% since IPO. PTON share count is up 23%!

ZM sells at a premium to PTON

PEG 1.37. PE 193. P/cash flow 17. P/sales 4. PTON PS is 0.9. It doesn’t have any other valuation numbers.

ZM’s best asset is 5.5 bil in cash compared to a market cap of 19.4 bil. It does not have long term debt. But despite this I don’t know if ZM is a good buying opportunity today. ROE of 0 and ROI of 0.6. And despite 13x increase in its revenue, it hasn’t been able to improve margins. And ZM has only been able to maintain its anemia 2% op margin by non-GAAP-ing its employees salary expense as SBC.

Other than a cash pile equal to the GDP of Fiji, the only other bright spot is ZM’s enterprise customer growth. 20% last quarter and 13% this quarter. Enterprise revenue is 57% of revenue. As the smaller employer and average Joe returns to in person meetings the remaining 43% of ZMs revenue will continue to contract. IMO it’ll be 2-3 years until this contracts enough that its enterprise customer growth shines enough to be felt on the top and hopefully bottom line. They need to continue to add value to enterprises to maintain double digit growth to remain a successful company.

ZM is a verb but that doesn’t mean it’s without competition. They do command a healthy 55% of the video conference market. 21% Microsoft teams, 13% gotomeeting, 9% WebEx, 5% google meet.

Stay at home was simultaneously a boom for ZM the business and a roller coaster nightmare for ZM the stock. Let’s set up an alternate reality. Pretend the pandemic never happened and ZM grew revenue at a CAGR of 20% for 14 years. Starting in 2019 with 330 mil revenue and end 2033 with 4.4 bil in revenue. ZM the stock would have had the same success as CRM the stock.

But now that ZM had 2 decades of fast growth crammed into 3 years ZM has become what Peter Lynch calls a stalwart. IMO they have 2 options. Use that mountain of cash to acquire a new vertical in pursuit of growth or they need to start paying a dividend.

ZM isn’t a buy today but I will continue to hold.