Stocks - r/Stocks Daily Discussion & Options Trading Thursday - Sep 16, 2021 |
- r/Stocks Daily Discussion & Options Trading Thursday - Sep 16, 2021
- I am selling all of my positions and withdrawing all of my cash from my brokerage account. I am done, for a long time.
- To the more experienced folks here: How much were the informed retail investors aware of the impact of Bear Stearns bankruptcy back in 2008?
- Powell orders ethics review after Fed presidents disclosed multimillion-dollar investments
- The Carbon Capture Industry will be Huge
- Palantir and connected vehicle platform, Wejo, announce new partnership
- The New Moonshot Technologies
- Reasons I Remain Bullish
- Here is a Market Recap for today Thursday, September 16, 2021
- Selling for a loss can be ok
- What is happening with JNJ, MRK and BMY (essentially a lot of pharmaceutical stocks)?
- Why did the market drop today?
- Worst companies to invest in right now?
- Lithium Juniors Mega Thread
- How do swing traders determine the kind of market they're in as is relevant to their trading style?
- Brilliant Earth IPO
- Airline stocks in an upward trend. No specific news for them?
- Buy Ducthbros Today or wait for IPO buzz to die down
- How To Know When You're Just Lucky?
- Thoughts on Dynatrace (DT)
- Looking for a chart app or website for daily historical data w/open for that day
- LWLG worth looking into.
- Simple DD on SelectQuote $SLQT
- Why did the market rally today?
- Where is the cannabis industry heading?
| r/Stocks Daily Discussion & Options Trading Thursday - Sep 16, 2021 Posted: 16 Sep 2021 02:30 AM PDT This is the daily discussion, so anything stocks related is fine, but the theme for today is on stock options, but if options aren't your thing then just ignore the theme and/or post your arguments against options here and not in the current post. Some helpful day to day links, including news:
Required info to start understanding options:
See the following word cloud and click through for the wiki: If you have a basic question, for example "what is delta," then google "investopedia delta" 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. See our past daily discussions here. Also links for: Technicals Tuesday, Options Trading Thursday, and Fundamentals Friday. [link] [comments]  |
| Posted: 16 Sep 2021 09:00 AM PDT After going from 15k to 43k and back down to now 9k (mostly due to 0 day options), I've realized that I have a severe addiction to gambling that I've never had before in my life. I have decided it's no longer worth it. I'm getting out after 18 months and a 6k total loss. It's OK, I'm going to be spending more time and reconnecting with family; working on my mental health which has been seriously effected by stock trading. I have deleted Stocktwits, Twitter (that's all I used it for), and will only check SPY once daily. I will be back if the big correction occurs, but I will absolutely then tread lightly and only buy shares. If you are new, do not trade options. Just don't. Good luck everyone. [link] [comments]  |
| Posted: 16 Sep 2021 04:47 AM PDT I see here recently a lot of people talking about Evergrande and their possible bankruptcy. Some are saying, a financial crisis resulting out of this is very unlikely because the CCP will bail them out and the Chinese real-estate market is relatively isolated from the rest of the world, some are already saying this is Lehman 2.0, because the real estate market in China is incredibly important for their economy and they possibly could have cooked their books and actually have much more debt. Of course if you ask the average Joe and Jane on the street they probably never heard about Evergrande and don't know what's going on, but I think it's clear that most of the informed retail investors who follow financial news are aware, that there is potential risk for a domino effect and would not be surprised and caught completely off guard if the situation escalates. Considering this background, I have a question to the more experienced folks here, who were already actively investing in 2007/8. Were you aware, that the bankruptcy of Bear Stearns potentially could foreshadow a bigger crisis which it eventually became, or did you think it was an isolated one off event and were completely surprised to what it eventually developed? [link] [comments]  |
| Powell orders ethics review after Fed presidents disclosed multimillion-dollar investments Posted: 16 Sep 2021 11:26 AM PDT I'm sure Powell will make it so Fed presidents can't profit from their positions. /s [link] [comments]  |
| The Carbon Capture Industry will be Huge Posted: 16 Sep 2021 11:39 AM PDT The Case for Carbon Capture The world produces about 40 Gigatonnes of CO2 per year (that's 1 billion tonnes). In order to reach the global warming goal of 1.5°C proposed by the Paris Climate Agreement, the world needs to be essentially carbon net zero or negative by 2050. The Intergovernmental Panel on Climate Change (IPCC) says a 20 Gigatonne/year reduction in CO2 emissions will need to come from switching to electric cars and transitioning energy sources from fossil fuel, coal, and natural gas to solar, nuclear, geothermal wind, or hydroelectric. As for the other half, there are a lot of things where we just don't have a green alternative for: airplanes, industrial furnaces, freight trains, tanker ships, etc. To deal with this other 20 Gigatonnes of CO2, the world is going to have to adopt carbon capture technology on a huge scale. The IPCC says that carbon removal technology will have to be on the order of 100-1000 Gigatonnes of CO2 per year over the 21st century. It's clear there is currently a huge opportunity for carbon capture companies. So much so that some oil and gas companies are turning their attention to it. Occidental Petroleum's CEO has said that they are becoming a "carbon management company". Big names like Microsoft have committed to going carbon neutral by 2030. Only one way to do that. Here's another quote: "According to most climate models, decisive carbon removal together with lower greenhouse gas (GHG) emissions are needed to limit global warming to below 2°C from pre-industrial levels. To reach that target, it is forecast that the carbon removal industry will grow to the size of today's oil & gas industry by 2050." (Source) [https://www.swissre.com/institute/research/sonar/sonar2020/sonar2020-carbon-removal-insurance.html] I should mention here that there are 2 types of carbon capture, one where they strip a concentrated source of CO2 like the off-gasses from combustion. The other is called Direct Air Capture where they strip regular atmospheric air of CO2. Both have a big role to play. You might be thinking, can't we just plant more trees? Reforestation will help but it will take 3x the area of the USA to remove 10 Gigatonnes/year of CO2. There just isn't enough land for that. Carbon Capture can do what trees can do in far less space. It is going to be a huge industry and has to be a huge industry in the fight against climate change. (IPCC Source) [https://www.ipcc.ch/sr15/] Many governments are introducing carbon taxes. Canada already has one and plans on ramping it up to $170 CAD/tonne by 2030. Stocks This is such a new industry that there aren't many public companies. Here are a couple: CNSX: DELT is a Canadian company that strips CO2 from concentrated sources like flue gasses. I like them because the Canadian carbon tax will help them a ton. OXY is using Carbon Engineering' tech to build a massive carbon capture plant in the next couple years. They plan on pulling 1 million tonnes of CO2 per year from this facility and have plans for many future carbon capture plants. They also have a lot of the infrastructure in place needed to sequester CO2. Disclosure: I have a small position in DELT and no position in OXY. I'm waiting to see how this first carbon capture facility goes for them. [link] [comments]  |
| Palantir and connected vehicle platform, Wejo, announce new partnership Posted: 16 Sep 2021 09:32 AM PDT "Wejo, a global leader in connected vehicle data, and Palantir Technologies (NYSE: PLTR) ("Palantir") today detailed the early success of a new partnership aiming to solve the most ambitious problems of the mobility revolution. As the world moves at furious pace to reduce emissions, improve vehicle safety, and design resilient smart cities, Wejo and Palantir are looking to create an integrated data ecosystem for the automotive industry and beyond." "Connected vehicle data is vastly underutilized across the automotive industry, and needs to be turned into actionable intelligence in order to address the most pressing mobility problems of the day. Wejo collects and analyzes more than 16 billion data points per day in near real time across a network of 11 million live vehicles. To date, Wejo has ingested more than 10 trillion data points and 48 billion journeys from connected vehicles. The partnership aims to combine Wejo's robust data asset with the power of Palantir's Foundry platform to unlock a diverse set of use cases that will benefit society on a global scale. These use cases range from working with parts suppliers on component quality, to working with regulators in defining the future of autonomous driving, to helping city planners make data-driven investments in smart city infrastructure." [link] [comments]  |
| Posted: 16 Sep 2021 05:27 AM PDT BofA Global Research released a 152-page research report identifying 14 "radical technologies that could change our lives and accelerate the impact of global megatrends." The technologies have a $330B market size today that could grow to $6.4T by the 2030s, strategists led by Haim Israel say. "These moonshots could transform and disrupt multiple industries, contributing to the next big cycle of technology-driven growth." Israel says. The 14 are:
https://assets.bwbx.io/images/users/iqjWHBFdfxIU/izsrvpss9WiY/v0/-1x-1.png Lower lifespan: The lifespan of S&P 500 incumbents is shortening and by 2027 components could last just 12 years before being replaced, BofA says. For Next Tech to succeed, first the innovation must have the potential to be economical, then it must solve a key problem or improve quality of life, and finally, there must be government support in some way. Risks to the 14 ideas include the tech not being commercially scalable, prohibitive costs outweighing the benefits and regulation limiting applicability. [link] [comments]  |
| Posted: 16 Sep 2021 11:04 AM PDT Reasons Why I Remain Bullish Hey Psychos! You may know me as the guy that writes a the Daily Market Recap. Recently, I've been getting tons of questions asking me why I remain bullish even now. While I never discount market risks or volatility, I believe in the long-run the market (S&P 500) still room to go higher. While the recap broadly covers these points, I want this post to more explicitly cover my reasons. As always, this is simply my humble opinion. This is not meant to be an in-depth post, just my top-line thoughts on the market. This is simply my humble opinion and I would love to hear yours. (1) People Overreact to QE Tapering Unfortunately, here on Reddit, there is a trove of misinformation spreading around regarding quantitative easing and the effects this has on the economy. To use a crude analogy, QE is like training wheels for a bike, they support you while you are learning, but are not needed once you learn to ride. In the same vein, during the height of the pandemic last year, when people were forced to quarantine and businesses were forced to close their doors, the regular flow of capital was severely disrupted. Therefore, the Fed passed QE measures to bolster, stimulate, and support the economy. Now, we are seeing consumer demand vastly outstrip supply and record growth in corporate earnings. While disruptions still exists stemming from the pandemic and now the surge in the Delta variant, the economy no longer needs its training wheels. A very similar dynamic played out in 2013. During the 2008 housing collapse and recession, the Fed once again passed QE measures in order to support the economy. Fast forward to 2013 and the Fed decides it is time to taper QE given the economy had broadly recovered and the market absolutely lost its mind for a month or so. This just seems like history repeating itself, people put way too much emphasis on QE, the real test for equities IMO will be when the Fed discusses interest rate hikes. https://www.investopedia.com/terms/t/taper-tantrum.asp (2) Pace of Corporate Earnings In Q2, 87% of companies in the S&P 500 beat consensus estimates on earnings per share, according to data compiled by FactSet. The expected, year-over-year overall growth rate for the SPY currently stands at 89.3%, the fastest increase since the Q4 2009. David Kostin, Chief US Equity Strategist at Goldman Sachs, said "In an earnings season with many surprises – including the highest frequency of EPS [earnings per share] beats in our 22-year data history – one of the most notable was the surge in corporate buyback activity. Strong corporate equity demand is one reason we forecast a 5% return to our SPY year-end target of $470". (3) Consumer Spending Yet to be Fully Unleashed Due to a variety of factors, including the surge in Delta variant and supply-side disruptions, consumer spending, which accounts for roughly 70% of US GDP has yet to be unleashed. Due to the multiple stimulus packages passed last year, many Americans have high levels of savings and are cash-rich but have not been able to exercise buying power due to pandemic-related factors. Once the Delta variant begins to recede (there are hopeful signs we have already crested the peak of the wave), I expect supply-side disruptions (which I will discuss more below) to ease up and allow consumer spending, which has been pent up for more than 18 months, to finally unleash. Just today, the Commerce Department reported a 0.7% climb in sales last month came after a 1.8 percent decline in July and gains earlier in the summer. The gains in August, which were better than what economists expected, were prompted by a rise in spending on clothing, electronics, and furniture, and home goods. (4) Supply-Side Disruptions Mean Demand is Higher than Supply Nowadays, in order to physically produce goods to sell, companies rely on a truly global supply chain with many different links in vastly different geographical areas of the world. When the pandemic hit last year, essentially global supply chains were forced to suddenly stops, throwing a big wrench into the system. As the economy continued recovering and consumer demand starts picking up, restarting a global supply chain takes a lot of time and effort and continues to be disrupted by pandemic-related factors. Sizeable gaps have emerged between factory orders and output. Transportation costs from China to Europe and the US have risen seven to 10 times in the past year. More companies in more sectors are supply-constrained. One particular facet you may be familiar with is the global semiconductor shortage, which has led auto-makers and electronic manufacturers across the world to raise prices and slash production capacity. Moreover, the labor market remains deeply imbalanced, something that has only intesified during the recent surge in Delta variant cases. Due to this surge and the reimposition of pandemic-era restrictions in areas with high transmission rates, August employment numbers came in shockingly low compared to estimates and the previous month's numbers. Here are the numbers.
President Biden said of the report, "While I know some wanted to see a larger number today and so did I, what we've seen this year in continued growth, month after month, in job creation. This is the kind of growth that makes our economy stronger." Moreover, according to a report released yesterday by the Bureau of Labor Statistics, the number of job openings in August was 10.9 million, higher than estimates of 9.9 million and 10.18 million last month. The rate of job openings measured against the total labor force swelled to 6.9% in July, up from 6.5% the previous month and 4.6% a year ago. From an industry standpoint, the rate jumped to 10.7% from 10.2% in the critical leisure and hospitality field, which has suffered the most during the Covid-19 pandemic. Openings rose to 1.82 million, a total gain of 134,000 last month. There are enough job openings to cover the roughly 8.4 million unemployed Americans. I see no reason why the slack in the labor market won't start to quickly tighten once Delta variant concerns begin to dissipate, which again would serve to boost consumer spending. [link] [comments]  |
| Here is a Market Recap for today Thursday, September 16, 2021 Posted: 16 Sep 2021 01:56 PM PDT PsychoMarket Recap - Thursday, September 16, 2021 Stocks finished mixed in a volatile session after getting a boost following the release of new economic data that showed retail sales for the month of August coming in stronger-than-expected, suggesting that consumer spending, which accounts for roughly 70% of US GDP, held up despite rising coronavirus Delta variant concerns. The tech-heavy Nasdaq (QQQ) and Russell 2000 (IWM), which tracks the performance of small-caps, closed the day with a gain of 0.07% and 0.08% respectively. The S&P 500 (SPY) fell 0.17% and the Dow Jones (DIA) fell 0.17% and 0.19% down respectively. Jobless claims also came in near a pandemic-era low. With the coronavirus Delta variant fanning fears of a slowdown in growth in the US and China, market participants have been carefully weighing incoming economic data. In the US, August retail sales showed an unexpected rise despite the latest surge of coronavirus Delta variant cases. The Commerce Department's August retail sales report showed overall sales rose by 0.7% on the month after a downwardly revised 1.8% drop in July. Consensus economists were looking for a 0.7% drop. A few days ago, China's retail sales report showed a dramatic slowdown in growth as the country battles rising coronavirus cases and seasonal floodings, with output and sales reaching a one-year low. Consumer spending grew 2.5% in the month of August, a sharp deceleration from the 8.5% growth in July and missing estimates of 7% growth. Industrial production rose 5.3% in August from a year earlier, narrowing from an increase of 6.4% in July and marking the weakest pace since July 2020, data from the National Bureau of Statistics showed on Wednesday. Output growth missed the 5.8% increase tipped by analysts. In a new weekly report by Factset, consensus analysts are still looking for S&P 500 earnings growth of nearly 28% for the third quarter. While a deceleration from the more than 80% growth rate posted in the second quarter of this year, that would still mark the third-highest year-over-year increase in earnings for the index since 2010. Third-quarter earnings reporting season is set to pick up next month. Highlights
"A gem cannot be polished without friction, nor a person perfected without trials." - Seneca [link] [comments]  |
| Posted: 16 Sep 2021 09:55 AM PDT I'm staring at my portfolio, making adjustments, looking to sell stocks I no longer have great faith in and looking to concentrate my capital into stocks I prefer within an allocation I like. My portfolio has done just fine, but I have a few positions that have lost value, some significantly. I'm excited to sell some of these stocks at a loss! Hell yeah! let's pull that bandaid off and move on. The recorded loss will balance out profits I took elsewhere and my capital will have greater potential for appreciation (in my current thinking). I'm writing this because I read far too often of people "bagholding" because they don't want to sell at a loss, I read of covered call writers who don't want to allow a stock to be called away at a strike price less than their cost basis. That's fine if you have confidence in the underlying company to appreciate in value, but it's not if you are simply wed to a dollar amount you happened to buy a stock for previously. Cost basis is a number from the past. Make smart decisions about your holdings about their current value and your expectation of their future value. Take your losses and move on. Selling for a loss is OK. [link] [comments]  |
| What is happening with JNJ, MRK and BMY (essentially a lot of pharmaceutical stocks)? Posted: 16 Sep 2021 07:54 AM PDT Quite a steady and solid drop for nearly a month now, I hold JNJ, MRK and BMY, and planning to increase my JNJ by a good amount. Seems very strange as the drop is quite substantial if you look at some companies like BMY, any ideas or reasons why? [link] [comments]  |
| Why did the market drop today? Posted: 16 Sep 2021 07:15 AM PDT What was the news or catalyst that caused this red drop? Ive been looking and still havent found a reason why . Im not against a red ending its rather , I just want to know what caused that flip. Also im a little sad that the flip happened , amd and a lot of other stocks were close to testing major supports / 50mas , reguardless I think it was close enough to the support/ 50 ma for me to consider it good but still. [link] [comments]  |
| Worst companies to invest in right now? Posted: 16 Sep 2021 01:19 PM PDT I see posts daily by people asking for the best stocks that they should invest in right now and I am curious of the flip side to this question. What are some of the worst stocks to buy right now? Maybe its a company heavily reliant on revenue from a dwindling customer base, a company with good fundamentals but disastrous leadership, or maybe it's simply a company that can't keep up with the competition or technological innovation and is slowly bleeding out. I am interested to hear what you guys believe are the worst companies to invest in right now. [link] [comments]  |
| Posted: 16 Sep 2021 10:50 AM PDT I wanted to compose a list of all the potential lithium junior miners, whether they are in exploration or developmental stages. Post your picks and I will update the alphabetical list below! BLILF Bearing Lithium OTC / website LIACF American Lithium OTC / website LLKKF Lake Resources OTC / website LTHHF Lithium Power OTC / website [link] [comments]  |
| How do swing traders determine the kind of market they're in as is relevant to their trading style? Posted: 16 Sep 2021 11:26 AM PDT I'm talking swing traders that will buy and hold for ~1 week or less. I'm new to swing trading and fairly new to stock trading in general. My core question here is this: for folks that only look for short term inter-day gains, how do you determine if the market is bull or sideways for that short period of time? I'm not interested in long term analysis. Do you use something like a 20 day MA and if the S&P is closing below it(even on a dip) then it's safe to say it's not bullish at the moment or if it closes above it several days in a row we're moving into bull territory? Sorry if that's gibberish, just trying to improve myself and my analysis and make smarter trades. Appreciate any insight. [link] [comments]  |
| Posted: 16 Sep 2021 09:28 AM PDT So at one point in my life I heavily debated using this company. Even though I didn't, I still might in the future, but I just saw that they're going public and thought this might be a good investment as I see the draw to their products. Thing is I'm not the smartest guy in the world, even more I'm still learning about stocks. I just wanted to see if someone smarter than me knew anything about the company? Any help or advice is appreciated! [link] [comments]  |
| Airline stocks in an upward trend. No specific news for them? Posted: 16 Sep 2021 11:13 AM PDT After trading flat for a while, it looks like all the airline stocks are in an uptrend almost breaking their resistance levels. I cant seem to find any specific reason for their uptrend. is there positive sentiment in the airline industry now? [link] [comments]  |
| Buy Ducthbros Today or wait for IPO buzz to die down Posted: 16 Sep 2021 09:12 AM PDT I'm pretty bullish on Dutch Bros, they're expanding massively and everyone I know in the younger generations prefers them over Starbucks. I know common knowledge is to wait 2 - 3 weeks after IPO to buy in and avoid that initial IPO craze purchase. But I could definitely see a situation where it doesn't come back down. What are y'all's thoughts? Edit: I appreciate everyone who agrees it's a good purchase, but really hoping to get some thoughts on whether the price jumps the past 2 days are typical IPO hype and we should expect it to come back down, or if it'll pull a Snowflake and just jump up high and stay there [link] [comments]  |
| How To Know When You're Just Lucky? Posted: 16 Sep 2021 12:00 PM PDT Kind of a weird question, but I recently started day-trading stocks. It's been 2 weeks, 10 trades later, and I'm up +117%. For now I think that I'm probably just lucky, but what I'm asking is at what point should I stop thinking that and actually believe that I'm not bad at day-trading. If I keep this up for 6 months is that enough? Every one of my 10 trades has been profitable too. Thank you guys. [link] [comments]  |
| Posted: 16 Sep 2021 11:52 AM PDT Hi All, Was wondering about people's opinions on Dynatrace. The last year the company has done well. I have a few shares that I bought at around $40. Was wondering if I should buy more, hold, or sell. [link] [comments]  |
| Looking for a chart app or website for daily historical data w/open for that day Posted: 16 Sep 2021 11:44 AM PDT Hi All, I'm looking for an app or website where I can pick a historical day for a ticker and see the price action for that day (on perhaps a 1 minute or 5 minute frequency), with the open for that day. Nothing complicated. Just like how when it's 4pm and you look at the chart for that current day's movement, except you could pick a historical day. I know you can easily pick a historical day on most sites and see its chart, however I haven't come across anywhere with the option to overlay the open for that particular historical day. Any advice would be much appreciated, thanks! [link] [comments]  |
| Posted: 16 Sep 2021 12:28 PM PDT Been buying since $4 per share. Just got listed to NASDAQ. The company website that has a solid 30 min video to explain what they do and the path they are on to bring people up to speed. No promises but if you do your DD you will see the upside potential is quite large. Today proves the validity of the product. Faster and more energy efficient data transfer. https://finance.yahoo.com/news/lightwave-logic-polariton-technologies-achieve-123100545.html [link] [comments]  |
| Simple DD on SelectQuote $SLQT Posted: 16 Sep 2021 12:17 PM PDT The Case For SelectQuote ($SLQT) Heavy insider buying and big growth potential make this already under-valued stock look even more attractive. Company Overview Website: https://www.selectquote.com/ Market cap at publishing: $2.3B Price at publishing: $13.80 Price Target: $20.96 (52% upside) CEO: Tim Danker Headquarters: Overland Park, KS Founded: 1985 Employees: 3,300 Company Overview SelectQuote, Inc. operates a technology-enabled, direct-to-consumer distribution platform that sells a range of insurance policies to consumers from various insurance carriers in the United States. The company operates through three segments: Senior; Life; and Auto & Home. It distributes senior health policies, such as medicare advantage, medicare supplement, medicare part D, and other ancillary senior health insurance-related policies, including prescription drugs, dental, vision, and hearing plans; term life policies; and non-commercial auto and home property, and casualty policies. The company was incorporated in 1999 and is headquartered in Overland Park, Kansas. The first thing I like about SelectQuote is they have a simple and easy-to-understand business, they are insurance brokers. They are not an insurer and therefore are protected from any risks associated with underwriting. SelectQuote just sells insurance on behalf of insurers primarily via their website and collects commissions. Commissions are earned once the plan is activated and again for subsequent renewals, they also receive performance bonuses from many of their insurance partners when hitting certain quotas. Currently their lifetime value of commissions or "LTV" which represents commissions estimated to be collected over the estimated life of an approved policy for their two biggest segments, Medicare Advantage and Medicare Supplement stands at $1,260 and $1,269 respectively. SelectQuote estimates that their market share is less than 2.5% in each of the three segments they operate, allowing for plenty of room to grow. Financials SelectQuote's income statement for the year ended June 30, 2021 looks like this: Between 2018 and 2021 CAGR for revenue is an impressive 59% with a 76% increase in revenue over 2020. EBITDA and net income are also up over 40%, all very positive signs of a growing company. Here is a breakdown of where that $938M in revenue came from in 2021: $729M or 77% came from their senior segment which is basically medicare insurance plans. The fact that they are focusing so much on Medicare is significant because that is where most of the future growth will come from as we'll see in the sections to come. Some YoY comparisons I like to make: The 80% decrease in FCF is primarily due to the adjustment of $333M in commissions receivable to the net income when calculating operating cash flow but this should positively affect their future FCF as those pending commissions are converted to cash. Insider Buying This is actually how SelectQuote first hit my radar, I saw large amounts of insider purchases and I decided to dig a little deeper into the company. As you can see, there have been 13 flat-out purchases by the CEO, CFO, COO, and directors in prices ranging from $8.75 all the way up to $13.28 on September 13th, 2021 in addition to eight option exercises. The total value of all purchases comes out to more than $8M. The most notable purchases are the Senior President dropping $2M, the CEO dropping $1M, and the COO dropping $2M, all in Aug 21'when the price was near $9. As an investor, you obviously love to see this. No one knows the company better than these guys and they seem to know that the stock has plenty of upside if they are willing to splashdown that much of their own cash. Analyst Consensus Don't just take it from me, here are the views of "professional" analysts. There are 7 analysts covering SelectQuote who have an average PT of $17.93, with a low of $13 and a high of $25. The targets are very much in line with my own PT of $20.96. OutlookGrowth Potential So what does the future hold for SelectQuote? Growth, and lots of it. Growth will come in the way of a larger TAM and a more aggressive push to activate more policies. There are several ways for seniors to sign up for Medicare. The first is to sign up for the "traditional" government-issued insurance and the other is to sign up for a private market solution, which is basically Medicare offered through an insurance company, this is called Medicare Advantage. Medicare Advantage is SelectQuote's biggest segment and accounted for 77% of their revenues in 2021. Why is it so important for SelectQuote to focus on Medicare Advantage? Well, the market is growing quickly and so will their share of it. The market is growing thanks to favorable demographic trends that will see more baby boomers reaching 65 years of age. In 2020, the percentage of the population reaching 65 was 15.6%, that's up from 12.9% in 2010. On average, 10,000 baby boomers are expected to turn 65 every day, or nearly 4 million per year for the next 10 years. Not only will there be more people eligible for Medicare but our grandmas and grandpas are now internet-savvy technophiles. Internet usage among older generations has increased from 40% in 2019 to 75% in 2021, meaning more online shopping that includes everything from diapers to insurance. There were roughly 60M Medicare policies in 2019, 27M were through Medicare Advantage, representing 38% of the market. Of the 27M Medicare Advantage plans, SelectQuote only accounts for .55M or 2%. According to analysts, the Medicare Advantage market alone is expected to swell to 37M by 2025. If they can reach just 4% of the market by that point, they'll have roughly 1.5M policies which, if they can maintain their LVT of $1,260/policy will total ~1.9B in Medicare Advantage revenue alone. I believe they can do even better than 4% because of their improving online targeting and aggressive hiring of agents. As of June 30, 2021, SelectQuote employed a total of 1,356 core agents and hired an additional 3,000 flex employees during the Annual Enrollment Period which is a long way of saying busy season in the insurance industry. In comparison to 2020 when they had 1,000 core agents and 1,400 flex agents, an increase of 36% and 114% respectively. They are also ramping up their marketing by spending $385M in 2021 vs $185M in 2020, a 108% increase. Acquisitions In April 21' SelectQuote launched an online platform called Population Health which is designed to "provide awareness and education for seniors to ensure the full utilization of their health benefits". The website is designed to ultimately make contact with MA patients and understand their needs to get them the best care for them. In doing so, they are able to connect these patients with one of their primary care providers (generating commissions) or provide a service of their own. In order to facilitate the growth of Population Health, SelectQuote created SelectQuote Ventures Inc "SVI" to identify potential partnerships and potential acquisitions. So far they have acquired InsideResponse, an online marketing consulting firm for $65M, Lead Distribution Company, which does what its name suggests for $33.5M, and Express Med Pharmaceuticals or SelectRx for $24M. SelectRx is an interesting pharmaceutical distributor which handles everything there is to handle regarding medications. After gathering information through a consultation, they automatically refill and package medications in easy-to-read and understand packaging and mail it out to their subscribers. SelectRx should provide a healthy ROI, especially when used in conjunction with Population Health. SelectRx is expected to generate $120M in revenue in FY2023 with EBITDA around $20M, not bad for a $24M investment. Both platforms are already performing well as the data below shows. Conclusion Today I told the story of a company with a simple and solid business that is at the pinnacle of expertise due to its long exposure to the insurance brokerage business. Although they have been around for a while, they are just starting to hit their stride with the large influx of cash from their IPO ($350M) when they were priced at $20/share. A company that is operating in a market that is undoubtedly growing along with an aging population and who is aggressively seeking to increase their share of said market. They are off to a great start by growing their senior revenue by 101% between 2020 and 2021. They are not just resting on their laurels and focusing on senior revenue but creating a new platform (Population Health) and making acquisitions like SelectRx to expand their offerings. Probably the most telling point I touched on in this article is the insider buying. SelectQuote's management at all levels is so convinced of the future of their company that they are willing to splash down large bundles of their own cash all the way up to $13.34/share and I'm not sure they are done yet, I would look for more insider buying in the months to come. If they are so assured of the company's future why the hell wouldn't I be? Valuation I use a simplified discounted cash flow analysis based on Aswath Damodaran's teachings at NYU which uses assumptions about future cash flows that are discounted to today's dollars in order to reach a present valuation. I used the company's own financial forecasts to guide me up to the year 2022. The discount rate of 6.67% is based on their WACC which was calculated using the assumptions seen below in the "WACC" section. I used 1.2% as the terminal growth rate for the purpose of being conservative. The current value per share I get is $20.96 representing an upside of 53%. Price Target I have a price target of $20.96 for SelectQuote. TL;DR: Grandparents are getting older and know how to use computer, will use computer to buy Medicare through SelectQuote, stock price go up. My position I have not initiated a position in any companies mentioned in this article, however, I may purchase shares within the next 72 hours. Disclaimer The contents on this site/article are for informational and entertainment purposes only and does not constitute financial, accounting, or legal advice. I am not a financial advisor, I can't promise that the information shared on my posts is appropriate for you or anyone else. By reading this article, you agree to hold me harmless from any ramifications, financial or otherwise, that occur to you as a result of acting on information found on this site. [link] [comments]  |
| Why did the market rally today? Posted: 15 Sep 2021 07:29 PM PDT What was the news or catalyst that caused that green ending? Ive been looking and still havent found a reason why . Im not against a green ending its rather , I just want to know what caused that flip. Also im a little sad that the flip happened , fb and a lot of other stocks were close to testing major supports / 50mas , reguardless I think it was close enough to the support/ 50 ma for me to consider it good but still. [link] [comments]  |
| Where is the cannabis industry heading? Posted: 15 Sep 2021 04:44 PM PDT The past couple of days I've been looking into cannabis stocks and they all seem to be reaching a Y.T.D. low, forming a downward wedge. I came across information stating the summer's end brings in a good amount of revenue for the cannabis sector and am wondering if we should be seeing a break out this upcoming quarter? Volatility was high February-March with some bullish movement in April and June, but slowly in decline since. Medicinal marijuana (12: not allowed/CBD only) and decriminalization (18 not) has occurred across the USA. What is holding legislation back from legalizing marijuana and what are the arguments against it? Overall, I'm trying to get a better grasp of the sentiment around the industry and if there is a good opportunity around the corner. If it takes another year, a 4x potential return is definitely worth the wait. [link] [comments]  |
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