Snowflake provides a cloud-based data platform, addressing the rising data management needs of enterprises. The company went public recently and has delivered staggering listing gains to its investors. In this report, we analyze Snowflake’s business model, competitive strength, financial position, and finally conclude with our opinion on the stock’s risk-reward investment opportunity versus its current valuation.
Chinese E-Commerce Small Cap: High Growth, Attractive Valuation
Shares of this Chinese, small-cap, “brand-focused,” e-commerce company trade in the US (on the Nasdaq) as an ADR (American Depositary Receipt), and they are currently priced attractively after the recent sell-off, especially considering the continuing powerful growth expectations for online commerce and for the company in particular. In this article, we review the solutions offered by the company, its growth prospects, valuation, risks and conclude with our view on why the shares are worth considering if you are a long-term investor.
High Growth Software Company: Tremendously Popular Solution, High Options Market Premium Income
This young high-growth software company has become a solution-of-choice for developers and organizations alike within a relatively short span of time. The company has achieved a five-year annual revenue growth rate of ~59% through a proven “Land-and-Expand” business model, an endeavor to fill the platform’s functionality gaps, a rapidly expanding market, and a solid management team. The company’s stock lost about half of its value in the COVID-19 induced market turmoil earlier this year, but has strongly recovered since then and is currently trading at almost 28x Price-to-Sales multiple. The valuation certainly looks rich (considering the company is not yet profitable and is burning a lot of cash), but the platform is immensely popular among developers and it has a very long runway for continuing high growth in the years ahead. The shares also offer very high premium income in the options market. This article reviews the health of the business, growth prospects, valuation, risks, and concludes with our opinion about why it may be worth considering (and how to play it with put options) if you are a long-term growth-oriented investor.
New Options Trade: Very High Upfront Income, Huge Upside Potential
The world continues to change, and uncertainty and fear are currently high. These two broad factors have combined to create a very specific attractive opportunity to generate high upfront income and very large price appreciation potential. This small digital advertising company ($1 billion market cap) is in the right place at the right time (the intersection of disruption and volatility) thereby creating this very attractive option trade opportunity (plus, the $9 share price makes the “cash secured” part of this trade more palatable for some). In our view, this is an attractive trade to place today, tomorrow and potentially into early week (so long as the share price doesn’t move too dramatically before then). You get to keep the attractive upfront premium income this trade generates (no matter what), and you may end up owning shares of an extremely attractive, long-term, small cap, disruptive-growth stock at a very compelling low price.
Johnson & Johnson: Bedrock Dividend Growth? Time to Sell Calls?
Johnson & Johnson is one of the most revered dividend aristocrats (it has raised its dividend 58 years in a row). The company has incredibly strong fundamentals derived from its well-diversified three-pronged business model that contributes to consistent profitability and a strong balance sheet. It is one of only two AAA-rated companies (the other being Microsoft), signifying its extremely strong capacity to meet financial commitments. Johnson & Johnson’s share price hit a four-year low during the March downturn, but has since rebound and is now trading near all-time highs. Is Johnson & Johnson sill a buy at any level? Is it time to sell covered calls? We answer these questions in the conclusion of this article after first providing a detailed review of the health of the business, valuation, risks and dividend safety.
Alibaba: Despite Big Risks, Cloud Growth Makes Valuation Interesting
Alibaba (BABA), often referred to as “the Amazon (AMZN) of China,” is the country’s largest e-commerce, cloud, and digital advertising company. Its e-commerce business has been the growth and profit engine for years, but cloud computing is positioned to increasingly contribute meaningfully to high-margin growth in the future. The perception of weak corporate governance, combined with geopolitical tensions, are major risks, and November could be a big month considering the US election, the company’s upcoming earnings announcement, and Singles’ Day. In this article, we analyze Alibaba’s business model, its market opportunities, fundamentals, valuation, risks, and finally conclude with our opinion on whether the stock offers an attractive balance between risks and rewards.
Why This Fast Grower Fell 28%, And What Comes Next
During afterhours on Wednesday, shares of this fast growing company fell dramatically as it released preliminary third quarter revenue numbers that were below expectations. This particular business provides an “edge cloud platform” designed for the “modern internet” thereby allowing digital applications to process quickly, reliably and safely—on the edge of the internet. This report reviews the business, its massive long-term growth opportunity, its newly revised rapid growth trajectory, valuation, risks, and concludes with our opinion on why the shares are worth considering.
New Options Trade: 8.8% Yield Property REIT + Covered Call Income
This is an attractive long-term 8.8% yield property REIT trading at a compelling valuation, but the shares have rallied hard in recent weeks thereby creating this high-income options trade opportunity. Specifically, nervous investors may slow the short-term rally by taking profits, which is fine with us because we’d keep these attractive shares for the long-term and get paid the big dividend shortly after the options contract expires in just over 1-month from now. And if the shares do get called, that’s a 39-day gain of approximately 20%, not too bad at all. We believe this is an attractive trade to place today, and over the next few days, as long as the price of the underlying shares don’t move too far during that period.
Know Your Goals: Overcome Fear & Greed, Especially Now!
Fear and greed are very real psychological hazards when it comes to investing. And lately (with everything going on), it seems growth stocks have taken on the role of greed (considering their performance has been so strong!). Rather than worrying about keeping up with the Joneses, a better strategy right now (and always) is to know your own investment goals, avoid those common mistakes caused by fear and greed, and pick really good stocks! This article provides some perspective on current market conditions and opportunities, it highlights a handful of our recent top investment ideas, shares performance, and hopefully provides a little meaningful perspective as you manage your portfolios in light of everything going on right now (e.g. low interest rates, the upcoming US election, Covid and the acceleration of technology in the global economy).
Attractive CEF: +9% Yield, Discounted Price
Income-focused stock-market investors often make the unfortunate mistake of concentrating all of their investments in the same few big-dividend sectors of the market. However, this particular closed-end fund diversifies across important sectors, thereby reducing investor risks, increasing total return opportunities, and still offering a big yield for investors. It is also trading at a very attractively discounted price, has an experienced-leadership team, and pays investors at least a 6% annual yield—and usually more (in 2019 it paid 9.6%, and 2020 is on pace to be another very strong year). What’s more, because it pays three smaller dividends in Q1, Q2 and Q3, investment websites consistently under-report the size of the big yield, and there is still time for investors to get in now to capture the big upcoming Q4 payment. And by the way, it’s been paying healthy dividends for over 80 years straight!
Top 7 Preferred Stocks: 7.0% Yields and Up
A lot of people don’t understand preferred stocks, yet they can be quite attractive sources of income. And with interest rates near all-time lows, and market volatility and fear elevated, now is an outstanding time to consider select preferred share investments. In this report, we countdown our top 7 big-dividend preferred stocks, starting with number 7 and finishing with our top idea.
LNG Shipper: 9.6% Yield Common, 9.3% Yield Preferreds
This LNG shipping business has been improving, and there are reasons to believe the common units have significant price appreciation ahead. However, if you prefer a similar high yield without as much risk, you might also consider the preferred shares (they too offer price appreciation potential, just not as much). In particular, and despite the highly cyclical LNG shipping industry, this company has an impressive history and opportunity for consistency in the quarters and years ahead, stemming from its fully-fixed fleet for the remainder of this year and 94% fixed for 2021 (thereby largely insulating it from the current weak short-term LNG shipping market). In this article, we review the health of the business, cash flow position, balance sheet flexibility, valuation, risks, dividend safety, and conclude with our opinion about why company is worth considering if you are a long-term income-focused investor.
Top 10 Growth Stocks: Options Trading Edition
Let’s face it, stocks are likely to be volatile in the weeks ahead. The market fear index (VIX) has been jittery, arguments can be made that social-distancing stocks have rallied too far (and not far enough), and there is this little thing in the United States called the upcoming presidential election on November 3rd. My investment philosophy is to always buy good businesses and then hang on (despite potential volatility) the for long term. And in this article, I will rank my top 10 growth stocks. However, I’ll also share specific options trading strategies that I believe are particularly compelling (based on current market conditions), potentially very lucrative and also consistent with my long-term philosophy. But before we start counting down the Top 10, it’s worth considering the tremendous and wide-ranging recent performance, valuation and expected revenue growth for top growth stocks.
Mortgage REIT Preferred Shares: Attractive 8.4% Yield, Discounted Price
The common shares of this once beloved mortgage REIT suffered significant equity erosion earlier this year (and it was forced to cut its dividend by 90%) as it was hit with margin calls and forced to liquidate assets at depressed prices during the market-wide Covid-19 sell-off. Since then, the company has been limping its way back towards better health, albeit with a significantly less valuable book of business. Furthermore, the company’s three series of preferred shares still trade at attractively discounted prices and offer compelling high yields (they are also insulated, from some risks, by the company’s common shares). In this article, we review the business, the shares (common and preferred), and then conclude with our opinion on investing.