Newsletter Update
Premium Content
Hey everyone,
I hope you all had an excellent 4th of July weekend! Due to the holiday, I did not prepare a newsletter for this morning, as I only had time to publish the newest update for my premium subscribers this weekend. These premium posts are weekly updates on my overall portfolio & the top 10 positions I’m currently trading, giving subscribers an intimate view of my trading activity, portfolio composition, and mini deep-dives on each company.
In these weekly updates, it becomes evident how the data being discussed in my daily newsletter is helping to shape my portfolio. For example, I have been repeatedly highlighting the tech/growth > value rotation in my daily newsletter, because this is exactly what’s important to me & my portfolio. In the edition I sent to subscribers this weekend, 7/10 of my positions are tech/growth-related stocks. To contrast, my first portfolio update on May 31 had only 1/10 positions that were tech/growth-related.
Due to my high-turnover in terms of trading activity, I typically have anywhere from 3-6 new companies in my top 10 every week. As such, subscribers are constantly getting new analysis on several companies, which are essentially my highest conviction plays & meet my set of investment criteria. As an example, here is the analysis that I provided in a recent portfolio update report for one of the ten companies, Veritone Inc. ($VERI):
“Veritone is an artificial intelligence company, specializing in media, content, and language services. Their proprietary operating system, aiWARE, allows a user to gain key insights from structured & unstructured data sets in order to make “our world smarter, faster, and more fun”. Their customers range from studios, networks, broadcasters, sports organizations, government branches/institutions, clean energy companies, and advertising groups. In their 5-year history as a publicly traded company, they have yet to have a single quarter of profitability, which is certainly worrisome to an extent. In their most recent quarterly earnings report, Veritone showed record revenues of $18.3M, representing a +54% increase YoY. This was up from the prior quarterly revenues of $16.8M (a record at the time) and a +35% YoY revenue growth. As such, the quarter-over-quarter revenue growth was a strong +9%, which is adequate. While their revenues jumped by +54% YoY, their operating costs rose by nearly +100% to $48.8M, which resulted in a net loss of ($30.5M). Thankfully, the company had more than $127.4M in cash as of 3/31/2021, and total current assets of $172.9M so it appears that they can continue to fund their losses over the intermediate term. Their current assets are 1.7x their current liabilities, leaving appx. $70M in available capital; however, they have almost zero long-term debt. I believe this shows management has an ability to structurally organize the company for revenue growth & intentionally bypass profitability.”
If you’re interested in receiving these updates on a weekly basis, along with my reports for watch lists & focus lists (typically around 50 stocks that are the primary pool of companies I am considering to invest in), I highly encourage you to click the link below and subscribe to get access. By subscribing, it will ensure that you receive these updates going forward & you will also get access to the premium content that I’ve already published. Feel free to reach out to me directly if you have any questions about the premium access or if you want to find out more: calebfranzen@gmail.com.
I’ll be continuing with the normal newsletter tomorrow, covering the most important news/data/charts that I see today regarding the economy, stock market, and cryptocurrency.
Caleb Franzen