Q. Who benefits most from car improvements in tech?
A. I think $QCOM, for one, is getting positioned to benefit big-time from car tech advancements as they are wanting to dominate the chipsets for smartcars. https://www.qualcomm.com/produ…
Q. How do you think FANG stocks will do over the next 3-6 months. The markets seems to be really spooked. Unfortunately I opened a heavy position in $AMZN at $690 and its tanked since then. Where do you see this in the next few months?
A. I wrote the following predictions for FANG in the new eBook: “Apple (AAPL) rallies back to $130, but struggles to break above those recent all-time high levels from 2015. Google, now Alphabet (GOOGL), also powers higher, hitting my $1,000 price target that I put out on it when it was at $250 back in 2011. Amazon (AMZN) and Netflix (NFLX) will lag the broader markets, though both will have their occasional spikes and sell-offs. Netflix and Amazon are overextended and ain’t cheap.”
Q. Consumers have more money to spend as a result of lower gasoline prices. It’s clear why energy stocks go down when the price of oil goes down but today the FANG stocks are getting torched. Can you help me understand why?
A. I never try to read too much into any single day or single week’s action in a few individual stocks. The markets are in tank mode, so it makes sense that high beta stocks including $GOOG, $AMZN and $NFLX would get hit with the broader markets in today’s intraday sell-off.
Q. How low do $AMZN and $NFLX need to go before you would buy more? Likewise, $GOOGL?Are we close yet? Moreover, if you think $GOOGL, $AMZN, and $NFLX could go down by another 10%, is it not too late to sell them now and buy back later?
A. I’d probably buy some of the AMZN shares I sold near $700 back if it got closer to $550. I’ve been saying I’d look to buy the $NFLX shares we sold near $130 back if the stock gets below $100. If I’d sold my AAPL, GOOG and FB everytime I thought the stocks might drop 10%, I’d have missed the 4 bagger, 10 bagger and even bigger returns I’ve had in the stocks since I fight bought them years ago. I’ve ridden each of them down 30% or more at various times, but I had enough conviction in my bullish long term thesis for each that I bought more when they were down rather than selling them and trying to game short-term swings. I don’t think anybody can sustainably game short-term 10% swings in any stock for the long run.
Q. Can you explain what’s going on with $NFLX today? I have a small position with a small gain and I’m trying to decide whether to sell it and try to back it back lower (say 106).
A. I have no idea how to try to game such a 5% move as you’re looking at with a wildly volatile stock like $NFLX. No good reason for it to be down 5% today, but such is the nature of that stock.
- Follow up comment: Thanks for the advice on $NFLX. I’ve only owned it for a few weeks and if it can move down 5% for no good reason then I need to limit my position to the point where that won’t bug me.
- Cody’s follow up: Correct and this is probably true for any stock you ever own: “I need to limit my position to the point where [a 5% one week sell-off] won’t bug me.”
Q. You have GOOG as opposed to GOOGL then, am I right ?
A. I have both but consider them the same.
Q. Any thoughts on SHLD?
A. Sears is a secular loser to Amazon, it’s a retailer with billions in debt and hardly much cash. I’d steer clear of $SHLD except maybe as a potential short.
Q. What’s your take on $SNE performance? Where do you see them going near term?
A. Seems like every week I hear a news story about how Hulu, Amazon and/or Netflix are willing to pay up big for exclusive rights to big movies and TV shows. Sony’s catalog is building in value as I’d outlined when I’d first bought the stock in the mid-teens a while ago. On the other hand, Sony supplies iPhone and other smartphones with image sensors and that’s been gluttish lately, so that has been the overhang on the stock. Long-term, I think there’s a lot of upside to $SNE still. Short-term, don’t know.
Q. Cody any opinion on POT?
A. I like $POT better than most commodity stocks, as potash isn’t as susceptible a crash as most other commodities. But $POT has $2bb in net debt and that alone would keep me away from this stock.
Q. How about $TSLA? Buy on pullback?
A. I am not a $TSLA bull and would rather be short than long the stock from these levels.
Q. Is it possible your timing on FITBIT was off? Besides the performance of the stock, are there any other indicators that would keep you away?
A. There’s no doubt that my $FIT “timing” was off. I still think the stock is fundamentally growing and could have some upside in the next few years and/or get bought by a bigger company.
Q. Robert marcin is a legend. Does he like anything ?
A. He wrote this today: “I don’t insist on long only. In fall of 2000, I was short $10 million notional in QQQ. So I can take offensive short positions. But I’d rather be long and short now than simply short. So I am asking for long tickers my friend. ” So he’s sorta close to my boat of wanting both longs and shorts and higher cash levels right now than we were back in 2011-2013.
