Robots, Shopify, Ambarella and “The Courage to Act”
Here’s Part 3 of 3 from this week’s Trading With Cody Live Q&A Chat transcript.
Q: I would love to get your thoughts on BZUN, IRBT and provided they are not debuting on Trading With Cody file list?
A. That’s funny, I could answer your question like those “intelligence” directors who were testifying today answered, by not answering. In other words, I think everyone assumes Trump must have asked those guys to intervene, but they quote-unquote “didn’t feel pressure to do so”. But no, I frankly have several stocks that I am working on that I want to buy. They are not secretive or something, you’ve probably heard a lot of the names in the last few weeks that were brought to us in the TWC chat room by subscribers. I am working with, Jake and Spekoulenis to write a book about artificial intelligence and a couple other Revolutionary sectors. As we are doing that, some of those stocks we are writing about in the books I am going to end up buying into that book being published. Finally guys, I don’t just like BZUN, I have done a little work, I don’t know it very well, but I am looking at the chart right now and it makes my stomach turn because A.) why wasn’t I in it for the move over the last year for $5 to $22 and B.) it is like a bubble blowing bull market on steroids right now.
Anything that has potential that is not crapping the bed like Pandora and Valent goes up a bunch all the time right now. So your three stocks you asked about: BZUN, the profile is a Shang Hi based China company and my standard answer when anyone asks about technology investing or investing in China in general is. I think Baidu is the only one I would feel safe, maybe Weibo– the biggest ones there in China are probably the best ones already. I don’t know BZUN well enough and my inclination is I would rather sell it than buy it at $22. I am doing work on it and I will have more details if I do end up shorting it, but I don’t plan on buying BZUN. That might surprise you because you were probably asking about the long side.
Shopify. That one I truly am sick to my stomach. We have talked about that on Trading with Cody over the last year. That thing has just been on this tear and I feel stupid as to how we did not get in that. I looked at it, I liked it, I kept wanting to do more homework, but never got my arms around how truly big it really could be. Now I am doing homework on it now because I am not going to not buy it just because it is up a bunch. IF I really think it can triple again, I’ll buy it so it is a name that we are working on actively. But it is definitely one of the companies that could be on that trade alert list. Now I sound like an ‘intelligence’ director who is stupid.
Your third one was iRobot. I wrote a book 2-3 years ago called Stocks for the Robotics Revolution and that one was featured in there and highly rated and I never pulled the trigger…never mind I am thinking of ISRG, you’re asking IRBT. Let me pull it up, I haven’t looked at it recently, since writing the book. Oh my gosh. Are you just trying to ruin my day? Lol.
Q: Haha. What do we do? We can’t have them all, or can we?
A. Haha. Well, we should have. We can wish we had them all. IRBT compared to BZUN. I have no interest in shorting IRBT. It is a good company, an incredible industry, US based, I don’t own it and I don’t think I want to chase it or buy it right now, but it is definitely a better position, revolutionary type company than BZUN. Shopify and IRBT are both great companies. I should have been in them. I pride myself on getting in those stocks guys and even if I was bullish and talked about them, like I did, especially with IRBT writing about in my book and stuff. I can pat myself on the back until the cows come home, but were trying to actually own the stocks and benefit directly from the stuff. So, it makes me want to puke, I have nothing left. Is there a stock symbol for bile? Haha.
The answer to your question is, I am not going to chase those today with them at 52-week highs and our portfolio doing what it has done and having been in so many revolutionary companies and robotics related companies and what not. Both of those are also on the book list and we are currently analyzing them. I would love a 20% pull back in one of those names. Not necessarily both of them, but I will end up buying one of them at some point if they come down and/or I think it is just too much potential upside regardless.
Q: What is the gig with Amba? Are you still a believer, give it room? I don’t have a position in it yet.
A. Okay. So of course I hate a stock when it is down 10% and I have owned it for awhile like this. It is not like I am wanting to buy more today or waiting for opportunity to by more Amberella right now. That name is fully part of the whole overview thing I am doing in the robotics side right now and part of the reason I continue to be bullish on Ambarella is I think it has the potential to be in a lot of robotics and self driving cars and all the different things that need eyeballs. They talked about it on the call last night that they have invested in delivering technologies and platforms that help people to have eyeballs. I think I talked about the same concept a month ago on a conference call like this. That thought is still very real.
One thought I had about Ambarella I had today was, shouldn’t some of that stuff be here right now? If it is truly going to end up being that dominate and that key in those sectors, shouldn’t it have the same chart as Nvidia. Nvidia has proof in the pudding I think has been better than Amabarella. Amabarella has talked about this stuff, but the quarter wasn’t amazing. Nvidia quarter was amazing because it is selling it to those markets already and acceleration is there and AMBA wasn’t there. You all know that I don’t pretend that I am 100% conviction level on each of our stocks at any given time. I just try to wear my heart and my analysis on my sleeve, so to speak as we look at these things. This is real time. The stock is down today in real time and I am not happy about them. I am disappointed in their quarter. I don’t think it is terrible. The growth is still there, there is the margins and cash flow is good. It is not a disaster or anything but lets get revolutionizing if Ambarella is going to be a revolutionary company! It has been awhile, I am ready for this thing to perform so I am going to put that it in the doghouse right now and that is going to be the answer to your questions. I am putting Ambarella at a 5.5 rating on my Revolution Rating profile. We will make a decision soon, but I wouldn’t go buy it right now if you don’t own it.
Any other questions or have I just illuminated the entire stock market and economy for you and you now have all the answers. Haha.
Like I have mentioned earlier in the call, I have been working on a graphic that include the factors that contribute to the bubble blowing bull market that we talk about, from 0% interest rates to incredibly low effective corporate tax rates. I know everybody cites that 30% or whatever supposed corporate tax rate in this country, but I have a chart that I included in this graphic that I am sending out. It shows how the effective real corporate tax rate in US has been on a steady decline from, certainly a contributing factor, to the overall revenues of our government. Real corporate tax contribution to our nation’s tax base has dropped by 70% in the last 20-30 years while payroll tax contribution have gone up huge and personal income tax has been steady. So from that to 0% interest rates, to currency wars around the world, which is related to the 0% interest rates also, the petro dollar and the artificial demands around the world for US dollars and how it contributes to all of this. So I have been trying to put all of that into a graphic for you guys and I will be sending it out. I haven’t sent it out yet because I am still tweaking it to be as creative and helpful as it can. I am also trying to write a whole thing about all this stuff still and it is an on going battle. I guess I could write a whole book about it. Call it the “Courage to Act by Cody Willard”, because I am so courageous when it comes to money like Bam Bernanke with other people’s money.
So with that, I am leaving it right there, that is it! I am about to go hoarse and I have another conference call in 12 minutes I need to get ready for. Peace, Love and Happiness everybody. Go to Trading with Cody.com if you are not yet a subscriber and listening to this. Thanks everyone for listening in, subscribing, for your questions, and talk to you all soon.
