Latest Positions, including a few Trade Alert updates

Here is a list of my latest personal portfolio positions and most of the hedge fund positions with updated commentary and ratings for each position.

I’ve broken the list into Longs and Shorts. I’ve further broken the list down in order of highest-rated to lowest-rated (I’m no longer going to break down down each list into refined categories in order from the largest positions within each category to the smallest, since the hedge fund positions can change more quickly than the relative size listings would imply). Those ratings, as usual, go from 1 to 10, 1 being “Get out of this position now!” and 10 being “Sell the farm, I’ve found a perfect investment.”

Longs –

• Here are most of the longs from the hedge fund that I haven’t put into my personal portfolio yet (because, quite frankly, I couldn’t balance Amaris in the hospital with the new hedge fund with trying to manage my personal portfolio too). I am going to buy a starter position in each of these in my personal portfolio here today and/or early next week, with Dell being the biggest one.  Consider this the Trade Alert for those trades. 
  • DELL Dell (9) – Trading at 7x earnings, the stock is one of the cheapest tech stock I can find. And they just came public. Nobody’s trading the stock and I think that will change in another six months if the stock rallies to $60 and eventually gets closer to $80 as I expect it could this year.
  •  SQ Square (8) – So many new businesses use Square for their point of sale solutions and the market share taker here is real. The stock isn’t cheap, but I want to own a core position.
  • ADTN Adtran (8) – The stock’s down big from its highs, is now trading at about 10-12x next year’s probable earnings and looks increasingly like it could be a 5G spending beneficiary.
  • AAOI Applied Opto (7) – The stock’s down big, is now trading at about 10-12x next year’s probable earnings. Inventory issues might be fixed, margins would expand if so. At or below $15, I might buy some more, depending on what they say on their earnings report on February 22. Supplier to cloud data center companies and that sector’s spending, if Amazon’s quarterly report is any indication, is about to accelerate again.
  • SPOT Spotify (7) –  Revolutionary music leader. Too expensive to get into big yet. Stock could drop to $110 or below in a major market sell-off or if they miss on subscriber growth numbers in their earnings report this coming Wednesday.
  • QCOM Qualcomm (7) – Stock has been crushed, shortsellers proclaiming how it could drop in half, lots of negativity around this name. Meanwhile, the dividend is nearly 5% and Qualcomm will be one of the best 5G plays in the world regardless of how their court cases play out.
  • OPRA Opera (7) – Strong cash flows, stock’s down big, people want an alternative and more private browser solution, which is what Opera is. Not sure I’d chase this one either, but at $6 or below, it’s quite attractive. I like this private-browser theme concept.
  • APRN Blue Apron (7) – The stock has rallied hard from its lows and I wouldn’t chase it here. Another couple quarters of EBITDA growth is required to keep this stock going up. It could drop back to $1 if business doesn’t improve from the Weight Watchers deal, but it could go to $5 if it does.

• Forever assets and other permanent holdings –
  • Media, hedge fund and other private investment/business holdings (9+ because betting on yourself and running a business is always a best bet)
  • Real estate, including the office I work out of, some land and the ranch I live on in NM (8)
  • Physical gold bullion & coins (8)
• Primary stock exposure portfolio
  • GOOG/GOOGL Google (8) – I like Google here a lot as the stock hasn’t moved as much off the December lows as most of our other stocks. Google’s self-driving unit, Waymo, is likely to be first to market in coming quarters and the company’s other ventures are worth billions in their own right. And Android, of course, is still an incredibly valuable asset. And YouTube. And Google Cloud. And search. And the ad network. Google could get above $1500 before year end with $1000 looking like the floor.
  • AAPL Apple (8) – Apple’s iPhone sales in China collapsed last quarter but the company is still growing margins and, just maybe, is going to roll out some new products that might even hit this year. The stock is now about in the middle of the wide range it established in the last six months. I’d expect Apple to go up a bit more than the broader markets during rallies for the next six months and down a little bit less than the broader markets during sell-offs.
  • VZ Verizon (8) – Verizon’s just barely even rolling out 5G commercially yet and there’s not a lot of 5G-compatible devices out there yet either. For the last couple years, Verizon’s ramping up spending and focus on 5G while AT&T, Sprint and T-Mobile have mostly just talked about it. I think Verizon could run to $100 by the end of 2020 and higher than that in years after.
  • TWTR Twitter (7) – Longer-term I think Twitter can put up 20%+ growth on the topline for the five to ten years, assuming single digit user growth. The company will get better at monetizing each user on the platform and I expect daily usage per user will grow 10-20% per year for the next few years too. The fact that every celebrity and media company use Twitter as a de facto instant messenger to the masses is going to be worth many more billions of dollars in coming years. The floor could be $30s, upside could be over $100 in the next three to five years.
  • AMZN Amazon (8) –  Amazon delivered another huge quarter of topline and profit growth. They are once again going to ramp up spending to stay ahead of competition and to make future years’ profits even bigger, so the stock sold off a bit after the report. I don’t think Amazon’s going back to $2000 this year, but I expect $1600ish is probably a floor and that the stock is still a must-own Revolution Investment and that it will have a multi-trillion dollar market cap in the coming decade.
  • Palo Alto Networks (7) – Palo Alto Networks isn’t terribly cheap, but it’s growing quickly as corporate spending on cybersecurity continues to grow. The stock’s getting extended near-term but if it breaks out, it could run to $300 this year. $190ish could be the low end of its range.
  • INTC Intel (7) – Business in China dropped off a cliff last quarter. Yeah, there’s a theme. Intel finally named their interim CEO, who was also the CFO, as the permanent CEO. Intel’s got big investments in driverless and IoT and 5G and the next five years could show surprising topline growth. Maybe $40ish lows for this name and a potential $70 or higher by year end.
  • NVDA Nvidia (7) – Nvidia said demand in China collapsed in the fourth quarter. Shocker, eh? Nvidia’s going to need do deliver a strong quarter or two instead of these misses they’ve been delivering lately. Because Nvidia’s positioned to extend its dominance in AI specifically, I expect the bar is set low enough that the company can indeed show upside. There’s risk all the down to $100 per share if the company misses another quarter’s estimates, but the stock could run over $200 with a couple of strong reports.
  • SEDG SolarEdge (7) – Big rally here in Solar Edge over the last couple weeks. The stock is extended enough here near-term that the company is going to need to deliver a strong earnings report on February 13 to keep the move going.
  • SNAP Snap (7) – It’s been a big run this year and the stock is one I’ve trimmed here about $7. Expectations are now high after the stock rallied so hard and Facebook reported such strong numbers. The earnings report this coming Tuesday are a bit binary — either the company’s going to show it can grow users and monetization or the question of whether they’ll need to raise more money will start to crop up. The stock could fall back to $5ish if they miss this quarter, but the stock could run to $15 if the company were to deliver two good quarters in a row.
  • GLD (7) – I continue to think that gold and GLD are probably going to be up 15% from these current levels over the next year as rotation from cryptocurrencies to gold as The Great Cryptocurrency Crash continues and as Geopolitical tensions are on the rise. $120ish lows and $150ish highs this year, I expect for GLD.
  • FB Facebook (7) – Strong quarter of growth and profits from Facebook. The company’s Instagram asset is its saving grace. The endless data and privacy and hacking scandals aren’t going anywhere, but until users give up on the company, I guess investors shouldn’t either. The stock could drop back to $140s if the markets get rocky or if the company’s many issues flare up again. $200+ by year end wouldn’t shock me. Can this be a trillion dollar company in coming years? With Whatsapp, Instagram and Virtual Reality and other assets to save Facebook from itself, it certainly could be.
  • UA Under Armour (7) – In less than two weeks, we’ll hear how Under Armour is succeeding in the turnaround: “This is a stock that’s expensive on a price-to-earnings basis but cheap on a price-to-sales basis. That’s because it’s a turnaround that’s trying to get their earnings back on track after stumbling in 2016 which gave us the opportunity to buy this stock with a $10 handle. Analysts expect mid-single digit growth for the topline this year and next, even as they expect earnings to double from 17 cents per share to 33 cents. Normalized earnings for UA are probably close to $2 per share if they can truly get their inventory cleared out and roll out a hit product or two. The stock is sort of in no-man’s land right now, neither a great buying opportunity nor one that looks like it’s about to pop higher. Steady as she goes because looking out three or five years, this stock could be back near $50.” I like the stock around $18, would probably buy more if the report is okay and the stock drops to $15.
  • CALX Calix (7) – Verizon and others are ramping spending on 5G, and I’ve added several other 5G related names to go with Calix There could be a lot of suppliers into the 5G Revolution that will benefit.
  • AXGN Axogen (6) – Surgeons are still swearing by Axogen’s products and they are are starting finding yet new uses for them as one of them explained to me earlier this week. That said, I’m just not sure Axogen’s quite “cheap” enough to be confident about calling a bottom here. $12ish bottom and a $25ish potential top? AXGN, SNE and TST are the only longs in the personal portfolio that I haven’t put in the hedge fund.
  • SNE Sony (6) – I’m going to listen and read everything that Sony reported in its quarterly report last night over the weekend. It’s possible I let go of Sony here, as I think there are better opportunities out there. AXGN, SNE and TST are the only longs in the personal portfolio that I haven’t put in the hedge fund.
  • TST The Street (6) – We’ll need more information on how this company and the equity will be structured after they close their latest deal. The stock should trade closer to the $120 million in cash they’ve got but with the CEO leaving, I’ll want to understand what’s next for shareholders. This and SNE are the only longs in the personal portfolio that I haven’t put in the hedge fund. AXGN, SNE and TST are the only longs in the personal portfolio that I haven’t put in the hedge fund.

Shorts –

• Here are most of the shorts from the hedge fund, all still very small, that I haven’t put into my personal portfolio yet. I am NOT going to short these in my personal portfolio, because the personal portfolio is not a hedge fund.
  • MJ Marijuana ETF (7) – I believe in the Cannabis Revolution long-term, but there’s still just way too much hype and hope and bubblicious valuations in the sector.
  • Tiny short hedges, all rated about a (7) – in PIR, APHA, MJ, VHC, GLUU, JD, AVGO. I might cover these at any time and I’m not expecting to make much money on these shorts. They’re just hedges for the hedge fund and I’m not sure any of these are no-brainer shorts. Please don’t just go around blindly shorting these for your personal portfolio.
• Primary short portfolio
  • IBB Biotech ETF (7) – I am probably going to short some IBB for the hedge fund as a hedge soon.
  • EWY SouthKorean ETF (6) – I’m going to cover this long-held ETF short. Consider this the Trade Alert. 
• Cryptocurrencies/tokens
  • Bitcoin (6) – I’m thinking it’s time to nibble some cryptos again, believe it or not, but I’d start with Ripple.
  • Stellar Lumens (6) – I’m thinking it’s time to nibble some cryptos again, believe it or not, but I’d start with Ripple.
  • Ethereum (6) – I’m thinking it’s time to nibble some cryptos again, believe it or not, but I’d start with Ripple.
  • Ripple (6) – I’m thinking it’s time to nibble some cryptos again, believe it or not, but I’d start with Ripple.

Disclosure: At the time of publication, the firm in which Mr. Willard is a partner and/or Mr. Willard had positions in some of the positions mentioned above although positions can change at any time and without notice.

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.