Eli's Investing

My personal investing/trading journal

[Eli's Investing @EliInvests]

@KrisPatel99 A lot of what you said was fair and selling vol on memory could be decent strategy but also yesterdays tech sell off wasn’t unique to memory.

Soxx down 6%, Intel, NVDA, Qcom all hit hard. BE down 18%, bad day for AI stocks not about memory.

[Eli's Investing @EliInvests]

@jukan05 Not to mention this is from over a month ago and Apple just raised prices citing memory indicating they aren’t getting pricing relief, you don’t ask the gov for a favor and then do something that would piss them off if you’re expecting to get Chinese memory access.

[Eli's Investing @EliInvests]

@jukan05 If micron wasn’t investing billions in US manufacturing touted by the administration and was doing large buybacks, then maybe this happens but this just seems hard to imagine the Trump administration signs off on this when they’ve said no before.

[Eli's Investing @EliInvests]

@ZaStocks I mean if the hyperscalers ever decide to cut capex materially they will basically all become consensus must own longs. Most everything else will be hard to justify owning in comparison. Until that date sure.

[Eli's Investing @EliInvests]

You’re not wrong that growth will slow in 2 years but look at their current forward multiples… they’re priced as if earnings will fall materially in 2-3 years.

If memory demand is more structural this time with LTA’s, and they’re trading at single digit forward multiples with ballooning cash balances that can be used for buybacks then maybe they can trade at 10-15x which is not unreasonable. Especially since there’s so much barriers to entry producing memory.

[Eli's Investing @EliInvests]

I looked into them and swear they’re a shitco. Super bullish commentary from mgmt every earnings but the backlog hasn’t moved in like 2 years.

In what should be damn near best environment ever for their business they can’t grow their backlog for 2 years. They resorted to talking about pipeline growth last q lol.

[Eli's Investing @EliInvests]

@steve2bacon You’re saying you intentionally upped contributions when you felt the market was oversold? That actually works out perfectly with bonus timing to avoid trying to optimize employer match. Never thought about that before, super smart.

[Eli's Investing @EliInvests]

Isn't this a skate where the puck is going trade though? Whether it's takes two more quarters or not to see material volumes if future data centers will be progressively 800V driven isn't that the most important factor here.

With Wolf 200mm Sic Fab, the only one in the world, I feel like that advantage on cost + U.S based supplier priority environment might limit SiC oversupply issues especially since China is currently behind on high end SiC.

[Eli's Investing @EliInvests]

@StonkChris That company was a shitco from the very beginning, nothing against Amit but that recommendation felt super negligent.

[Eli's Investing @EliInvests]

$GRAB the new hot fintwit name. I'm not sure people have really looked at valuation because it's not compelling.

To start Grab is currently worth 19.7B Market Cap and 14.3B EV due to a sizable cash position which is in part being used for buybacks which is actually good(they've bought 50-100M back a quarter past 3 quarters.)

What revenue/FCF supports this 14B Valuation? Well..

Revenue Growth has been consistently decelerating over the past two years as shown below- which is not great. There is a FX impact here and if the dollar weakens materially you could see another 1-3% of growth. I don't think this should be in anyone's base case to be clear but in my opinion to be bullish you are betting on a weakening dollar.

FCF-on a trailing 12 Month basis Grab had 76M in Adjusted FCF. In other words Grab is trading at 188x trailing FCF on declining revenue growth. To some people this will look weird- the reported FCF is much higher. This is because their unadjusted FCF includes consumer bank deposits. If you look at their valuation it looks like 40x trailing FCF because of this instead of the 188x it should be.

What are comparable U.S Companies trading at? Well Grab aspires to be a superapp so it's not a direct comparison with any company- but let's look at $UBER and $LYFT who operate in the same sector.

Uber grew 20% last quarter and is trading at 24x Trailing FCF. Lyft grew 27% last quarter and is trading at 6.3x Trailing EV/FCF. Typically U.S Companies trade at a premium to internation companies except in this instance. I realize there is much more competition concerns with Uber and Lyft versus Grab but does that explain an 8x and 30x valuation discrepancy versus their U.S competitors who are also growing faster than them? DoorDash is also growing 25% and is valued at 42x Trailing EV/FCF.

Now this stock may rip as it's being pumped by all of retail and it will be interesting what they report on earnings this week- I will want to see revenue reacceleration and momentum on adjusted FCF to think there's even a remote chance the valuation is slightly justifiable.

But if you're investing in companies for fundamentals- Grab is appears to be overvalued versus U.S competitors and not a compelling long.

[Eli's Investing @EliInvests]

@DeItaone As soon as futures started ripping last night for seemingly no reason, should have seen this coming lol was clearly leaking out

[Eli's Investing @EliInvests]

@KobeKapital @Mr_Derivatives https://t.co/qQIoNDIWjv

[Eli's Investing @EliInvests]

@DeItaone If this is finalized and this finally ends + gov potentially getting stake in AI companies which provides significant liquidity to market with a ton of selling- you get rate cuts + gov liquidity to AI names and this sell off ends quickly.

Bearish price action but can flip fast.

[Eli's Investing @EliInvests]

@TradingThomas3 Market randomly dives massively ahead of time this is very crooked

[Eli's Investing @EliInvests]

@blondesnmoney AI is a scam Qs down 10% on Monday

[Eli's Investing @EliInvests]

@Crussian17 It's unlikely but possible they also release more details today at Sony Event after hours.

[Eli's Investing @EliInvests]

@StockMarketNerd I’m sure it was warranted but I can’t help but wonder if we’d see this enforced if they were strictly going long vs shorting.

Shorting is un-American though I suppose.

[Eli's Investing @EliInvests]

@puppyeh1 It’s bullish because it’s not debt related, I think the larger debt raises by hyperscalers are scarier because they introduce more balance sheet risk.

This is the least risky way to show there’s still plenty of appetite for capex spend and it’s not an issue for google stock.

[Eli's Investing @EliInvests]

@jbulltard1 I read a while back that he did a shit coin pump and dump so this is not surprising in the slightest.

[Eli's Investing @EliInvests]

That seems potentially realistic I just think in that scenario where we get straight opening AND toll/nuclear issue are handled separately in talks than you might have a week or more of the market aggressively repricing certain sectors/names because it believes the straight is fully open for good.

After that week or whatever period it is- the market might realize it overreacted and oil rises again, I'm just trying to optimize for that period.

Then again if this is the millionth fake headline could all be a mute point and oil will rise again regardless.

[Eli's Investing @EliInvests]

This alleged end of war/ceasefire actually seems more viable than the past 30 times Trumps said it's happening. This feels like a time to have financials/fintech exposure as that sector has gotten smashed and could see a relief rally on rate cuts w/o inflation ie $SOFI & $HOOD

[Eli's Investing @EliInvests]

I think if we're agreeing basically to open the straight/end blockade and continue nuclear negotiations separately that oil will tank in markets but I agree that mechanically tankers and flows will be slow to increase.

But markets will price in straight being open permanently and in that scenario I think beaten down rate sensitive names outperform. And beyond that who knows, but I could see Iran giving up nuclear ambitions for a time in return for sanctions being removed.