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05.10.2023, 18:12

A list of stocks with incandescent long-term (over 3 years) potential return. IMHO

Категории: Рынок акций, США

the Hot list


Salam aleikum, fellas,


That's nothing but In my humble opinion (IMHO). Sorry for not having enough time for a detailed explanation. I will use my work short notes as they are, almost without corrections:

***SEDG (SolarEdge)_Current price is $125.31 ... max size up to 10% of portfolio at $160, 140, 120... and mb around $100...

SolarEdge makes solar inverters and optimizers for solar panels. It is a profitable, rapidly growing business in the US and EU. It has divisions to produce batteries, drive-trains for commercial EVs, and related components. It is a financially healthy business that operates with low indebtedness.

The company is getting big, it slowly drifting down in the US in terms of market share but still up in terms of revenue, the biggest market is the EU now, which is good. The price dropped below $180 in Aug2023 and we bought 2.5% for TSE at $179+. If it drops another 15-20%, we should try to add another 2-2.5%. At the current P/S 2.5 it is concidered cheap, despite short-term headwinds because of higher rates in economy. Long term trend is good, and the PE of the business is 33, and can be improved in the future.


***ENPH (Enphase)_Current price is $117.18 ... max size up to 5% of portfolio at $120, 100... and mb around $80.

Enphase is the same as SolarEdge but it has grown even faster during 2018-2023. It takes away market share from SolarEdge in the US. But I sort of less enthusiastic about ENPH.

Still worth trying at current levels.


***TPIC (TPI Composites)_Current price is $2.46 ... max size up to 3% of portfolio at $3, 2... and mb around $1.

TPIC supplies Vestas, Nordex, GE, and Environe with wind blades and other parts cheaply from the USA, Mexico, Tukey, China, and India. It managed to grow Sales before 2022 at the cost of profitability, but this is changing now. Sales didn't grow in 2022, and profitability wasn't there. The company must re-invent its business model because its marginality is getting worse. There is an activist investor onboard, Oaktree. From a historical perspective, the business is cheap at 0.5< PS, and it will survive. We must be careful. Buying at deep 4-5% max, we should sell 50% at a reasonable price, if any, and keep 2-2.5% for the future in case the business re-invents itself.
***up Aug31 2023: ...it cascaded below $6 and closer to 4. We increased our steak to 9% with an average price of>$7. The company's shares acted as if the business was doomed, however, at the moment, only auto body parts (3% of sales) looked doomed. Hopefully, the windblade business will see another decline and negative profits for several quarters. L-T's clean energy trend and the best partners in the EU and US should help the company withstand difficulties. Yet, we must decrease our exposure to 4.5% because the debt to assets is currently 35+% and further below 3% if their debt to assets won't fall. In 12-18 months, the company could get back to at least $9-10, in the best-case scenario $17.


***CRM (Salesforce)_Current price is $201.8 ... max size up to 8% of portfolio at $205, 190... and mb around $170.


Their technology and corporate culture are incredible. The main concerns are: * it makes ever bigger acquisitions every time, which CRM partly finances with stocks; * traits of maturing also worry a little. I want to keep CRM for 10+ years.

may18_2020 CRM has around 17-20% of the TAM, but its clouds & platforms of tools make a lot of sense for the new era. In 2017-2018 CRM proved that it could be profitable, but it decided to invest. The company has a leadership vision for its industry. It can be the Microsoft of cloud solutions.

nov04_2022 CRM has lost love because investors got picky in 2021-2022. They have found that behind the glittering front of Salesforce hides heavy stock-based compensations that burned tons of real cash, plus the inability to be highly profitable. It is still worth an 8% portion in 10y horizon, say it can grow sales 15-18%, but each year 2-5% are eaten by bad things, so I took 13% growth rate.


Worth mentioning:


LYFT below $10, 2-3% max;

HFG GR (Hello Fresh) at EUR 27, 3-4% max;

ZM (Zoom) at $65, 6% max.


Mb I will come back with further lists and explanations.




Создано: 05.10.2023, 18:12
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