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Category: Tech Stocks

Video: Our Stock Picking Strategy

About a week ago, Dan Shvartsman from Seeking Alpha interviewed Knox Ridley and I about the Zoom call we made last Fall, the trade made In January in the low-$60s, and the subsequent trades made in March in the low $100s and mid-$100s on our premium site. We discuss whether the company’s valuation matters now, and how our research site determines if we should hold on or add to the position amidst the rally. We also discuss the hard questions about Zoom, including the security issues the company faced in April and why removing friction from video conferencing is what…

Why I’m Stacking Satoshis

Last July, I began covering bitcoin. The premise was based on three phases for widespread adoption: institutional adoption, global economic uncertainty, and mobile payments. With Square’s cash app reporting fifty percent of its payments being made in bitcoin, or $178 million, it’s time to revisit why bitcoin is a transformative technology that is often misunderstood. Square’s report was for the period between October 1st and December 31st, which represented an increase of 50 percent over the prior two quarters. Perhaps the more critical point to understand about bitcoin is that its purpose is not to polarize opinions on fiat currency.…

Investing in Tech Stocks (Podcast)

The average cloud software company reported 10% growth during the 2008-2009 recession. Meanwhile, we’ve seen the market react harshly towards companies guiding for 25% growth (such as Elastic). We know the winners from shelter-in-place but we are still sorting out what growth should look like in the middle of the category. My guess is that 25% is going to be higher than average by the time we exit this year. I spoke about this and other topics this week on a podcast with Simon Erickson from 7 Investing. Simon Erickson is the CEO and Founder of 7 Investing, a company…

Playing Defense With Cloud Software Stocks

Paul Tudor Jones is one of many money managers who believes that protecting your money is more important than making it. In my latest article, I discussed this very concept in relation to cloud software stocks. The main risk to cloud software during a less-than-ideal economy is downgrades and churn. Signing new customers can also be a challenge. How a company is faring will often show up in net retention rates. My guess is we will see some cloud software companies remove this metric from their Q2 earnings report or we will see previously strong net retention rates dip below…

Will Roku Go Boom or Bust This Year

I recently wrote a report analyzing the future of Roku in 2020. My guess is investors will get Roku’s story wrong again this year as the company must choose between its top line and bottom line. Covid-19 offers an important opportunity for Roku as OTT usage is skyrocketing and the company must expand globally for long-term growth. In the earnings report this week, Roku gained 2.9 million incremental active accounts, or a 37% increase year-over-year to 39.8 million total, and streaming hours increased by 1.6 billion to a record 13.2 billion, or a 49% increase year-over-year. Oppenheimer analyst Jason Helfstein…

Why I’m Pivoting Away From The Trade Desk For Now

Last week I wrote an article explaining why I’m pivoting away from the bull thesis for The Trade Desk for 2020. But first, I should discuss my original bullish thesis. It’s important to remember that The Trade Desk is a “demand-side” or “buy-side’ ad platform which allows advertisers to buy ads in auction-like format through real-time bidding. This is an automated method for buying and selling inventory that eliminates the need to call up an agency or salespeople to place the ad. The Trade Desk’s financials and growth remain solid. Revenue grew 33% to $160.7 million with net income and…

Slack Set to Continue Growth After Pandemic

Last week, I wrote about Slack’s product-market fit, and why it’s set to continue thriving in the work-from-home trend. The company’s user growth has been parabolic during the pandemic. According to a series of tweets from the CEO, Slack was at 1 million “simultaneously connected” users in 2015 and grew to 10 million by March 10th, 2020. From there, the company grew to 11 million one week later and 12.5 million the following week.  Where the market gets uncomfortable with Slack is their current lack of profitability. The company recently released its fiscal year fourth quarter 2020 results on March…

Netflix: Coronavirus Cements The Company as Untouchable

Last week in Forbes, I explained why Netflix will remain the leader in the OTT market. The main reason is that it is a global media company, whereas the majority of OTT providers are domestic. The company outperforms globally with 70-87% of subscription OTT video service users in European English-speaking countries using the service and 55-64% of non-English speaking countries. When analysts incorrectly believed Disney Plus and Apple Plus were “Netflix killers,” I had pointed out at that time that they were being myopic as to Netflix’s global lead.  Overall, OTT video is projected to grow to 6.4% of emerging…

Can Uber Turn A Profit in 2020?

Sign up for Analysis on the Best Tech Stocks I’m an industry insider who writes free in-depth analysis on public tech companies. In the last 12 months, I predicted Facebook’s Q2 crash, Roku’s meteoric rise, Uber’s IPO flop, Zoom’s IPO success, Google’s revenue miss and more. Be industry-specific. Know more than the broader markets. Sign up now. I look forward to staying connected. If you are a more serious investor, we have a premium service that offers institutional-level research and entry/exit options. This membership offers a competitive edge in identifying growth opportunities and reducing risk in the tech sector. Learn…

Google and Facebook Stock: Is Lowered Ad Demand Priced In?

In a recent article, I pointed out that ad-tech may have a long road ahead before previous levels of demand return. Despite increased usage, Facebook, Google and Twitter have warned that Q1 is going to be lower than originally forecast. Media analysts have also weighed in with a consensus that ad demand will be weak this year. Usage across mobile and over-the-top television has been skyrocketing. Total streaming hours were up 24% between March 1st to March 16th from a year ago, according to Comscore, with Roku and Amazon up 16%. Live TV is also benefiting from the surge in…