Stocks - r/Stocks Daily Discussion & Fundamentals Friday Feb 12, 2021 |
- r/Stocks Daily Discussion & Fundamentals Friday Feb 12, 2021
- CIBC, Bank of America, UBS and TD Bank stand accused of coordinating “abusive” naked short selling and spoofing strategies
- How I pick a stock that I think will explode
- Blackberry -- A Dormant Giant
- Naked shorting in GME and how the pieces suddenly fit together
- New investors, please realize this..
- NIO and it's long term potential
- Why BlackBerry is NOT a Meme Stock
- Why are all the weed stocks tanking?
- Full Diligence Post on Palantir (PLTR) - Earnings Next Monday (2/16) & Lockup Expiration (2/19)
- Virginia is about to legalize cannabis...buy this dip?
- SEC Rule 201 (aka "up-tick" rule) and how to recognize a healthy stock
- r/Stocks Discuss Overlooked Stocks Friday - Feb 12, 2021
- Elon Musk believes Bill Gates had a big short position on Tesla (TSLA) and lost a lot of money
- Shipping stocks are on the rise! Worth a look!
- Have you noticed MarketWatch pumping out really bad advice lately?
- $GSM - Biden Addressing Semiconductor Chip Shortage
- Where will the world be in five years? I am trying to find those stocks now.
- Puts on Chinese EVs $NIO, $XPEV
- Thoughts on Cannabis stocks
- ARK Israel Innovative Technology ETF
- My thoughts on Intel - $INTC
- Why does every stock seem pumped up now?
| r/Stocks Daily Discussion & Fundamentals Friday Feb 12, 2021 Posted: 12 Feb 2021 10:00 AM PST This is the daily discussion, so anything stocks related is fine, but the theme for today is on fundamentals, but if fundamentals aren't your thing then just ignore the theme and/or post your arguments against fundamentals here and not in the current post. Some helpful day to day links, including news:
Most fundamentals are updated every 3 months due to the fact that corporations release earnings reports every quarter, so traders are always speculating at what those earnings will say, and investors may change the size of their holdings based on those reports. Expect a lot of volatility around earnings, but it usually doesn't matter if you're holding long term, but keep in mind the importance of earnings reports because a trend of declining earnings or a decline in some other fundamental will drive the stock down over the long term as well. See the following word cloud and click through for the wiki: If you have a basic question, for example "what is EBITDA," then google "investopedia EBITDA" and click the Investopedia article on it; do this for everything until you have a more in depth question or just want to share what you learned. Useful links:
See our past daily discussions here. Also links for: Technicals Tuesday, Options Trading Thursday, and Fundamentals Friday. [link] [comments]  |
| Posted: 12 Feb 2021 09:43 AM PST International brokers sued over naked short selling allegations CIBC, Bank of America, UBS and TD Bank stand accused of coordinating "abusive" naked short selling and spoofing strategies in US and Canadian stock markets by a Bermuda hedge fund that claims to have lost tens of millions of dollars as a result. Harrington Global Opportunity Fund has filed a suit at the US District Court for the Southern District of New York alleging that various US and Canadian financial institutions, through their broker divisions, manipulated markets and drove down pharmaceutical company ADVANZ PHARMA's (formerly Concordia) share price in 2016. The specialist pharmaceutical recapitalised and rebranded in 2018 after being embroiled in a long-running dispute over apparent price hikes and accusations of mismanagement by its founder and CEO Mark Thompson, who stepped down in 2016. According to the suit, the defendants, which include several unnamed US and Canadian individuals, allegedly flooded the market with false sell signals by simultaneous naked short selling — in which the trader does not borrow a stock, or determine that it can be borrowed, before they short sell — and spoofing — a form of high-frequency trading that artificially inflates perceived demand of a security — which created millions of 'phantom' shares. These practices violate the US Securities Exchange Act 1934 and Regulation SHO. The result, Harrington suggests, is that Concordia's stock price tumbled from $34.77 to $1.83 over 11 months. According to the complaint, Harrington sold 9 million Concordia shares on US and Canadian markets, including the NASDAQ and the Toronto Stock Exchange, in response to the defendants' alleged illegal market manipulation. Harrington is seeking damages, legal fees and interest. It is alleged that in 2016 there were approximately 238 million shares of Concordia stock that were sold short on the Canadian and US exchanges, constituting around 58 per cent of the approximately 410 million Concordia shares traded during the period in question. However, Harrington argues that only 40 million shares were actually issued for trading, meaning the short sale turnover rate was approximately 600 per cent. "The enormous discrepancy between the 40 million shares issued by Concordia for trading and the approximately 410 million Concordia shares traded during this period represents an astonishingly high turnover rate of 1,000 per cent," the suit states. The fund alleges that a "strong inference can be drawn" that these figures were inflated by "millions of fictitious shares unlawfully manufactured" through naked short selling. Lawyers for the plaintiff told SFT that no court date has been set. None of the financial institutions featured in the complaint wished to provide a comment for this story. [link] [comments]  |
| How I pick a stock that I think will explode Posted: 12 Feb 2021 08:53 AM PST Know the market, know the company, know the product Pretty simple concept really. Here are some questions I commonly ask: Market
Competitors
Company
Product
Now you have some data, you need to figure out what to do with it. Here are some ideas: New company in a legacy market with a disruptive product
New market
Existential needs
Legacy company which has pivoted
There are many, many more questions and ideas. I'd love to hear your thoughts on the questions you ask and the ideas you have when looking at a company for growth. Edit: Ok folks, I am no expert... I should have said this earlier. I'm no guru and there are plenty of experts with more info and probably better methods. I shouldn't have used this title, it was in response to another post in the sub. I've used this and picked a few winners and thought I'd share my ideas, that's all! [link] [comments]  |
| Posted: 11 Feb 2021 05:50 PM PST Abbreviation Index:BB -- Blackberry AWS -- Amazon Web Services IVY -- Intelligent Vehicles Yo. I don't actually know if this stands for anything QNX -- Quick-Unix perhaps? It's a Unix-like embedded microkernel RTOS (real-time operating system) EOY -- end of year PT -- price target SP -- stock price EV -- electric vehicle SoC -- System on a Chip IoT -- Internet of Things TL;DR: Blackberry ($BB) is almost daily announcing new partnerships and new clients for their software, including new deals with companies that are just now or just this year launching autonomous vehicles that run on QNX software. The big kahuna of all these deals is BB's recent partnership with Amazon to go 50/50 into BB's software IVY, a scalable cloud-connected software platform designed for intelligent vehicle data gathering and data sharing. With Amazon's Jeff Bezos stepping down, and Andy Jassy filling his shoes, who was the CEO of AWS, BB will have some very firm support behind Amazon's new CEO. BB and Amazon are having a webinar Feb. 23rd about their partnership and IVY, which should be a strong catalyst moving forward. IVY beta earnings are projected to begin impacting BB's Q3 or Q4 earnings beginning in November this year, with IVY fully being integrated around the 2023 timeframe. Through a lot of reading and analysis, I believe BB has a four-tiered business model dating back as far as 2013 when BB's CEO John Chen was hired to begin the massive BB turnaround process. Tier 1 was development of QNX and IVY, lasting from 2013 to today and onward, however, Tier 2 overlaps Tier 1. Tier 2 was customer acquisition, primarily distributing their secure software in QNX, SecuSuite, Spark, and AtHoc. They secured 37 automakers during this time, including 9 of the top 10 automakers, over 106 governments from around the world, including all of G7 governments and 18 of G20 governments, as well as 77% of Fortune 100 companies, including partnerships with Amazon, Microsoft, Google, Sony, XPENG, XPEV, NVIDIA, Intel, Qualcomm, Baidu, IBM, LG, Samsung, and others. Well if they have such an incredible market share, why are they so undervalued? The answer is that QNX was not the end-all-be-all product. It was the base that the rest would be built on. Particularly IVY, which is the real money-maker. Tier 3 is IVY beta, and Tier 4 is IVY distribution and subscription revenue streams. So why is IVY the big deal and not QNX? They are both big deals, but QNX was never designed to be the money-maker. They are charging a one-time fee per vehicle use. There is a bigger goal here, to secure their clients as their customers for the bigger product in IVY. They also need QNX is to be a secure system in order for IVY to be trustworthy and reliable. And it certainly is secure. QNX has ISO26262 certification, as well as US government clearance, NSA clearance, and CIA clearance. The US government uses QNX and Blackberry products. Just let that sink in. That should tell you something about its security. Anyways, IVY will be used in autonomous vehicle level 4 and level 5 communication (note that QNX is level 5 certified... it has a business moat just in its security level and clearance), as well as EV and gas vehicle data collecting and AI-powered data synthesis. See below for more details on IVY. Wrapping up this TL;DR, BB is going to do well this year as IVY unfolds, but will do even better in the next 2-5 years. I have a PT of 25 by EOY and a PT of 80 by 2023 EOY, and a PT of 160+ by 2025 EOY TL;DR: TL;DR: BB go up, but go slow for now because IVY revenue not here yet, but big fast later. Make big monies, BB is the future tech that Amazon, Microsoft, Google, etc will be building upon in the EV and IoT market FAQs:1) Why is Blackberry stock price going down? A: A few possible reasons. One, as of today the whole market is down. BB is connected to overall market swings as most companies are. Two, there may be some market manipulation by bearish financial institutions as there are a lot of calls expiring on 2/19. I would expect that BB SP to be volatile between $11 and $14 between now and then, and to move upwards after 2/19 and especially after 2/23 (Amazon + BB webinar). Three, there are bearish investors who still think BB is a phone company and don't understand the underworkings of BB's business strategy, their software, their patents, or their partners. Their revenue has been affected by coronavirus and has not been particularly phenomenal so far this year. 2) Should I invest now or later? A: First off, I'm not a financial advisor, these are just my opinions. Invest at your own risk. In my opinion, BB will see a large SP growth by EOY, anywhere from 50% to 150% growth by EOY. While revenue will likely not increase much this year, the partnership with Amazon and news regarding IVY will likely create new floors for their SP much higher than the current SP right now, at around the $12 SP 3) What's stopping competitors from building a similar product and hurting BB's business? A: There's a lot of reasons why BB has a huge moat right now. One, notice the partners that BB has with QNX. They've got all the big boys working them, aside from Apple and Tesla. Seeing as SpaceX runs on QNX, and seeing that Apple was trying to make a deal with Hyundai that did not go through, I think it is still possible that either Tesla or Apple or both companies could also make a deal with BB to use QNX as their OS system. BB worked to develop their QNX embedded microkernel OS for the last eight years or so. Anyone trying to step into the game now is far too late. Apple has the best chance of all companies, as it has its own OS and Apple knows security very well, but this still requires an entirely new system in order to work in the EV sector. Also, Apple announced recently that they would be developing their own EV, although they did not give much details beyond that statement. The likelihood that they are both working on the hardware and software side of this thing is slim given the large number of difficulties that come with certification as it relates to the cybersecurity software space. Regardless, I would suspect that either Apple or Tesla is the most likely to be competitors in this space, but neither company has successfully completed a certified OS system, particularly for the emerging sector of autonomous EVs. Tesla is currently building a Linux-based system that is having a lot of difficulty in passing certifications such as ISO26262, a struggle that has been ongoing for years now. They may achieve a product that passes these safety regulations and certifications, but the question remains whether this will be in time as the EV and autonomous market picks up speed, and whether competing companies would even be interested in using their product. In fact, any car company is unlikely to develop their own OS software because none of their competitors would be likely to use it. BB is the perfect business to license since it is not competing in the hardware sector for the EV market. This argument can also be used for Apple if they are also building an EV. 4) Why is BB's revenue so low if they have so many customers and partners? A: QNX has been licensed so far as a one-time purchase, per vehicle or IoT using their software. IVY will be a subscription-based software that also includes a one-time purchase. Thus, BB's revenue streams are somewhat unimpressive currently, but they are playing the long game. If my hypothesis is correct, it is John Chen's goal to lay low as software is developed and customer relationships are built. It's the same with the book market. It's the sequel that makes all the money, not the first book. QNX is just the first book of a series looking to hook in its customers with low costs before hitting 'em with the strong follow up in IVY. Additionally, in order to build a competitive business moat, it was to their advantage to not forewarn any competitors of their involvement and plans. Consider John Chen's work as a CEO in his last business Sybase. Chen worked as the CEO of Sybase for 10 years. For the first 7 years, the SP remained at around $10 a share. Three years later, the SP was at $100 a share. I suspect he is implementing a similar model with Blackberry. Chen joined Blackberry in 2013. BB stock actually dropped for most of the last 7 years, resting at a stock price of around $5. Now BB is at $12 a share. I would not be surprised if BB reaches $50 two years from now. Now for the details.Read this for DD on BB's achievements, certifications, markets, QNX products, EV growth, Spark software and clients, BB Radar, software pricing, and BB challenges: Comprehensive Guide about BB and how it shall take off in coming years Full List of Clients and Partners:Blackberry Clients and Partners Automakers: Honda, Audi, Jeep, Mitsubishi, Ford, Hyundai, Volkswagen, Bentley, Lamboghini, Byton, Mini (cooper), Toyota, Subaru, Fiat Chrysler, Mazda, Nio, BMW, Porsche, Lexus, Kia, Land-Rover, Mercedes-Benz, Buick, Jaguar, Visteon, Skoda, Chevrolet, Nissan, Acura, Continental, General Motors, Baidu, Motional Other: Denso, Aptiv, Bosch, Panasonic, Harman, Bugatti, LG, Vodafone, Bell, Carahsoft, CACI, Telus, iSec, KPMG, Tableau, Qlik Major: Amazon, Google, Sony, XPENG, XPEV, Li Auto, NVIDIA, Canoo, Microsoft, Intel, Verizon, Qualcomm, IBM, LG, Samsung Major Investors: PRIMECAP, Hamblin Watsa, Ontario Teachers' Pension, Vanguard, Harris Associates, ETF Managers Group, Wells Capital, Arrowstreet Capital, Kahn Brothers Advisors, Norges Bank Investment Governments: Albania, Andorra, Angola, Argentina, Australia, Austria, Bahrain, Belarus, Belgium, Benin, Bosnia and Herzegovina, Botswana, Brazil, Brunei, Bulgaria, Burkina Faso, Cameroon, Canada, Congo, Croatia, Czech Republic, DR Congo, Denmark, Egypt, Estonia, Finland, France, Gabon, Germany, Ghana, Gibraltar, Greece, Guadeloupe, Hong Kong, Hungary, Indonesia, Ireland, Italy, Japan, Kenya, Kuwait, Latvia, Lesotho, Liechtenstein, Lithuania, Luxembourg, Macau, Macedonia, Malawi, Malaysia, Mali, Malta, Marthinique, Mauritania, Mauritus, Mayotte, Mexico, Moldova, Monaco, Montenegro, Morocco, Mozambique, Namibia, Netherlands, Netherlands Antilles, New Zealand, Nigeria, Norway, Oman, Philippines, Poland, Portugal, Qatar, Romania, Russia, Réunion, Saint Barthélemy, Saint Martin, San Marino, Saudi Arabia, Senegal, Serbia, Singapore, Slovakia, Slovenia, South Africa, Spain, Swaziland, Sweden, Switzerland, Taiwan, Tanzania, Thailand, Togo, Turkey, USA, Uganda, Ukraine, United Arab Emirates, United Kingdom, Uruguay, Vatican City, Western Sahara, Zambia, Zimbabwe Blackberry Current Revenues:BlackBerry Revenues: How Does BlackBerry Make Money? -- Trefis --> This display the biggest bearish argument to BB. Until IVY begins producing new revenue streams, BB is likely to not exponentially increase revenue streams, but only sustain moderate YoY growth Blackberry Analysis Regarding Infotainment and Google and Ford Deal:see "Blackberry (BB) Stock News Analysis | What I need to say..." by Financial Live by LEYA on the forbidden video website --> The media recently picked out a story that left out a lot of pertinent information, making it seems that BB lost Ford as a client. This is not true. QNX is designed to be a SoC. This means that other operating systems, such as Linux or Android, can be easily added to QNX. It is in fact encouraged. The Ford and Google deal was simply announcing the Ford would be using Android as their infotainment system. I believe that BB was never intended to try and be the predominant entity for all software systems in EVs or IoTs, but the backbone that connects all together, and to protect all components in a secure system. Autonomous EVs and even regular EVs in general would not be possible without a secure system protecting the product, as is true with IoTs. This is also why things like US Fighter Jets run on... you guess it, QNX. Ford is still using QNX. It is simply also now using Android that is running on top of QNX more commentary on this: Analyzing Blackberry Bear Argument - Case No. 1: Ford Deal Pretty ChartsThe New BlackBerry Everyone is Talking About $BB Facebook Settlement with BBThis is an interesting one to be sure. Facebook was being evil, like the do, and were caught using a number of BB patents. They settled in February, and the day that the settlement was finalized, John Chen (BB CEO) tweeted reminding everyone that BB is used on the ISS https://twitter.com/JohnChen/status/1358853064153784321?s=20 Well, the connection and speculation here is that Blackberry is going to the moon, and that the settlement is rather significant. Someone else also dug out some information in Facebook's most recent 10-K, specifically a portion for a 'non-cancelable contractual commitment' of an amount of $7500 million dollars. That's 7.5 billion btw. We don't know how big the settlement is, but it is worth noting that BB's entire market cap is 7.5B. I highly doubt that a settlement would reach such lofty numbers, but it could be possible that FB settled for some initial amount of $1B or so, as well as $1B in reoccurring payments over several years. We won't know until March 15th actually, so stay tuned. Blackberry New PartnershipsWithin the last few weeks, Blackberry has announced a stronger partnership with Baidu (China's Google), as well as their involvement with Baidu choosing to use QNX for their autonomous vehicles that will be hitting the road, as early as this year and next. BB has also announced their involvement with Motional, a joint venture between Hyundai and Aptiv, which will use QNX for their autonomous vehicles. Motional will be partnering with Lyft to use autonomous vehicles to begin serving customers and will be deploying their vehicles in 2023. It was also announced that QNX will be working with AOSP (Android Open Source Project), as well as announcing yesterday that QNX Hypervisor 2.2 is now released, which is what allows Android and Linux to run on top of QNX. A sum-up of all the recent news on $BB BB's Technical Page on QNX Security--> Very technical. But cool stuff. Rumor: Blackberry Buyout? Here's why that's not happening:Just read this post. It's quite revealing: Great Day for BB despite stick dipping. TL;DR: Amazon could have easily bought BB. Why didn't they? Well, all the big players are interested in this EV and IoT emerging sector. This is the new wave of technology that will dominate the market. First we had the dot.com boom, then the cell-phone and smart-phone market, and now we have the autonomous EV and IoT market. If Amazon were to buy BB, they would have to submit a tender offer. This would be a red flag to all the big players that Amazon were trying to buy up the best security out there. It would be a bidding war that could result in a double-digit multi-billion dollar buyout. It was much more to their advantage to create a secret alliance with BB and establish a 50/50 partnership, whose contract includes exclusivity for their use of IVY. Ouch! That's gotta hurt. This is where the importance of QNX lies. BB will be able to pull the rug out from any company that chooses to use something other than IVY. No IVY, no QNX, no EV. It will be a package deal where IVY is the big money maker. All other companies will have to build from the ground up or be forced to license QNX and make their money off of other sectors, such as the infotainment sector, as Google has already begun to do with the Ford deal. When this deal happened, the other big boys wet their pants realizing they needed to get into this space, and fast. Microsoft partnered with Cruise/GM. Apple tried to partner with Hyundai, who was so flattered, they may have initially said yes or indicated so, before realizing that they were already partnered with BB, so it was a no-go. Not sure if that is fact or fiction, but it is an interesting proposal. Blackberry IVY + AWS Partnership:Alright, so what's the deal with IVY? Why is it going to be so profitable? Why is IVY the real money-maker, while QNX has been used as the customer-acquisition software tool? Check out this picture: For one, IVY is designed for real-time communication between EVs or other IoTs. Autonomous driving level 5 requires vehicles to communicate with one another. This is where IVY comes in. IVY connects the different software components of an EV (which presumably are running on QNX), as well as harvesting data on those systems. The data used can be distributed for a wide-variety of uses, including, but not limited to, automakers and suppliers, app developers, consumer services, smart cities, EV charging providers, insurance companies, and vehicle maintenance providers. All of these different sectors will be willing to pay subscriptions for these data services, as well as the automakers and IoT makers who will also be willing to pay subscriptions for IVY. For instance, IVY can help share information between vehicles that will allow for a car detecting ice roads in one area so that other cars using IVY can take a different route. This results in less crashes, which helps the automakers. Insurance companies can use data from all these different data points as well, allowing them an inside-view of their clients. The list of what is possible here is inexhaustible. As for price points, the subscription models for multiple outside companies wanting to use the data will be create huge revenue streams for BB. With Amazon as a 50/50 partner, and with their resources and strategic management, BB will be poised to be the foundation in security and data sharing for the entire EV, and somewhat of the IoT market (the IoT market has more competitors for sure) see "Is BlackBerry Stock Undervalued?" by Wealthy Mindset on the forbidden video website see "Roadmap to $180 a share (BlackBerry Stock)" by Wealthy Mindset on the forbidden video website Revenue, revenue, revenue...Blackberry is poised to be an industry leader in EV, government, and IoT security and data sharing with products such as QNX, IVY, Spark, and their other software products. Stock price will likely stay somewhat stunted until IVY revenue begins picking up. It is possible that more announcements and marketing related to IVY will make this growth more rapid. In my opinion, either way BB over the next 5 years will 10x. The question is whether you want to get in now at $12 / share or two years from now at $40 a share or something similar, assuming that either way this stock is going to push for that 100B market cap (it's currently at 7B). There will be bearish analysts that will continue to say that Blackberry is a worthless company until those IVY revenue streams begin to come in. It is also possible that a realistic competitor may emerge within the next three years, such as Tesla or Apple. But if Apple is seeking to create its own EV product, then both companies will have a hard time finding any way to license their software to any other company. It remains possible that Apple and/or Tesla may strikes deals with BB as well in order to be able to produce autonomous vehicles and get a bite of that market share Really, no competitors?Well it's called a business moat for a reason. As we have recently seen, QNX is working with AOSP, and so clearly, they are not to be worried about. Tesla is not a true competitor as their OS product is not certified yet, and has demonstrated difficulty in doing so, and additionally, other automakers will not want to benefit their competitors by using their product. A third-party non-auto-maker will be much more desirable. Other companies such as VxWorks, have a lot of to prove both in security and certifications, as well as producing an OS product that is compatible with an emerging autonomous level 5 EV market. QNX's embedded microkernel RTOS is very much unique in this regard. This type of system allows for real-time processing and power distribution, while protecting the system from attacks. In an embedded microkernel system, if one part of the system is attacked, the whole system will not shut down, in layman's terms. This is essential for the security of any high-risk product that is built upon an underlying software that controls that different components of the system. Conclusion:All eyes are turned towards Blackberry right now. People want to know what this deal with Amazon will look like, how it will work, what they will focus on, (will Amazon also use this system for a fleet of delivery drones? hmmm), what the revenue streams will look like, what are their projections, what markets and sectors are they targeting, what are their future goals, what will Amazon be doing on their end, etc, etc. The Amazon + BB webinar may answer some of those questions, or maybe they won't. Time will tell (Feb. 23rd, specifically -- here's a link to sign up and watch: Next-Gen Vehicle Architectures Unlock Unprecedented Opportunities for Automakers). Also look out for that FB settlement numbers on March 15th, and Q4 earnings March 31st. I don't expect Q4 earnings to be particularly interesting unless they include the FB settlement numbers. Could those numbers instead be put into Q1 earnings for 2021? Possibly. Initially IVY beta is expected to begin being released late this year. I will also be looking forward to see how Apple and Tesla respond in the coming months. Ultimately, BB is a long-term play, but is poised to dominate this emerging industry with the partnerships and security focused software they have secretly been building. Now if only the could do something about their logo, some rebranding would be nice... This is not financial advice, just my own opinions. I am not a financial advisor nor a professional. I own 14k shares in Blackberry, as well as options (10x 8/17/21 20c BB). Do your own DD and fact check me as well [link] [comments]  |
| Naked shorting in GME and how the pieces suddenly fit together Posted: 12 Feb 2021 12:44 PM PST TLDR: Naked shorting appears prevalent in GME, and if true was likely aided by DTCC, whom by extension may have shut down the short squeeze on 1/28 because it would've caused a massive scandal had the squeeze happened. (This post has a lot of sources but in order to push this through I've had to remove most of the link, you can pm me for sources if you'd like) I was doing some research on naked shorting in the context of GME which led me down a rabbit hole of pieces connecting with each other as it relates to GME. I was taking notes while reading and below are the results of my notes. This is still a hypothesis and theory but appears supported by numerous pieces of the puzzle, I could be wrong but personally the pieces seem clear to me now: One of the interesting things about GME and a big part of what triggered the short squeeze happening is the extraordinarily large short interest percentage reported by Finra to be 226%, and later in the range of 150% percent of total float. Another interesting factor is the extraordinarily high number of FTIDs (https://wherearetheshares.com/). Both are strong indicators of the practice of naked short selling which in general is illegal. In addition there have been many indications that there are far more shares out there then should exist. Where do these shares come from? One potential explanation is covering using synthetic long shares or counterfeit shares caused by naked shorting. I'm an entrepreneur, not a finance expert, so I started doing some more digging on naked short selling to educate myself more on the subject. I started withreading SEC Regulation SHO which deals with naked short selling. "Failures to deliver may result from either a short or a long sale. There may be legitimate reasons for a failure to deliver. For example, human or mechanical errors or processing delays can result from transferring securities in physical certificate rather than book-entry form, thus causing a failure to deliver on a long sale within the normal three-day settlement period. A fail may also result from "naked" short selling." Interesting. We have a consistent and very high rate of FTIDs dating from 2020 and beyond, an indicator that the stock has potentially been naked shorted for a long time. According to former Chairman of the SEC Christopher Cox, "Abusive naked short sales... can be used as a tool to drive down a company's stock price to the detriment of all of its investors. The Commission is particularly concerned about persistent failures to deliver in the market for some securities that may be due to loopholes in the Commission's Regulation SHO, adopted just two years ago… Selling short without having stock available for delivery, and intentionally failing to deliver stock within the standard three-day settlement period, is market manipulation that is clearly violative of the federal securities laws… We are particularly concerned about the potential negative effect that substantial and persistent fails to deliver may be having on the market in some securities. Specifically, these fails to deliver can deprive shareholders of the benefits of ownership - voting, lending, and dividends from issuers. Moreover, they can be indicative of abusive naked short selling, which could be used as a tool to drive down a company's stock price. In a different speech Mr Cox re-iterated that short selling helps prevent "irrational exuberance and bubbles. But when someone fails to borrow and deliver the securities needed to make good on a short position, after failing even to determine that they can be borrowed, that is not contributing to an orderly market – it is undermining it." Mr Cox also "referred to "the serious problem of abusive naked short sales" as "a tool to drive down a company's stock price" and that the SEC is "concerned about the persistent failures to deliver in the market for some securities that may be due to loopholes in Regulation SHO" As another datapoint, Robert J. Shapiro, former undersecretary of commerce for economic affairs has claimed that naked short selling has cost investors $100 billion and driven 1,000 companies into the ground. I also read 'One complaint about naked shorting from targeted companies is that the practice dilutes a company's shares for as long as unsettled short sales sit open on the books. This has been alleged to create "phantom" or "counterfeit" shares, sometimes going from trade to trade without connection to any physical shares, and artificially depressing the share price'". Shortly after, I read that Matt Taibbi contended the use of naked shorting and counterfeit shares was the tactic used to help kill both Bear Sterns and Lehman Brothers. Taibbi said that the two firms got a "push" into extinction from "a flat-out counterfeiting scheme called naked short-selling". All these sources above seem to support the theory that GME stock was wildly naked shorted, which put funds in the risk of being badly short squeezed. If investing on the basis of the extraordinarily high short interest percentage, GME was a prime candidate for a short squeeze to happen -- potentially even an infinite short squeeze. On 1/26 Elon tweeted about Gamestop and that was the day the stock entered the mainstream for a lot of people and retail investors began to really pile on to the stock outside of WSB. The goal of this was to push the stock price up and trigger a short squeeze, the theorized losers would be the funds that naked shorted and would be stuck in the squeeze. On 1/28 Thursday when the stock had immense momentum from the moment pre-trading started (the stock shot up to 513 in pre-trading) and it looked like the squeeze was going to happen that day, the momentum was suddenly shut down when RHood (where many or potentially majority of retail investors were on) were shut off from the ability to buy GME stock and only allow selling, followed by several other brokers. Many believe this was a result of collusion and that this shut down allowed badly besieged hedge funds to close some positions while the public was shut out of buying (but funds were not.) When this happened people were upset at RHood suspecting it was a result of potential collusion between RHoodand Citadel (which along with Point72 invested a lifeline of 2.5 billion to Melvin Capital, one of the short side funds, and is also responsible for something like 40% of RHoods entire revenue by buying their order books), but many also speculated collusion with DTCC itself. Now, personally speaking, its kind of crazy to think about DTCC being complicit in something like this. However, looking into the details of what happened, a skeptical part of me became suspicious. Apparently what triggered the shut down on trading GME on that day was DTCC sending a letter at 4 am to RHood requiring them to come up with 3 billion dollars. So it sounds like it was essentially this DTCC letter that led to the shut down of the momentum on GME and the short squeeze happening. On that day, there were theories thrown out that DTCC was potentially complicit in the naked short selling of GME and intentionally did this to stem the massive blow back/scandal if an infinite short squeeze did happen. Assuming the price of share of the price rocketed to 1000 or beyond (which would be likely in the event of a short squeeze or infinite short squeeze), hedge funds would likely go bankrupt as financially speaking there would be no way they would be able to cover all their shorts, and presumably entities that lent the short side hedge fund the shares to short would be holding the bag. Worse, DTCC would be exposed for being complicit in this entire thing, I imagine it would be an incredible scandal to say the least. Then I read something that caught my eye… DTCC has had a history of being at the center and source of naked shorts. From an article dating back to 2007, "Depository Trust & Clearing Corp. is a little-known institution in the nation's stock markets with a seemingly straightforward job: It is the middleman that helps ensure delivery of shares to buyers and money to sellers. About 99% of the time, trades are completed without incident. But about 1% of the shares -- valued at about $2.5 billion on a given a day -- aren't delivered to the buyer within the requisite three days, for one reason or another. These "failures to deliver" have put DTCC in the middle of a long-running fight over whether unscrupulous investors are driving down hundreds of small companies' share prices." Apparently the DTCC has been known to be allowing or complicit in this action for a very long time. According to Wall Street Journal "There is no dispute that illegal naked shorting happens. The fight is over how prevalent the problem is -- and the extent to which DTCC is responsible. Some companies with falling stock prices say it is rampant and blame DTCC as the keepers of the system where it happens. DTCC and others say it isn't widespread enough to be a major concern." "It has been alleged in tens or hundreds of lawsuits that the DTCC and its Prime Broker owners have abused their monopoly position to create numerous techniques that allow for the creation of counterfeit shares through naked shorting that facilitate stock manipulation by hedge funds. Law suits have been brought against Merrell. Lynch, Goldman Sachs, Morgan Stanley, JP Morgan, UBS, other market makers and also the DTCC. The Prime Brokers and DTCC have fought back ferociously against these lawsuits with great success and have been largely successful in blocking attempts to gain access to their transaction data bases. The information that they do release is incomplete, self-serving and misleading. As a thought experiment, lets say naked shorting is rampant in GME (many many indicators point to this) and lets say DTCC was ultimately responsible for allowing a wide scale naked shorting campaign on GME, wouldn't it be in their best interest to make sure this doesn't get out and blow up in their faces? Something to consider. Because had they not done what they did on 1/28 Thursday, many traders believe the squeeze would've happened that day. From the Wall Street Journal: "The Securities and Exchange Commission has viewed naked shorting as a serious enough matter to have made two separate efforts to restrict the practice. The latest move came last month, when the SEC further tightened the rules regarding when stock has to be delivered after a sale. But some critics argue the SEC still hasn't done enough… Some delivery failures linger for weeks or months. Until that failure is resolved, there are effectively additional shares of a company's stock rattling around the trading system in the form of the shares credited to the buyer's account, critics say. This "phantom stock" can put downward pressure on a company's share price by increasing the supply… Critics contend DTCC has turned a blind eye to the naked-shorting problem." From everything I've seen, as someone who has been an observer and a participant of this saga starting from 1/26, many things look very fishy and there are a lot of red flags people have documented. I personally hold the following hypothesis:
If you care about this case, you might asking yourself now, what I can do? You can: - Tweet, email or write a letter to your local congressman. Feel free to send them this post if you'd like or summarize the issue for them. - Notify the SEC - Contact any journalists you know, forward this post to them, let them know the story and why its significant. - Spread the word through word of mouth, twitter, etc. Share this post as much as you can. Edit: Matt Taibbi's rolling stone article is highly relevant and good reading on this subject https://www.rollingstone.com/feature/wall-streets-naked-swindle-194908/, so many parallels that the signs are hard to miss. Even if you've read it before, recommend reading it again. Shows me that if the hypothesis posed is true, Prime brokers are likely complicit. Prime brokers also happen to own the DTCC. This brings up another interesting thought experiment a Redditor brought up: On 1/28 when the price was 450+ and shorts were likely under 100, if we assume prime brokers allowed naked shorting in GME, then when the squeeze was about to happen (or happening), if brokers margin called the shorts, they would presumably also go down because shorts would not be able to pay in that event and the brokers would be holding the bag. By that logic, they have every incentive in this case to NOT to margin call because doing would also taken them down and they would lose a lot of money. Instead the most logical option would probably be to make a backroom deal, which is what I personally think mostly likely happened. [link] [comments]  |
| New investors, please realize this.. Posted: 12 Feb 2021 09:54 AM PST Great companies tout free cash flow growth. If companies don't have that, they tout revenue growth. If companies don't have either, they tout total addressable market. That is all. Good luck out there. [link] [comments]  |
| NIO and it's long term potential Posted: 12 Feb 2021 06:40 AM PST Hello, NIO has done very well over the last 12 months now now has been sitting around $60 (+/- $5) over the last 4-6 weeks. China is going to go crazy when NIO ramps up production and rolls out a charging infrastructure. I'm curious to understand what your thoughts are and what you think NIOs long term growth is. Where do you see it's price in 12/24/36 months... Thanks! [link] [comments]  |
| Why BlackBerry is NOT a Meme Stock Posted: 12 Feb 2021 11:10 AM PST I've been seeing some well-written posts like this one and this as well, as I'm sure you have as well. It seems like people are finally starting to realize that BlackBerry, in fact, is NOT a meme stock. You might ask, why is that? Well, here are a few of their partnerships and products that they're developing (and have already developed): - Partnership with Amazon: On December 1st, BB announced a multi-year agreement with AWS, which is Amazon's cloud service business. The agreement plans to develop and market BlackBerry's Intelligent Vehicle Data Platform, IVY. BlackBerry IVY is a scalable, cloud-connected software platform that will allow automakers to provide a consistent and secure way to read vehicle sensor data, normalize it, and create actionable insights from that data both locally in the vehicle and in the cloud. Automakers can use this information to create responsive in-vehicle services that enhance driver and passenger experiences.
Okay, so why is this important?
Gartner Research (who published the study) even placed BlackBerry higher than VMWare, IBM, and MSFT basically signaling that their products and services are better than their competitors. In fact, NONE of BlackBerry's customers that use BlackBerry Guard were affected by the SolarWinds hack. And the stock price is still $12. The Sobering Part of this DD: After taking a look at their balance sheet, I can agree with the skeptics that they're not raking in a ton of money right now, but anyone can see that their current balance sheet makes the company appear to be undervalued, especially when compared to their competitors. I mean, based on this information ALONE, the price of the stock should be much higher than it is right now. BlackBerry's current market cap is around $7 billion, with its competitors like Palantir, a software company that I'm sure you've heard other YouTubers talk about, hovering at 60 billion. And funny enough, Palantir is also focusing their software on electric vehicles and cybersecurity, just like BlackBerry. If BlackBerry had the same market cap as Palantir, its stock price would be $110. Final Thoughts: Here's what the skeptics don't realize though. They don't realize that BB is still very focused on product development and customer acquisition, and that boomers probably still think it's a phone company. Well, it's not. With their partnership with Amazon, Baidu, their UES and UEM product known as BlackBerry Spark, BlackBerry IVY, and their QNX operating system for vehicles, it seems like the market is not correctly pricing in BlackBerry's future growth. Maybe one day if BlackBerry receives the same amount of hype that Palantir is getting right now, maybe then it'll be taken much more seriously. But only, once people realize that it's not a meme stock. [link] [comments]  |
| Why are all the weed stocks tanking? Posted: 12 Feb 2021 05:32 AM PST Why are all of the weed stocks tanking? I bought into APHA in Hopes to make out when the TLRY merger goes through with a good amount of research put into my reasoning. As of yesterday, the stock plummeted but so did TLRY, the meme weed stock, Aurora, canopy growth, and even MSOS etf and I'm sure many more. I know this may have been due to them all being in the same sector but they all have almost identical patterns and several people have mentioned their trading was suspended for APHA, and the meme weed stock, these that I know of. Does anyone know what's going on here? Is it truly just sector related to tank that bad? [link] [comments]  |
| Full Diligence Post on Palantir (PLTR) - Earnings Next Monday (2/16) & Lockup Expiration (2/19) Posted: 12 Feb 2021 10:27 AM PST Hello! Wanted to share my thoughts on Palantir ahead of its earnings next TUESDAY (Edit: sorry this is wrong in the title). Warning: long post ahead and TLDR at the bottom. Would love to know all your thoughts as well. What Does Palantir Do?
The Palantir Business Model
The Bull Case
The Bear Case
Financials and Valuation
What I'm Doing
TLDR: Palantir has a best-in-class, sticky data platform that it offers to both the government side (where it's pretty much a monopoly) and businesses (which is picking up steam with tweaks to the business model and a growing salesforce). Growing healthy top-line but unprofitable and trading at a higher valuation than almost all other software companies. I am holding off on buying for now but would welcome major dips as great buying opportunities. What do you think? [link] [comments]  |
| Virginia is about to legalize cannabis...buy this dip? Posted: 12 Feb 2021 09:11 AM PST Forget the WSB pump and dump, there are so many tailwinds to the cannabis industry. More legislation coming from Rhode Island also (as soon as next week). I'm buying ETFs this dip and holding while all of this new legislation passes. Seriously looking for someone to change my mind. Cannabis stocks seem like a no-brainer on this dip. [link] [comments]  |
| SEC Rule 201 (aka "up-tick" rule) and how to recognize a healthy stock Posted: 12 Feb 2021 08:04 AM PST I have seen my favorite stock $ATOS in red for the whole week. Today's pre-market was no exception. With my average being around $2.8, I was a little nervous today to go red. BUT an interesting thing happened. I noticed that my broker indicated that from 9:30 today until 20:00 Feb 16 this stuck is traded under SEC 201 rule, meaning that short sellers are not allowed to sell under the highest bid price. It is interesting twhat this simple rule unveiled about this stock: that it is not going down because there is something wrong with the fundamentals, but it is going down because short-sellers are forcing it to. As soon as this rule was executed, the stock started going back up to $3.7 (as of now) from $2.80 in the first 5 minutes of the market (before Rule 201 was imposed and it was going down hard with heavy volume [aka short sellers]). This means that there are more bulls than bears behind this stock, right? Since I am planning on keeping my position open for the long run, I want to make sure if my understanding of what happened today is right. What do you think? As another example in contrast to this one, the same thing happened to AEZS on Feb 9 or 10, after a spike in price. But this time the price kept going down, meaning that the price was too high even for the bulls. Is that a correct way to think about this? I appreciate your feedback. Disclaimer: Please keep in mind that this is not financial advice. I am long $ATOS 3,000@$2.8. EDIT: I forgot to mention I added a limit sell order of $50.00 to prevent my shares from being lent to short sellers. The idea of short selling makes no sense at all. [link] [comments]  |
| r/Stocks Discuss Overlooked Stocks Friday - Feb 12, 2021 Posted: 12 Feb 2021 07:00 AM PST Now's the time to discuss overlooked stocks that no one is talking about: Overlooked & possibly undervalued stocks. All the rules of r/Stocks still apply, so please see the sidebar or click here. But here's the twist you can't bring up meme stocks that have been hotly discussed in the past several weeks. Those stocks that everyone has been talking about, you can't bring up here or they'll be autoremoved. Why? It's to keep this thread pure & focused. The current list of meme stocks can be found here. So don't mention these stocks in this post or your comment will be removed. Need ideas on which stocks to discuss, try a screener like this one. Search past overlooked stock discussions here. Also check out our wiki After discussing your stock here, feel free to create a post on r/Stocks with all the information you might have just learned. Thanks & enjoy! [link] [comments]  |
| Elon Musk believes Bill Gates had a big short position on Tesla (TSLA) and lost a lot of money Posted: 12 Feb 2021 01:37 PM PST Elon Musk revealed that he has heard that Bill Gates had a big short position on Tesla (TSLA), and he might have lost a lot of money on it. Billionaires Musk and Gates don't always have good words to say about each other, but they do appear to share similar concerns about climate change. However, Gates made some strange comments about electrification last year, including that electric trucks, like the Tesla Semi, and electric airplanes will "probably never" work. In a new interview on the Joe Rogan Experience, Musk was asked about those comments from gates. Tesla's CEO responded: "He didn't know what he was talking about. Probably somebody told him that and he is just not that close to the physics of it. I don't think he is ill-intentioned here, I just think he doesn't know what he is talking about." He added Tesla already has working prototypes of electric trucks that are transporting cargo – something that we already pointed out in our original report about Gates' comment, including the fact that not only Tesla has working electric semi truck programs, but also other automakers like Daimler. But then Musk revealed that he has heard that Gates was betting against Tesla with a large short position: "I also heard that at one point he had a large short position. I don't know if that's true or not, but it seems weird. People I know who know the situation pretty well, I asked them "are you sure?" and they said "yes, he has a huge short position on Tesla". That didn't work out too well." We have reached out to Gates' foundation to see if we could get a comment on Musk's claim, and we will update if we get an answer. Tesla has sometimes been the most shorted stock on the NASDAQ, and people who bet against the electric automaker lost $38 billion in 2020. [link] [comments]  |
| Shipping stocks are on the rise! Worth a look! Posted: 12 Feb 2021 08:51 AM PST Not sure how many of you are following whats going on in container and bulk shipping...? But, it may be worth your attention as they are going from strength to strength. For those of you that haven't been keeping an eye, container rates have gone through the roof due to a bottleneck in the container market met with increased demand for consumer goods during the pandemic (ie. containers are logjam and can't keep pace with demand as people order more goods from China/amazon). Similar, there is a huge amount of demand for raw materials as countries make their way out of the pandemic with government stimulus. Much of this demand is currently being driven by 'Chinese Special Bonds' (ie. more cheap money for infrastructure/raw materials). In the handysize vessel segment alone, day-rates have now surpassed 2011 highs. This trade should continue for a while as more government stimulus is pumped into the system, central banks keep rates low and countries begin exiting lockdown/pandemic. There is a huge pent up demand and big infrastructure projects underway. Just look at the Biden administration's environmental agenda! A good way to get exposure to the upside in shipping is buying companies with handysize fleets. Due to the parcel size of the non-ferrous metals, handysize vessels are the best fit for non-ferrous transport. An added bonus in Handysize at the moment is the fact that the fleet is aging (which means the oldest of them get scrapped) and the orderbook for new builds only makes some 2% of current fleet. It takes 18 months (at least) to build a handysize so its not like the market can get flooded one day to the next. Demand currently far outstrips supply! I would recommend that everyone has a look at the segment. Not all alpha has to come from brick phones and movie theaters.... If any of you find this trade idea interesting feel free to message or respond and I'll share a few stocks I've analysed. [link] [comments]  |
| Have you noticed MarketWatch pumping out really bad advice lately? Posted: 11 Feb 2021 09:54 PM PST I just ran across three articles in my trading app and they couldn't be more wrong. They're sound by the numbers only and I think their articles that are auto generated by Ai/bots. The articles lack the ability to look at more than just the numbers. As an example several of the articles were Activision underperforms, Walt Disney underperforms, take two interactive under performs. These are shitty articles to be putting out there because you know damn well Disney is one of the largest media companies in the world. Literally too big to fail. Everyone should know that honestly, the government would never let that happen not just because they're a media company but because they are a propaganda arm for the way the rest of the world perceives The US. And take two interactive is the parent company of 2K games and rockstar games. You know the company that makes some of the best, most successful video games ever made both critically and commercially? Like I'm sure the numbers add up but this is very basic bitch analysis and seems like it's written just for the hits. anyone who would know anything about the companies being talked about would know this news is not relevant long-term. [link] [comments]  |
| $GSM - Biden Addressing Semiconductor Chip Shortage Posted: 12 Feb 2021 01:07 PM PST Per recent automotive (Ford, GM, Toyota, VW, + more) vehicle production and computer chip delays/shortages (Intel, Apple, Qualcomm, NVIDIA, AMD, Microsoft, Sony, + more), the Biden administration is taking steps to address the semiconductor chip issues. Right now a big chunk of the semiconductor business is dependent on international-based manufacturers: "The missing chips are mostly manufactured in countries such as Taiwan and Korea, which have come to dominate the industry. The letter, sent by the Semiconductor Industry Association, said that the U.S. share of semiconductor manufacturing dropped from 37% in 1990 to 12% today." "Our share of global semiconductor manufacturing has steadily declined from 37 percent in 1990 to 12 percent today," the companies wrote. "This is largely because the governments of our global competitors offer significant incentives and subsidies to attract new semiconductor manufacturing facilities, while the U.S. does not." "The Semiconductor Industry Association, which includes AMD, IBM, Intel, Nvidia, Qualcomm, and others, suggested one idea in a letter to Biden on Thursday morning. The group urged the administration to include "substantial funding for incentives for semiconductor manufacturing, in the form of grants and / or tax credits, and for basic and applied semiconductor research," in the upcoming stimulus package. But it's unclear if the administration intends to do that." *GSM enters the chat.* Pre-2018, GSM was a $15-$20 stock and took a hit in 2018 partly due to: March 23, 2018 "Earlier this month the U.S. Department of Commerce determined that silicon metals sold in the U.S. by Australia, Brazil, and Kazakhstan were at less than fair value and subsidized by the governments of those countries at rates as high as 100%. However, the ITC determined that this isn't materially injuring the U.S. industry. As such, the ITC will not issue anti-dumping or other duties on these goods." (Source: https://www.nasdaq.com/articles/why-ferroglobe-plcs-stock-tumbling-today-2018-03-23) As of lately with discussions revolving around the shortage and delays, the stock's risen 500% within the last few months. Semiconductors' most common material is silicon crystals, and one of America's biggest silicon metal producers is GSM: "Globe Specialty Metals, Inc., a subsidiary of Ferroglobe PLC (NASDAQ:GSM) ("GSM"), and Mississippi Silicon LLC ("MS"), collectively representing the majority of American silicon metal production, today announced that the U.S. International Trade Commission ("ITC") will continue investigating the harm caused by imports of silicon metal into the United States. The announcement comes after Commissioners voted 5-0 that there is a "reasonable indication" that silicon metal imports from Bosnia and Herzegovina, Iceland, Malaysia and Kazakhstan are materially injuring the U.S. industry." Analysis of growing conductive silicon market: https://ksusentinel.com/2021/02/10/conductive-silicone-market-by-manufacturers-regions-type-and-application-covid-19-impact-analysis-to-2027-major-giants-wacker-chemie-ag-dow-corning-corporation-momentive-performance/ This move has the potential for everyone to win. The companies, the economy, us, and even the HFs. Altogether, 💎🙌. This isn't financial advice, this is just looking to be a stock that we grow to love. [link] [comments]  |
| Where will the world be in five years? I am trying to find those stocks now. Posted: 12 Feb 2021 10:22 AM PST I have been playing stocks with a strategy of attempting to pick the next big thing, like the next google or amazon before it gets popular. I realize this is high risk so I limit what I 'gamble' but i have been having pretty good success. I started doing this in late 2018 with $30k and it is now worth $267k. What I think will be big are the following markets: Space: TSLA. SPCE, AJRD Renewable energy and Batteries: SEDG, ENPH, TSLA, BEP Self Drive cars: TSLA, APTV Genetic medicine: EDIT, CRSP, SRNE NOBODY wants to work in an office again: CRWD, AMZN, WMT Those are my current focus areas. Those are the primary stocks I have been buying in those areas to get my gains over the past few years. What other stocks in these areas do you think are good plays and what other areas do you think will be big in the next five years? [link] [comments]  |
| Puts on Chinese EVs $NIO, $XPEV Posted: 12 Feb 2021 12:16 PM PST Every time I see another pump article on the "next Chinese Tesla" because deliveries, I get triggered and have to put on chilled cow on spotify for 3 hours. Although entertaining, "NIO is going to squeeze like GME, all aboard!" comments on stocktwits is making my testicles feel like tiny furrowed cerebrums and not because it's cold AF outside. So I had to put together some pleb research on TSLA, NIO, XPENG & LI for you to scoff at. This is NOT financial advice, I just don't like these stocks. 1. Positions https://imgur.com/qKMQHBo Yeah my lazy ass needs to switch off. A few more 2023s, I just went sniping randomly yesterday. Full disclosure, I also hold and sell CCs on my Tesla shares, so this play doubles as somewhat of a hedge for me. Sorry, not up to YOLO standards, I'm a lil biatch. 2. The Chosen Ones: NIO & XPENG Did you ever look at TSLA and think, god damn that shit is overpriced? Then look at the price to sales and realize, holy fuck it is? Then looked at it a month later and the price doubled? Well guess what, NIO and XPENG are trading even higher than TSLA. Current PS as of 2/10/2021 - TSLA: ~25 - NIO: ~40 - XPENG: ~41 - LI: ~19 (It's because their flagship SUV is hybrid electric +ICE, insane PS reserved for pure bloods only) Let's compare. These guys aren't coding the next Gran Turismo 8, but let's look at high margin tech anyways. - NFLX: ~10 - ABNB: ~28 - PLTR: ~72 (peter pan stock) Actual automotives, old, unsexy, fell from grace, like your grandma's teets - TM: ~0.8 - F: ~0.4 - VWAGY: ~0.5 I did some monkey spreadsheet math to forecast their updated TTM Revs after Q1. Don't ask me how I did that, the answer either won't impress you, or straight up glide over your smooth brain and I need you to focus on what's important right now. Q1 2021 PS if MC doesn't change - TSLA: ~22 - NIO: ~29 - XPENG: ~26 - LI: ~14 Yep, still overvalued AF. Before we get into the nuts and butts, there is always the risk (lotto upside in our case) that macros choke and correct >20% because of some black swan (I mean it's 2020s, Murphy has been trying to prove a point). When this happens, we know what gets hit hardest, the ones with the high forwarding looking, rosy multiples. These EV stocks will get beat up worse than that washed up highschool varsity prom king's girlfriend. Some other lotto events include China stocks being delisted, and who can forget the audit risk on those poorly cooked books, but enough to win the Great Chinese Bake Off. Can they grow Revenues though? Let's look. 3. Revenue Growth Stunted You might be one of those Stocktwats and you're thinking; "but but... they'll ramp deliveries exponentially and grow Revenues just like TSLA did back in 2018!" *Smacks you in the face*, no they won't and here is why. Chinese people love brand name shit. I repeat, Chinese people love brand name shit. Quantitatively, go look at LVMH sales in China. The figures on Chinese tourists going on vacation, spending without looking at the price tag (naw they definitely check for them deals) is incredible. They're not there to look at some antiquated tower (way better architecture back home), they tryin to get those furry Gucci Slips on discount (they are ugly AF btw). Tesla is no different, people worship Musk over there. You could probably sell his panties online, and some Chinese billionaire will pay millions for it, just like they did for his Gene Wilder house in LA. Qualitatively, I called my cousins in China, confirmed, he couldn't stop jizzing at the slight mention of Tesla. Why does this matter? Owning a TSLA is like owning any other brand name shit in China, social status. Social status is EVERYTHING to much more of the population in China vs. RoW. The biggest difference is, you're not going to be able to buy a knock-off TSLA in some shady, cigarette smoking thug's closet on the 2nd floor of a Chinese dumpling street stand. TSLA just ramped the Model Y in China and started deliveries in Jan. That shit sold out in a matter of days. If you're not buying one, you basically have to settle for an uglier wife (this is probably not much of an exaggeration). Well guess who has been selling mostly midsize SUVs without much competition from TSLA and achieving recording breaking deliveries up until now? NIO: 100% SUVs Xpeng: 40% SUVs Brand aside, some triggered specs nerd out there is thinking "Well, ultimately people will decide based on specs and value, not brand alone." Fine, let's take a look at what aspects of an EV people care about. Let's break it down apples to apples for these SUV EVs Tesla Model Y- Price: ~$52,800 - Range: 594 km (Kilometers for the apes) - 0-100km Acceleration: 5.1s - Charger network: 20,000+ NIO EC6 - Price: ~$57,200 - Range: 430 km (605 if you pay ~$9k for a bigger battery) - 0-100km Acceleration: 5.4s - Charger network: 290+ Xpeng G3 520 - Price: ~$30,580 - Range: 520 km - 0-100km Acceleration: 8.6s - Charger network: 866+ You may be thinking the G3 520's price tag is looking pretty attractive. Then you imagine the future wife you'll be banging, yeah, trade up for that Tesla boi. "But JJ, NIO has battery swap tech! It's perfect for China's dense cities!" If you know anything about product market fit, battery swapping for EVs is like trying to bang a gerbil's anus. First of all, battery swap stations are way more expensive to build, stock and maintain. Crazy upfront build out costs and battery requirements kill your rate of expansion (shit is important for demand). Tesla superchargers are spreading like wildfire and become recurring revenue generators over time, while battery swap stations stay cost centers over time, breakeven at best. That's why NIO tries to charge a $150 subscription fee, I'd rather get pornhub subs for the whole family. Oh btw, you can't even do it yourself, you have to give it to a service technician to do the swapping for you. Be realistic, these wealthy, classist Chinese dirtbags (I'm Chinese and know some first hand) don't want some lowlife service tech to sit on their mothball leather. Back to battery swapping and product market fit. Look, Tesla tried this in 2013, decided it was dumb, abandoned it and decided to make charging super fast and let you watch the actual Great British Bake Off while you wait. In 20 fuckin 13 some of you were still going through behavioral therapy. Lastly, the people buying EVs above the $50k range have easy access to charging, especially Tesla's network. So, battery swapping for cars above $50k is serving a niche market, a handicap, and a money losing operation. "But JJ… China EV Market Growth! They may have a smaller share right now, but the Pie grows for everyone!" Maybe, but if you look at the 2020 EV market growth, most of that came from guess who? Tesla. Oh, and a $8k mini, pretty much a golf kart that Tyrian would be uncomfortable in. Solar & batteries are money losing businesses right now for Tesla, but people are pricing in some of those rosy projections into the valuation. Nio and Xpeng haven't even hinted at the idea because people in China live in 3D printed skyscraper boxes. Home solar and battery doesn't make sense, but this also means no revenue opportunity. Oh and let's not forget about autonomy… no, let's forget about it (for now). International expansion you say? Sure Nio and Xpeng trying to expand oversees to... Norway. No way has the population size of a small Indian wedding. Let's be honest here, would americans buy a "made in china" EV over a Tesla or even Ford/GM EV? I'm Chinese and I wouldn't even fuckin touch that shit. Back to Cars, to make matters worse for Chinese EV players, Tesla has already designed a budget model. Unfortunately, it'll be hard, like wiping ass with sandpaper, for Xpeng and Nio is follow suite in this space because of... MARGINS. Let's look at this next. 4. Your margin is my opportunity - JB Retiree History lesson; how did China become #2 in GDP globally? They industrialized their massive population, kept the RMB artificially deflated to undercut the world through exports. Sure, quality suffered, but everything was "made in china" at some point. This is all to say, you can always increase demand by reducing price, and you can optimally reduce price if you have better margins than your competitors (or have the cash to sustain a loss to not bleed out before they do). Let's look at the current state of margins. Q3 2020 Gross Margins - Tesla: 23.5% - Nio: 12.9% - Xpeng: 4.6% - Li Auto: 19.8% We'll have to revisit Q4 margins when everyone reports in a few weeks. But wow, it's not even close for Nio and Xpeng. This is not even taking out Tesla's solar & battery margins, which are negative, like when your mom finds out you YOLOed your college tuition on [redacted] at $400. "But JJ, that's not fair, Nio and Xpeng are still ramping!" First of all, so is Tesla, just on a larger scale. I mean, they are building factories like Starbucks locations. But fine, just taking a peak at margins for Tesla in earlier "ramp" years. 2017: 18.9% 2016: 22.8% 2015: 22.8% This may not look right, something must be wrong you're thinking. Well, let's we take a look under the hood, you won't find Trayvon Martin. - Battery is the main cost of an EV. Tesla has been working on battery tech from the beginning, they invented and are retiring the "skateboard" design, saying it's obsolete because they got something better, while Chinese EV companies are busy copying it. Ay caramba! - For the batteries them selves, just look at battery output distribution. Both Nio and Xpeng rely on CATL for their batteries in China. But so does everyone else at an Indian wedding, including Tesla. Either everyone is going to be supply limited, or someone is going to have to pay more. You can pay more when you have better margins to work with/bleed cash. At least Tesla will have their own way out soon enough. Can you find Nio, Xpeng or Li Waldo? - Tesla's electronics are industry leading, Mario knows. Neo and Xpeng on the other hand outsources most of the Chips (Nvidia) and hardware (Mobile eye). When you outsource, you ultimately have less margin, control, speed and ability to freely synergize. - Tesla is also literally stamping entire cars like crispy cream donuts. It's almost if Chinese EVs are trying to take on Megatron's fuckin Fusion Cannon with blow darts. Nio on the other hand abandoned plans to make their own factory due to cash shortage and partnered with JAC. A short term plat that won't help margins in the long run. - You know how Tim Apple gets a hard on every time he talks about service margins, EVs have some of that too. - In car entertainment: Tesla is building an app store, while Nio and Xpeng outsources - EV Charging: Tesla has the biggest network, Nio has $ losing battery swap, while Xpeng relied on and pays government network - Connectivity: Startlink? *shrugs* - Autonomous driving: Tesla is rolling out subs for FSD, and I wouldn't trust Nio and Xpeng's software with your wife's boyfriend's life 5. Closing Look, Nio is backed by Tencent and Bidu. Xpeng is backed by Ali. Their balance sheets pass the acid test with flying colors, so they can bleed cash for awhile. But Tesla has a meme lord at the helm. Let's not forget some of the giant local players like BYD, who is backed by Bigly Buffet himself. There is also SAIC, Great Wall, Geely, BAIC, Chang Jiang, Kandi, and dozens more names you don't know, just like the name of your cousin's mail in bride. Tesla copy cats are literally coming out of the woodworks, when buyers have a paradox of choice, the clear pick defaults back to the trusted brand, guess who? CCP has already been 3 steps ahead of Biden (I mean, who isn't, lol) and EV bullish years ago. Matter of fact, EV subsidies (which Nio and Xpeng survive off of like a bums on opioids in the streets of San Francisco) are already getting cut by 20% in 2021, and phased out by 2022. I'll let you figure out what happens to deliveries when subsidies get cut, again comes back to magins and cash. If it comes down to EV price wars, I don't think it'll be Nio and Xpeng winning the bleed out. It'll be more like Matrix 3, rather than 1. I'm no voodoo magic chart nerd, but Nio tested $65 resistance again yesterday and failed. Xpeng in general looks like it's peaked. Google search interest has spiked and all the little virgin armchair analysts on YouTube have pumped it 10 times over. I'll wait for their earning numbers in a few weeks to take the temperature again. I'll likely add more to the position then, will update. At the end of the day, Nio and Xpeng may trade sideways for much longer than I can stay solvent, but fuck it, I've spent too much time on this, so sunk cost is set in hard, change my mind. TL;DR Not sure when, but bet on EV bubble popping with Puts on Nio and Xpeng. Better to sit on the side lines for Tesla and Li Auto [link] [comments]  |
| Posted: 12 Feb 2021 01:14 PM PST For anyone feeling helpless right now, remember that the cannabis industry is a long hold. The best companies will come out on top. If we keep heading toward legalization, there is a lot of growth to be had. I suggest we all contact our representatives and demand legalization. Let reddit and forums like this put the pressure on D.C. We can work together instead of trying to tear each other apart. NORML has great templates for reaching out to representatives. Here is a sample for NY: "As your constituent, I urge you to support efforts to legalize and regulate marijuana for adults in a fair and equitable manner. It is essential that New York's marijuana legalization law includes the following core consumer-centric tenets: The legal option for adults to cultivate personal use quantities of marijuana in private residences; Reduced barriers of entry for those seeking to participate in the legal adult use marketplace; Provisions facilitating the automatic review of past criminal records and for the expungement of those records where the past behavior is no longer classified as a criminal offense; Provisions prohibiting employers from discriminating against workers in the practices of either hiring or firing solely because their off-the-job cannabis use; and Dedicated funding of social and retroactive justice initiatives through Community Reinvestment Grant fund. Never in modern history has there existed greater public support for ending the nation's nearly century-long experiment with marijuana prohibition. According to statewide polling data, 65% of New Yorkers endorse regulating the adult use of marijuana. Please support efforts to legalize and regulate adult use marijuana in a way that ensures safe, affordable, and equitable access for all New Yorkers." NORML allows you to easily find your reps and reach out. WE HAVE THE POWER! [link] [comments]  |
| ARK Israel Innovative Technology ETF Posted: 12 Feb 2021 07:28 AM PST Was browsing ARK website and found this ETF I didn't know existed. Tbh I had no clue Israel was big in tech but with this new ARK fund do you guys think it would be worth investing? Since it's ARK I imagine a lot of people will start flocking in once it gains publicity. What do you guys think? [link] [comments]  |
| Posted: 12 Feb 2021 06:25 AM PST Before you start this is not a DD, I haven't gone through financials, it's more of an overall opinion coming from a computer enthusiast on why I think Intel could be interesting and it's worth adding on a watchlist. I'm posting this so I can get opinions from you guys about what I'm right or wrong about. And for full disclosure even though I don't think it's relevant due to the size I'm gonna mention it anyway: I do technically own some INTC but it's only 2 shares, yes 2 shares. So as of now while I may add a position in the future, this could go to zero or do a 100x and it wouldn't really affect me or my judgment in anyway. I may actually get a real position on Intel but as of now I'm just keeping it on my watchlist, I want to see how the new CEO is gonna handle it first. ----------------------------------- ConsBefore we talk about the pros of Intel I really think we should discuss the cons, since INTC has many, I'm gonna list them first then address each one: - Management - Production issues - Competitors - The x86 architecture is getting old ManagementI think we can all agree management has been a hit or miss at best, while AMD managed to take a company with uncompetitive products to leading player. In the meanwhile Intel has managed to go from its dominant position to a… well… pretentious follower that doesn't even care its products are being laughed at by enthusiasts. It's technically not a complete failure, they did manage to milk the dying cow well enough to grow revenues consistently but this approach couldn't have kept it alive much longer. Production issuesIntel has been stubbornly avoiding outsourcing, which is good in theory sadly this didn't go as planned and they still didn't scrap the idea as a failure, it just caused delay after delay on products they absolutely needed to stay competitive. CompetitorsIf you are thinking AMD, you are wrong, they kept going in alternating cycles forever thinking their duopoly wouldn't be challenged, the time has finally come. Apple, while not an actual competitor has shown that what has kept the two companies on top is starting to get less competitive and it's not the only viable solution for the desktop market anymore. Apple may have just scratched them but now the blood is in the water and the sharks are smelling that. The x86 architecture is getting oldWe have finally arrived to the real threat to Intel survival, their beloved x86 architecture, licensed only to their frenemy AMD. The crown jewel of Intel is not enough anymore, Moore's law for Intel does not apply anymore but it does for ARM. I think it's important to understand the main difference between x86 and ARM, this is a battle between CISC and RISC. I don't want to go into the details since things can get complex so let's make it quick and simple: x86 is a CISC architecture meaning on each chip they pack a lot of instructions so that if you want to perform an operation you need less cycles. ARM approach is different though, ARM is a RISC architecture meaning the chips only contain the strictly necessary and basic instructions, in this case to perform one operation you may need to use more instructions and cycles however it has one big benefit: the chips are much more simple, less complexity = easier production. ARM requires a lot less power to work and by consequence less heat is required to be dissipated this little detail is what makes a chip with less instructions faster than a chip with more instructions, yes, you may need to use more cycles for your operations but you are able to make the chips run at higher speeds and pack a LOT more cores. ProsFinally! We've reached the pros, again like the cons I'm gonna list them first, and, you may notice something interesting about them: - Management - Brand - Production issues - Competitors - Architecture & support Yes, they are almost the same, Intel is a weird beast in a fairly complex environment ManagementNot much to say here, #1 problem of Intel has finally been addressed, the CEO is about to be replaced, Swan was a CFO placed into a CEO position, you may be the best CFO of this world but you can't drive a company like this looking at the checkbooks. Gelsinger is coming in and his background is pretty promising, like I did in school I'm gonna steal this next section from Wikipedia (thank you Wikipedia):
And he's not coming alone, a couple of skilled veterans are coming with him. It's still too early to judge how this will go, and things will need a few years to play out, R&D does take time, even Su didn't save AMD in one day. BrandWhile it has fallen out of favor many still prefer to buy Intel just based on the Brand alone. Production issuesLet's not beat it around the bush to much, Intel should've outsourced production, however IF they could get everything to work properly the pay out will be insanely useful, especially in moments like these, just take a look at TSMC, it just can't keep up with the demand. This move can be smart, making your own staff just like Apple has proven comes with nice benefits. I still think Intel needs to outsource while they keep developing their internal pipeline though. CompetitorsThis is tricky, I don't think it's actually a pro per se but I'm gonna put it here anyway. AMD is not really a threat to Intel survival, they want to be dominant but they don't want to go for the kill. With the M1 Apple SoCs though ARM chipmakers are smelling blood, however Intel has still time to catch up, the M1 is a great but it really needs macOS to shine, Windows is still not there yet on ARM support. Architecture & SupportYes, x86 is showing its age, but is still the only architecture with decent support on Windows, which let's not forget has basically a monopoly and old software still requires x86 compatibility, Windows emulation of x86 is not up to par with Apple's So, while old x86 still has the edge, for now. BUT I do NOT think x86 is the future, ARM is already a successful, valid and objectively better solution for scalability. Unlike x86 ARM licenses are available with anyone who wants to pay for them so Intel can actually join the game on this. There is also another road, RISC-V, it's showing promising results and it's open source. Anyone can take RISC-V and develop it without paying any fee. Edit: as a final note, I'm sorry for the formatting Reddit is not great for text walls and also sorry for possible english mistakes, it's not my first language I'm not too used with posts of this lenght. [link] [comments]  |
| Why does every stock seem pumped up now? Posted: 12 Feb 2021 07:03 AM PST I'm trying to look for some good stocks that haven't already exploded over the 2020 pandemic or over the past month. It seems EVERYTHING is at an all time high, which makes buying in kind of worrying. Any advice? EDIT: Thanks for all the advice guys and gals! [link] [comments]  |
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