Cody’s Latest Positions with new analysis for each (Updated)

Cody’s note: I forgot to update the actual Revolution Investing Ratings for each of our positions and to add Snapchat in The Latest Positions post I sent out earlier. Please use this one instead.

Next Monday, I’m headed to speak at the Money Show in Las Vegas and to network/research at the SALT Conference. Come by if you can!

Meantime, Amaris has been fussy for the last couple days and Lori’s headed up with her to the hospital in Albuquerque. Thanks for prayers and well-wishes. She’s such a trooper. Both of ’em and big sister Lyncoln too.

I finished this up early this morning. Here is a list of my latest positions with updated commentary and ratings for each position.

I’ve broken the list into Longs and Shorts. And from there, I’ve broken down each list into refined categories in order from the largest positions within each category to the smallest. I also give each stock a current rating from 1 to 10, 1 being “Get out of this position now!” and 10 being “Sell the farm, I’ve found a perfect investment.”

So here’s the list:

Longs –

• Forever assets and other permanent holdings –
  • Media and other private investment/business holdings (9+ because betting on yourself and running a business is always a best bet)
  • Real estate, including land and the ranch I live on in NM (8)
  • Physical gold bullion & coins (8)

• Primary stock exposure portfolio
  • Facebook (7) – Facebook’s portfolio of companies have elentless growth and growing power in the fastest growing media sector on the planet — apps. That said, Snapchat’s clearly got CEO Mark Zuckerberg’s attention and more importantly, it’s got the attention of teens and young adults. Instagram is probably worth 50x the $1 billion amount Zuckerberg paid for it mainly because it’s also on every teen’s and young adult’s daily media consumption diet along with Snapchat. Facebook itself isn’t about to fade either, but it’s not going to be the dominant platform of media consumption for teens and young adults. I’m still riding this stock, but have trimmed it several times and I do think it could see $130 before it sees $170 — though I’m not going to try to game that.
  • Google (7) –Like Facebook, Google has relentless growth and growing power in the fastest growing media sector on the planet — apps. The company’s everywhere with bets on music, video, AI, voice response, autonomous cars, flying cars…oh, and search. Search is still key to Google’s growth and still growing in large part because it’s so built into Android. The stock’s at yet new all-time highs again. Like with Facebook, I’m still riding this stock, but have trimmed it several times and I do think it could see $850 before it sees $1000 — though I’m not going to try to game that.
  • Apple (6) – iPhone sales in first quarter of 2017 turned out not so bad and the market’s already looking ahead to the next iPhone cycle. So what’s this? Apple’s at yet new all-time highs again, powering past $150 per share and $810 billion in market cap.
  • Amazon (7) – Warren Buffett’s right:  “I’ve never seen a guy succeed in two businesses almost simultaneously that are really quite divergent in terms of customers and all the operations,” Buffett said, citing Amazon’s success in cloud computing and its dominant position in online retailing. “I can’t think of another example like it.” He’ll probably be saying the same thing about Amazon being dominant in AI and voice response operating systems/platforms in ten years too. I’m a bit amazed at the rally our largest positions have continued to have this year. If you haven’t trimmed 5-10% of Facebook and Google and Apple recently, I suggest doing so at some point because the pendulum will eventually swing and these stocks can pullback and/or stagnate for months and years.
  • Nvidia (8) – Speaking of stocks stagnating for months, Nvidia first broke above $100 back in December and has been stuck 10% above and below that range for the last six months. Here’s some quotes from me about Nvidia from an interview I gave to Jeff Miller on Scutify: “This is a platform play on both self-driving cars and deep learning. These are the fastest-growing and most revolutionary applications. Both are chip-intensive. If either of these markets hits, NVDA will have a market cap of in the hundreds of billions. The intermediate-term weakness reflects the company’s decision to commit to long-term opportunities. The pull back in the short-term has cleared out some of the very short-term momentum players, so it is an interesting entry point. A near-term catalyst could be next week’s earnings report. I see downside risk of about 5%, and the potential to break the upside of the channel.”
  • Sony (7) – In the prior Latest Positions round up, I wrote, “I will be frank and admit to myself and you that I am bored with Sony.” See, the stock had been stagnating for months. It’s subsequently broken out to new multi-year highs. Their camera imagery component business is dominating the market for Samsung and Apple smartphones.
  • Ambarella (7) – I will be frank and admit I’m actually a bit bored with this wildly volatile stock. Ambarella supplies Sony, Taser and GoPro and a growing list of other customers of their camera chips and the incredible amount of wearable, driveable, robotic and drone cameras coming on market in the next ten years make this a long-term Revolution Investment despite more boredom with it.
  • Axogen (7) – Axogen reported another very strong quarter of growth and market acceptance. I trimmed some as it has now tripled from our purchase price.
  • First Solar (7) – First Solar reported a blow out quarter with revenue of $891 million, up from $876 million a year ago and above Wall Street estimates of roughly $668 million. First Solar also updated its guidance for full-year 2017 with a slight raise in the range of $2.85 billion to $2.95 billion, up from its prior view of $2.8 billion to $2.9 billion. I keep saying I want to invest in solar for the long-term and I keep saying that First Solar is probably the single best pure play on that bet.
  • Twitter (7) – Mark Cuban announced he’s been buying Twitter for the same reason we bought it — big data/AI. Twitter’s still got a lot of work to do to monetize its business, but the amount of data and ease of use of that data because each datum is just 140 characters long, is likely to be prime for monetization in a big way for the next few years if Twitter pulls it off. IBM should buy Twitter and combine its big data/AI with Watson.
  • Impinj (7) – $PI is still in the midst of trying to become a de facto standard RFID platform. It’s a long way from here to there, but the latest quarter was strong and the stock’s being accumulated by some big money right now.
  • Lion’s Gate (7) – Lion’s Gate is going to benefit long-term from its Starz acquisition as the Starz app is on a lot of smart TVs and smart TV platforms. In the meantime, much of the stock’s movements will correlate with the parent company’s success or failure in launching new movies and TV shows.
  • Solar Edge (7) – Solar Edge’s earnings report comes tomorrow. I’d like to see some growth in topline and customers.
  • Snap (9) – The company’s due to report earnings on Wednesday and if they grow users as fast I think they did last quarter, the stock could really pop. I own a few call options in this one and am letting them do the work in this name for now. If the company and its management impress me enough in the next few weeks and months as these options come to expire, and if they’re in the money, I might let them turn into common shares for me.
  • The Street (7)- Earnings report comes tomorrow. Last quarter was hopefully the “kitchen sink” quarter in which management through all the bad stuff in and hopefully new we start to see some turn in the businesses.
• Primary short portfolio
  • Pandora (9) – Earnings after the close tonight. I saw an ad for Pandora Premium on the NY Post site on my smartphone the other day. I chuckled because that can’t be a good sign for Pandora’s self-heralded Premium launch if they’re trying to drum up my business on a web browser this soon after launch, can it?.
  • Biotech ETF IBB (7) – This has been a good hedge though we are down a handful of percent on the trade. That is, the broader markets and our long portfolio have far outperformed this short and I’m keeping it on as a hedge against the risk of a broader market decline.
  • South Korean ETF EWY (5) – Amazing rally in the South Korean stock market. This has not been a good market hedge of late and I’m likely to go ahead and take my losses on it with a cover soon.
  • HubSpot (5) – The company reported a strong growth quarter and the stock popped. My thesis on this stock has not played out well and I’m likely to take my losses with a cover soon.
  • HerbalLife (6) – Herbalife also reported a strong growth quarter and a turn in their business. I’m worried that I’m wrong on this short thesis too. Not likely to cover this one quite yet though.
  • Small Cap ETF IWM (8) – This small cap ETF has been a good hedge against our broader long portfolio. I’m sticking with it though our puts are losing value.
  • Valeant Pharmaceuticals (7) – *Tiny Position Same story: “I’ve been short $VRX since the $170s, as you guys know but I’ve covered most of it. I still think $VRX heads much lower. Back near its lows again, I’m holding my remaining short steady.”

Remember: I wouldn’t rush into a full position all at once in any of these stocks or any other position you’ll ever buy. Patience and allowing the market and time to work to your advantage by buying in tranches is key. Maybe 1/3 or 1/5 of whatever you  might consider to be a “full position” in any particular stock. And I wouldn’t ever have more than 5-15% of your portfolio in any one stock position at any given time. The younger you are and/or the higher the trajectory of your career income, the more concentrated and risk-taking you can be with weighting in your portfolio. But spread your purchases and your risk out over time and over a several positions no matter your age or risk-averse level.

Scaling into a position using an approach of buying 1/3 or 1/5 tranches over time is how I build my personal portfolio positions, but there’s no scientific way to go about investing and trading. Sometimes you have to pay up for the latest tranche but I try to be patient and wait for a temporary sell-off to add to the existing position.

** NOTE FOR NEW SUBSCRIBERS:

If you’re new to TradingWithCody or if you’ve been a subscriber for a while but haven’t acted on much of my strategies yet and/or if you haven’t been in the markets, but you’re sick of getting 0% on your CDs, Treasuries, savings, checking, etc while the markets have been continually hitting all-time highs this year, what should you do now?

Before you ever make any trade, step back and catch your breath before moving any money anywhere. Rank your positions and your whole portfolio and make sure you’re not about to make any emotional moves with your money.

If you haven’t yet read “Everything You Need to Know About Investing” then spend a couple hours doing so, please. It’s a quick read but chock-full of important ideas, concepts and strategies that amateurs and pros alike should understand.

Then, take a look at my own personal portfolio’s Latest Positions and slowly start to scale into some of the ones you like best and/or the ones I have rated highest right now. I’d look to start scaling into a few of the many stocks in the Latest Positions that are at all-time highs along with a couple that we’ve recently featured in our Trade Alerts that I’ve personally been scaling into.

You can find an archive of Trade Alerts here.