Stocks - Investment Ideas $150K |
- Investment Ideas $150K
- How Stocks Are Valued Part 1: Discounted Cash Flow
- Zillow's CEO says its share price is "obviously" too high
- How much did Reddit change your investment strategy?
- What are some companies you love but hate the value of their stock?
- How does shorting affect a stock?
- Trying to look for other signs of over/under valuation with PE ratio
- Why is it so important for a company to pay dividends?
- The Greatest Investment Advice Ive Ever Read
- Which do brokerages sell first?
- Leveraging portfolio…
- MKSI - A buy?
- Northwest heatwave - Looking for tickers of Air Conditioning companies and stores?
- GOGL ZIM etc? Shipping companies.
- EV shovel stocks, and shovel stocks in general
- Does breakeven point matter for options?
- Best websites for News and DD
- World ETF or slice'n'dice?
- What do you thing of Gaming Stocks ?
- Investing in California (My Top 10)
| Posted: 27 Jun 2021 08:03 AM PDT Imagine you have $150K sitting in the bank not collecting any income. How would you use this money for the next 5-8 years to generate more income? I'd love to hear about your investment ideas.. It doesn't have to be investing in the stock market, it could be real estate or anything else. Thank you! [link] [comments]  |
| How Stocks Are Valued Part 1: Discounted Cash Flow Posted: 27 Jun 2021 07:46 AM PDT I saw a question on this sub yesterday about why stocks are valuable, so I thought I would do a write-up of what I learned about stocks in business school. But first, an important concept: The Time Value of Money, Present Value, and Discount RateA loan to a friend Imagine if you loaned someone $1000 for a year. You probably want to be paid back with interest. This interest compensates you for losing access to that money for a year, during which you could have deposited it at a bank, invested it, or even spent it. The long story short is that $1000 today is worth more than $1000 tomorrow because of the flexibility and options that you have with today's money. We can say that the Present Value of $1000 next year is less than $1000 today. This concept is also known as The Time Value of Money. An Example With T-Bills Treasury bills (T-Bills) are essentially loans to the US Government, but the amount to be repaid is fixed. T-Bills are typically denominated in $1000s, which is the amount the government will repay when the bond matures. An investor can typically buy a T-Bill for less than the full $1000 on the open market. The investor makes money because she purchased the future $1000 payment at a discount. This discount exists because money today is worth more than money tomorrow. How do you convert between the two? Using the appropriately named Discount Rate, or the required rate of return. The average investor wants to make money from lending money, even to the US Government. If investors want a 1% return, then $100 today is the same as $101 next year. We can similarly price T-Bills: If the required rate of return is 1%, and the bond will pay $1000 in a year, then the Present Value of the T-Bill is about $990. This is because the $990 investment will grow by 1% into $1000. -------------------------------------------------------- Are you still awake? Good. This is the fun part. So What Are Stocks Anyway?Stocks represent partial ownership of a company. A company is divided into units of stock called shares, and as a shareholder, you are entitled to a fraction of the company's assets (after all debts are repaid) and any future profits. So Why Does a Stock Have Value? Part of a stock's value comes from its book value (the value of all company assets minus all company debt) but this clearly only a small fraction of that price ( the average price-to-book ratio for the companies in the S&P500 is about 4.5). The remainder of the stock value comes from the future earnings of a company. Similar to how the price of a T-Bill is the present value of a future payment, a large part of a stock's value comes from the present value of future earnings. Analysts will project (and discount) a company's future earnings, add the book value, and arrive at an estimate of the stock's value. Oversimplified DCF Example:The Pear Company makes $100 a year risk-free. For simplicity's sake, it has $200 in assets and no debt. For some reason, you figure 100% is a good discount rate to use. The Pear Company will make $100 next year (Year 1), which is worth $50 today ($50 doubles into $100 in a year). In Year 2, The Pear Company's earnings are only worth $25 to you today, and so on. If you add the present value of all future cash flows together, you'll arrive at $100. You can find the company value by adding the value of its assets ($200) with the present value of its future earnings ($100). If Pear issues 100 shares, each will be worth $3. Of course, even simple DCF Models IRL look a little scarier than the above example. But What Makes The Stock Valuable To Me?You might have noticed that dividends aren't really taken into account at all. How are you supposed to get any real money from a company whose stock pays no dividends? Unpaid dividends don't just disappear. Management can decide to reinvest these profits to grow their income. This results in a larger stock price over time. The company might also just decide to keep the cash on its balance sheet. This results in a larger book value, and the stock price will increase to reflect that. You can sell some stock to create your own "dividend" if you'd like; you will own a smaller percentage of the company, but because profits were not distributed to shareholders, the company has gotten bigger. But What Makes The Stock Valuable To The Next Guy? Eventually, the company's value will be returned to shareholders. This could happen in several ways:
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| Zillow's CEO says its share price is "obviously" too high Posted: 27 Jun 2021 09:15 AM PDT Zillow Group (NASDAQ:ZG) CEO and co-founder Rich Barton said that the real estate listing company's stock price appreciation over the past year doesn't reflect the reality of the business. Zillow's share price more than doubled over the past year through June 14. "Obviously the company isn't in reality that much more valuable in the space of one year, which just highlights how the stock price is just not the business." Barton was speaking on the NPR podcast "How I Built This with Guy Raz" earlier this month. "The business is the business, and in the long term the stock price reflects the business," he said. [link] [comments]  |
| How much did Reddit change your investment strategy? Posted: 26 Jun 2021 08:56 PM PDT Did Reddit either influence or change your investment strategy, by that I mean you had a sound strategy when you first started investing and it was changed due to reddit influence. I think redditors know alot about tech sector more than anything. So I bought more tech companies than I anticipated. What about you guys, how much did reddit influence your investment strategy? [link] [comments]  |
| What are some companies you love but hate the value of their stock? Posted: 27 Jun 2021 12:10 PM PDT I have a few companies I love that I want to invest but the stock value is too hot and waiting for them to cool down. What are on your watch list of companies you love? For me, I love Tesla as a company but the value seems far out there. I also want to take a position in Disney and just waiting for it to strike my target. [link] [comments]  |
| How does shorting affect a stock? Posted: 27 Jun 2021 02:21 AM PDT I don't mean the stock's price, I mean the company itself. I keep seeing people saying that short sellers bankrupt companies, but, to my understanding, the only way that they affect the company is through lowering the share price. A lower share price means that the company can raise less money through additional share offerings, but... That's about it, right? I also guess it affects more of the intangible aspects like investor confidence and so on, but I still fail to see exactly how short sellers affect the company. If the company is good enough, eventually it will bounce back up, right? There's a reason why the most shorted companies are some of the most controversial ones. Most of the them have slim chances of performing well or are overvalued. And, also, if we apply the reverse logic, if a company's share price gets pumped up and kept up, the only thing they can do is raise more money through the shares. However, if their management and business is shit, they're just buying themselves more time before bankruptcy, right? I've seen the theories about companies that are trading above the fair value actually creating value through share offerings, but at the end of the day it comes down to the underlying business and it's performance. If a company was that good that it only needs money to become an amazing performer, there surely would be some merry bunch of individuals who would give them some. I mean, investors and institutions are spending a fuckton of money supporting companies with a 10% chance of surviving over the next few years and dodgy startups, if they saw a company that only needs cash to perform well, they'd surely recognise the opportunity, right? I have not actually done any substantial factual research on this although admittedly it's a bit hard to find good resources right now which are not biased. This is purely my own personal understanding. There's plenty of people here who are smarter than me so I was hoping that somebody would have a good answer 😁 Thanks! [link] [comments]  |
| Trying to look for other signs of over/under valuation with PE ratio Posted: 27 Jun 2021 12:09 PM PDT I've been told in some of my recent posts that my analysis of the companies PE ratios 5 year averages relative to the current ratio they are trading at is not always a sign of over or undervalued. What do other investors look for to determine valuation aside from comparing every worthwhile competitor in the industry that I can find to one another (something I'm not above doing if had a comprehensive enough list for a certain industry)? Trying to be a more well-rounded investor and put these numbers into better context. [link] [comments]  |
| Why is it so important for a company to pay dividends? Posted: 27 Jun 2021 02:01 AM PDT Relatively new to investing doing it for half year but the more i get into it the less i understand. So why is it so important for some companies to pay and constantly increase dividends year by year. As far as i understand companies need money at the beginning of their life to cover the expenses and then in exchange they return the profit to the investors in dividends or buybacks which makes the stock/company valuable which drives the stock price up so they can issue more shares if they need money for further investment. So this is completely ok but a company like coca-cola, altria, 3m etc. doesnt really issue any new shares or do something innovative to reform the company/build factories etc. So does it even matter what their stock price is? Their net profit would cover all expenses isnt it? So why dividend champion stocks keep increasing their dividends each year why dont they just stop pay dividend and pay the profit to the workers or to the management or whatever. [link] [comments]  |
| The Greatest Investment Advice Ive Ever Read Posted: 27 Jun 2021 02:18 PM PDT Theres a great interview with David Tepper on CNBC from just after the GFC in 08 where he kind of just puts his balls on the table for Becky and Joe to ogle at. He basically says that he followed the feds guidance and just bought financials because TINA/ZIRP and he didnt even need leverage because he knew the payout would be so big. It got me thinking about one of the greatest bits of advice i have ever heard. It basically is, invest like you have the money to individually move a stock. If you can get into this psyche you will win more than you lose. Once you get into the mind state of the Teppers and Ackmans, you will start to understand how financial markets truly operate. My best returns were when i bought Etsy in April of last year (still holding though sold some last fall). I put 30% of my account in it. It was a purely psychological play. I knew if some HF with a big enough bankroll had my same thought process id be golden. [link] [comments]  |
| Which do brokerages sell first? Posted: 27 Jun 2021 06:48 AM PDT Hey guys, this may be a newbie question, but let's say if I were to buy 10 shares of a stock and then 10 later down the road for example, if I were to then sell 10 shares will my brokerage automatically sell the first 10 I bought, the most recent 10 or randomly? Intuitively it makes sense to sell the longest held shares for lower capital gains tax, but I'm not sure if that's worked into brokerage algorithms or not. I mostly use Webull and dabble a bit in Robinhood. [link] [comments]  |
| Posted: 27 Jun 2021 02:17 PM PDT Another post on here was questioning general investment strategy and this brought the question of property into the equation, and it prompted me to get your views on this… Property can be a great investment generating both capital growth and income. But it's a pain in the arse. I'm in a senior position in a fairly substantial private property investment company, but I have no interest in owning buy to let property, despite doing this for a living. I suspect people do it because they can put down a relatively small deposit, mortgage finance the remainder, acquire a substantial asset and watch it grow, whilst also receiving an income from rent. My question is, why not do the same with equities? Assuming I only invest in equities with a margin requirement of 25% then I can have a portfolio 4 x larger than I could otherwise have, and at a fairly low rate of interest, a rate comparable to buy to let mortgage rates. Im mid thirties, have about £280k ($389k) free cash at the moment and most is invested in equities. I earn a decent salary and live fairly modestly, so a good chunk of future earnings can also be saved or invested. No large future expenses anticipated. Own my house in London (albeit with mortgage). So why not treat equities like property, leverage it, and profit in the long run in a much more liquid market, with lower costs and less hassle than property. Obviously everyone's personal circumstances are different but I could definitely tie this money up for 10 years, so what good reasons are there not to do this. I am aware I need to leave a good chunk of cash free for any margin calls, particularly if the market tanks! [link] [comments]  |
| Posted: 27 Jun 2021 12:05 PM PDT MKS Instruments (Nasdaq: MKSI) is a global provider of measuring and controlling devices used in advanced manufacturing processes. They also provide services related to their products including installation, maintenance, repair and training. Primary industries are semiconductor, healthcare, research and defence. As of 2021 the company has more than 2,200 patents. In May of 2021 MKSI announced the acquisition of Canadian company Photon Control Inc. in an all cash transaction with the aim of broadening their product and service portfolio. On Apr 26, 2021, Mks Instruments reported Q1 2021 revenue of $693.90 million up 29.53% year over year. Revenue has increased annually by an average of 26% over the past 5 years. EPS has increased each of the last 5 quarters from $1.26 to $2.21 P/E of 23.83 Strong through-cycle free cash flow. 70% of capital reinvested in growth initiatives such as acquisitions, debt management, product development and dividends. This weekend I've been doing some DD and looking at 2023 leaps which aren't too expensive. Analysts forecasts are strong $200+ Currently trading at $173 MKSI has a strong market presence, the 2200+ patents, solid financials and continued growth is this a BUY? Would be interested to hear opinions. [link] [comments]  |
| Northwest heatwave - Looking for tickers of Air Conditioning companies and stores? Posted: 27 Jun 2021 12:05 PM PDT People are going to be buying A/Cs like never before up there. Even if they were late for this heat wave, it's only June and there are two more months left of summer. Looking for companies that manufacture a/c's or popular department stores that might benefit off massive sales. [link] [comments]  |
| GOGL ZIM etc? Shipping companies. Posted: 27 Jun 2021 06:56 AM PDT I see that Michael Burry was or is invested in GOGL which has a 8%+ dividend and has been doing very well lately along with other shipping companies like ZIM etc. ZIM is up over 300% ytd along with others in its category. I see GOGL has been as high as in the 100s in past years, but declining until about 2019. In 2014 it was about $55 a share. Wondering anyone's thoughts. GOGL looks pretty good for a small bet in my IRA with 1% or something? 8% dividend? [link] [comments]  |
| EV shovel stocks, and shovel stocks in general Posted: 26 Jun 2021 09:10 PM PDT I saw a post the other day talking about shovel stocks, as in when the gold rush was going on the people selling shovels were the ones making the real money. I feel like we are starting to get to a point where electric vehicles are starting to be affordable, attractive, and more widespread. Rather than investing in the EV market I would like to find some shovel stocks in the supply chain (battery manufacturing and recycling for example). What are your favorite picks for both the EV industry as well as some of your favorite shovel stocks in general? [link] [comments]  |
| Does breakeven point matter for options? Posted: 26 Jun 2021 06:36 PM PDT i got a option that expires in two weeks, break even point was abt 10 percent more (this was a call) but i made a hefty amount of profit when it only went 5 percent up? How would u explain this i thought u need to hit breakeven point to make money so i could make money on a option if the break even point is like +50 percent? and it expires in two weeks? and if it goes up just a few percent [link] [comments]  |
| Posted: 27 Jun 2021 09:23 AM PDT I have only in the last year been into investing and have come across a wide variety of different websites and news outlets. It can get chaotic with 10-12 different accounts for different websites and I would love to hear how you get the best up-to-date news in stocks and which websites do you use to check stock forecasts/options etc. So far I have heard of and/or used: Finviz Market Chameleon Apewisdom.io Stockmarketmba Wall Street Journal Marketbeats Bar chart Yahoo Finance OTCmarkets.com Market Watch Naked Short Report Webull E*TRADE Twitter (company social media) & of course Reddit. How can I simplify this process? Or is it typical to wake up and check 2-5 different websites when planning the day. Thanks for any input. [link] [comments]  |
| Posted: 27 Jun 2021 01:45 PM PDT Hi all! I have a larger pension from a previous job that I would like to invest long term in world ETFs. I would like my investment to be based on the ESG standards (ex China). I have 30+ years until retirement. I currently see two options:
A minor issue with option 2 is that Pacific ex Japan doesn't exist as ESG from iShares (where I intend to buy most of my portfolio), but it's only 4% of the market. I also haven't found the Emerging markets ex China as ESG. Covering Developed markets with regional ETFs would save about 0,1% per annum, but I'm not sure it's worth the hassle. If, at some point, I have to sell part of my investment to pay my taxes from the earnings, or I want to change course a bit, then the allocation will either be skewed, or I'll have to pay extra in brokerage fees to keep the correct allocation between the regional ETFs. I know some people also advocate for simple portfolios. What would the normal advice be? Or what would you do, and why? [link] [comments]  |
| What do you thing of Gaming Stocks ? Posted: 27 Jun 2021 08:10 AM PDT I personally think that GTA 6 will come in the next 1-2 years- and as always it will be a smash hit and break records. TTWO Activision is into e-sports and mobile games, I don't think these will be gone in the near future. EA- Kinda wish to add them, they pump good shooters, recycle trash FIFA's, NFL's etc. that a lot of people buy every year along with microtransactions in them Tencent- Probably the most solid here- League of Legends, Fortnite... Nintendo- No opinion. So what do you think? [link] [comments]  |
| Investing in California (My Top 10) Posted: 27 Jun 2021 08:10 AM PDT Despite the gloom and doom the news would have you believe, droves of people are not in fact leaving California and not only did the Golden State weather the storm of Covid better than many expected but its economy is booming. Anchored by three global powerhouses in entertainment, agriculture, and tech (SoCal, Central Valley, Bay Area) here are my top 10 stock picks in no particular order for long-term growth from the best state in the Union:
Disclosure, have positions in all of them and from Los Angeles so might be a bit biased... Also, please note that while my choices are based on DD that draws upon my education background in Materials Science Engineering and current employment as a software engineer in Silicon Beach, this is not financial advice lol Edit: Some things people don't consider when bashing California:
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