Gregmal Posted October 27, 2022 Posted October 27, 2022 (edited) 1 hour ago, Spekulatius said: it's the law of large numbers more than anything else that is a problem for the FANGS, not so much the valuation (valuation was the main issue with the Nifty Fifties back then). Agree. I’ll let someone else be the first to claim 10 bagger status on a $1T company investment. Edited October 27, 2022 by Gregmal Edit billion to trillion
dealraker Posted October 27, 2022 Posted October 27, 2022 I feel like making a Greg-type comment (I love them Greg!) about my f***ing Facebook/Meta investment. But my wife says, "Don't do it...you aren't any good at that." So I just hope Greg does another one. But to sneak in --- could it be that Zuck sold enough ($17 bil wasn't it?) stock that what's left is is play money? Anyway, its a small thing for me but still pisses me off in that I began buying at $11 and something and today's pricing I have a 35% loss on it.
Gregmal Posted October 27, 2022 Posted October 27, 2022 7 minutes ago, dealraker said: I feel like making a Greg-type comment (I love them Greg!) about my f***ing Facebook/Meta investment. But my wife says, "Don't do it...you aren't any good at that." So I just hope Greg does another one. But to sneak in --- could it be that Zuck sold enough ($17 bil wasn't it?) stock that what's left is is play money? Anyway, its a small thing for me but still pisses me off in that I began buying at $11 and something and today's pricing I have a 35% loss on it. Ha! I think what’s troubling is that a lot of these visionaries just don’t care about money, at all. It’s the culture. We hear about the winners but there’s a million losers for each winner and the losers still were surf shorts and flip flops and drink green milkshakes. I think part of where I luckily, no skill even the result of laziness, sold META to buy Nintendo, is cuz I just don’t want to have to babysit investments too much. If nothing else, Zuck should spin off the real business and give investors a shot. But I don’t want to worry about what crazy shit this goofy but promising project might yield.
Dalal.Holdings Posted October 27, 2022 Posted October 27, 2022 (edited) 1 hour ago, Spekulatius said: I would argue that the FANG are too large to be Nifty Fifties. Xerox etc never were that large relative to the economy back in the 1960's than the FANG are right now. it's the law of large numbers more than anything else that is a problem for the FANGS, not so much the valuation (valuation was the main issue with the Nifty Fifties back then). A lot of these were trading at 40x or more multiples last year. That's in the vicinity of Nifty Fifty. And when I talk about multiples, I'm talking about FCF after SBC or real GAAP earnings, not the B.S. "adjusted earnings" or "adj EBIDTA" you see these days that did not exist much in the '70s. Edited October 27, 2022 by Dalal.Holdings
Dalal.Holdings Posted October 27, 2022 Posted October 27, 2022 Here's a list of them. Many of them--IBM, Sears, GE, Phillip Morris, J&J, P&G, Kodak, Disney, McDonald's were big components of the U.S. economy in those days... And you can see many of them had P/E ratios in the mere 20s or 30s... http://economics-files.pomona.edu/GarySmith/papers/Nifty50/Nifty50.html
Dalal.Holdings Posted October 27, 2022 Posted October 27, 2022 At the end of the day, the proof is in the pudding. If you have high expectations (future high growth) for your investments in a world shifting from low rates to higher rates, well then good luck. Recent results from GOOG, META, NFLX, and the rest are showing you that these companies do not behave like their shareholders thought they would when interest rates go even slightly up...
CorpRaider Posted October 27, 2022 Posted October 27, 2022 (edited) Law of large numbers usage violation above. haha. But yeah it's nice to see some -2% nasdaq, flat(ish) dow and SPY days. Justice. Now we just need the internet ponzis to zero. Edited October 27, 2022 by CorpRaider
changegonnacome Posted October 27, 2022 Posted October 27, 2022 (edited) Another General taken out and shot.... Edited October 27, 2022 by changegonnacome
Gregmal Posted October 27, 2022 Posted October 27, 2022 16 minutes ago, changegonnacome said: Another General taken out and shot.... Not meant in a way other than comradely level laughing, but I feel for you man. Your nose has been spot on with big tech but your moneys been on Apple and Tesla lol. My only real short position at the moment is the same thing. Shit ton of December Tesla puts. Seems so strange watching good companies implode and Tesla just shrug. I gave up on timing Apple in q1.
Dalal.Holdings Posted October 27, 2022 Posted October 27, 2022 The bear mauled META to death today after 10 months of torture. GOOG and AMZN have been whipped. The way to outperform the bull market was -- Buy Tech The way to outperform the bear market seems to be -- Avoid Tech
changegonnacome Posted October 27, 2022 Posted October 27, 2022 (edited) 24 minutes ago, Gregmal said: Not meant in a way other than comradely level laughing, but I feel for you man. Your nose has been spot on with big tech but your moneys been on Apple and Tesla lol. My only real short position at the moment is the same thing. Shit ton of December Tesla puts. Seems so strange watching good companies implode and Tesla just shrug. I gave up on timing Apple in q1. Know its in good fun but dont cry for me just yet.....I've had way more than just Apple & Tesla shorts on, even them when done with options like I have have given me some fantastic annualized returns especially twinned with Twitter merger arb.....I've been riding the indexes too SPY/QQQ...with the simple thesis that we are in a secular bear market.......every rally is a false flag operation........I buy puts on the rips, and I sell on the dips! Dont count me out on AAPL and Tesla though either - their days are coming too Edited October 27, 2022 by changegonnacome
changegonnacome Posted October 27, 2022 Posted October 27, 2022 (edited) https://www.marketwatch.com/story/apple-earnings-show-iphone-sales-miss-amid-questions-about-smartphone-demand-stock-dips-11666903283?mod=election-2020 That didnt take long - iPhone sales miss.......when you on purpose moved the opening couple of weeks of new iPhone sales into this quarter to make the numbers and even that didnt work out.....it does not bode well for the holiday quarter. Not giving financial forecasts at this stage is also bullshit.....I can give you a forecast....its not good....ive listend to some European telco calls and new handsets are in deep trouble. Edited October 27, 2022 by changegonnacome
Gregmal Posted October 27, 2022 Posted October 27, 2022 (edited) And the stock is up after hours even with the Amazon print. In hindsite: FB you have a rogue founder blowing all their FCF on a dream AMZN Bezos checked out to go hang out with celebrities and build space ships. Even the divorce was like yea we don’t care Google/MSFT/Apple all still being run by quality stewards focused on market share and profits Who are the weakest links? Me….Again looks over at Tesla and sees founder who’s living on the edge and selling stock for more aspirational projects and not really making money and shakes head… Edited October 27, 2022 by Gregmal
changegonnacome Posted October 27, 2022 Posted October 27, 2022 Just FYI as you seem to think TSLA hasnt been hit or something...its down 44% YTD........its got WAY more to go so agree with you there. AAPL is the last to go over the cliff........but over the cliff it shall go.....it is the quintessential money manager bear market hide out but in the end the bear gets even the best of breed......
LC Posted October 27, 2022 Posted October 27, 2022 Assume Apple doesn't hold up - anyone thinking about the effects to Berkshire?
Gregmal Posted October 27, 2022 Posted October 27, 2022 Tesla is still what, at least 5x pre COVID and trading like a blue chip. Everything in the world is down 25-30% this year. I consider Tesla more of a Zoom than I do an Alphabet. The one thing I’m trying to refrain from doing is getting carried away thinking it’s open season to be putting on valuation shorts. That’s always an awful idea. It’s the same as holding cash. Just cuz in hindsite it would have been nice 1/10 years doesn’t mean it’s a great strategy. Kinda where I got with Apple. It’s 30-40x but what? The best company in the world and blessed by Buffett. But Tesla? Outside of the woke money backing it, the business has so many fatal flaws. Will see.
changegonnacome Posted October 28, 2022 Posted October 28, 2022 12 hours ago, Gregmal said: carried away thinking it’s open season to be putting on valuation shorts. That’s always an awful idea. Not during a secular regime change it isn’t…..ZIRP to AZIRP (ABOVE zero interest rate policy) which is exactly where we are right now…..you’ve been holding on to 2010’s ideas too long in the face of compounding evidence to the contrary…..that world is over, it’s a new world…..it’s been working very well for me this year……come on in, the water is warm…..you have an ultra bullish bias…..there will be a time for that, just not now……I’m desperate desperate to turn bullish on the US….but it’s really not the time yet…..FANGMA cracking is just an invitation to get more aggressive on the short side and selling vol. Is it also time and OK to continue talking about E failing off a cliff? Seemed it was dirty word there for a while that garnered derision but I can hear the clicking of Wall St. analysts updating SPY FWD earnings guidance right now on back of META/APHT…..and lets be clear Apple not giving guidance heading into their most important Qtr is a chickenshit move and speaks volumes about the trajectory of their business and how the global economy is deteriorating underneath them.
Gregmal Posted October 28, 2022 Posted October 28, 2022 26 minutes ago, changegonnacome said: s it also time and OK to continue talking about E failing off a cliff? Seemed it was dirty word there for a while that garnered derision but I can hear the clicking of Wall St. analysts updating SPY FWD earnings guidance right now on back of META/APHT…..and lets be clear Apple not giving guidance heading into their most important Qtr is a chickenshit move and speaks volumes about the trajectory of their business and how the global economy is deteriorating underneath them. What is a cliff? What’s been reported this quarter so far has varied. Energy is rebalancing w/ tech weighting wise. Otherwise, with all the doom porn and “terrible” reports, spy is 3800 today, yes even after Amazons pitiful quarter. Apple is up. WM is still like 5% off the ATH. Costco at $500. Are people really just going to sell these off 20-30% because some analysts say updates his book report? Or because they can get 4% in a checking account? Or because earnings will fall for a year or two? This doesn’t all seem really short sighted to you? Especially when you’ve said this is just a temporary “12-18 month reset before the economy has a decade to be healthy again”? This is why valuation shorting is dumb. Aren’t there obvious BAD businesses to be targeting. You seem to be really going down the doom porn rabbit hole lately. Is another 10-15% drawdown in the cards into year end with tax losses for everyone and the future hikes plus earnings season rounding out? No idea. Possible. I just wouldn’t get carried away, that’s all.
Gregmal Posted October 28, 2022 Posted October 28, 2022 Big names in the news today. Apple, Exxon, Chevron, Amazon. Not sure I see falling off a cliff happening with the above. I mean let’s get real. Amazon never had earnings. The special guys running value funds just imagined they did starting 2 years ago.
Dalal.Holdings Posted October 28, 2022 Posted October 28, 2022 when everyone and their mother thought investing was as easy as “just buy big tech” it should have raised some flags…even the “pros” like Li Liu were piling into these.
changegonnacome Posted October 28, 2022 Posted October 28, 2022 7 minutes ago, Gregmal said: Or because earnings will fall for a year or two? This doesn’t all seem really short sighted to you? Especially when you’ve said this is just a temporary “12-18 month reset before the economy has a decade to be healthy again”? This is why valuation shorting is dumb. Aren’t there obvious BAD businesses to be targeting. You seem to be really going down the doom porn rabbit hole lately. Hey it’s a rabbit hole that’s worked. I’m long term bullish just not on US stocks in the short term…not a trader but this short term trade, became so obvious to me that I had to play…when I’m less certain I’ll take off the various vol and short things I have knocking around...I mean don’t paint me as an ultra bear…..go have a look at my Hostelworld write up and earlier statements about moving outside the US I’m bullish just not on US…..globally it’s the most egregiously overpriced due to ZIRP and the economy suffering REAL monetary inflation…..the beta sucks in the US, it’s impossible to swim against it……short term there is money to be made recognizing the regime change…..at worst it takes the sting out of holding MSGE….at best much better…..and I’ve been doing bad businesses as well don’t worry . Tesla still doing what’s it’s doing even down nearly 50% ytd ….tells me this bear isn’t near done….your puzzled, as am I…..that’s because we haven’t seen full capitulation yet in US markets, but that’s coming too. This bull has been on the rampage for a decade it will take more than a few lacerations to take it down. Every rally is bear market rally in the short term IMO. Doom porn…..I just like things that make money. The greatest doom porn available this year was Europe around March & I stepped right into it with Hostelworld in a big way. I know retarded doom when I see it….the issues in the US are real, the monetary inflation is real and persistent and pernicious. It’s slowly choking consumers…..the cure is killing foreign earnings…..its a recipe for trouble.
UK Posted October 28, 2022 Posted October 28, 2022 If you short Apple because of China or something like that, than maybe, but even then, you probably could find better targets? Otherwise I do not understand this, it is probablly one of the best business in the world, maybe somewhat still overvalued, but how low you expect it to go down? In terms of BRK, I would be happy if they diworsified Apple somewhat, but not because of valuation etc, but because of Apples very high dependency on China at this point of time.
Gregmal Posted October 28, 2022 Posted October 28, 2022 1 minute ago, UK said: If you short Apple because of China or something like that, than maybe, but even then, you probably could find better targets? Otherwise I do not understand this, it is probablly one of the best business in the world, maybe somewhat still overvalued, but how low you expect it to go down? In terms of BRK, I would be happy if they diworsified Apple somewhat, but not because of valuation etc, but because of Apples very high dependency on China at this point of time. 2am this morning I got an email from Apple that Apple TV was going from $4.99 a month to $6.99. Shrugged shoulders and went back to bed. It’s an incredible business with so many different access points to one’s wallet.
changegonnacome Posted October 28, 2022 Posted October 28, 2022 (edited) Nobody is saying Apple isn’t a great business….but no business no matter how great can’t be made a bad investment simply by raising its price (multiple). Apples price (multiple I’m mainly speaking about) has been raised by quite a lot in the last few years and on relative basis…to bonds & to humble savings accounts it’s become over priced. Remember equity risk premium…. @Spekulatius posted some good stuff from Dramdoran on it….an equity investor needs/has to be compensated to move outside FDIC world or he/she is a dummy. Don’t ever confuse me with somehow saying Apple isn’t a great business. Multiple compression is a bitch….that’s why for about 20 pages of this thread I’ve advocated for buying businesses with low multiples….less multiple to compress and catch you offside if indeed this is a secular regime change. it’s why value will outperform moving forward…..earnings can even hold up (I doubt they will) but the multiple being paid for them moving into A-ZIRP world won’t. One outcome, two ways to win. Edited October 28, 2022 by changegonnacome
Gregmal Posted October 28, 2022 Posted October 28, 2022 Wouldn’t that then make something like WD40 a better target if strictly going on the valuation angle?
Recommended Posts