Updates on the new baby, AMBA, LNN, SYNA, Pandora and more
I’m in the office today and have a lot to catch us up on. I’ll also try to be here in the chat room most every day at least for a little bit using my TradingWithCody apps from now on (Download the TradingWithCody iPhone app here and download the TradingWithCody Android app here).
For now, I’m just back in the office here for a day and will be headed back to Albuquerque tomorrow. I brought my 18 month old daughter, Lyncoln, home with me last night so she could have a couple nights of sleep in her own bed.
We welcomed the cutest little Amaris Willard into the world on Monday. She’s still in the hospital and she’s a miracle of a baby with the cutest little feet and toes you’ve ever seen. Don’t try to kiss those feet though, or she’ll go kicking those feet around as she reacts. We haven’t gotten to hold her yet, but we get to sing and put our hands on her to comfort her and she’s stable and comfortable.
Thank all of you in the TradingWithCody family for all for your prayers, well-wishes and support.
Now onto some of that catching up stuff…
Lindsay, LNN, is up 10% after a much “better than expected” earnings report. I am holding my LNN steady for now — it’s a very small position for me anyway.
Facebook, $FB, is finally steadily treading towards $90. It’s still underowned by mutual fund and tech money managers. I am holding my longheld FB steady.
Ambarella has been wild since it hit $100 for the first time a few weeks ago. As you guys know, I took some profits as it was spiking above $112 and onto the $120s. Parabolic stock charts have a way of coming down, at least temporarily. Such is the case here:
Did I catch the exact top with that AMBA trim a couple weeks ago? Of course not. Our job is not to catch the exact top or bottom. Remember that we bought our Ambarella stock back in the $20s just over a year ago, and as I’ve said since then as the stock went parabolic, you have to expect a major pullback at some point, even if we are right that the stock could double or more again from these $100ish levels in the next couple years. I’m not looking to add to the AMBA any time soon, as it’s already gotten to be a very big position for me personally as I’ve let this winner mostly ride. I do think if it dropped down to the $80s, I might consider another tranche, buying back the shares I trimmed higher. And of course, if you don’t own any AMBA yet, I might look at nibbling on your first tranche and look to scale into more in the $90s.
Synaptics is down about 10% in the last week (but still up 50%+ from where we first bought it) after this story from Digitimes about Apple developing its own integrated touch controller/display driver chips. I’m not a fan of trying to game stocks using reports from Digitimes as a reliable source. Maybe Apple is developing their own version of the chip they currently buy from Synaptics, but it will take at least a year or two for such a chip to hit market if and when it does. All that said, the entire display driver chip business is about 15% of syna revs, and the company has been diversifying its customer base very rapidly. The stock would certainly get hit on a loss of the Apple business, but again, I think that’s at least a few more quarters out if it happens at all.
Meanwhile, in the near-term, I think Synaptics could have a very strong earnings report when it reports next as they’ve indicated that unit sales have been exceptionally strong lately. Their earnings report won’t be here til July 30, but if the stock gets hit a little bit more here, I’ll be looking to nibble on some more common before that earnings report hits.
Finally, one trade I am going to make — I’m shorting another tranche of Pandora $P common stock. Pandora’s being squeezed by competitors that go by the name of “Apple,” “Google,” not to mention the best music service, Spotify and a host of others. I think this stock is in big trouble in the next few quarters if there’s any hint of the company missing revenue, earnings and/or usage numbers. I’m just adding to my still smallish P short today.
